[00:00:01] Speaker 02: Proceed? [00:00:12] Speaker 02: Yes. [00:00:19] Speaker 02: Thank you. [00:00:19] Speaker 02: May it please the court. [00:00:20] Speaker 02: My name is Scott Stemson. [00:00:21] Speaker 02: I'm with the law firm of Sills, Cummings and Gross in New York City. [00:00:24] Speaker 02: We represent the appellant pay locker, also known as IPT. [00:00:29] Speaker 02: This dispute started back in 2014 when the city of New Orleans sought a new contract for its auto-related debt collection, including parking boots. [00:00:43] Speaker 02: Professional account management, also known as PAM, bid for that. [00:00:48] Speaker 02: I think we understand the history of this case, so why don't we go to the issues? [00:00:51] Speaker 04: It's a little unusual. [00:00:52] Speaker 04: I mean, usually we'll see these transfer questions come up in the context of mandamus motions. [00:00:58] Speaker 04: And this is kind of an unusual posture, right? [00:01:01] Speaker 04: So why don't you speak to that? [00:01:03] Speaker 02: Yeah, well, it's unusual posture because of the court-sized jurisdiction, not because of mandamus, because of the grant of a preliminary injunction. [00:01:10] Speaker 02: Here you have a district court in New Orleans enjoining a sister court in New Jersey, which had different parties and different infringement allegations. [00:01:23] Speaker 02: That's how we get here. [00:01:24] Speaker 04: Were there different infringement allegations? [00:01:26] Speaker 04: As I understand it, all the infringement allegations that we're talking about all occurred in New Orleans as part of this contract in which the district court referred to one of the parties as a puppeteer, I think. [00:01:39] Speaker 02: Yes, I understand. [00:01:40] Speaker 04: And the other party as the actor. [00:01:42] Speaker 04: So what's the difference? [00:01:45] Speaker 02: Well, there is a difference. [00:01:46] Speaker 02: Actually, the two infringement allegations, I think, are best addressed. [00:01:49] Speaker 02: And there are two different buckets, really. [00:01:51] Speaker 02: There's the New Orleans bucket, which you just addressed, Your Honor. [00:01:54] Speaker 02: Then there's the bucket of anything else. [00:01:56] Speaker 02: With regard to New Orleans, in the district court, I recognize this in its footnote three. [00:02:02] Speaker 02: The first thing that comes out is there's a question. [00:02:05] Speaker 02: What's actually happening in New Orleans? [00:02:07] Speaker 02: And SP has recently been saying that they're doing all the steps. [00:02:12] Speaker 02: But if you look at the record here, including our cease and desist letter to Pam, we actually did an investigation. [00:02:18] Speaker 02: And it was Pam that was doing this. [00:02:20] Speaker 02: Part of this process. [00:02:21] Speaker 04: But everything being done was happening in New Orleans, right? [00:02:25] Speaker 02: Well, for the part in New Orleans, yes, that's correct. [00:02:28] Speaker 04: In terms of the infringement, actually, is what we're talking about. [00:02:31] Speaker 02: Yes. [00:02:31] Speaker 02: For the New Orleans bucket, yes. [00:02:33] Speaker 02: Everything that's actually happening is happening in New Orleans. [00:02:35] Speaker 02: But if you look at our cease and desist letter, which is appendix 188 to 89, [00:02:42] Speaker 02: We actually did an investigation before we told them they had to stop infringing. [00:02:47] Speaker 02: And one of the things we found out was that the payment of the fine and the release of the boot, which are two things in all these patent claims, they had a number for that. [00:02:58] Speaker 02: And that number was a number for PAM, not SP. [00:03:02] Speaker 02: So SP is trying to tell us that they do everything in New Orleans. [00:03:05] Speaker 02: And I just don't think that's factually accurate. [00:03:08] Speaker 02: You also have the Robinson Declaration, which they submitted. [00:03:12] Speaker 02: which says that Pam is involved. [00:03:15] Speaker 02: And as we told the district court, SP actually told us they did not do the deposit steps. [00:03:23] Speaker 02: So here's the difference between the two litigations and why New Jersey should go ahead. [00:03:29] Speaker 02: It doesn't matter what's happening in New Orleans. [00:03:31] Speaker 02: It doesn't matter how they're slicing and dicing these process steps. [00:03:35] Speaker 02: It doesn't make any difference if the city's booting some cars or Pam's doing it or SP [00:03:41] Speaker 02: It doesn't matter who's doing what steps. [00:03:43] Speaker 02: It's covered in New Jersey because Pam is responsible for all of it. [00:03:48] Speaker 02: If Pam is doing some of the steps, we've