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Supreme Court Patent Ruling: What Lies Ahead

In a highly anticipated ruling, on May 22, 2017, the Supreme Court decided the T.C. Heartland v. Kraft Foods Group case, restricting venue in patent cases to venues in which the Defendant resides or venues in which the Defendant has committed acts of infringement and has a regular and established place of business. The ruling is expected to result in a major redistribution of patent cases throughout the country, some of which may have limited patent experience.

Given the large number of companies incorporated in Delaware, that jurisdiction may remain a popular patent jurisdiction. Furthermore, we expect that the second portion of the venue statute which allows for venue “where the defendant has committed acts of infringement and has a regular and established place of business” will see significantly more litigation as parties work to parse out the metes and bounds of “regular and established place of business” that might confer venue.

The Court held that 28 U.S.C. § 1400(b) is the sole and exclusive provision governing venue in patent infringement actions and is not to be supplemented by the general venue statute, 28 U.S.C. § 1391(c). The Supreme Court’s ruling overturned 25 years of Federal Circuit precedent interpreting these two statutes, which had, in effect, exposed Defendants to patent infringement actions in almost any jurisdiction in which an allegedly infringing act had occurred.

The Court recounted the history of the patent venue statute, §1400(b), and found particular significance in the fact that it had not been amended or modified in any way since 1948, despite intervening case law that had issued in the interim. Section 1400(b) provides that:

“[a]ny civil action for patent infringement may be brought in the judicial district where the defendant resides, or where the defendant has committed acts of infringement and has a regular and established place of business.”

The Supreme Court had previously held that for purposes of §1400(b) a domestic corporation “resides” only in its State of incorporation, rejecting the argument that §1400(b) incorporates the broader definition of corporate “residence” contained in the general venue statute, 28 U. S. C. §1391(c). See Fourco Glass Co. v. Transmirra Products Corp. Since Fourco, Congress has twice amended §1391, which now reads: “[e]xcept as otherwise provided by law” and “[f]or all venue purposes,” a corporation “shall be deemed to reside, if a defendant, in any judicial district in which such defendant is subject to the court’s personal jurisdiction with respect to the civil action in question.” §§1391(a), (c). In Monday’s holding, the Court found the latest amendment to §1391 to be particularly significant. In 2011, Congress added the clause “[e]xcept as otherwise provided by law,” to §1391. Thus in adding that savings clause, the Court found that Congress had “[made] explicit the qualification that this Court previously found implicit in the statute” in Fourco.

© Polsinelli PC, Polsinelli LLP in California

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About this Author

Robyn AstGmoser, Polsinelli Law Firm, Patent and Trademark Litigation Attorney
Associate

Robyn Ast-Gmoser represents clients in all aspects of patent and trademark litigation, including initial case assessment and strategy development, fact and expert evidentiary case development, claim construction and dispositive motions practice, and trial. An experienced patent litigator, Robyn manages cases from start to finish, including overseeing all phases of discovery, regularly participating in the taking and defending of depositions, and preparing and arguing contested motions.

With dual scientific undergraduate degrees in botany and...

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As the former Under Secretary of Commerce for Intellectual Property and Director of the U.S. Patent and Trademark Office, Todd Dickinson possesses an in-depth knowledge of the USPTO and its practices, as well as an uncommon perspective on all facets of U.S. and international IP practice and policy.

During his 35-year career, Todd has also been Chief IP Counsel for two Fortune 50 companies, with overall corporate responsibility for all IP, including the management of extensive patent and trademark portfolios. This senior-level in-house experience gives him an intimate understanding of the issues, problems and budget challenges facing corporate counsel.

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Keith J. Grady, Polsinelli, Trade Secret Technology Protections, Lawyer, Copyright Infringement Attorney
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Specializing in disputes relating to all forms of intellectual property, Keith Grady's 25 years of experience in courtrooms across the nation provides him with the knowledge and insight necessary to advise his clients on the full range of options available. Whether in the courtroom, boardroom or around a mediation table, Keith uses his advocacy skills to further the goals of his clients and avoid unnecessary disruptions to their business.

Keith’s areas of focus include:

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Gary E. Hood, Polsinelli, Intellectual Property Proceedings lawyer, Litigation Division Chair
Shareholder, Intellectual Property Proceedings & Litigation Division Chair

Gary Hood is an effective, practical trial lawyer. His clients count on him to determine, early in a case, what is at the heart of the dispute, and how to win. His 20 years of courtroom experience trying cases involving a range of legal issues have given Gary perspective and insight on judge and jury persuasion, for which clients seek him out. This experience has enabled him to develop a unique case preparation method that identifies strategic direction early, which Gary uses to lead his teams efficiently and effectively.

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