Potential Game Changer On The Horizon: U.S. Supreme Court to Review Patent Venue
The U.S. Supreme Court agreed to review the patent venue laws that govern where patent holders may file claims for patent infringement. The Supreme Court’s ruling could put an end to patent owners seeking out and filing cases in certain districts that are perceived to be strategically advantageous, including most notably the Eastern District of Texas (where more than 40% of all U.S. patent enforcement actions were filed in 2015).
The venue laws in question[1] currently allow a patent owner to sue in any judicial district where the defendant is subject to personal jurisdiction, which in essence means wherever it makes sales. The Supreme Court could change the landscape by, for example, limiting venue to where defendants have actual business locations – thus significantly limiting the ability of so-called “patent trolls” to engage in forum-shopping. Patent venue reform has been a hot topic considered by both the House and the Senate in recent years. It appears the Supreme Court agrees and is ready to take action.
The case comes before the Supreme Court through an appeal from TC Heartland which was sued in the District of Delaware, another patent litigation hotbed, by Kraft Foods Group Brands LLC for its sales of liquid sweetener products. TC Heartland is incorporated and headquartered in Indiana. It asked the District Court to dismiss the complaint because it had no contacts with Delaware other than 2% of its alleged infringing products ending up there. Both the District Court and Federal Circuit denied TC Heartland’s requested relief.
The Supreme Court will hear the case in early 2017; a decision is expected by the end of June, 2017.
[1] 28 U.S.C. § 1400(b), 28 U.S.C. § 1391(c), and the Federal Circuit’s 1990 decision in VE Holding Corp. v. Johnson Gas Appliance, 917 F.2d 1574 (Fed. Cir. 1990).