got them. [00:03:51] Speaker 02: If SP is doing the steps, we've got them vicariously. [00:03:55] Speaker 02: If the city is doing some of the steps and the contract with the city indicates that perhaps that might be the case as well, it's okay. [00:04:01] Speaker 02: We've got Akamai. [00:04:03] Speaker 02: No matter what's happening in New Orleans, we've got them in New Jersey. [00:04:07] Speaker 03: Can I ask you, you said it's not the same activity in New Orleans versus New Jersey. [00:04:14] Speaker 03: Is that, what is that based on? [00:04:17] Speaker 03: Is it based on who's accused or is it based on, is the direct infringement the same in each of the two cases? [00:04:23] Speaker 02: If I said that, I misspoke. [00:04:25] Speaker 02: The activity, whatever's happening in New Orleans, for the New Orleans bucket of this infringement allegations, it's the same for both cases. [00:04:33] Speaker 02: But the difference is, [00:04:34] Speaker 02: that the New Jersey case, we don't know who's doing what steps of the process. [00:04:39] Speaker 02: We think that the city's involved with some steps, doing some steps, maybe the collection of the fine, collection of the deposit. [00:04:47] Speaker 02: PAM is doing other steps. [00:04:48] Speaker 02: In fact, that's what our investigation showed. [00:04:50] Speaker 02: And SP is doing maybe other steps. [00:04:53] Speaker 02: That's what we think. [00:04:54] Speaker 02: And our investigation showed that it's not just SP. [00:04:59] Speaker 02: So the case in New Jersey, because it's against PAM, [00:05:03] Speaker 02: No matter what's happening, we've got it covered. [00:05:06] Speaker 02: But if you look at the case in New Orleans with just SP as the infringement defendant, unless SP is doing every single step of the process, if they're not doing every step of the process, then we don't have direct infringement. [00:05:24] Speaker 02: That entire case is a dead end because we can't address the infringement. [00:05:29] Speaker 04: So that's why the case in New Jersey... What is the answer to that in the briefs? [00:05:33] Speaker 04: I'm a little confused. [00:05:35] Speaker 04: You could have brought the other party in as part of your counterclaim. [00:05:38] Speaker 02: Well, we could have, but all these cases that look at situations where you have two different cases. [00:05:44] Speaker 02: I mean, you could always say that. [00:05:45] Speaker 02: I mean, especially before T.C. [00:05:47] Speaker 02: Artland, you could bring cases wherever you want. [00:05:49] Speaker 02: The way the courts look at it, including the Wilton Supreme Court case, you have these two cases. [00:05:56] Speaker 02: Look at the... [00:05:58] Speaker 02: wise judicial administration, that's what the Supreme Court says, which one makes the most sense to go ahead with. [00:06:04] Speaker 02: And here, if we go ahead with a case in New Orleans, there's a real distinct possibility, and I think a very strong possibility, that's going to get nowhere because SP, we don't think, is doing all the steps of the process. [00:06:18] Speaker 02: And so we have no way to get them for infringement. [00:06:20] Speaker 04: But you didn't sue SP in New Jersey, right? [00:06:23] Speaker 04: So in New Jersey, you're left with the absence of a direct infringer for purposes of infringement, right? [00:06:28] Speaker 02: Yes, Your Honor. [00:06:28] Speaker 02: But it doesn't matter. [00:06:31] Speaker 02: We've still got somebody there who's responsible for the infringement and the prime contractor, Pam. [00:06:36] Speaker 04: OK. [00:06:37] Speaker 04: Do we all agree the abuse of discretion is the standard to apply here? [00:06:40] Speaker 02: Yes. [00:06:41] Speaker 04: Yes. [00:06:41] Speaker 04: Okay, and they filed first in New Orleans. [00:06:45] Speaker 02: They did. [00:06:46] Speaker 04: So where is the sufficient basis for us to say that the District Court abused its discretion? [00:06:51] Speaker 04: We're talking about the preliminary injunction now, right? [00:06:54] Speaker 02: Yes, Your Honor. [00:06:55] Speaker 02: Well, really, they're very closely related. [00:06:57] Speaker 02: But the abuse of discretion comes in at least three areas. [00:07:00] Speaker 02: You have an abuse of discretion in two areas of law. [00:07:04] Speaker 02: The first one was the District Court telling us that we had to sue Pam, we must sue Pam, [00:07:09] Speaker 02: in New Orleans as a compulsory counterclaim. [00:07:12] Speaker 02: That was just legally wrong. [00:07:14] Speaker 02: Rule 13 just doesn't allow that. [00:07:16] Speaker 02: The second abuse of discretion is saying that Pam is a required party under Rule 19. [00:07:24] Speaker 02: And those two, of