"The overall effect of the ruling will be to limit cases in the district", said Q. Todd Dickinson, the former director of the U.S. Patent and Trademark Office now in private practice at the law firm Polsinelli.
But Justice Thomas focused on the intent behind the venue statutes and, as a result, the Supreme Court found that the intent behind the statutes "supports an interpretation that seems contradictory to the plain meaning of the statutes when read side by side".
As the Wall Street Journal points out, companies will not only be able to defend themselves better on their home turf, but the patent infringement cases would also take longer to process, which could further discourage patent trolls. When TC Heartland wanted to move its case to IN, it asked the Federal Circuit to reconsider VE Holding. The case is TC Heartland, LLC v. Kraft Foods Group Brands LLC, and despite appearing pedestrian in nature, the impact of this decision on patent infringement litigation will be dramatic. Because of confusion about where the suit belongs, however, the merits of this case have gone untested.
The Supreme Court on Monday delivered a major blow to so-called patent trolls-shell companies whose business revolves around acquiring patents and then suing others for infringing on them-by making it much harder to bring lawsuits in friendly venues like East Texas. Heartland wanted the case transferred to IN, but was rebuffed by a district court and the Federal Circuit.
Because so many companies are incorporated in DE, analysts expect the number of lawsuits filed there to increase. But, in 1988, Congress revised the definition of "reside" in Section 1391 to allow for venue wherever personal jurisdiction could be established over a defendant.
Overall, the TC Heartland case is likely to usher in a seismic change in the geography of patent litigation, and exactly how that change plays out remains to be seen. The Federal Circuit hewed to its precedent a year ago in blocking removal of the case to in, the home of TC Heartland.More news: Guentzel's late goal gives Penguins Game 1 over Predators
"In short", Thomas added, "nothing in the text suggests congressional approval of VE Holding". Kraft sued in DE, the judicial district with the second-highest number of patent lawsuits. It's a practice that hurts the industry as large. Thus, even though it will still be possible to sue alleged infringers: "where the defendant has committed acts of infringement and has a regular and established place of business", the Court did not comment on what that meant.
The court ruled 8-0 in favor of Heartland. TC Heartland is incorporated in Indiana, and has its headquarters in Carmel, Indiana.
On Monday, the Supreme Court agreed.
"This ruling represents a sea change for patent litigation across the country, not just in East Texas", says Wasif Qureshi, patent litigation partner in the Houston office of Jackson Walker.
Most Idaho business owners were probably unaware that this decision had been issued, or if they were they likely paid it little mind.
The Supreme Court has reinstated a more restrictive standard for where patent holders can file infringement lawsuits, upending almost 30 years of established practice and doing away with a system that critics said fueled forum shopping.