Archives for June 2017

UNANIMOUS SUPREME COURT RESTRICTS PATENT VENUE RULES FOR DOMESTIC CORPORATIONS

TC Heartland LLC v. Kraft Foods Group Brands LLC

In, TC Heartland LLC v. Kraft Foods Group Brands LLC, the Supreme Court considered what constitutes proper venue under 28 U.S.C. §1400(b) for a patent infringement lawsuit brought against a domestic corporation.  The patent venue statute, §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 unanimously ruled that, for the purposes of the patent venue statute, a domestic corporation “resides” only in its State of incorporation.

The decision overturns the Federal Circuit’s almost thirty year old precedent, under which a defendant corporation was deemed to reside, for the purposes of patent venue, in any judicial district in which it is subject to personal jurisdiction.  The Federal Circuit’s interpretation effectively allowed a patent owner to file suit anywhere a defendant made allegedly infringing sales.  The Supreme Court’s decision, however, limits venue for a domestic corporation sued for patent infringement to the state where it is incorporated, or where it “has committed acts of infringement and has a regular and established place of business.”  As a result, the ability of patent owners to pursue lawsuits against domestic corporations in courts that are often viewed as more favorable, such as the Eastern District of Texas, will be restricted.

However, the Court expressly declined to address the question of venue for foreign corporations, other than noting its prior decision in Brunette Machine Works, Ltd. v. Kockum Industries, Inc., 406 U.S. 706 (1972).  In that decision, the Supreme Court held that venue for a patent infringement action against a Canadian corporation was not governed by the patent venue statute, but instead was governed by 28 U.S.C. §1391(d) (now codified at §1391(c)(3)), which provides that a foreign corporation may be sued in any judicial district.

Please see our June 27, 2017 Special Report “UNANIMOUS SUPREME COURT RESTRICTS PATENT VENUE RULES FOR DOMESTIC CORPORATIONS” on TC Heartland LLC v. Kraft Foods Group Brands LLC. 

TC HEARTLAND LLC v. KRAFT FOODS GROUP BRANDS LLC, Appeal No. 16-341 (U.S. May 22, 2017).  Thomas, Roberts, Sotomayor, Kennedy, Ginsburg, Breyer, Kagan, Alito.  Appealed from Fed. Cir. (Judges Moore, Linn, and Wallach).  (Patent Venue)