Unreported / Non-Citable
Background
Yangtze Memory Technologies Company sued Micron Technology, Inc., two related Micron entities, and distributor Avnet, Inc. in the Eastern District of Texas. Because patent venue can depend on whether a defendant has a regular and established place of business in the district, Yangtze sought discovery concerning whether Avnet’s activities in the district could be attributed to Micron under an agency theory.
The parties’ distribution agreement stated that Avnet could set its own prices and sales terms and that title and risk of loss passed to Avnet upon shipment. Yangtze nevertheless argued that Micron’s communications, training materials, draft emails, and interactions with Avnet might show that Micron actually exercised interim control over Avnet’s sales process. After producing approximately 300 documents, the defendants resisted additional email discovery and deposition testimony as irrelevant, disproportionate, and unduly burdensome.
The Court’s Holding
The court granted Yangtze’s motion to compel in part. It held that the requested communications and testimony were potentially relevant because they might show whether Micron gave Avnet step-by-step sales instructions or otherwise exercised sufficient interim control to make Avnet Micron’s agent for patent-venue purposes. The court emphasized that the discovery might or might not ultimately establish agency and that its authorization of email discovery was limited to the case’s unique facts, not a rule that email discovery is ordinarily required in venue disputes.
The court permitted Yangtze to select one Micron custodian and one Avnet custodian from specified pairs, with production capped at 1,000 emails per custodian and due September 11, 2026. It also allowed Rule 30(b)(6) testimony about meetings and interactions between defendants’ employees in or related to the district, with remaining venue depositions due October 2, 2026. The court denied the defendants’ protective-order motion as moot and denied without prejudice their venue-dependent severance, dismissal, stay, and transfer motions, allowing refiling after venue discovery.
Key Takeaways
- Communications between a manufacturer and distributor may be discoverable when they could show interim control over the distributor’s sales process and support an agency-based patent-venue theory.
- The court imposed concrete proportionality limits: two total custodians, no more than 1,000 emails from each custodian, and defined production and deposition deadlines.
- The ruling did not decide whether venue was proper; it authorized discovery needed to resolve that issue and deferred venue-dependent motions until the discovery was complete.
Why It Matters
The decision illustrates that contractual language describing a distributor as independent may not end the venue inquiry when other evidence could show actual control over pricing, marketing, customer support, or sales activities. Parties contesting patent venue should expect courts to examine the practical relationship, not merely the formal agreement.
At the same time, the court expressly confined its approval of email discovery to the particular facts and used custodian and volume caps to control burden. The order therefore supports targeted venue discovery without treating broad email collection as routine.