It is a “well-established rule that suits against alien defendants are outside the operation of the federal venue laws.”[1] Judge Gilliam stopped a declaratory judgment plaintiff’s attempt to initiate a parallel lawsuit in California when only the plaintiff’s foreign parent was sued in Texas.
AU Optronics Corporation (“AUO”) was formed in 2001 in Taiwan when Acer Display Technology, Inc. merged with Unipac Optoelectronics Corporation. In 2002, AUO was listed at the New York Stock Exchange, becoming the first manufacturer of pure TFT-LCDs to do so.
Plaintiff AU Optronics Corporation America (“AUO USA”) has a principal place of business in California. Before AUO USA filed its declaratory judgment action in the Northern District of California, Defendant Vista Peak Ventures, LLC (“Vista Peak”) had filed three lawsuits against AUO USA’s foreign parent corporation in the Eastern District of Texas alleging patent infringement. None of the Texas lawsuits named AUO USA as a defendant.
Vista Peak moved to dismiss AUO USA’s declaratory judgment action filed in the Northern District of California due lack of personal jurisdiction. In its opposition to Vista Peak’s motion to dismiss, AUO USA contended, among other things, that the California court should exercise personal jurisdiction over AUO USA. According to AUO USA, had Vista Peak sued AUO USA in the Texas lawsuits, TC Heartland would require the lawsuits to be venued in California because AUO USA is a California resident, and Vista Peak’s Texas lawsuits circumvented TC Heartland by naming AUO USA’s foreign parent only. Citing In re HTC Corp, Judge Gilliam rejected AUO USA’s argument and dismissed the case because “the Federal Circuit has expressly permitted suits under the alien-venue rule against foreign corporations in the manner employed by [Vista Peak] in the EDTX Actions.”[2]
Endnotes
[1] In re HTC Corp., 889 F.3d 1349, 1361 (Fed. Cir. 2018).
[2] 889 F.3d 1349 (Fed. Cir. 2018).