SCOTUS to hear TC Heartland case on patent venue

The US Supreme Court has agreed to hear an appeal concerning restrictions on where patent claims can be filed.

On Wednesday, December 14, the court  granted TC Heartland’s writ of certiorari,  filed in September this year.

The case stems from a patent infringement lawsuit brought by Kraft Foods against TC Heartland, an Indiana-based company that creates water enhancers.

Kraft sued at the US District Court for the District of Delaware, and TC Heartland unsuccessfully asked the judge to transfer the case to the US District Court for the Southern District of Indiana.

TC Heartland appealed against the decision to the US Court of Appeals for the Federal Circuit.

Critics, including the Electronic Frontier Foundation (EFF),  stepped into the fray, asking the court to change the rules in a bid to limit the number of lawsuits being filed at the US District Court for the Eastern District of Texas, a popular destination for patent claims.

The Texas court was not part of the proceedings, but was brought into consideration as part of the argument put forward by the EFF.

But, in April this year, WIPR  reported that the appeals court handed down a judgment denying TC Heartland’s petition for a writ of mandamus.

The Indiana-based company had urged the court to cast aside a 26-year-old ruling that said patent suits can be filed in any district where the defendant sells its products.

The ruling, VE Holding Corp v Johnson Gas Appliance, held that a proper venue for action could be any district where a defendant “has sufficient contacts for personal jurisdiction”.

Now, the Supreme Court will answer the question of whether 28 USC, section 1400(b) is the sole and exclusive provision governing venue in patent infringement actions and is not to be supplemented by 28 USC, section 1391(c).

Section 1400(b), the patent venue statute, provides that patent infringement actions “may be brought in the judicial district where the defendant resides”.

Section 1391, the statute governing “venue generally”, has “long contained”a subsection (c) that, where applicable, deems a corporate entity to reside in multiple judicial districts.

In October, a number of amicus briefs were submitted to the court, including from the EFF, Washington Legal Foundation and Dell.

In a statement, the EFF said: “We’re glad to see that the Supreme Court has agreed to hear this important case that could significantly curtail some of the worst actors in the patent game. EFF will be there to urge the court to restore balance and fairness in patent litigation.”

Tom Duston, partner at Marshall Gerstein, said: “If recent history is any guide, the Supreme Court generally does not accept review of decisions of the Federal Circuit with the expectation of merely affirming those decisions.”

He added that one thing that will weigh on the court’s mind is the practical implication of shifting patent litigation.

“Also, the court cannot be ignorant of the potential implications for currently pending cases. They may seek some way of ensuring that making their ruling is prospective only,” said Duston.

If TC Heartland’s appeal is rejected, the status quo will be maintained, “a status quo in which the bulk of patent filings continue to be made in the Eastern District of Texas”.