A Rare Sight: East Texas Judge Grants Motion to Dismiss Patent Infringement Suit

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A Rare Sight: East Texas Judge Grants Motion to Dismiss Patent Infringement Suit


The data are in. As we’ve previously discussed, the U.S. District Court for the Eastern District of Texas outstrips all others for patent infringement litigation, with approximately 40% of all recent cases filed in that one court. The reasons plaintiffs—especially patent trolls—favor this district have been studied. Most recently, in an August 2015 article, “Forum Selling,” Daniel Klerman and Greg Reilly show that, among other plaintiff–friendly factors, the judges of that district grant summary judgment at less than one–quarter the rate as judges in other districts with a significant patent docket. By the numbers, the usually long odds of success on a dispositive motion are unusually long in the Eastern District of Texas.

That is why we sit up and pay attention when an east Texas judge grants an accused infringer’s dispositive motion in a patent case, as happened in the case of NexusCard v. Kroger. In a March 24, 2016, order, Marshall, Texas–based Judge Rodney Gilstrap granted Kroger’s motion to dismiss NexusCard’s complaint, concluding that the asserted patents’ claims claimed nothing more than the abstract concept of a method for providing a membership program. The judge further determined that NexusCard’s patent lacked an “inventive step” that could generate patent–eligibility because the additional limitations in the claims recited either functional results (desired outcomes) or elements not significant to the claimed invention.

Although a happy result for Kroger, the company nonetheless had to litigate the case for approximately nine months—the complaint was filed in June 2015—before receiving a ruling, despite having moved for a stay pending resolution of a Petition for Covered Business Method Review by the U.S. Patent and Trademark Office and its (ultimately successful) motion to dismiss. Given the east Texas court’s crowded docket, it is difficult for accused infringers to get a ruling on even early–case dispositive motions before expending significant sums on discovery and claim construction that, as it turned out in this case, were needless.

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