The Supreme Court is set to decide a case which may put an end to the widespread practice of forum shopping in patent cases. On December 14, 2016, the Supreme Court granted certiorari in TC Heartland v. Kraft to consider the question of whether the current patent venue statute, 28 U.S.C. § 1400(b), is the “sole and exclusive provision governing venue in patent infringement actions.”
Although predicting Supreme Court decisions is far from an exact science, many commentators have speculated that the Court is likely to reverse the Federal Circuit’s decision, and thus, impose limits on where patent infringement cases may be filed. Driving this speculation is the fact that, on grants of certiorari since 1999, the Court has reversed the Federal Circuit’s decisions in nearly 75% of the time, often unanimously. Furthermore, there has been a trend in recent years of the Supreme Court handing down decisions that limit plaintiffs’ access to federal courts.
Forum shopping is a prevalent practice in patent litigation. In 2015, nearly 65% of all patent infringement cases were filed in only five district courts, and 44% were filed in the Eastern District of Texas. The Eastern District of Texas has received much attention for the cottage industry of trial lawyers that has been propped up by the venue’s status as the most active patent forum in the country. Plaintiff-friendly local rules and even friendlier juries have made small communities like Marshall and Tyler hotbeds for patent litigation. Marshall’s courthouse has become well-known for its ice skating rink, which was donated by Samsung, a frequent defendant in patent cases.
Any change making forum shopping less prevalent is likely to gain support from the most frequent patent defendants. Amicus briefs were recently submitted by groups of technology companies and corporate financiers in support of the petitioner. If the Court does reverse, prominent patent forums like East Texas are likely to see a sharp decline in the number of cases filed, while districts where many companies are headquartered, such as the District of Delaware, Northern District of California, and Southern District of New York are likely to see more patent filings.