The Supreme Court Delivers Opinion in TC Heartland LLC v. Kraft Foods Group Brands LLC

In an 8-0 opinion regarding the case TC Heartland LLC v. Kraft Foods Group Brands LLC, on May 22, 2017 Justice Thomas delivered the opinion of the Supreme Court. The judgment was reversed and the case was remanded. All members joined, except Justice Gorsuch, who took no part in the decision of this case. The Supreme Court issued this highly-anticipated decision and reversed the Federal Circuit. The Supreme Court ruled that 28 U.S.C. 1400(b) remains the only applicable patent venue statute. Secondly, that 28 U.S.C. 1391(c) did not modify or amend 1400(b) or the Court’s 1957 ruling in Fourco Glass Co. V. Transmirra Products Corp. The Supreme Court also ruled that the term “residence” in 28 U.S.C. 1400(b) means only the state in which a company is incorporated.

Patent owners will no longer be able to sue an infringing defendant in a district court where the defendant is subject to personal jurisdiction. Patent infringement lawsuits will only be able to be filed in districts within states where the infringing defendant is incorporated. As well as in districts where there has been an act of infringement and the defendant has an established place of business.

The Supreme Court also determined In TC Heartland, that Congress did not intend to change the meaning of 1400(b), or to overrule the decision in Fourco Glass. The Supreme Court relied and referred to the 2011 changes that added “otherwise provided by law” as some evidence that Congress must have wanted 1400(b) to apply.

Foreign corporations and other types of domestic entities can still presumably be sued mostly anywhere. The Supreme Court’s decision did not directly address this, but it was clearly stated in footnotes 1 and 2. While this decision is not favorable to patent owners, patent venue has been the target of patent reform debates in Congress for many years. This ruling is expected to increase cost, complexity and continue to create uncertainty for small entities.

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