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Supreme Court Considers Why Patent Trolls Favor Texas Courts

271 点作者 hvo大约 8 年前

13 条评论

redm大约 8 年前
We (MediaFire) were part of the Amici brief submitted to the Supreme Court regarding the eastern district of Texas. [1]<p>It is a serious issue. Being a Texas company, we have been sued numerous times primarily because we are in Texas and it allows the other defendant&#x27;s cases to be tried in the Eastern District of Texas.<p>The patents are always baseless, but it matters little. In almost all cases, the board of directors wants to settle the case quickly instead of fighting it out, even (in many cases) if the CEO or inside counsel wants to fight. It&#x27;s cheap(ish) to settle and very expensive and time-consuming to fight; in short, it&#x27;s a big distraction, one that can be solved with money. Since most of the plaintiffs are shell companies run by lawyers, there is little cost to them even if they loose and no value to the defendant if they win.<p>The exception to all this being Lee Chang at NewEgg who always fights. That works if you have a CEO and board who is willing to spend the time and money to establish a reputation but that is seemingly rare. Newegg also signed onto this Amici. [2]<p>This problem has been going on for a long time (8 years for us), and while we keep hoping for some reform, Congress is yet to act in a meaningful way.<p>On a side note, our former patent defense attorney, who clerked for the patent judge in Marshall, TX, left defense a few years ago and became a plaintiff&#x27;s attorney. His reasoning? Much more profitable.<p>[1] <a href="http:&#x2F;&#x2F;www.scotusblog.com&#x2F;wp-content&#x2F;uploads&#x2F;2017&#x2F;02&#x2F;16-341-pet-amicus-48-Internet-Companies.pdf" rel="nofollow">http:&#x2F;&#x2F;www.scotusblog.com&#x2F;wp-content&#x2F;uploads&#x2F;2017&#x2F;02&#x2F;16-341-...</a><p>[2] <a href="https:&#x2F;&#x2F;blog.newegg.com&#x2F;lee-cheng-holds-reddit-ama-explains-fights-patent-trolls&#x2F;" rel="nofollow">https:&#x2F;&#x2F;blog.newegg.com&#x2F;lee-cheng-holds-reddit-ama-explains-...</a>
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clamprecht大约 8 年前
This video from Austin Meyer (creator of X-Plane) is pretty eye-opening:<p><a href="https:&#x2F;&#x2F;youtu.be&#x2F;sG9UMMq2dz4" rel="nofollow">https:&#x2F;&#x2F;youtu.be&#x2F;sG9UMMq2dz4</a><p>Apparently there are TWO judges in the district, BOTH of whose own sons are lawyers in the same district. And BOTH sons handle a lot of the patent litigation, in front of their own fathers, the judges. Pretty incredible. Watch the video starting at about 5 minutes to see it.
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ridgeguy大约 8 年前
This is such a widely known situation in legal circles.<p>The United States District Court for the Eastern District of Texas described by the NYT is known as the &quot;rocket docket&quot; and the go-to forum for patent trolls.<p>A friend who is a patent litigator in a major US IP law practice, recently was moved to TX to be near the Court&#x27;s location. Relocation driven by the disproportionate economic activity surrounding that jurisdiction.<p>Hope the Supremes will do something to mitigate the disproportionate influence of the Eastern District Court in patent matters.
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jimrandomh大约 8 年前
Quotes in the article suggest that the justices want to consider only legislative intent, and not deal with the issue of forum shopping or of East Texas in particular.<p>This may technically be legally correct, but it is a serious mistake. East Texas has a reputation for unfairness, and that reputation is undermining the credibility of the US legal system as a whole.
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RangerScience大约 8 年前
Huh. If you block IP addresses from this part of Texas, can you claim to not to business there, and thus cannot be tried there?<p>Edit: Actually... Could you have one company make the product, and one company resell the product, and pick where the first company does business to be advantageous to themselves during patent litigation? Or can the reseller be sued for patent infringement?
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nathancahill大约 8 年前
Was hoping for a cameo appearance of Lee Cheng, the (edit: former) Chief Legal Officer for Newegg. He&#x27;s a force to be reckoned with when it comes to patent trolls in East Texas.
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microcolonel大约 8 年前
&gt; That decision said defendants in patent cases, as in other cases, may be sued essentially anywhere they do business.<p>If this is the case, it seems like it would make sense to simply stop doing commerce in hostile jurisdictions. It might constitute a short term loss for some vendors, but it might kill the cottage industry of plaintiff-slanted patent hearings.
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droithomme大约 8 年前
