In December 2016, the United States Supreme Court agreed to hear arguments in TC Heartland v. Kraft Food Group Brands, a case that centers on patent litigation forum shopping. In addition, Congressional lawmakers are considering adding patent venue reform to its legislative agenda.
Last month, Sen. Orrin Hatch (R-UT), Chairman of the Senate Republican High-Tech Task Force, held an event to announce his innovation agenda for the 115th Congress. Included in that agenda are items such as enhancing America’s competitive workforce, fostering a modern competitive and open internet, and protecting American innovation and inventiveness.
“I believe there’s one area where we can see real progress this year: venue. Abusive litigants have exploited a hole in the law to direct a disproportionate number of suits to plaintiff-friendly forums, and to one such forum in particular,” said Hatch.
The TC Heartland Case
The Supreme Court will be considering whether venue in patent litigation cases should be governed by the patent venue statute or the general venue statute. The former limits lawsuits to venues in which a defendant resides, or has committed infringement and has a regular and established place of business. On the other hand, the general venue statue permits a lawsuit in which there is personal jurisdiction.
The case made it to the High Court after a ruling by the U.S. Court of Appeals for the Federal Circuit in April 2016. The appellate court rejected TC Heartland’s request to transfer venue, finding that the general venue statute applied and that the issue had previously been resolved by a 1990 Federal Circuit decision. Some observers believe that this decision led to the proliferation of patent litigation forum shopping and the subsequent concentration of cases in the Easter District of Texas.
In short, a reversal by the Supreme Court will curb venue shopping. However, Sen. Hatch also indicated that while lawmakers will be watching the TC Heartland case, Congressional action on venue reform may still be needed and will likely happen this year.
“No matter what the Court does, we’re likely going to need follow-on legislation to prevent future forum-shopping,” he said.
In the end, the TC Heartland Case and any reform measure coming out of Congress bear watching. In the final analysis, patent litigation may return to a focus on substantive issues such as the validity of a patent and whether or not there has been infringement, rather than venue shopping for a favorable outcome. If you are faced with a threat of, or are seeking to institute a patent litigation, it is critical to seek the advice and counsel of experienced intellectual property attorneys on venue and other issues.