Patent Riffs and Links: Commentary on In re: Cray

In re Cray Inc. (Fed. Cir. 2017) | PATENTDOCS.ORG
“Turning to the statute, the Order focused on ‘the only question before the court’: whether Cray’s activities satisfy the ‘regular and established place of business’ requirement. The Federal Circuit recognizes three requirements to be considered (and all of which must be satisfied for venue to be proper): ‘(1) there must be a physical place in the district; (2) it must be a regular and established place of business; and (3) it must be the place of the defendant.’ The panel recognized that the evolution of venue law in patent cases reflects a balance between a restrictive standard (where the infringer was incorporated) and a liberal standard (wherever a defendant could be served). The Order specifically notes that patent venue is a more restrictive standard than, for example, personal jurisdiction or general venue statutes based on ‘doing business’ in the district…

The panel is careful to note that it is not creating any bright line rules, stating that ‘no one fact is controlling’ in making venue determinations. But as a consequence of this decision, neither Judge Gilstrap nor any other district court judge will be able to craft venue rules (either in favor of or against either party) outside the scope of the analytical framework announced by the Federal Circuit today.”

Federal Circuit strikes down Gilstrap’s four-factor test for patent venue | IPWATCHDOG
”At the end of the day it seems that venue decisions will be highly fact intensive, which ordinarily should not make them ideal candidates for a writ of mandamus, which is reserved for exceptional circumstances where there is a clear abuse of discretion or usurpation of judicial power. Mandamus is an extraordinary writ that seems to be more popular and successful in recent years, particularly with matters of venue, and particularly when the Eastern District of Texas makes those venue decisions. I think this mandamus decision can be best understood by taking into account the patent troll hysteria, the number of patent infringement cases filed in the Eastern District of Texas, the reputation of the Eastern District of Texas for never transferring cases out, the Supreme Court’s recent decision in TC Heartland and continued angst surrounding venue decisions in the Eastern District of Texas.”

Patent Venue: Cyberspace does not Expand Place of Business | PATENTLYO
Precedent/persuasive cases – “Of note, in its analysis, the Federal Circuit paid special attention to historical application of the statute that was originally adopted in 1897. At that time, one congressman indicated its purpose was to ‘give original jurisdiction to the court where a permanent agency transacting the business is located.’ 29 Cong. Rec. 1900 (1897) (statement of Rep. Lacey). The court favorably cited pre-Federal-Circuit cases from the various circuits… In addition, the court revisited its important Cordis decision on point: In re Cordis Corp., 769 F.2d 733 (Fed. Cir. 1985)…

The opinion here is by Judge Lourie and joined by Judges Stoll and Reyna, and the basic holding is that the statute means the same as it did in 1897 and the same as it did in the 1940s and the same as it did in the 1980s (the last time it was interpreted directly). Even if taken en banc, I would not expect any significant departure from this result.”
Cray Appeals Texas District Court’s Broad Patent Venue Ruling | BNA
High burden to get the writ of mandamus: ”If the Federal Circuit takes up the case, it will be its first chance to address the venue issue since the Supreme Court’s May 22 ruling in TC Heartland LLC v. Kraft Foods Grp. Brands LLC, which was expected to make it more difficult for patent plaintiffs to sue in a favored court, such as the Eastern District of Texas. Critics of abusive patent lawsuits argue that choosing a favorable venue gives patent owners extra leverage in getting defendants to settle quickly without going to trial…

The Federal Circuit has the option to deny Cray’s petition for a writ of mandamus, an order from a superior court to a lower court or body, without a full briefing, so asking Raytheon to weigh in may suggest that it is considering the issue. But even if the court takes the case, Cray has a high burden, because it must prove the trial court clearly abused its discretion.”

BACKGROUND: House IP Subcommittee Slams “Reprehensible” EDTX | PATENTSPOSTGRANT
Congressional rebuke of J. Gilstrap‘ s ‘rules’ – ”At the opening of the hearing, Chairman Issa explained that Judge Gilstrap’s interpretation of TC Heartland “rejects the Supreme Court’s unanimous decision” and is “an act I find reprehensible.” It only got worse from there.
Chairman Issa explained that Judge Gilstrap may be more interested in serving the surrounding hotels and law firms, but that his recent decision outlining his TC Heartland analysis “does not serve justice” (ouch). Then, Chairman Issa finished up with: “it is not common for a member of Congress to call out an individual judge or a district, but after a long period of enrichment of a community by judges who consider that community’s well being as part of their goal, I can reach no other conclusion”