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US Top Court Considers Changing Where Patent Cases May Be Filed (reuters.com)

Posted by msmash on from the changing-the-system dept.

The U.S. Supreme Court on Monday grappled over whether to upend a quarter-century of practice and limit where patent-infringement lawsuits can be filed. From a report on Reuters: The U.S. Supreme Court struggled over whether to upend nearly 30 years of law governing patent lawsuits that critics say allows often-baseless litigants to sue in friendly courts, giving them the upper hand over high-technology companies such as Apple and Alphabet Google. The justices heard an hour of arguments in an appeal by beverage flavoring company TC Heartland LLC to have a patent infringement suit brought against it by food and beverage company Kraft Heinz moved from federal court in Delaware, where it was filed, to Heartland's home base in Indiana. TC Heartland is challenging a lower court ruling denying a transfer to Indiana. Even though the case did not involve a lawsuit filed in Texas, the arguments involved the peculiar fact that the bulk of patent litigation in the United States is occurring in a single, rural region of East Texas, far from the centers of technology and innovation in the United States. Critics have said the federal court there has rulings and procedures favoring entities that generate revenue by suing over patents instead of making products, sometimes called "patent trolls." The outcome of the TC Heartland case could be profoundly felt in the East Texas courts. The justices could curtail where patent lawsuits may be launched, limiting them to where a defendant company is incorporated and potentially making it harder to get to trial or score lucrative jury verdicts.

14 of 55 comments (clear)

  1. FINALLY!! by rkhalloran · · Score: 5, Insightful

    About time they weighed in on "venue-shopping" by trolls. Either of the defendant or plaintiff's headquarters' locations.

    1. Re:FINALLY!! by Mia+Yuuki · · Score: 2

      About time they weighed in on "venue-shopping" by trolls. Either of the defendant or plaintiff's headquarters' locations.

      Even that has problems, as the patent trolls will simply all incorporate in the Eastern District of Texas and keep a one man shop open there. I think like many other such cases, it needs to be limited to the location of the Defendant or a plan in which a contract or agreement has been signed.

    2. Re:FINALLY!! by whoever57 · · Score: 3, Interesting

      Expect to see a few corporate headquarters relocated to East Texas

      The patent trolls already did. Tyler, TX has buildings "occupied" by lots of companies, except that there is never anyone in the office.

      --
      The real "Libtards" are the Libertarians!
    3. Re:FINALLY!! by pr0t0 · · Score: 2

      They already do this. Some news organization did an expose on it. They went through a building that was simply corridors full of one-room offices, a company nameplate on the door, and no one ever went in or out.

      --
      I'm sorry, but your opinion seems to be wrong.
    4. Re:FINALLY!! by Anonymous Coward · · Score: 2, Insightful

      There are already shell companies operating out of offices in East Texas. Limiting venues is a step in the right direction, but more work needs to be done. How about limits on who can profit from the litigation? That would render shell companies useless. Invalidating NDAs over patent demands? All those Microsoft threatened before Barnes & Noble would have appreciated that. Reversing settlements if the patents-in-suit are invalidated? US companies still lay off workers or go under if their arrangement with a troll outlives the patents. More clarity at the federal level for when courts need to wait for USPTO re-examination? The first Apple v. Samsung case would have been a bit different. Actually funding the USPTO for a change? Think of how many stupid patents would get rejected if they could spend more man hours looking for prior art. Sweeping acts to invalidate existing software patents? They're just waiting to be invalidated anyway, grab the bull by the horns.

    5. Re:FINALLY!! by OrangeTide · · Score: 2

      I'd love for some percentage for settlements to go to USPTO. That might be hard to pull off through legislation, but it could help tremendously in funding this service of a patent system through those who benefit the most from it.

      --
      “Common sense is not so common.” — Voltaire
    6. Re:FINALLY!! by RubberDogBone · · Score: 3, Informative

      They already do this. Some news organization did an expose on it. They went through a building that was simply corridors full of one-room offices, a company nameplate on the door, and no one ever went in or out.

      There may have been news reports but one of the best investigations was from Austin Mayer, developer of the flight sim X-Plane, who was being sued by one of these worthless companies.

      Austin went to East Texas, dug around those empty hallways, and produced a scathing report: http://www.thepatentscam.com/

      It's brilliant.

      --
      Sig for hire.
  2. Dedicated patent courts. by JDAustin · · Score: 2

    We have dedicated courts specifically for Bankruptcy and Immigration. We need a dedicated court for both Patent and Malpractice issues.

    1. Re:Dedicated patent courts. by gurps_npc · · Score: 2

      We effectively have that, you just dislike their methodology. The Texas court in question handles so many patent cases, that it is the defacto dedicated court.

      But they got that way by illegally intentionally favoring a specific point of view, favoring patent holders no matter how ridiculous the patent or complaint. One major factor is their strong belief in jury trials, which slows things down, and raises trial costs significantly, and increases the risk of a ridiculous over the top jury award. All of these factors encourage people to settle.

      --
      excitingthingstodo.blogspot.com
    2. Re:Dedicated patent courts. by russotto · · Score: 3, Informative

      There's a huge difference between being the "de facto" standard due to rubberstamping in favor of the plaintiff (who usually gets to decide where they file their complains,) and being explicitly designed with the intent of treating cases fairly ie: not favoring the plaintiff by default.

      Unfortunately, not really. Patent appeals are by design handled exclusively by the Court of Appeals for the Federal Circuit.... which results in them favoring a very expansive version of patent law even when SCOTUS tells them to cool it.

  3. Adjectives by dinfinity · · Score: 2

    "US Top Court"

    Because "supreme" just doesn't quite cut it.

  4. Re:A quarter century by amiga3D · · Score: 3, Insightful

    In the tech industry it's an incredible length of time. 25 years ago Intel introduced the 80486DX2, the same year Commodore Business Machines launched the Amiga 1200 computer. I now emulate an Amiga 1200 at full speed on a Raspberry Pi 3, a 35 dollar throwaway computer board. 25 years in the tech industry sees companies rise and fall and products come out, go obsolete and their replacement go obsolete, etc....

  5. Re:A quarter century by Altrag · · Score: 2

    25 years is also more than 10% of the entire history of US law. That's not insignificant.

  6. Re:A quarter century by JoeMerchant · · Score: 3, Insightful

    25 years saw this nation move from a British Colony, through a war of independence and a provisional government, into one based on the present Constitution, move its capital from Philadelphia to a dedicated federal district, and double its population from ~2.5 million to more than 5 million.

    Doesn't matter when you live, a lot happens in 25 years, or relatively little, depending on what you focus on.