News & Insights

U.S. Supreme Court Tightens Rules for Where Patent Lawsuits Can Be Filed

The patent venue statute, 28 U.S.C. § 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.”

On May 22, 2017, the United States Supreme Court unanimously held in an 8-0 landmark decision that a domestic corporation “resides” only in its State of incorporation for purposes of the patent venue statute. TC Heartland LLC v. Kraft Foods Group Brands LLC, 581 U.S. ___ (2017). The Court’s decision overturned a 2016 ruling by the U.S. Court of Appeals for the Federal Circuit that held defendants in patent cases may be sued wherever they conduct business. Justice Clarence Thomas, writing for the Court, reversed the Federal Circuit’s decision and held that, “[a]s applied to domestic corporations, ‘reside[nce]’ in § 1400(b) refers only to the State of incorporation.” In reaching that conclusion, the Court relied on a 1957 United States Supreme Court decision, Fourco Glass Co. v. Transmirra Products Corp., which concluded that the patent venue statute operated independently from the general federal venue statute, and held that a corporation “resides” in its place of incorporation for patent cases. 353 U.S. 222, 226 (1957).

It is expected that the TC Heartland decision will limit the ability of patent owners to venue shop and bring cases in more patent-friendly jurisdictions and where juries tend to be more sympathetic to plaintiffs. Moreover, many observers expect that the District of Delaware will see an increase in new patent infringement suits, given that many companies are incorporated in Delaware.

Justice Neil Gorsuch took no part in the consideration or decision of the case. For a copy of the full opinion, please click here.

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