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10.15.17

US Patent Trolls Are Leaving and the Eastern District of Texas Sees Patent Cases Falling by More Than Half

Posted in America, Courtroom, Patents at 10:14 am by Dr. Roy Schestowitz

Summary: The decline of patent aggression in the US and the patent microcosm’s response to Justices, having ruled in TC Heartland, curtailing patent trolls

THE world is changing for the better when it comes to patents. Sure, the European Patent Office (EPO) is in trouble as patent scope is out of control there, but in the US things are improving. The EPO‘s friends at IP Europe wrote/quoted: “Development of innovative new standards jeopardised by #IEEE patent policy”

We wrote about IEEE the other day, specifically in relation to this article. This is a lie. IP Europe knows that it’s a lie. But it’s paid to lobby for patent extremists such as Microsoft. The IEEE is US-based and it’s possibly leaning towards liberal policies. That may mean no patent tax on standards.

In various other ways the US improving. Patent trolls seem to be on their way out. We have not heard of Erich Spangenberg for a while (he nearly disappeared). He is one of the most disgusting patent trolls of all. He had blackmailed over a thousand (maybe thousands) of firms using what later turned out to be an invalid patent and now, according to IAM, he is “back buying in the US”. To quote:

IPNav founder and renowned [sic] patent monetiser [sic] Erich Spangenberg is back buying US assets. According to an 18th September notice on the USPTO patent assignment database an entity called Page Innovations LLC acquired a single patent from inventor Justin Page relating to identity theft protection. In the assignment cover sheet Spangenberg is listed as the manager of Page Innovations. The details of the assignment were first reported in an RPX weekly email.

We have been writing about RPX for nearly a decade. We’ll come back to RPX in a moment.

The biggest news on the patent front was reported by Joe Mullin several days ago. It’s extremely pleasing to see that the US Supreme Court has managed to eject many patent trolls out of Texas. Here are some numbers:

New lawsuits are down—way down—in the mostly rural district that was once the national hotspot for patent disputes.

For several years, the Eastern District of Texas hosted more patent lawsuits than any other judicial district in the country. Last year, East Texas saw more patent lawsuits filed than the next four judicial districts combined. But in May, the Supreme Court sharply limited where patent owners can choose to file their lawsuits, in a case called TC Heartland. That’s leading to a sharp change in the geography of patent litigation.

[...]

The trend seems likely to continue, given a recent case called In re: Cray Inc., in which an appeals court clarified how TC Heartland must be applied. In that case, a federal judge ruled that a case against supercomputer manufacturer Cray could be kept in East Texas because the company employed a single work-from-home employee in the district. The top patent appeals court sharply disagreed, though, and overturned that decision, forcing the Cray case out of East Texas.

“The patterns we’re seeing are changing dramatically, and the double-digit dominance of East Texas is gone,” said Brian Howard, Lex Machina’s data scientist, in an interview with Ars.

United for Patent Reform‏ said: “Since #TCHeartland #patenttroll filings in #EDTX have dropped from 50% to 26%…”

This is based on Lex Machina.

Here is RPX’s take on some of the latest figures: “Patent law faces continued uncertainty in all three branches of government. The Supreme Court’s TC Heartland decision in May likely precipitated a dip in new patent litigation that carried unevenly through the third quarter. While litigation remains slow overall, plaintiffs have begun to test the bounds of TC Heartland by bringing novel venue arguments in the Eastern District of Texas and by charting new courses in Delaware, California, and Illinois. On the other hand, the tables could turn: the Court granted certiorari in Oil States in June, casting the continued existence of inter partes review (IPR) into doubt. Though most commentators discount petitioner Oil States’s likelihood of success, even the slightest potential for victory is a ray of hope for patent owners.”

On the Federal Circuit reaffirming all this, here is another belated take (we wrote about this before):

Until the U.S. Supreme Court’s May 22, 2017 ruling in TC Heartland v. Kraft Foods, the Court of Appeals for the Federal Circuit and the United States district courts had interpreted the patent venue statute, 28 U.S.C. §1400(b), to allow plaintiffs to bring a patent infringement case against a domestic corporation in any district court where there is personal jurisdiction over that corporate defendant. The Supreme Court’s TC Heartland ruling, however, clarified that personal jurisdiction alone does not convey venue for patent cases under the patent venue statute. But that clarification led to confusion as to how to interpret the venue statute itself. The Federal Circuit just addressed that confusion in In re Cray Inc.

In re Cray was also an important decision because it helped highlight the sheer disregard for the law (and the Supreme Court) down in Texas. It is hopefully a lot clearer now (to more trolls) that there’s nothing attractive about Texas. The figures speak for themselves.

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