Posts Tagged: "venue"

If the Supreme Court were to reverse the Federal Circuit and revert back to Fourco Glass, that would make it difficult for patent owners, including Whirlpool and others like them, to reasonably seek redress for patent infringement. Essentially, a reversion back to Fourco Glass would mean that patent infringement cases brought by corporations like Whirlpool would have to literally be brought in the home court of the patent infringer, or perhaps in Delaware where so many entities are incorporated. It would also necessitate a multiplicity of lawsuits, as Whirlpool explained in its amicus filing.

With respect to the thorny issue of patent litigation, Senator Hatch explained that there is a very real chance that venue reform will happen this year… HATCH: “The Supreme Court is currently examining the issue, so we won’t have a full view of the landscape until after the Court rules. But no matter what the Court does, we’re likely going to need follow-on legislation to prevent future forum-shopping and to ensure that litigants have a meaningful connection to the site of the suit.”

While calls for widespread patent reform are not as loud as they have been in previous years, 2017 is shaping up to be a year where we may still see significant change to U.S. patent laws. What will the changes to U.S. patent laws look like over the next year? The better question may be to first ask whether those anticipated changes will be coming from the judiciary, legislative or executive branch, all of which will take center stage at some point in 2017.

The Federal Circuit’s broad interpretation of the patent-venue statute has led to widespread forum-shopping with a disproportionate number of cases being filed in the Eastern District of Texas. For example, since 2011, roughly a quarter of all patent-infringement cases have been filed in the Eastern District, with 2015 being a peak year when 44% of all patent-infringement cases were filed. This despite the fact that the Eastern District of Texas is home to relatively few companies and home to little more than 3.5 million people. By comparison, the Northern District of California, a district with nearly 8 million people and home to many companies, only made up 4-5% of all patent-infringement filings annually.

The genesis of the patent venue “problem” is simple: Many patent infringement defendants complain about traveling to the Eastern District of Texas. They feel that it is too pro-patent, too pro-enforcement, or too difficult for defendants to win on a motion to dismiss… With the US Supreme Court agreeing to hear TC Heartland the perennial patent venue issue is front and center for patent reform in 2017. This case will attract much amicus, media, Congressional, law school, and fake news attention. It should influence how patent owners and litigation investors look at venue options in general and perhaps also with regard to growth markets like Germany and China. It will also tell us how the Trump administration thinks about patent issues.

While Congress seems to pass some form of patent legislation roughly every 9 to 11 years, the more important changes with regard to business predictability and economic growth tend to come from specific Court decisions. Just look at what Alice has done to ruin software patents with uncertainty, and now with the PTAB actually finding that an MRI machine is an unpatentable abstract idea. Worse it has placed the US behind Europe and even China in terms of protecting computer implemented inventions… Courts can make patents great again in America. And if not they will at least be as active as they have been in the past 10 years in terms of shaping the patent dialogue.

While Congress does seem to pass some form of patent legislation roughly every 9 to 11 years, the more important changes with regard to business predictability and economic growth tend to come from specific Court decisions. Just look at what Alice has done to ruin software patents with uncertainty, and now with the PTAB actually finding that an MRI machine is an unpatentable abstract idea. Worse it has placed the US behind Europe and even China in terms of protecting computer implemented inventions.

Every time a new patent reform bill moves forward in Congress, the courts create case law eliminating the need to pass the bill. They legislate from the bench to protect their turf. The infringer lobby took advantage of this dynamic and pushed bills that would stimulate response from the courts… I think we should employ this well proven method of changing law. I know this is not how our government is supposed to work, but let’s be pragmatic. We cannot force an unwilling government to follow its own constitutional processes. So, we need to work with what is available.

Suffice it to say that 2016 has been an interesting year. The political climate is much different than one year ago amidst a growing tide of nationalism abroad and populism here in the United States. Throw in a massive migration crisis stemming from the Middle East, a slew of unexpected celebrity passings and the fact that the Chicago Cubs are lovable losers no more, and we’re about to wind down a year which seems nearly mythological in stature… As we turn the page onward to 2017, it’s a good time to take another look at some of the major trends shaping the IP and technology landscape in the United States and abroad. From increasing competition with an Asian powerhouse to the continuation of a misleading narrative about patent system abuses, the past year leaves us with many important narratives to consider for the year ahead.

