United States: Podcast - Supreme Court Preview: TC Heartland v. Kraft

What impact could the pending Supreme Court argument and decision in TC Heartland v. Kraft have on patent infringement litigation in the United States? With the oral argument scheduled for March 27, Doug Hallward-Driemeier, who leads Ropes & Gray's Supreme Court and Appellate practice, along with Matt Rizzolo and Sam Brenner from the firm's Intellectual Property Litigation practice offer their perspectives on the case and what it may mean for venue reform in intellectual property litigation.


Hello, I am Matt Rizzolo IP litigation counsel in the Washington D.C. office of Ropes & Gray. Today I am joined by my colleagues Doug Hallward-Driemeier and Sam Brenner. Doug is a partner in the D.C. office of Ropes and Gray and chairs of the firm's Appellate and Supreme Court practice. Sam is a senior IP litigation associate in Ropes & Gray's Boston office.

In today's Supreme Court preview podcast we are going to talk about the potential changes that may come from the judicial branch here in Washington D.C. Specifically, we're going to talk about what many have called the most important patent case of the year: TC Heartland v. Kraft which is being argued on March 27. Sam I begin with you – what is this case is about? How did we get here?

Sam: Well Matt, this case is all about venue in patent infringement litigation. Venue refers to the geographic location or judicial district where a company may properly be sued for infringing a patent. The case goes all the way back to 2014 when TC Heartland was sued by Kraft in Delaware over three patents relating to concentrated liquid dispensers. TC Heartland, which is based in Indiana, argued that because it has no operation in Delaware and only a minimal percentage of its sales went to Delaware, the case should have been brought in Indiana instead. But both the Delaware Court and the Federal Circuit Court disagreed and TC Heartland filed the novel petition for certiorari that apparently caught the Supreme Court's eyes.

Matt: Yeah, let's talk a bit more about that. Doug, the Supreme Court doesn't grant a lot of cert petitions, right? What do you think it was about TC Heartland's petition with this case that may have led the Court to hear this appeal?

Doug: Well, that's right Matt. The Supreme Court hears only about 80 cases per year and it receives approximately 100 times that many petitions for certiorari. So in a sense, every cert petition is a long shot. The court doesn't provide specific reasons for granting a particular petition, but there are likely a couple different factors at play here. First, intellectual property cases such as this one do not fall on traditional or common ideological lines and because the Court has been sitting at eight members for a little over a year since the death of Justice Scalia, the Court has been taking more IP cases during that time perhaps because of the fact that they don't fall along this judicial fault line. The second issue here is where a plaintiff can bring infringement cases has been the subject of great debate over the last several years nationwide. TC Heartland's petition was supported by several amicus briefs filed by companies, trade associations, law professors, economists and even a former federal circuit judge.

Matt: The idea of venue reform for patent infringement cases is something definitely that has been raised at various times over the last decade – both in the run up to the 2011 America Invents Act and the more recent attempts at so-called patent reform. Sam, why is this?

Sam: Well in short, it's because all roads lead to Texas and more specifically to the Eastern District of Texas, a largely rural district that since 2012 has been by far the most popular district for patent infringement cases. In 2015, for example, 44% of all patent cases filed in the U.S. were filed in this one district, Eastern District of Texas. The second most popular venue was the District of Delaware with 9% of cases.

Matt: And while a large number of companies are headquartered in Delaware, I am betting that in many cases the defendants in these patent cases don't have much of a connection to East Texas and don't want to have to defend against a patent case there right?

Sam: Yes, that's right. The Eastern District of Texas has proven popular with patent plaintiffs for a number of reasons. First, it's a relatively fast jurisdiction, so plaintiffs are often able to get to trial faster there than they would be able to in other places. And over the last 20 years, plaintiffs have on average been far more successful in prevailing in jury trials in East Texas than most other districts, and in recovering higher damages than they might in other districts as well. But beyond the ultimate resolution of the case, the judges in East Texas also employ local rules and manage cases in ways that defendants typically find disadvantageous. For example, the Eastern District requires defendants to make mandatory disclosures and document production early in the case, rarely grants summary judgment or motions to dismiss in favor of defendants, and also rarely issues stays of litigations pending Inter Partes Review proceedings. Plaintiffs are attracted to Texas by these sorts of factors because they can be used as leverage over defendants in settlement discussions.

