nsucurrent.com March 20, 2018

Supreme Court Deals Blow To Patent Trolls Shopping For Friendly Venues

24 May 2017, 05:29 | Ruby West

Supreme Court puts new restriction on patent trolls

US Supreme Court

On May 22, 2017, the US Supreme Court unanimously rejected prior case law allowing patent holders to rely on the general venue statute, 28 U.S.C. § 1391 (c), to file suit where a domestic defendant makes sales. These are called "non-practicing entities", or "patent trolls", because their main source of revenue comes from suing companies and hoping they settle rather than duking it out in court.

The rocket docket fueling patent litigation in Texas' Eastern District may soon be crashing back to earth, as the U.S. Supreme Court has grounded forum shopping for infringement lawsuits. In 2015, of 5,819 new patent cases filed in the country, 1,686 landed before U.S. District Judge Rodney Gilstrap in Marshall, Texas.

These are companies that make their money nearly entirely from patent licensing, representing two-thirds of all cases in U.S. district courts at the time, they became known as patent trolls. Heartland argued that the case should be transferred to its home state of IN since it has no presence IN DE, where the suit was originally filed.

Intellectual property partner John O'Quinn of Kirkland & Ellis called the decision "seismic" in a statement emailed to the ABA Journal, and said it could lead to more infringement being filed in DE, where many corporations choose to incorporate.

Tech companies worry a lot about being sued by firms that simply hold a lot of patents but don't use them to manufacture any goods. That district has acquired a reputation for patent friendly juries and judges, who helped small towns like Marshall and Tyler keep their restaurants and hotels bustling with out-of-town lawyers and executives attending patent trials.

"For decades, USA businesses have been unfairly required to defend patent suits in far off locales adding cost, complexity, and risk to the litigation process". In 1990, the same question came up through the courts again: should the patent venue rules be interpreted in light of the more general venue law, or should the venue retain its own, more strict, guidelines? In fact, because any lawsuit will likely need to be filed in a venue in which the accused infringed has the advantage, patent trolls may find it more hard to extort settlements from their victims. In the case of patent infringement suits targeting Idaho-based businesses, this will mean the Idaho federal courts in many instances.

"Given the definition of "resides" is limited to the "state of incorporation, ' it may lead to a swell in patent cases in DE, and otherwise funnel cases towards defendants" home jurisdictions", said Kirkland & Ellis intellectual property partner John O'Quinn.

The ruling aims to keep patent suits confined in districts where the defendant is incorporated or has an established place of business.

The ruling may well signal the demise of the Eastern District of Texas as a favorite venue for patent lawsuits, especially those brought by "patent trolls", which have no business outside of licensing and litigating patents. This becomes more likely, analysts say, if patent cases can be heard in venues other than the ones that trolls now prefer. Previously, the so-called trolls would buy patents and then sue larger companies for royalties or damages. While the suit had nothing to do with technology, it highlighted the practice of "forum shopping" by forcing TC Heartland to face a suit in DE instead of in, where it's based. This case would still likely leave approximately 60% of patent cases in these same five districts. Justice Neil Gorsuch did not consider the case.

Other News

Trending Now

Penguins knot series with 3-2 win over Senators
Ruhwedel was assisted to the dressing room in the first period after taking an elbow to the face from Ottawa's Bobby Ryan. The TV cameras caught a frustrated Karlsson upset with centre Kyle Turris after a power play in the second.

Julian Assange: Sweden Drops Rape Investigation Into WikiLeaks Founder
United Kingdom officials have not confirmed that they would or would not extradite Assange to the US. The post Rape charges dropped but Assange faces arrest in Britain appeared first on Vanguard News.

Davis homers twice in extra innings, Orioles edge Tigers
But an improvement from an offense that ranked 20th in runs scored during April, given the Orioles' lineup, was inevitable. He's a thumping right fielder with a great work ethic and a humble persona, a fan favorite who embraces the big moments.

Marilyn Manson and Charlie Hunnam are Besties
David Beckham and his son Brooklyn pose at the European premiere of "King Arthur: Legend of the Sword " in London May 11, 2017. Despite what you may have thought, this isn't actually the 42-year-old's film debut. "He was fantastic", Ritchie said.

Mom: Child welfare officials were OK with cage for toddler
Kutz was unable to post bail and remains in the Schuylkill County Prison while he awaits his next court date. Police say the children's mother is hospitalized with complications from the youngest child's birth.

Car Companies Settle Takata Lawsuits
Takata and auto makers for years have been defending themselves against allegations lodged in the Florida litigation. Takata also reached a $1 billion settlement with the USA that included a $25 million criminal fine.

Japan's Emperor Akihito to step down as cabinet approves bill allowing abdication
Only males can inherit the throne and there was a succession crisis until 2006 as both the emperor's sons had only daughters. His heir apparent Crown Prince Naruhito-and any future successors-would not be able to abdicate under the same law.

Japanese tycoon to launch $100bn-fund during Trump Saudi visit
The fund may also serve the interests of Saudi Arabia by helping Riyadh obtain access to foreign technology. The rest of the money will be raised in the next six months.

What time is Twin Peaks on TV in the UK?
What we do know is it's set 25 years after the original and that filmmaker David Lynch has directed all 18 episodes . Yet the dark woods rustled anew with unresolved mystery like a dreamer disturbed by a recurring nightmare.

Manchester City confirm that Zabaleta will be moving on
His side have two games to clinch the eighth place they have held for much of the season. "We can not say the same thing now". Pep Guardiola says Gabriel Jesus has plenty to improve on and feels his open-mindedness will allow him to thrive at City.