In 2016, 44 percent of all patent cases were filed in only two districts, the Eastern District of Texas and the District of DE, the district in which this case arose. In recent years, a single judge based in Marshall, Texas, oversaw about a quarter of all patent cases nationwide, more than the number handled by all federal judges in California, Florida and NY combined. The popularity of eastern Texas as a venue for patent lawsuits has created a cottage industry in cities like Tyler-an entire economic infrastructure has been developed to support the courts' adjudication of these lawsuits, perhaps further reinforcing the plaintiff-friendly culture in those communities. The main difference is that most cases would shift out of the Eastern District of Texas, but two other districts would see a potentially commensurate uptick in filings - the Northern District of California and the District of Delaware.
The U.S. Supreme Court issued a ruling Monday that may have effectively ended a 15-year intellectual property litigation boom in East Texas.
In an 8-0 decision, the Supreme Court answered in the negative and reversed the Federal Circuit. 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.
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"Today's opinion from the Supreme Court is an important step in restoring balance in litigation and confidence in the patent system", said the Business Software Alliance, a Washington, D.C. -based trade association.
Dickinson said a wave of lawsuits against retailers could prompt Congress to enact legislation shielding them from patent lawsuits relating to products they do not manufacture. Thomas wrote that because of this interpretation, updates to the rules by Congress did not change a 1957 Supreme Court decision that had previously found that patent suits must take place in the targeted company's home state.
In 2014, Kraft, a DE company, brought a patent infringement action in the district of DE against an in company, TC Heartland. The case was between food and beverage company Kraft Heinz Co. and beverage flavoring firm TC Heartland LLC. That Washington-based patent court ruled past year that patent lawsuits can be held anywhere a defendant's products are sold. Wherever there is money to be made there will always be opportunistic individuals and companies who will obtain patents in order to profit from licensing or litigation. Even Texas Solicitor General Scott Keller led a coalition of 17 states calling for an end to so-called "forum shopping" in patent cases. "Forum-shopping in patent cases will largely become a relic of history", he said.
The court's newest member, Justice Neil Gorsuch, did not participate in the consideration of the case or the court's decision. "In contrast, the federal District Court for the District of DE will undoubtedly see a significant rise in patent litigation, owing to the large number of corporations incorporated in DE".