course, combine for the district court to tell us we must sue Pam there. [00:07:28] Speaker 02: So that was a legal error. [00:07:29] Speaker 02: That's an abuse of discretion. [00:07:31] Speaker 02: And then there's also an abuse of discretion in that [00:07:36] Speaker 02: a clear error of judgment in the district court not recognizing this difference between these two cases and their scope. [00:07:43] Speaker 02: Because only the New Jersey case is going to resolve, definitely resolve the infringement in New Orleans. [00:07:51] Speaker 02: If SP is not doing all those steps in New Orleans, it's a complete dead end. [00:07:57] Speaker 02: That case is a dead end. [00:07:58] Speaker 02: Because no matter what happens, we haven't got a case for infringement down there. [00:08:02] Speaker 00: What was the status the New Jersey judge mentioned counterclaiming against Pam? [00:08:11] Speaker 00: Isn't Pam now before the, well, weren't they before the New Orleans Court? [00:08:16] Speaker 02: Pam is now before the New Orleans Court, Your Honor, and the reason that happened is because in this order that's under review, the district court said that [00:08:24] Speaker 02: If we have a claim against PAN, we must, and this is the district court's word, twice, and they emphasize the word must, you must sue PAN in New Orleans. [00:08:33] Speaker 02: So at that time, what I'm facing is two things. [00:08:36] Speaker 02: I have a federal judge who just told me that if I have a claim against PAN, I must sue them as a compulsory counterclaim in New Orleans. [00:08:43] Speaker 02: And I'm also facing a deadline. [00:08:45] Speaker 02: I have a deadline to add counterclaims. [00:08:48] Speaker 02: So I have to do that. [00:08:49] Speaker 02: I have to do that. [00:08:50] Speaker 02: I can't take that chance that I'm going to lose a claim against Paylock. [00:08:54] Speaker 02: I had to sue them in New Orleans. [00:08:55] Speaker 02: There was no other choice. [00:08:57] Speaker 02: So that's the only reason that Pam's down there. [00:09:00] Speaker 02: It's because of the error of law that the judge made in New Orleans saying that it was a compulsory counter-claim. [00:09:05] Speaker 02: It's clearly not. [00:09:07] Speaker 04: Before your time runs out, can I just ask you a logistical question, which is we've got the next appeal coming up on 101. [00:09:14] Speaker 04: If we were to conclude that there is merit or we agree with the district court judge, or at least we would affirm the district court judge on the 101 and validity assertion, then effectively this case is mooted out. [00:09:26] Speaker 04: Am I right? [00:09:28] Speaker 02: If the conclusion is, I'm looking forward to the next argument, but if the conclusion is that it's 101 and valid, I guess it really doesn't matter what court we're in. [00:09:35] Speaker 02: I would just footnote that in that I know it's statistically unlikely, but just in case we go up to the Supreme Court, in that case it might become [00:09:44] Speaker 02: important, but you're right if the patents are invalid it doesn't matter really what court we're in. [00:09:50] Speaker 02: So I talked briefly about the the first bucket in New Orleans. [00:09:54] Speaker 02: There's also another bucket here and that's if we our client is in this business we know who our competitors are. [00:10:01] Speaker 02: We chose Pam. [00:10:02] Speaker 02: Pam's always been our target and the reason is because we think they're out there doing this and it's not just New Orleans. [00:10:09] Speaker 02: The New Jersey action will catch anything else that Pam is doing. [00:10:13] Speaker 02: We know that PAM is out there. [00:10:15] Speaker 02: We know that PAM is, and these other municipalities, seeking auto-related debt collection activities. [00:10:22] Speaker 04: We know that... That's kind of thin, right? [00:10:25] Speaker 04: In terms of knowing... I mean, we know what's going on in New Orleans. [00:10:29] Speaker 04: Yes. [00:10:29] Speaker 04: Because they're acting on this. [00:10:31] Speaker 04: It's under the contract. [00:10:33] Speaker 04: You've got the government. [00:10:33] Speaker 04: You've got various parties that are involved. [00:10:36] Speaker 04: And then you're representing that we know there's something more going out there. [00:10:42] Speaker 04: going on out there. [00:10:43] Speaker 04: It's a little thin, right? [00:10:44] Speaker 02: I was very candid in our briefing to this before and here that we do not have conclusive evidence. [00:10:49] Speaker 02: What we have is we have, we know they're out there working with other municipalities, not necessarily self-release booting. [00:10:57] Speaker 02: We have the Wendler declaration that they submitted