from the forum-selling dept
For years, you may recall that we would write about the insane nature of forum shopping for patent trolls, in which the trolls would flock to the federal courts in East Texas. Going back nearly 15 years, we wrote about how East Texas courts became grand central for patent troll cases, leading to all sorts of sketchy behavior. There are a bunch of empty office buildings setup in small Texas cities (mainly Marshall and Tyler) just to "pretend" to have offices there. Companies engaged in many patent cases started to try to suck up to residents of those small cities, in case they might be on a jury. TiVo literally bought a "Grand Champion Steer" just weeks before a jury was set to rule on a massive TiVo trolling case. Samsung threw so much money at the local "Stagecoach Days" event that it was renamed "Samsung Stagecoach Days," and built a Samsung ice rink right next to the courthouse in Marshall.
For years, people pressured Congress to fix this mess, but instead, the Supreme Court finally stepped in, with the TC Heartland ruling, and said that the proper jurisdiction should be where defendants actually are incorporated. Of course, this seemed to have the reverse effect -- as companies no longer want to be in East Texas. Apple shut down its stores there to avoid the jurisdiction.
Of course, if you thought that the judges would go quietly, you'd be wrong. It's always felt like a few judges in East Texas loved the reputation they'd built up as being super friendly to patent trolls. For a while it was Judge T. John Ward. And when he left the bench (to become a patent lawyer, natch), Judge Rodney Gilstrap stepped into the gap he left. He even tried to ignore the Supreme Court's TC Heartland decision (though the Federal Circuit appeals court was not impressed).
However, as Patent Progress notes, there's a new judge vying to be at the top of the patent troll's Christmas list, and he's in West Texas. Judge Alan Albright, a former patent litigator, was appointed to the bench in 2018 -- and he literally went on a tour to convince companies to bring patent cases in his court:
U.S. District Judge Alan Albright and attorneys who predicted last year that Waco’s federal court would become a hotbed of patent and intellectual property litigation missed their prediction just a bit.
With Albright traveling the country drumming up business and patent attorneys spreading the word that Waco’s new federal judge, a longtime patent litigator, will provide the expertise to create an efficient and welcoming environment in Waco, the response in the past year actually exceeded those predictions.
Since Albright took office in September 2018, more than 250 patent cases have been filed in the federal Western District of Texas, which includes Waco. That total eclipses the number for the previous four years combined and has made the Western District among the busiest in the country for patent cases.
It's hard to read that and not think... that's fucked up. A judge should not be "travelling the country drumming up business." There's a reason that forum shopping is a bad idea -- and this is even worse: it's forum selling. As that article notes, more and more patent law firms are now setting up business in Waco, near Albright's court, and even the troll firms in East Texas are heading just a bit west:
Waco law firm Haley & Olson announced in March it was combining forces with Mann, Tindel and Thompson, an East Texas firm that specializes in patent litigation, to capitalize on the new focus of the Waco federal court.
That should be seen as a problem, but instead, it seems to be business as usual in the federal courts of Texas.
Two law professors have now come up with a new paper delving into this troubling trend, which kicks off with a pretty telling mocked up Craigslist ad, which they say "startlingly... accurately portrays what is happening right now in the U.S. District Court for the
Western District of Texas."
The two professors -- J. Jonas Anderson and Paul Gugliuzza -- lay out the problems pretty starkly:
One judge, appointed to the court less than two
years ago, has been advertising his district—through presentations to
patent lawyers, comments to the media, procedures in his courtroom, and
decisions in patent cases—as the place to file your patent infringement
lawsuit. And he has succeeded. In 2018, the Western District received
only 90 patent cases—a mere 2.5% of patent suits nationwide. In 2020,
the Western District is on track to receive more than 800—the most of any
district in the country. Importantly, these suits are overwhelmingly filed
by so-called patent trolls—entities that don’t make any products or
provide services but instead exist solely to enforce patents.
The centralization of patent cases before a single judge, acting entirely
on his own to seek out patent litigation, is facilitated by the Western
District’s case filing system, which allows plaintiffs to choose not just the
court but the specific judge who will hear their case. These dynamics—a
judge advertising for patent cases and plaintiffs shopping for that
judge—undermine public confidence in the impartiality of the judiciary,
make the court an uneven playing field for litigants, and facilitate the
nuisance suits patent trolls favor.
As they note, it seems like an easy thing to fix if Congress had the will:
Two reforms would help solve this
problem: first, district judges should—by law—be randomly assigned to
cases and, second, venue in patent cases should be tied to geographic
divisions within a judicial district, not just the district as a whole.
The article even details how in the midst of the pandemic, both Judge Albright and Judge Gilstrap appear to be competing to rush through as many patent cases as possible, in person, so that more trolls will file in their courts:
The COVID-19 pandemic has upended American life. Millions are
unemployed. Many who still have jobs—grocery store workers, delivery
drivers, healthcare providers—risk their lives every day. Those of us
who are privileged have learned to work entirely from home; our biggest
risk is a dancing child or stray pet wandering into the background of a
Zoom meeting. COVID has disrupted the practice of law, too. Even the
U.S. Supreme Court has yielded, holding oral arguments by telephone
and broadcasting them live for the first time. The U.S. Court of Appeals
for the Federal Circuit, which hears appeals of all patent cases
nationwide, has likewise suspended in-person oral arguments until
further notice.
