The United States Supreme Court issued a unanimous opinion overturning the last 27 years of practice. Patent owners were allowed to file suit against potential infringers in venues other than where they are incorporated. Today that changed.
In TC Heartland LLC v. Kraft Foods Group Brands LLC, No. 16-341, slip op. (S. Ct., May 22, 2017) the Supreme Court overturned the Federal Circuit Court of Appeals decision. The Federal Circuit’s decision allowed patent owners to bring a patent infringement action in venues where a potential infringer had a certain level of infringing activity. In TC Heartland, the patent owner sued the alleged infringer in Delaware, where allegedly infringing products were sold. The alleged infringer asked the suit be transferred, arguing that suit could not be brought in Delaware because it had no presence in the state of Delaware and the majority of its sales were outside of Delaware.
The Supreme Court agreed with the alleged infringer. The Supreme Court overturned the Federal Circuit’s broader interpretation of the statute on patent venue, which allowed suit to be brought in other places other than where a defendant is incorporated. With the Supreme Court’s ruling, patent infringement suits will be mainly limited to where a potential infringer is incorporated.
The decision is considered a win to help limit where “patent-trolls” can bring suit, providing a barrier for a patent trolls to file a suit in an area that is patent-owner friendly. However, the Supreme Court’s decision also affects businesses that actually produce a product (both parties in this case were businesses who make their own products), forcing them to file suit in an alleged infringer’s home court.