Today, the U.S. Court of Appeals for the Federal Circuit issued an Order denying TC Heartland LLC’s petition for a writ of mandamus, affirming the scope of venue in patent cases, and declaring that “[t]he arguments raised regarding venue have been firmly resolved by VE Holding, a settled precedent for over 25 years.” In re: TC Heartland LLC, No. 2016-105 (Fed. Cir. April 29, 2016).
Had the Appellate Court instead adopted TC Heartland’s argument, and granted the petition, then: (i) the scope of venue for patent cases would have been substantially narrowed; (ii) patent owners would find it challenging to find venue in forums perceived to be patentee-friendly (for example, historically, the U.S. District Court for the Eastern District of Texas); and (iii) TC Heartland’s case would have been transferred from the U.S. District Court for the District of Delaware to that for the Southern District of Indiana.
Petitioner TC Heartland principally argued that Congress’ 2011 amendments to the venue statute (28 U.S.C. § 1391) changed the statutory law governing venue for patent infringement suits and nullified the Federal Circuit’s prior holding in VE Holding Corp. v. Johnson Gas Appliance Co., 917 F.2d 1574 (Fed. Cir. 1990). In its earlier VE Holding ruling, the Federal Circuit “held that the definition of corporate residence in the general venue statute, § 1391(c), applied to the patent venue statute, 28 U.S.C. § 1400.” The panel compared the pre-amendment general venue statute to the post-amendment general venue statute, and found certain of those changes a “broadening of the applicability of the definition of corporate residence, not a narrowing.”
In addition, the Federal Circuit dismissed – as “utterly without merit or logic” – TC Heartland’s contention that the 2011 amendments codified a 1957 decision of the U.S. Supreme Court regarding a prior version of the patent venue statute.
Perhaps telegraphing the likelihood of future proceedings, Judges Moore, Linn, and Wallach expressly noted that “[a]s a panel, we are bound by the prior decisions of this court.” Today’s Order by the Federal Circuit is likely not the last word regarding the scope of venue in patent cases, as many expect TC Heartland to seek an en banc rehearing by the full Federal Circuit court or, perhaps, file a petition for Petition for a Writ of Certiorari requesting U.S. Supreme Court review.