But Judge Albright appears determined to forge ahead with patent
litigation as usual. Judges in other patent-heavy district courts are, too.
Though some judges have compromised and held patent proceedings on
Zoom, Chief Judge Rodney Gilstrap of the Eastern District of Texas,
who, until last year, heard more patent cases than any judge in the
country, recently denied a defendant’s motion to delay an in-person
jury trial slated to begin on August 3, quoting poet Robert Frost’s idiom
that “the best way out is always through.” What is going on with these
judges?
They are in the midst of a vigorous competition to attract patent
cases to their courtrooms. As this article shows, Judge Albright is
winning. And this court competition is not good for the patent system
or the court system more broadly.
As the article notes, this forum selling is the unexpected flip side of historical forum shopping. And Judge Albright seems to have figured out how to sell his court like no judge before. One of the things he'll even do is let patent holders sue in his court in Waco, transfer the case to the more convenient court in Austin... but still have Judge Albright preside over the case. Here's a simple chart of how this has played out in practice:
And again, nearly all of those are going to a single judge. If you don't see that as a problem, well, then you're probably a patent troll. Judge Albright isn't particularly shy about this either:
Immediately upon his appointment as a district judge in 2018, Judge
Albright went on a media blitz, letting everyone know that his court
would welcome patent litigation. The Waco Tribune-Herald reported
that Judge Albright “let it be known in no uncertain terms that he would
like his Waco courtroom to become a hub for IP cases.” He attended
dinners for patent litigators and patent owners to extoll the virtues of
trying patent cases in Waco. Judge Albright stated that he took the
position in Waco because he “‘thought it was the perfect place to try and
establish a serious venue for sophisticated patent litigation.’” Most
tellingly, he gave a presentation at the 2019 annual meeting of the
American Intellectual Property Law Association titled, “Why You
should File Your Next Patent Case Across the Street from the ‘Hey
Sugar,’” referring to a candy store near his Waco courthouse.
You'd think a judge would recognize just how bad this looks, but I guess not.
As the paper details, Judge Albright is the only judge in Waco, so if you file there, you're guaranteed to get him, and he's made it clear that he'll personally handle all the details of patent cases, farming out the grunt work on other cases to magistrate judges:
Secure in the knowledge that patent cases filed in Waco will be heard
by Judge Albright, patent plaintiffs are even more incentivized to file in
Waco because of Judge Albright’s unique assignment orders to his
magistrate judge. Judge Albright assigns all cases to his magistrate to
handle all non-dispositive motions—except in patent, copyright, and
certain habeas corpus cases. Thus, patent plaintiffs know that Judge
Albright will be personally involved in every aspect of the litigation and
won’t be distracted with other, non-patent cases on his docket. That level
of attention from a district judge during all stages of litigation is
exceedingly rare. Delaware, for example, heavily uses magistrates in
patent cases. Even the Eastern District of Texas relies on magistrates
to handle important motions and pre-trial hearings, including claim
construction.
For plaintiffs, choosing the Waco Division could not be simpler.
Plaintiffs simply select “Waco” from a drop-down menu of divisions on
the Western District’s electronic case filing system and—voila!—the
case is automatically assigned to Judge Albright.
The paper goes on to detail more and more and more crazy examples of just how blatant this all is -- and why it's so problematic. At a time when there is so much else going on, I recognize that this might not seem like a priority, but it's insane. A judge is literally shopping for cases -- cases in which he's hardly an unbiased observer, having been a patent litigator before being appointed to the bench. As we've discussed at great length over the years, the closer judges are to patent lawyers, the more likely they are to support patent trolling, and not see the problems with overly broad patents, or patent trolls shaking down actual innovators.
The paper also details how Judge Albright's practices aid patent trolls (which may explain why 85% of these patent cases filed in his court are from trolls). He pushes the cases to move faster, which puts much more pressure on companies to settle to avoid the expense of litigation. And, Judge Albright is much faster than even Judge Gilstrap, whose court in Marshall was regularly called the "rocket docket" for its speed in handling patent troll cases.
And what about that TC Heartland decision that finally started pressuring Gilstrap in East Texas to transfer cases to their proper venue?
Since taking the bench, Judge Albright has likewise staunchly
refused to transfer cases out of the Western District. As of July 7, 2020,
he has decided thirteen motions seeking transfer away from the Western
District under § 1404(a); he has denied eleven. In fact, in a recent
order, Judge Albright effectively told Apple—which has been sued at
least ten times in cases assigned to Judge Albright and regularly seeks
to have those cases moved to the Northern District of California—to stop
filing transfer motions.
They do note that the Federal Circuit recently ordered Albright to transfer one of his cases, involving Adobe, and threw some shade at his current failure to regularly transfer cases. Hopefully that means it starts pushing back on him more often.
Again, there's a lot more in the paper, and it's all crazy that this is allowed in a federal court. Congress has many things on its plate, but it should do something to fix this jurisdiction selling by Judge Albright.
Filed Under: alan albright, austin, east texas, marshall, patent trolls, patents, rodney gilstrap, texas, tyler, waco, west texas
