Wednesday, March 28, 2018

Shelf is not a Place of Business Under Patent Venue Statute

The court granted defendants' alternative motion to transfer for improper venue because defendants did not have a regular and established place of business in the district. "The full extent of Defendants’ physical presence in the [district] is a shelf containing a piece of [one defendant's] telecommunications equipment. . . . [T]his equipment is involved in processing calls to and from New York-based phone numbers. . . . All electronic traffic flowing to [defendant's] equipment travels via [plaintiff's] network. . . . In a sense, the preposition is key: [defendant's] employees may direct telecommunications traffic through New York, but they do not engage in business from the shelf itself. . . . The Court acknowledges that a human-centered definition of 'place of business' may feel unsatisfying in an economy increasingly characterized by virtual transactions. But the Court is constrained to follow the text of the statute, which 'cannot be read to refer merely to a virtual space or to electronic communications from one person to another.'. . . Under a faithful reading of the statute, the Court must conclude that whatever a 'place of business' is, it is not a shelf."

Peerless Network, Inc. v. Blitz Telecom Consulting, LLC et al, 1-17-cv-01725 (NYSD March 26, 2018, Order) (Oetken, USDJ)

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