Why East Texas Judges Just Gave Patent Holders Incentives To Sue More Companies…

from the interpretations-on-transferring-cases... dept

Earlier this year, we noted that the judges in East Texas were actually transferring some patent lawsuits out of the court, following a ruling from a year ago at the appeals court level (CAFC) telling the district courts to move cases to where they were more “convenient.” For a few months, however, various patent attorneys have been saying to keep watching, and that the folks in East Texas, who know they have a good thing going, will come up with ways to keep more cases in their favorite courthouse. And… that appears to be happening. In a few recent rulings in Marshall, Texas, Judge Ward has denied attempts to move the cases to more convenient locations, sometimes challenging the question of whether or not they really were more convenient — but the reasoning doesn’t pass the sniff test.

In a case brought by a patent holder named MHL Tek, who is based in Michigan, against something around a dozen auto manufacturers, Judge Ward denied the transfer, saying that with so many different parties, it made no sense to claim that Michigan (the requested transfer site) was somehow more convenient:

“With regard to defendants, four defendants reside in Germany, three in California, two in Japan, two in South Korea, two in New Jersey, one each in Michigan, Tennessee, Alabama, Georgia, South Carolina, Indiana, and Virginia. The Court finds that this district would, in the least, be just as convenient or inconvenient to most of the defendants as the desired transferee District.”

So… the plaintiff and at least one of the defendants is based in Michigan (and many of the others have offices there). None of the the parties are based in Texas. But because some of the defendants are based elsewhere, now it’s suddenly ok to keep it in East Texas?

What’s the likely end result? Any patent holder who wants to make sure a case remains in East Texas should make sure to sue many more companies who are distributed around the country (or the world), just to give judges in East Texas an excuse to keep the case there. That hardly seems to be living up to the spirit of what CAFC intended with its ruling…

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Comments on “Why East Texas Judges Just Gave Patent Holders Incentives To Sue More Companies…”

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24 Comments
Frank says:

This is completely normal

There is nothing unusual about this decision at all. The plaintiff has offices in Texas and several defendants have offices in Texas. What is so strange about the judge’s ruling? It is perfectly consistent with federal jurisdiction law. IMHO, you should leave legal critiques to those that went to law school.

angry dude says:

Re: I say "End Patent NOW"!

“Innovate, Instantiate…

AND keep it a trade secret, you forgot to add..

One of the primary purposes of the Patent system (other than providing incentives to innovate in the first place) is public disclosure of all patented inventions, so other people can learn from patents and do not need to reinvent the wheel

But you didn’t know this, punk, right ?

GeneralEmergency (profile) says:

Re: Re: I say "End Patent NOW"!

Ahhh…but I did know that.

And do -you- know what the most amazing thing about secrets is?

They are -virtually impossible- to keep.

And tossing off blunt ended cliches like “reinvent the wheel” demonstrates that you’re not really paying attention are you?

Whole cloth invention is extremely rare anymore. The word ‘invention’ as it applies to patent these days is an overreaching joke. The vast majority of what is patented these days is simple innovation around the edges of what already exists, or worse, IP land grabbing of what evolution has built over millions of years, or the now discredited “Business Process” nonsense.

And what’s with the name calling? How old are you? 12?

Roberto says:

Federal diversity jurisdiction

Respect to Frank up in reply #4. Everything going on here is perfectly legal and normal according to centuries of basic civil procedural jurisprudence: corporations are considered legally present in any state where they have significant activity or presence. That’s why I, as an Arizona resident, injured by a New York corporation while traveling through Ohio, could file suit in Arizona if the corporation had a significant presence there.

It’s a simple question of efficiency in the judicial system. Since plaintiff and some defendants have offices in East Texas, there’s no reason to move the case halfway across the country, force the present attorneys to either find replacements or undergo hefty transportation and lodging expenses, make *another* judge go through all the tiresome initial paperwork, etc.

As a postscript, angry dude, the main reason we have so many problems with the executive and legislative branches of government is *because* of the judiciary. 😛

tijir (profile) says:

East Texas

I am from East Texas, Tyler not Marshall, and you know the blanket statements about the area are getting old. From everything I have seen and read, these cases are only in Marshall. So have a care Mike, let’s be a bit more specific than blanketing all of East Texas as a patent hoarders haven. Some of us here think the same thing you do about the patent system.

Sunlight (user link) says:

East Texas jury pools

Eastern Texas is the ideal place for witness tampering and stacked juries. That is why so many tort lawyers flock to the area and sue big business and ‘win’- and why the public never really reads about it. It is a racket used to extort money by using local trial attorneys’ friends and relatives selectively seated on the trial panel. They sue companies out of existence.

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