and even Mr. Wendler's declaration. [00:11:01] Speaker 04: Yeah, but we don't know, I mean for all we know that could be happening in California then and that might become the more appropriate venue for further action rather than New Jersey. [00:11:10] Speaker 04: So even [00:11:11] Speaker 04: If we give some credence to the fact that you know that they're out there doing stuff, why does that get you to New Jersey? [00:11:19] Speaker 02: Because New Jersey solves them all. [00:11:21] Speaker 02: What we don't want, Your Honor, is we don't want 10 different litigations across the country against 10 different subcontractors. [00:11:27] Speaker 02: The litigation in New Jersey will solve them all, because Pam is the primary contractor. [00:11:33] Speaker 02: And in New Jersey, we have it. [00:11:35] Speaker 02: We have it covered. [00:11:37] Speaker 02: And one just quick point. [00:11:38] Speaker 02: I have 45 seconds. [00:11:41] Speaker 02: You say it sounds thin, Your Honor, but there's at least some circumstantial evidence of this. [00:11:47] Speaker 02: I'll point out that we all know an offer for sale is an infringement. [00:11:51] Speaker 02: So we've asked, and we've asked, and we've asked. [00:11:54] Speaker 02: We put in our brief at the district court. [00:11:55] Speaker 02: We raised it at the district court. [00:11:57] Speaker 02: We put in our brief here. [00:11:58] Speaker 02: Nowhere have they even acknowledged that question. [00:12:02] Speaker 02: I mean, they put in declarations in response to this motion. [00:12:05] Speaker 02: They won't even acknowledge the question. [00:12:08] Speaker 02: Does that mean conclusively that they're doing this offering somewhere else? [00:12:11] Speaker 02: No. [00:12:12] Speaker 04: But you will be able to ascertain that information in the New Orleans proceeding, not the improv municipality. [00:12:19] Speaker 02: I will not, Your Honor. [00:12:21] Speaker 02: If only SP is down there, unless the district court was right in ordering us to do that, I will not. [00:12:28] Speaker 02: It will only be SP. [00:12:29] Speaker 02: I can't pursue infringement against PAM and other municipalities down there. [00:12:33] Speaker 02: If it's only SP that's down there, I don't think I can do that. [00:12:37] Speaker 04: Wait a minute, you just said unless the district court was right in insisting, but you have as a practical matter brought in, have not. [00:12:45] Speaker 02: Yes. [00:12:46] Speaker 02: Yes, your honor. [00:12:46] Speaker 02: Only against our, over our objection. [00:12:49] Speaker 02: We did place an objection. [00:12:50] Speaker 02: We don't think we have to do this. [00:12:51] Speaker 02: It's wrong. [00:12:52] Speaker 02: Uh, but now Pam's down there, but if Pam wasn't down there and Pam's not a party, I don't think we can pursue other infringements by Pam in other municipalities because without Pam being a party, [00:13:04] Speaker 02: So we'd have to go through this case. [00:13:06] Speaker 02: Why don't we reserve the remaining time? [00:13:08] Speaker 02: Thank you. [00:13:14] Speaker 01: Good morning, Your Honor. [00:13:14] Speaker 01: May it please the Court? [00:13:16] Speaker 01: Chris Ralston and Lindsay Calhoun on behalf of SP Plus Corporation. [00:13:22] Speaker 01: The Court has already identified, and the standard is an abuse of discretion standard. [00:13:26] Speaker 01: And the Court has already asked some of the questions that were raised by us and certainly addressed, I think, by the district court below. [00:13:32] Speaker 01: I heard one new argument this morning [00:13:34] Speaker 01: that we didn't hear at the district court, but the rest were addressed. [00:13:38] Speaker 01: And I'll just, I guess, go through some of the analysis in terms of the Genentech decision has certainly settled. [00:13:45] Speaker 01: And I believe, Your Honor, authored that decision that a district court can enjoin a later filed or a second filed action, which is what happened here. [00:13:54] Speaker 01: It's important to remember that although I've heard counsel's arguments here and at the district court, there is no infringement in New Jersey. [00:14:02] Speaker 01: The only thing in New Jersey is where a pay lock is located. [00:14:06] Speaker 01: And that, I think, calls to mind the decisions like the other Genentech decision where this court held that it was not just an abuse of discretion, but it warranted a mandamus to correct the proceeding of a second filed action in California when the only connection to California was that the defendant, or excuse me, the party claiming infringement had some of its personnel willing to attend, personnel located there. [00:14:32] Speaker 01: It's very, you know, when