Tuesday, May 23rd 2017
Patent Trolls to Lose their "Homefield" Advantage Thanks to Supreme Court
Thanks to a ruling from the Supreme Court, patent trolls could see their designs being thwarted more often than they have until today. Patent trolls stand as a scourge of the industry, ie, companies and even individuals that hold intellectual property with the sole purpose of levying infringement lawsuits against other companies - without producing anything themselves. They're kind of the leeches of the tech and business worlds, without some of the benefits their biological counterparts manage to deliver.
The latest ruling comes as a result of a legal battle between beverage flavoring company TC Heartland LLC and food and beverage company Kraft Heinz Co. Heartland attempted to get the matter transferred to its home state of Indiana, arguing that it has no presence in Delaware and that 98 percent of its sales come from outside of the state. Justices with the US Supreme Court voted 8-0 on Monday that patent infringement lawsuits can only be filed in courts where the defendant is incorporated, overturning a previous ruling by the US Courts of Appeals for the Federal Circuit, which ruled, last year, that patent lawsuits can be held anywhere a defendant's products are sold.
That's quite an interesting sphere of locales, to be sure. Considering that, it's at least strange (not to say suspicious) how 40 percent of all patent suits in the US are filed in East Texas. This happens because East Texas has a history of rulings in favor of the so-called patent-trolls, and history really does tend to inform present and future action. This ruling should put some cold water on some patent troll's endeavors, simply from the added unpredictability of suing in a state that doesn't have a history of ruling in favor of them.
I've taken the liberty of leaving an interesting infographic below for your perusal, as well as the result of a study on patent trolls circa 2013, from the archives of the previous administration.
Sources:
TechSpot, Lotempio Law, White House.gov Archives
That's quite an interesting sphere of locales, to be sure. Considering that, it's at least strange (not to say suspicious) how 40 percent of all patent suits in the US are filed in East Texas. This happens because East Texas has a history of rulings in favor of the so-called patent-trolls, and history really does tend to inform present and future action. This ruling should put some cold water on some patent troll's endeavors, simply from the added unpredictability of suing in a state that doesn't have a history of ruling in favor of them.
I've taken the liberty of leaving an interesting infographic below for your perusal, as well as the result of a study on patent trolls circa 2013, from the archives of the previous administration.
34 Comments on Patent Trolls to Lose their "Homefield" Advantage Thanks to Supreme Court
Patent owners will lose, this is not a good thing.
And!
I must protest the use of the term, Patent Troll.
The use of that term infers negative connotations on the patent owners, who have legal right to all property under their patent(s).
Fourco Glass Co. v. Transmirra Products Corp., 353 U.S. 222 (1957)) stating that any kind of lawsuits are to be filed in the state where the company is based or incorporated.Only and act of congress can change the law.
Here is the ruling: www.supremecourt.gov/opinions/16pdf/16-341_8n59.pdf
In the article I read it mention who changed let patent trolls file a lawsuit anywhere. A direct result of our corrupt government and what lobbyists do to damage the system.
I agree with ya there.
What could possibly go wrong???
I don't really know how the American justice system works, and having so many lawsuits in a specific area is certainly not right, but is this ruling actually improving the status quo?
But it also splits patent law by giving individual States jurisdiction..
So if I own a patent and bring a product to market in my state and only my state I won't have a claim if someone else is able to bring it to market in the other states as it is now first come first serve... AKA big money wins... Since whoever has the financial means to bring a product to the market first is the owner.
Edit:
It does stop the trolls from sitting on patents and waiting for someone to bring it to the market and then suing them for IP infringement but it leaves a giant loophole that will give big money the upper hand.
Remember, if Delaware rules against Heartland, they can always appeal which can leave the jurisdiction of both Plantiff (Indiana) and Defendant (Delaware). More cost, yeah, but more likely to get a fair trial.
As an end consumer this is a win-win..
It's far less expensive for a smaller business to bring a case to state courts...
But...
I definitely see a giant loophole.
I see this becoming a race to the bottom for the usual States...
Texas, Alabama, Connecticut etc... Will adjust their laws to suit big money.
I wonder how this will affect lawsuits currently in progress. It shouldnt affect legitimate suits.
But now it won't really get past the state that's already too friendly with money...
If they want to keep doing that, they're going to have to move their headquarters which means no more tax havens. It is very doubtful they'll move.