New Bill Designed To Stop Egregious Venue Shopping By Patent Trolls
from the sorry-east-texas dept
Abusive patent litigation siphons tens of billions of dollars from the economy every year. In addition to burdening American entrepreneurs with lost revenues and great uncertainty, the scourge of frivolous lawsuits depletes funds that otherwise could have used toward research and development, venture-capital investment and other essential business activities.
While it isn't the kind of comprehensive corrective to America's "patent troll" problem that we'd like to see, the newly introduced Venue Equity and Non-Uniformity Elimination Act would address one small piece of the problem. The bill, S. 2733, would curtail rampant venue shopping that unfairly distorts legal outcomes by allowing plaintiffs to select friendly judges in advance.
According to research from George Mason University's Mercatus Center, nearly half of all patent cases are filed in the U.S. District Court for the Eastern District of Texas. Through the first half of 2015, the Tyler, Texas-based court heard 1,387 patent cases, compared with an average of 19 such cases in other federal judicial districts.
The district has become so notorious as a magnet for "patent troll" litigation that Samsung ramped up its giving to charities near the court, and even built an ice skating rink next to the court's Marshall, Texas division, undoubtedly to present a more friendly face to local juries. The City of Tyler even advertises itself as "IP friendly" and lists the big awards the court has doled out. The current state of affairs is so absurd that John Oliver even covered it.
When the Federal Circuit heard oral arguments this month in TC Heartland, a case that deals with venue, it blamed Congress for the current mess. As the panel explained, the present situation arose from a 1990 case called VE Holding that overrode the previous, stricter, rules following an interpretation of a 1988 law. Therefore, since Congress messed it up in the first place, they should be the ones that fix it.
Yet, cracking down on venue shopping alone offers a more modest goal than the sorts of comprehensive patent-reform legislation that have stalled in Congress in recent years. The last major push for comprehensive reform – H.R. 3309, the Innovation Act of 2013 – passed the U.S. House in December of that year with broad bipartisan support and an overwhelming margin of 325-91. At the time, it held a 7-1 margin of support among Republicans.
Alas, the bill also drew host of special interests to the table, who swiftly ramped up an intense and well-funded opposition campaign (get your fill of AstroTurf at www.savetheinventor.com). After failing to clear the Senate during the 113th Congress, the Innovation Act was reintroduced last year by House Judiciary Chairman Bob Goodlatte, as H.R. 9. Both that measure and a Senate companion bill (S. 1137, the PATENT Act) included venue-reform provisions. Despite strong support from free-market groups (including R Street) and a wide variety of other organizations, a coalition of special interests has obstructed either bill from moving forward.
The holistic approach to patent litigation reform appears to have been swallowed up by fear-mongering. Opponents have gone so far as to claim that an effort pushed by some of the most conservative legislators actually represented Obama's liberal vision for a "patent-free society." Narrowly-targeted reform efforts like the one introduced by Sens. Jeff Flake, Cory Gardner, and Mike Lee (none of whom are even remotely considered to be on the "liberal" end of the spectrum), present a new opportunity to move forward.
The fruits of innovation should go to entrepreneurs and inventors, not trial lawyers. Addressing abusive patent litigation is essential to ensure that America's rules to reward technological innovation remain in line with the Constitution's mandate to "Promote the Progress of Science and the useful Arts."
Nathan Leamer and Zach Graves are from R Street, a free market-based, think tank in Washington DC
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Filed Under: bob goodlatte, cory gardner, east texas, jeff flake, jurisdiction shopping, mike lee, patent reform, patents, venure reform
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Hey Techdirt.....
Granted, the earliest I can find is 2009, a YouTube video has the Samsung sponsors on the rink boards, BUT the Wonderland of Lights has been going for at least 27 years in Marshall (when the ice rink operates from Thanksgiving to about New Years).
I'll be glad when they put the venue shopping to an end too, but quit mentioning something that has been there before Samsung came to town.
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Lawyers Playing Games
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lies and more lies
For our position and the changes we advocate to truly reform the patent system, or to join our effort, please visit us at https://aminventorsforjustice.wordpress.com/.../our.../
or, contact us at tifj@mail.com
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Perhaps it would be good to have a discussion about the contributors and the reasons behind their postings...
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link correction
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Re: lies and more lies
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If you don't want it done to you...
The idea that restrictions on venue shifting such that patent infringement cases are heard either in the area of the accused, or the area of the accuser is somehow 'anti-inventory' is beyond ridiculous, and is little more than parasites throwing a fit because their favorite weapon, a ludicrously biased court might be taken away from them, meaning they might actually have to double-check that they have a case before sending out the shakedown letters.
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Re: Hey Techdirt.....
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Re:
Go for it, nobody is stopping you. Understanding motivations for holding a position is always good.
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Re: Re: Hey Techdirt.....
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Mercatus, sure, why not
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Really. VENUE Act.
How many hours have been wasted making up that recursive backronym? It sounds like something you'd find in a comic. The government is slowly but surely becoming a parody of itself...
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Re: Re:
So yeah, it's one of those good questions: Why is the insurance industry's group so interested in the subject?
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Re: Re: Re:
That should really be "offices". This is generally a fake office with no employees, just to be able to sue in that jurisdiction. It's not as though these companies actually operate in Texas (or at all, generally).
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Re: Re: Re: Re:
Would it be fair to punish corporations over individuals?
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Yes. But you go ahead and keep worshipping at the corporate altar, buddy.
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