we look at this case, what do we have? [00:14:35] Speaker 01: We've got everything about both proceedings, everything about both proceedings, concerns, alleged infringement by the city of New Orleans through its contractor professional account management and its subcontractor, SP Plus Corporation. [00:14:54] Speaker 01: I know that counsel made the argument that the district court didn't accept it. [00:14:57] Speaker 01: There has never been any question about who's performing the activities. [00:15:00] Speaker 01: We've been upfront about that. [00:15:02] Speaker 01: It's SP Plus Corporation through a subcontract with PAM and that PAM has the contract with the City of New Orleans for the provision of parking related services. [00:15:11] Speaker 04: But it is the case that if it were correct or if it were true that PAM is out there in various other municipalities nationwide trying to get contracts and use this on the assumption that you've got a valid and infringed patent, that would [00:15:29] Speaker 04: that wouldn't necessarily be covered in the New Orleans Act. [00:15:32] Speaker 04: I mean, your friend is saying this is a nationwide issue and we have some reason to believe that there's more activity going on by PAM, which SP may or may not even be involved with, and New Orleans may or may not even be involved with. [00:15:47] Speaker 01: They have said that, Judge, despite all the evidence to the contrary, despite written declarations and affidavits saying, and there is no other activity. [00:15:54] Speaker 01: I mean, everyone's been unequivocal about that. [00:15:56] Speaker 01: The only place [00:15:58] Speaker 01: That certainly that SP Plus offers this self-releasing of the alleged infringing activity is in New Orleans because the city of New Orleans asked us to do so. [00:16:06] Speaker 01: And PAM, Professional Account Management, has also been unequivocal that it is performing that service by contract or otherwise nowhere else in the country or the world. [00:16:16] Speaker 00: You're saying the subcontractor is operating only in New Orleans. [00:16:21] Speaker 01: Well, my client, the subcontractor, is operating nationwide, but the only place [00:16:27] Speaker 01: The only place that we're offering the alleged infringing activity is in New Orleans. [00:16:33] Speaker 04: But you're saying that the contractor as well, the only place that this is at stake. [00:16:36] Speaker 01: That's absolutely true, Judge. [00:16:38] Speaker 01: Absolutely. [00:16:39] Speaker 01: No question about that. [00:16:40] Speaker 01: And the district judge heard that, too. [00:16:42] Speaker 01: But I heard the hypothetical that Your Honor posed, and I wanted to address that. [00:16:47] Speaker 01: Sure, there has been that statement, but it's in the face of everything to the contrary. [00:16:51] Speaker 01: And I'm sure the Court noticed, because it's been clear that the panel's well prepared today, [00:16:57] Speaker 01: Paylock, IPT, issued a public records request in New Orleans to find out all the details about what was being provided and certainly knows how to do that in other municipalities if they had any real belief that this infringing activity was being offered anywhere except for New Orleans and today there has been no allegation other than just an allegation it could be happening somewhere else. [00:17:23] Speaker 01: That's in the face [00:17:25] Speaker 01: of clear and unequivocal statements by SP Plus Corporation and PAM, professional account management, that neither are performing it anywhere, period, except for New Orleans. [00:17:36] Speaker 01: And we've been upfront about that from the very beginning. [00:17:38] Speaker 01: In fact, when we filed the lawsuit in the Eastern District of Louisiana, Southern SP Plus, my client, we said we are performing this service in New Orleans pursuant to a subcontract in connection with the contract through professional account management with the City of New Orleans. [00:17:54] Speaker 01: There was no doubt about that. [00:17:55] Speaker 01: There was some statement made again this morning at the district court that we denied that we were, you know, providing the activities. [00:18:01] Speaker 01: That's never been the case. [00:18:03] Speaker 01: And I think Judge Feldman recognized that. [00:18:06] Speaker 01: There was no reason for us to say that when we walked into Federal court and filed our complaint saying we are performing all of these activities in New Orleans pursuant to a subcontract. [00:18:14] Speaker 01: And so I just want to address the hypothetical that Your Honor posed. [00:18:18] Speaker 01: But I do think that the district court addressed that below. [00:18:21] Speaker 01: And I think [00:18:22] Speaker 