Court Declines to Exercise Pendent Venue Over a Patent Case and Denies Section 1400(b) Discovery

Olivia Garden, Inc. v. Stance Beauty Labs, Inc., et al., N.D. Cal (July 12, 2017) (Judge Haywood S. Gilliam, Jr.)

In a June 12, 2018, order, Judge Haywood S. Gilliam, Jr. granted the motion of defendant Stance Beauty Labs (“Stance”) to dismiss for improper venue, rejecting plaintiff Olivia Garden’s request that the court exercise pendent venue over its claims.  The court found that pendent venue was unavailable for patent claims, despite being brought alongside related claims that the plaintiff brought against a codefendant.

Specifically, Olivia Garden brought claims against Stance (represented by Orrick) and codefendant Burlington Coat Factory of Texas (“Burlington Texas”) alleging design patent infringement, trade dress infringement and unfair competition based on certain of the defendants’ brush products.  Stance subsequently moved to dismiss based on improper venue.  In opposition, Olivia Garden acknowledged that Stance was incorporated in Connecticut and that it lacked facts sufficient to show proper venue under the second prong of 28 U.S.C. § 1400(b).

Notwithstanding, Olivia Garden (no relation to the restaurant of free breadstick fame) argued that the court should exercise pendent venue based on considerations of “judicial economy.” Generally, once a court has determined that venue is proper as to one claim, the doctrine of pendent venue allows for a court to exercise its discretion to adjudicate closely related claims, even if venue would not otherwise be proper as to those claims.  Olivia Garden argued that although the doctrine has been traditionally applied to additional claims against a single defendant, courts have extended it to claims against a separate defendant.  Here, Olivia Garden continued, the court should exercise such discretionary venue over Stance given the properly venued and closely related claims against Burlington Texas.  Olivia Garden argued in the alternative that the court defer any ruling on the motion to dismiss and allow it to obtain limited “venue discovery” from Stance to determine whether it maintained a regular and established place of business in the district.

The court declined to find the venue proper, noting Olivia Garden’s failure to present any authority “suggesting that courts after TC Heartland exercise pendent venue over third parties in patent infringement actions.”  The court also cited several post-TC Heartland cases that declined to exercise pendent venue in patent infringement cases primarily due to the Supreme Court’s prescription that § 1400(b) is the “sole and exclusive provision controlling venue in patent actions.”  Indeed, the court further explained that some courts have declined to exercise pendent venue when the “primary claim” serving as the basis for pendent venue is a cause of action for patent infringement, as was the case here.  The court also rejected Olivia Garden’s argument that declining pendent venue would waste time and resources.

Finally, the court rejected Olivia Garden’s request for additional discovery pertaining to venue, as it failed to explain what new facts additional discovery could reveal, particularly given its failure to challenge the substance of a declaration submitted by Stance showing that venue was improper in California.