&gt; a few companies urged the justices to retain the current rules, saying there was a value in letting cases be considered by courts that have developed expertise in patent matters.<p>Fair enough, let&#x27;s have an IQ and competency test for Judge T. John Ward and see if this claim by various corporations that he is truly the century&#x27;s most brilliant jurist on the topic of IP or not.
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prance大约 8 年前
&gt; That could lead to overcrowding in the federal court in Delaware, he said, given the large numbers of corporations incorporated in the state.<p>Wouldn&#x27;t that actually be fair? As it is now, it seems that Delaware can give all those tax breaks, and not bear any consequences.
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rayiner大约 8 年前
The case is a good example of why popular reporting about how the Supreme Court works often misses the mark. The case really isn&#x27;t about patent trolls--the policy question of balancing patent rights versus other consideration is squarely in Congress&#x27;s wheelhouse. Instead, this is a dispute about what Congress has already said. Specifically, what it has said about &quot;venue&quot; in patent cases.<p>&quot;Venue&quot; is the idea that several courts may have the <i>power</i> to hear a case (<i>i.e.</i> they have jurisdiction over the case and over the defendant), but that for various reasons we may want to funnel the litigation to particular courts. Venue rules are set forth in federal law.<p>28 U.S.C. 1400(b) states: &quot;Any 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.&quot; That&#x27;s a venue provision specific to patent cases. It tends to limit where venue is proper (<i>i.e.</i> where lawsuits can be brought), because ordinarily &quot;residency&quot; for a corporation is defined pretty narrowly.<p>There is also a more general venue provision, 28 U.S.C. 1391(a)-(c), which provides for venue in, among other places, wherever a corporate defendant is subject to personal jurisdiction. That tends to permit venue in more places, because corporations can be subject to personal jurisdiction almost everywhere they have a substantial business presence (under the theory that if you do business somewhere, you can&#x27;t complain about being taken to court there).<p>The Supreme Court held in 1957, in <i>Fourco Glass v. Transmirra Products</i>, that in patent cases, only section 1400 applies, not the more general venue provision in section 1391. That is, until the Federal Circuit determined that subsequent amendments to section 1391 had the effect of making the more general venue provision of section 1391 applicable to patent cases too.<p>Now, whatever you think of patent trolls, you kind of have to handicap the case in favor of Kraft (the party arguing for broader venue). The text of the current version of section 1391 is pretty clear: an action may be filed in &quot;a judicial district in which any defendant resides,&quot; where the &quot;residency&quot; of corporate defendants is defined as &quot;any judicial district in which such defendant is subject to the court’s personal jurisdiction with respect to the civil action in question,&quot; <i>for &quot;all venue purposes.&quot;</i><p>Kraft argued at the Supreme Court the definition of &quot;residency&quot; in 1391(c) applies &quot;for all venue purposes,&quot; including for purposes of section 1400. Thus, even if section 1400 is the exclusive venue provision in patent cases, it incorporate&#x27;s 1391(c)&#x27;s broad definition of where a corporate defendant &quot;resides.&quot;<p>Undoubtedly, many pages will be spent arguing about the effect of one reading of the statutory text versus the other vis-à-vis patent trolls. Some justices will care about that, because they view statutory interpretation through the lens of policy decisions. Others will not care. Not because they do or do not like patent trolls, but because to them statutory interpretation is a matter of what the words on the page say, not policymaking.
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nomercy400大约 8 年前
How about moving the specialized court to the US Patent Office area (not same building), and have both the &#x27;anywhere&#x27; and the &#x27;incorporated&#x27; part solved? The specialism is around the corner, the government can set up the court basics and scale to demand. Incorporated Delaware isn&#x27;t overloaded. And finding the best court to go to for trolls disappears.
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anonymousDan大约 8 年前
So if I&#x27;m starting a new company today, what&#x27;s the best place to incorporate to avoid patent trolls, both in the US and&#x2F;or globally? What other strategies are there to avoid patent trolls (e.g. never do business in the state of Texas?).
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rodionos大约 8 年前
What this article fails to emphasize and report on is the amount of settlement payments and related legal expenses produced by cases filed with the EDT court.<p>I wouldn&#x27;t be surprised if they would dwarf whatever remedies are awarded by the court to the plaintiffs.