The U.S. Supreme Court announced its ruling in TC Heartland v. Kraft Foods Group Brands LLC on May 22, 2017, a patent infringement case that has garnered national attention for its implications on venue. This case originated with a motion to transfer an action filed in the District of Delaware to the Southern District of Indiana, where the Defendant accused of patent infringement is headquartered. However, the national attention has focused on the possibility that a significant amount of other patent litigation may now shift to the District of Delaware. The U.S. Supreme Court granted certiorari at the end of last year and heard oral arguments in March to address the question of “where proper venue lies for a patent infringement lawsuit brought against a domestic corporation.” The Court has now provided a response to this key question, although a few issues still remain.
On Monday, March 27, 2017, the U.S. Supreme Court heard oral argument in TC Heartland v. Kraft Foods Group Brands LLC, a case that could have a profound impact on where patent infringement cases may be litigated.
Although this case has focused a lot of attention on the Eastern District of Texas – a hotbed of patent litigation – it wasn’t even filed in that district. TC Heartland moved to transfer a patent infringement action that Kraft Foods filed in the District of Delaware (a distant second to the Eastern District of Texas in terms of the volume of patent litigation) to the Southern District of Indiana, where TC Heartland is headquartered. After that motion was denied, TC Heartland appealed to the Federal Circuit, arguing that the patent venue statute (28 U.S.C. §1400(b)), not the general venue statute (§1391(c)), sets forth the requirements for venue in patent cases, a position that would limit the venues available to plaintiffs in most infringement actions. In denying TC Heartland’s petition, the Federal Circuit reaffirmed its long-standing view that patent suits may be filed in any judicial district in which the defendant sells an allegedly infringing product. But the U.S. Supreme Court granted certiorari on the appeal, perhaps signaling the Court’s willingness to overturn almost 30 years of practice.
Did Qualcomm utilize anticompetitive licensing tactics to extract excessive royalties from OEMs for its standard-essential patents (SEPs)? Is the company seeking to weaken its competitors by refusing to license its patents on fair, reasonable, and non-discriminatory (FRAND) terms? The Federal Trade Commission thinks so and filed suit against Qualcomm on January 17 in the Northern District of California for allegedly monopolizing the market for CDMA and LTE baseband processor technologies.
Issuance of the complaint was authorized on a 2-1 vote of the Commission, which hinged on the vote of President Obama-appointed FTC Chairwoman Edith Ramirez, so the Inauguration of Donald J. Trump as President on Friday may have direct implications on this case.
The Mintz Levin team discusses the case and points out the irony of the timing since the FTC and Antitrust Division of the Department of Justice (DOJ) issued their revised Antitrust Guidelines for the Licensing of Intellectual Property on January 13, in which they declined to adopt guidelines relating to precisely this sort of conduct.
Read our full discussion.
The New Year brings excitement and anticipation of changes for the best. Some of the pending patent cases provide us with ample opportunity to expect something new and, if not always very desirable to everybody, at least different. In this post, we highlight several cases that present interesting issues and that we anticipate may provide for new and important developments in the patent law this year.
On May 11, 2016, President Obama signed the Defend Trade Secrets Act (DTSA) into law. This important new legislation creates a federal private civil cause of action for trade secret misappropriation in which “[a]n owner of a trade secret that is misappropriated may bring a civil action . . . if the trade secret is related to a product or service used in, or intended for use in, interstate or foreign commerce.” Defend Trade Secrets Act of 2016, S. 1890, Sec. 2. The statute does not preempt existing state trade secret law regimes, but will exist in parallel, adding an enhanced toolbox of options for American companies’ enforcement of their intellectual property rights.
One provision of the new DTSA that has generated much commentary in the run up to its enactment is the new civil seizure mechanism established by the statute. This mechanism allows a court to “issue an order providing for the seizure of property necessary to prevent the propagation or dissemination of the trade secret that is the subject of the action.” The civil seizure process will allow American companies who are aware of a potential misappropriation of their trade secrets to quickly prevent further exposure of proprietary information during the pendency of a formal DTSA case.
The Defend Trade Secrets Act (DTSA) is now one signature away from becoming law. On April 4, 2016, the Senate unanimously passed the DTSA and, last week, on April 27, the House of Representatives followed suit, passing the DTSA by a vote of 410-2. The DTSA thus has wide bipartisan support and President Obama, who expressed his own strong support for the bill, is expected to sign the bill into law in the near future.
Once enacted, the DTSA will create a federal private civil cause of action for trade secret misappropriation. Under the DTSA, “[a]n owner of a trade secret that is misappropriated may bring a civil action . . . if the trade secret is related to a product or service used in, or intended for use in, interstate or foreign commerce.” Defend Trade Secrets Act of 2016, S. 1890, Sec. 2. Civil remedies for trade secret misappropriation have previously been a matter of state law, but, with the passage of the DTSA, an additional avenue of redress will be made available for a party seeking to remedy improper acquisition of its trade secrets. The DTSA gives United States district courts original jurisdiction over actions under the statute. The statute will not preempt existing state trade secret laws, but will exist in parallel, adding an enhanced toolbox of options for American companies’ enforcement of their intellectual property rights.
Below is an explanation of some of the salient provisions of the DTSA that American companies should be aware of as the DTSA moves onto the President’s desk. We will be monitoring DTSA jurisprudence following its enactment and will provide continuing commentary on the new law – check back for regular updates.