Over the past decade or so, litigious nonpracticing entities (also known as patent trolls) expressed a keen preference to litigation in the Eastern District of Texas. This is because the Eastern District is known to be home to patent owner-friendly juries that have historically provided significant damage verdicts. The Eastern District was also known as a “rocket docket”—a forum that speedily and steadily moved toward trial. Patent trolls relied on these factors and others to “extort” settlements from defendants.
On May 22, the U.S. Supreme Court’s TC Heartland v. Kraft Foods Group Brands decision just put an end to that gravy train. TC Heartland confirms that, for purposes of the patent venue statute—28 U.S.C. Section 1400(b)—the term “resides” is limited to the state of incorporation for a domestic corporation. Since TC Heartland was handed down, the flood of patent infringement cases filed in the Eastern District has slowed to a mere trickle.
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