The Federal Circuit Strikes Again- In re: Intel Corporation

Today, the Federal Circuit granted Intel Corporation’s writ of mandamus which vacated Judge Albright’s November 20, 2020 order re-transferring Intel’s case against VLSI back to the Waco Division. We previously covered Judge Albright’s November 20, 2020 Order, but for those who didn’t have time to review my previous post, here is a quick recap: Judge Albright relied exclusively on two bases to retransfer the trial back to Waco. First, Judge Albright relied on authority under Federal Rule of Civil Procedure 77(b). Second, he relied on his inherent authority for docket management. According to the Federal Circuit, neither authority gives Judge Albright the ability to retransfer the case back to Waco. However, as Joe covers in his post, the Federal Circuit did seem to leave the door open to retransfer the case under other means. 

Here is the substance of the Federal Circuit’s Order:

The Federal Circuit agreed with Intel that “moving the trial from Austin to Waco Division over Intel’s objection would be fundamentally inconsistent with the governing statutes.” Specifically, the Circuit pointed to 28 U.S.C. § 124(d)(1), which provides that “[c]ourt for the Austin Division shall be held in Austin.” The Circuit continued: “Intel generally has a ‘statutory right’ to have this case tried in the division in which the action lies.” 

The Circuit also quickly shot down VLSI’s first argument, which relied on 28 U.S.C. § 1404(b). The Circuit pointed out that this statute is simply not applicable to the facts in this case, as section 1404(b), “by its terms, applies only when all of the parties consent,” and Intel did not consent to moving the trial to Waco. 

Next, VLSI pointed to 28 U.S.C. § 1404(a). However, the Circuit had two problems with this particular argument. First, Judge Albright did not rely on § 1404(a) as authority for his retransfer order. Second, Judge Albright did not “purport to transfer the entire action from the Austin Division to the Waco Division.” Instead, Judge Albright merely ordered that trial would be held in Waco. Thus, the Circuit concluded that “§ 1404(a) cannot authorize transfer of just the trial from one judicial division to another.”

Finally, VLSI argued that Judge Albright had authority for his ruling based on the district court’s inherent authority to manage its docket. The Circuit noted that the above-cited statutes “simply leave[] no room to invoke such authority here.” Along the same lines, VLSI argued that Rule 77(b) authorized such a transfer. Again, however, the Federal Circuit quickly pointed out that “it does not follow that Rule 77(b) . . . allows a district court to later sidestep the transfer rules set forth in § 1404 generally.” The Federal Circuit further held that such a reading of Rule 77(b) “would undermine 28 U.S.C. § 124 and make § 1404(c) superfluous.”

Thus, the Federal Circuit held that Judge Albright’s decision to retransfer the case back to the Waco Division based on Rule 77(b) and “inherent authority” amounted to a clear abuse of discretion.