The patent trolls have lurked in the Eastern District of Texas, reaping rewards as it became very pro plaintiff. Legitimate patent holders used it too, and for the past decade it became the sweet spot for patent claims litigation. It was not known for granting quick injunctions, but pushing forward into litigation of damages, where juries could award big verdicts; which made it useful for certain patent claims and not others, and a honeyspot for trolls.
Recent patent reforms have attempted to limit forum shopping, especially for “non-practicing entities” (ie. “trolls” by a fancy name), but my favorite source for inside patent news, patenting-art.com, reports that perhaps the reforms weren’t necessary. The ED of TX had already begun becoming less hospitable to plaintiffs. One major reason is the retirement of Judge Ward, who is now in private practice.
I have some experience with this. One of my companies filed in EDTX to stop a patent pirate, and first found that they were not inclined to grant injunctions; and later found they had new circuit court judges coming in and changing the pattern in the district from driving to trial to pushing for settlement.
The EDTX lawyers and jurors were said to liken patents to oil & gas properties, and were protective of private property rights. Last year, 25% of all patent infringement case filed there, and plaintiffs won 75% of the time. Not bad odds, although we don’t know how many spurious cases were dismissed or settled for scratch. The newsletter of patenting-art summarizes the reforms this way:
A series of U.S. Supreme Court rulings has made it easier for defendants
to challenge the validity of patents. And the U.S. Court of Appeals for
the Federal Circuit, which handles patent appeals, has limited the
amount a jury can award in cases when an infringed patent makes up only
a small part of a product. The court is also making it easier for
defendants to move a case out of Texas if it was brought there for no
other reason than to benefit the plaintiff.
President Barack Obama threw an even bigger obstacle in front of
lawsuit-happy patent owners when he signed the America Invents Act in
September. It includes a provision that prohibits filing a single suit
against dozens of unrelated companies. Instead, plaintiffs must file
cases individually, making it more expensive to launch scattershot
lawsuits in hopes of coercing quick settlements. “It’s more problematic
to file a case here than it was three years ago.”, says Baxter.