WASHINGTON – A closely watched patent case set to be considered by the U.S. Supreme Court may bode major changes for patent trolling cases.
SCOTUS granted certiorari in the T.C. Heartland v. Kraft Foods case, which will address major concerns regarding venue. This isn’t a new issue for patent law, in fact, the favorable nature of the Eastern District of Texas for patent plaintiffs has been reported extensively for almost a decade.
What makes this case different, explained Charles Duan, Director of the Patent Reform Project at Public Knowledge, is the argument being presented by John Duffy, a University of Virginia Law Professor and patent law expert representing T.C. Heartland. Duffy, along with other lawyers on the defendant’s legal team petitioned SCOTUS citing a 1957 precedent that would require that Kraft Foods file its case in Indiana, where Heartland is headquartered.
“Previously, I think that people thought that (venue requirement changes) would have to go through Congress, so there has been a substantial amount of lobbying on the issue in Congress, but nobody had a legal theory for how to do. So it was really that creative legal theory that came up that allowed for this case to proceed,” Duan told The Record.
The highest court in the nation doesn’t agree to consider cases unless they are likely to make some changes, Duan noted, which makes it likely that the court has some concerns about the ruling by the lower court.
“Additionally the trend has been that when the Supreme Court reviews patent cases, it has looked pretty disfavorably upon a lot of federal circuit decisions,” said Duan. “I think that makes it reasonably likely that they would reverse the federal circuit on (T.C. Heartland v. Kraft Foods).
“If the Supreme Court rules in favor of TC Heartland in this case, that would mean that we would return to the original state of law, which was that corporations can only be sued in two places: their place of corporation; and any place that the patent infringement actually occurs where they have an established place of business.”
While proponents of the current system have argued that having only a handful of judges hear the majority of patent cases has led to a sort of expertise in those courts, Duan disagrees.
“There are lots of judges that have aptitude in patent law right now,” he said. “The judges in California have lots of expertise in patent law, but because they tend to be seen as more friendly to the defendants in the cases, the plaintiffs will tend to gravitate to the districts that are favorable to them regardless of the expertise.”
The issue for Duan and Public Knowledge is one of fairness, not just for businesses, but for consumers. The judges in the Eastern District of Texas have put in place a lot of procedural rules that aren’t always fair for both sides of the court, with cases being heard across the nation, plaintiffs and defendants are more likely to get fair treatment.
“There’s a lot to be said for having different judges think about problems in different ways, particularly with procedures for patent cases,” said Duan. “If you have only one judge or two judges who are making all of the rules for patent cases, we don’t have the opportunity to benefit from that sort of collective learning. I think that the idea that a couple of judges will gain some sort of patent expertise, I think it’s helpful but I think that the overall better course is to have lots of judges learning and conversing with each other.”
The Supreme Court will hear arguments in the case on March 27, in the meantime, patent experts will be paying close attention to developments in the case.