01: You know, the documents belie any belief that there's any service being performed. [00:18:25] Speaker 01: This is all about venue, and I don't think there's any real question. [00:18:29] Speaker 01: But even if there was a question, Your Honor, on whether it's being performed somewhere else, I think this Court has addressed that type of situation in Micron Technologies versus Mozi Technologies. [00:18:40] Speaker 01: I mean, that was the whole point, that if we allow someone to get past the first filed rule, which this Court steadfastly follows, then we allow someone to manipulate it [00:18:51] Speaker 01: saying that there's something more, or leaving out a party as they did in this case, or adding someone else in to say, well, this lawsuit is really different. [00:18:58] Speaker 01: So the second filed action should proceed. [00:19:01] Speaker 01: And I think this Court has been consistent and uniform in saying that they're not going to allow that type of manipulation. [00:19:07] Speaker 01: Even if there's no manipulation here, the point is... Okay. [00:19:10] Speaker 04: Let me just move you on. [00:19:12] Speaker 01: Sure. [00:19:12] Speaker 04: The difficult, most, the more difficult issue for me, at least, is that Pam was not a party. [00:19:19] Speaker 04: And maybe the answer is, well, you can't unring the bell, because your friend, whether he felt coerced to bring Pam in or not, felt like after the dye had been cast, he brought them in. [00:19:31] Speaker 04: So it's no longer a problem. [00:19:33] Speaker 04: So maybe the answer is, well, it's no longer a problem. [00:19:36] Speaker 04: We're not going to unring that bell on an abusive discretion standard. [00:19:40] Speaker 04: But what's your view of that question? [00:19:42] Speaker 01: Thank you, Your Honor. [00:19:44] Speaker 01: address, just so that there's no confusion, and hopefully this addresses your question. [00:19:48] Speaker 01: First, the district court did not say that Pellock must sue Pam in New Orleans. [00:19:54] Speaker 01: And I think that the district court addressed that in its March ruling, Appendix 41, where it correctly wrote that the Pellock certainly, quote, certainly could add Pam as a third-party defendant and in response to Pellock's fervent arguments to the contrary. [00:20:10] Speaker 01: The court further elaborated that if Pellock really believed in its own [00:20:13] Speaker 01: quote, mothership theory. [00:20:15] Speaker 01: That is, if it believed that a lawsuit against SP Plus would not afford complete relief against PAM's nationwide infringement, then it had to assert claims against PAM. [00:20:24] Speaker 01: And so I believe, Your Honor, in answering your question, that when everyone's been clear that PAM is only a party to this and we're stepping up through an indemnity agreement, that it really doesn't matter whether Paylock decided to bring in PAM or not. [00:20:41] Speaker 01: It did. [00:20:42] Speaker 01: It did because the district court said it certainly could and the federal rules say it could, but it doesn't alter the analysis that when we've said that we're performing the services, it's not going to cause any prejudice or certainly no abuse of discretion in this case by the district court by the simple fact that Pam wasn't initially in the suit filed in the Eastern District of Louisiana. [00:21:03] Speaker 01: I hope that answers your honor's question, but that is how it happened. [00:21:08] Speaker 01: We, when we filed the suit, we didn't bring in Pam because SP Plus said, we're performing the services. [00:21:14] Speaker 01: We are performing the services pursuant to a subcontract through the contract with the city board. [00:21:19] Speaker 04: But just because you have an indemnity agreement with Pam, that doesn't, how is that even probative? [00:21:25] Speaker 04: I mean, if Pam is a necessary party just because you have the obligation to indemnify them, doesn't mean you don't have to come in. [00:21:32] Speaker 01: Absolutely, Your Honor. [00:21:33] Speaker 01: And I didn't, I'm sorry, I didn't mean to interrupt. [00:21:35] Speaker 01: And I didn't mean that it's legally significant. [00:21:38] Speaker 01: I was just explaining how we got here, you know, because I think this may be a little unusual. [00:21:42] Speaker 01: I don't think it changes the result. [00:21:43] Speaker 04: It is unusual. [00:21:45] Speaker 01: But the point of it was just I wanted to explain how we got here and the reason why we brought the action, because there was no question that we were performing it. [00:21:55] Speaker 01: And so we teed up the issue and brought it to the district court so we could get a speedy determination, because of course we've got a