Supreme Court Sharply Limits Patent Forum–Shopping In TC Heartland

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Supreme Court Sharply Limits Patent Forum–Shopping In TC Heartland


Today, May 22, 2017, the Supreme Court struck a powerful blow against forum–shopping in patent litigation and the related patent troll plague. In a concise opinion by Justice Thomas in TC Heartland v. Kraft Foods Group Brands, a unanimous Supreme Court held that a domestic corporation “resides” only in its State of incorporation for purpose of determining where a patent lawsuit can filed against it. In reaching this result, the Supreme Court rejected the Federal Circuit’s expansive view of patent venue as extending to any court with personal jurisdiction over a defendant. That view had led directly to the surge in forum–shopping that had seen the Eastern District of Texas become home to well over one–third of all patent cases.

Today’s holding moved to restore some balance to a broken system. From today, corporate defendants may now be sued only in their jurisdiction of residence (i.e., where they are incorporated) or in a jurisdiction in which they have committed acts of alleged infringement and have a regular and established place of business. See 28 U.S.C § 1400(b). In practical terms, this result should mean that the Eastern District of Texas will see far fewer patent lawsuits because few defendants named in patent suits in that district are incorporated there. By contrast, Delaware, already a fairly popular venue, may see an increase in its popularity given that it is the state of “residence” of many U.S. corporations.

As our readers know, we strongly support the corrective action taken by the Supreme Court, having filed an amicus brief in the case on behalf of 48 Internet companies, retailers, and associations urging the Court to reach this very result. Today is a good day for all legitimate stakeholders in patent litigation.

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