It is one again time to take a moment to look back on the year that was, reflecting on the biggest, most impactful moments of 2016. For us that means looking backward at the most impactful events in the world of intellectual property. As you might expect, the two recurring themes in this 2016 patent year end review relate to patent eligibility and the Patent Trial and Appeal Board.

Earlier today the United States Supreme Court granted certiorari in TC Heartland LLC v. Kraft Food Brands Group LLC. In deciding to hear this patent venue case the Supreme Court has agreed to decide whether 28 U.S.C. § 1400(b) is the sole and exclusive provision governing venue in patent infringement actions… Ultimately, the question that the petitioner really wants the Supreme Court to address is whether the Eastern District of Texas, which is home to 20-25% of all patent litigations because it is perceived to be patent owner friendly, is a proper venue for patent owners to be choosing. If the Supreme Court issues a ruling that strikes down current patent venue rules there would be no need for patent venue reform efforts to continue in Congress. On the other hand, if the Supreme Court were to affirm the Federal Circuit in this case calls for legislative venue reform would likely become deafening.

“My team and I do not tolerate time and attendance abuse,” Lee told the subcommittee. While she did note that the USPTO had taken disciplinary actions against examiners that have abused time and attendance reports, such actions ranging from counseling to expulsion and repayment for hours not worked, she added that there was evidence that instances of time and attendance abuse were not widespread. She cited a report on the USPTO’s telework program issued by the National Academy of Public Administration (NAPA) in July 2015. The report found that “It would appear to be unlikely that [time and attendance] abuse is widespread or unique to teleworkers, and it does not appear to reflect the actions of the workforce as a whole.” Additionally, the report indicated that the agency’s telework program saved the agency $7 million each year on average by allowing examiners to continue working in spite of government shutdowns caused by weather or other reasons.

There is simply no reason for so many patent cases to wind up in a district with so little relation to those cases. Basic principles of equity and justice don’t vanish just because a patent is involved. The court hearing a patent case should have a real interest in the case, just like any tort or contract case. The Eastern District of Texas has literally created a local industry of patent litigation, intentionally or not. Even local businesses acknowledge it and exploit it. Patent venue reform is long overdue, and it’s something that Congress can and should get done.

Clinton’s proposal for accomplishing this goal would be twofold: (1) to reduce excessive patent litigation through additional patent reform; and (2) strengthening the operational capacity of the USPTO by allowing the USPTO to keep and spend all the fees it collects. “You are looking at a 14-page detailed document. There is a lot of thought put behind this agenda,” explained Todd Dickinson, former Director of the United States Patent and Trademark Office under President Bill Clinton who was reached by telephone for comment. Not surprisingly, Dickinson has has been an advisor to the campaign regarding intellectual property matters. “Other campaigns will be hard pressed to match the depth and thoughtfulness of these proposals.”

Twenty-five years ago, the Federal Circuit decided a case that transformed where (and how) patent infringement cases can be litigated.[1] By expanding the scope of where a corporate defendant “resides” for venue purposes, the court in VE Holding Corp. v. Johnson Gas Appliance greatly increased the number of states and courts in which many corporations can be sued for infringement. This decision has contributed to the development of forum-shopping and related litigation issues over the past several years. One company, TC Heartland, LLC, is now urging the Federal Circuit to overturn that precedent and restore more stringent venue restrictions through a writ of mandamus, and dozens of others are joining the debate.

Larger companies like Adobe can defend themselves in court, even in Texas, but upstarts and mom-and-pop small businesses do not have the time or resources to defend themselves in a Texas courtroom for prolonged periods of time. Given the rampant and growing abuse, Congress must pass comprehensive patent legislation that includes critical venue reform measures. Without venue reform, patent trolls will continue to bring lawsuits against America’s leading innovators and small businesses in jurisdictions that have no connection to an alleged infringement. The choice of forum should not be outcome determinative. That’s not justice.