cease and desist letter and a lot of other [00:22:03] Speaker 01: threats that we were dealing with at the time. [00:22:04] Speaker 01: And so that's why we brought it. [00:22:06] Speaker 01: And frankly, it was a little surprise that there'd be an objection to proceeding in New Orleans, where all of the alleged infringing activity is occurring by the city of New Orleans. [00:22:15] Speaker 01: And now the district court addressed the issue about the city of New Orleans isn't going to send its employees to New Jersey. [00:22:21] Speaker 01: That's not something that they're going to do. [00:22:22] Speaker 01: And I know that the court saw that the affidavit and the record on that from the city head of public works. [00:22:29] Speaker 01: But those are the issues. [00:22:31] Speaker 01: of the district court considered and considering where is the appropriate place for the action proceed? [00:22:36] Speaker 01: The place where the infringing activity is occurring. [00:22:39] Speaker 01: Where PAM has certainly raised no objection to proceeding in New Orleans. [00:22:43] Speaker 01: SP Plus certainly, we're located in New Orleans in terms of having employees there. [00:22:48] Speaker 01: And so when you look at the personnel, the activity, the questions that would be at issue in any suit, we were honestly surprised that there would be an objection proceeding in the city when the city is being the alleged infringer. [00:23:01] Speaker 01: And so I think that that makes this really an easy one under whichever standard the court looks at. [00:23:07] Speaker 01: And certainly when we look at this court's precedents on the decision to allow the first file proceeding to proceed. [00:23:13] Speaker 01: And that's been a rule that's been followed. [00:23:15] Speaker 01: And certainly, I think, clearly the case here when the only connection to New Jersey, the only connection, is that Paylock would proceed, prefer to proceed there. [00:23:26] Speaker 01: And that, under this court's precedent, is not enough to transform this into an error [00:23:31] Speaker 01: much less an abuse of discretion. [00:23:33] Speaker 01: I think when we look at this court's holdings, and I cited Micron Technologies, cited in our brief and others, that it really becomes straightforward. [00:23:42] Speaker 01: We look at the 1404 factors. [00:23:44] Speaker 01: We tried to outline those for the courts here. [00:23:46] Speaker 01: I believe Judge Feldman went through the analysis fairly thoroughly in terms of where are the employees? [00:23:52] Speaker 01: Where would the witnesses be located? [00:23:54] Speaker 01: Where would the documents be located? [00:23:56] Speaker 01: Where is the alleged infringing activity itself occurring? [00:23:59] Speaker 01: Every single point. [00:24:01] Speaker 01: is in New Orleans. [00:24:03] Speaker 01: And there was no reason that the court couldn't exercise jurisdiction, which it has been told that it should do. [00:24:09] Speaker 01: And so when we look at the authorities from this court that say that an injunction is certainly appropriate against a second-filed action, when the only connection to the second-filed proceeding is that the party claiming infringement would prefer to proceed there, that it's not only not error [00:24:26] Speaker 00: But it was consistent with this court's authorities to issue the injunction, which it did in following... Wasn't your declaratory action based on validity rather than non-infringement? [00:24:39] Speaker 00: I'm the Louisiana action. [00:24:45] Speaker 00: But wasn't that requesting a declaration of invalidity rather than a declaration of non-infringement? [00:24:52] Speaker 01: It did assert non-validity. [00:24:54] Speaker 00: And therefore, why is it irrelevant where the inventors and the invention and all of the evidence and testimony as to validity where that was located? [00:25:09] Speaker 01: I'm sorry, Judge. [00:25:11] Speaker 01: I'm not going to say it's irrelevant. [00:25:13] Speaker 01: And we did claim invalid. [00:25:14] Speaker 00: You can't say it's irrelevant. [00:25:15] Speaker 01: Right. [00:25:16] Speaker 01: And I don't think I, if I did, I apologize. [00:25:19] Speaker 01: I don't think it's irrelevant. [00:25:21] Speaker 01: My point was it went under the analysis of the factors in the courts and what this Court has said in terms of- Well, all you talked about was infringement. [00:25:30] Speaker 01: Right. [00:25:30] Speaker 00: And we were alleged- Infringement, I don't think, was even disputed, was it? [00:25:35] Speaker 01: We did dispute infringement. [00:25:37] Speaker 01: But we also said that there was a validity question. [00:25:39] Speaker 04: So just to be clear, because I don't know, your