Innovation in the current Congress is practically a dirty word, as almost nothing encouraging it has made it past both houses. Most notably of all, the Innovation Act has been stalled in the House for years, despite massive bipartisan support for it. However, thanks to the general ineffectiveness of Congress, and the efforts of a few malicious actors trying to protect the vampiric industry known as patent trolling, such legislation remains on hold.
Fortunately, while Congress may be paralyzed, the judiciary is anything but. Indeed, one wonders if the patent trolls are beginning to regret their argument that changes to the patent system should be left up to the courts — because the courts are nigh-universally finding against them! Last week, yet another such devastating decision arrived.
First, a little background. Last year, the Supreme Court issued a ruling in TC Heartland v. Kraft that severely limited the ability of plaintiffs in patent cases to choose a venue in which to file their suits. This was extremely significant, because one of the major strategies of patent trolls was to file extortionate lawsuits in a handful of district courts with a record for blatantly unfair favoritism toward plaintiffs. The Big Kahuna in this strategy was the East Texas District Court, whose catering to the patent bar led to defendant companies (usually in the technology sector) offering desperate bribery tactics for juries, such as building ice rinks in the small town where the court was located. The single judge of this court — Rodney Gilstrap — also amassed a singular talent for ignoring precedent that was unfriendly to patent trolls.
There was just one problem with TC Heartland: The patent bar tried to argue that it only applied to patent lawsuits brought after the case was decided. In other words, those who were still undergoing litigation that began before TC Heartland was handed down couldn’t try to get the venue of their trials changed using the doctrine from TC Heartland because it wasn’t available at the time their cases started. If permitted, this reading would have wreaked havoc on courts, and on the legal strategy of everyone but the most predatory patent owners.
What a relief, then, that the Federal Circuit Court of Appeals dashed this opportunistic interpretation into a thousand pieces by ruling that yes, TC Heartland could be relied upon by defendants seeking to change where their cases were argued. The result is that many cases that were deliberately filed in inappropriate venues selected only for their friendliness to the patent bar will now be sent to courts without such a record of blatant favoritism. And, in the process, the legal strategy of picking the nastiest possible venue for a defendant, without regard to its jurisdiction, will wither and die.
This is a victory not just for patent defendants, but for the rule of law, and for innovation in America, generally. Patent cases will be much more likely to be adjudicated by the genuinely impartial, thus restoring faith in the legal system’s ability to resolve them. Moreover, in view of the attempt by the pharmaceutical and patent troll lobbies to weaken other legal mechanisms that frustrate their designs, this is a particularly sweet reminder of just how weak the legal footing of such actors really is, regardless of how many junk statistics or bad arguments they put forward.
Nevertheless, however pleasant their effects, legal steps like this are limited by the fact that they occur in response to individual, specific cases. Sweeping policy change is still the order of the day to fix our patent system and to eradicate those who abuse it once and for all. However, in the meantime, let us celebrate the courts doing their part to keep the vultures at bay.