action involved both infringement and validity? [00:25:46] Speaker 01: The primary claim was that the patents were invalid. [00:25:52] Speaker 01: But we also don't concede that there's been infringement. [00:25:56] Speaker 01: And we're talking about the New Jersey action. [00:26:00] Speaker 03: Sorry to interrupt you, but you said you didn't concede infringement. [00:26:04] Speaker 03: I'm sorry, I'm confused. [00:26:05] Speaker 03: Are you saying that it was based on a request for a declaration of non-infringement or simply that you weren't conceding infringement? [00:26:15] Speaker 01: We asked for a declaration of inviolability, Your Honor. [00:26:19] Speaker 01: Only inviolability? [00:26:21] Speaker 01: In New Orleans, in the Eastern District of Louisiana. [00:26:27] Speaker 01: And so my point was not that it's irrelevant, but when the claim has been brought pursuant to the whole infringement allegation, and our defense or response is that the patents are invalid, that by bringing the theory was not only improper, it was consistent with this court's authority for the court to defer or to order the party to proceed in the first filed action. [00:26:49] Speaker 01: And that was, I believe, consistent with what this court said in Micron Technologies and in Genentech. [00:26:54] Speaker 01: and the other authorities that we asserted in our brief. [00:27:00] Speaker 01: Thank you, Judge. [00:27:03] Speaker 01: We would ask the court to affirm on that point. [00:27:08] Speaker 02: Thank you. [00:27:09] Speaker 02: I'll just be brief on a few points. [00:27:11] Speaker 02: Your Honor, you asked about whether PAM should have been brought in in the first instance by SP in New Orleans, and absolutely yes. [00:27:17] Speaker 02: This would be a very different appeal had that happened because [00:27:21] Speaker 02: then the New Orleans case would have been able to solve whatever's happening with PAM, but they didn't do that. [00:27:26] Speaker 02: And so now the only case that can really handle everything is the one in New Jersey where PAM is properly party. [00:27:33] Speaker 02: And you're right, Your Honor, this is definitely not a traditional first-to-file case. [00:27:38] Speaker 02: SP is just a peripheral defendant. [00:27:40] Speaker 02: It's not the primary contractor. [00:27:43] Speaker 02: So this is the 1404 analysis and the transfer. [00:27:46] Speaker 02: I get that when you have mirror image cases. [00:27:48] Speaker 02: You have the DJ action and you have [00:27:50] Speaker 02: the infringement action, but that doesn't make sense here. [00:27:53] Speaker 02: We have different parties and the scope of the cases are different. [00:27:57] Speaker 02: In this situation, we follow Wilton under the United States Supreme Court, wise judicial administration. [00:28:04] Speaker 02: So moving to that issue, Mr. Raulston said there's not really any dispute that SP is doing all the acts in New Orleans. [00:28:12] Speaker 02: Well, there is. [00:28:13] Speaker 02: Appendix at 189, this is our first letter. [00:28:17] Speaker 02: This is long before any of this ever happened. [00:28:20] Speaker 02: long before any of these motions or any case in New Orleans, we did an investigation. [00:28:25] Speaker 02: And it says what the investigation showed. [00:28:27] Speaker 02: The pay and the release of the boots. [00:28:30] Speaker 02: Those are two steps in our claims. [00:28:31] Speaker 02: You have to do them to meet our claims. [00:28:34] Speaker 02: The pay and release of the boot, and you got a number. [00:28:37] Speaker 02: You call that number. [00:28:39] Speaker 02: It's not SP. [00:28:40] Speaker 02: It's PAM. [00:28:42] Speaker 02: So if that's correct, and [00:28:45] Speaker 02: The case against SP in New Orleans can't address the infringement. [00:28:49] Speaker 02: We don't have a direct infringement case against SP. [00:28:53] Speaker 02: They don't have a contract with the city. [00:28:55] Speaker 02: There's no direct infringement and that whole New Orleans action is just a dead end for infringement. [00:29:00] Speaker 02: It's going nowhere because the evidence is that SP is not doing everything. [00:29:06] Speaker 02: The New Jersey case can handle it no matter what's happening. [00:29:11] Speaker 02: Lastly, [00:29:12] Speaker 02: The national infringement, we talked about that. [00:29:15] Speaker 02: I encourage you, Honours, to look at the Wendler Declaration. [00:29:17] Speaker 02: This is their declaration. [00:29:19] Speaker 02: He expressly says, cannot rule out the fact that we've used these other boots elsewhere. [00:29:26] Speaker 02: So with that, I'm done. [00:29:27] Speaker 02: If there are no further questions. [00:29:30] Speaker 02: Thank you.