Matt: But TC Heartland involves an Indiana company trying to get out of Delaware – at first glance, it does not seem to have anything to do with East Texas. Doug, what is the crux of the legal issue before the Supreme Court?

Doug: Well perhaps an irony of this case – but whether we are dealing with Delaware or Texas or elsewhere, venue does matter. The question before the Supreme Court here is whether patent infringement actions are governed at least in part by the general venue statute 28 U.S.C. § 1391, or whether instead this special patent venue statute, 28 U.S.C. § 1400(b), is the sole and exclusive provision governing venue in these sort of actions.

Matt: Ok, let's break this down a bit. What does the special patent venue statute say?

Doug: Section 1400(b) says an action for patent infringement may be brought in either (1) the judicial district where the defendant resides, or (2) where the defendant has committed acts of infringement and has a "regular and established place of business."

Matt: Leaving aside the second test for the moment, where exactly does a corporation accused of patent infringement "reside"?

Doug: Well, that is precisely the issue here. The Supreme Court has previously said that for purposes of Section 1400(b), a corporation "resides" in its state of incorporation only. But Section 1391, the general venue statute, says that an entity resides "in any judicial district in which such defendant is subject to the court's personal jurisdiction," which for most patent cases where the allegedly infringing products are sold nationwide, means virtually anywhere in the United States.

Matt: Sam, can you explain why courts would look to the so-called "general" venue statute if there is a special law that governs venue for patent cases?

Sam: Well for many years, they didn't. In 1957, the Supreme Court ruled in Fourco Glass v. Transmirra that § 1400(b) is the sole and exclusive provision controlling venue in patent infringement actions, and that it is not to be supplemented by the provision of Section 1391. But in 1990, the Federal Circuit in a case called VE Holding v. Johnson Gas Appliance ruled that certain technical amendments made by Congress to the venue laws in 1988 changed the law so much that the Supreme Court's ruling in Fourco Glass no longer applied. TC Heartland is now effectively arguing that the Federal Circuit wrongly decided VE Holding 27 years ago.

Matt: The oral argument won't take place for another few weeks but you both read the briefs that have been filed – any predictions? In recent years, the Supreme Court has seemed to have an affinity for reversing the Federal Circuit.

Doug: Well I know that VE Holding has seemed settled laws from almost 30 years, but unchallenged law is not necessarily good law. In fact, in the recent Apple v. Samsung design patent case, the Supreme Court issued a decision that some think changed what had been settled law for over a century. It is interesting here because the Federal Circuit panel in the TC Heartland case was asking whether a more recent statutory amendment had overruled VE Holding. The Supreme Court, however, will be asking whether VE Holding was correct in the first place, and I suspect that the Supreme Court is going to be more guided by its own earlier decision in Fourco Glass.

Sam: I agree with Doug. I think there is at least a good chance that the Federal Circuit will be reversed. I think much of the commentary on the case seems to agree with both of us.

Matt: If the Supreme Court does reverse the Federal Circuit here, what are some of the implications that might have for patent litigation in the United States going forward?

Doug: At the very least, patent cases are likely to be re-distributed throughout the country and largely away from the Eastern District of Texas. Because companies could be sued where they are incorporated, and many are incorporated in Delaware, that district may actually see a rise in patent litigation. But 1400(b) also allows venue to lay where companies both have a "regular and established place of business" and have made infringing sales, so districts such as the Northern District of California, the Central District of California, and the Southern District of New York may also become more popular. And certainly "rocket docket" jurisdictions where companies may have a presence, such as the Eastern District of Virginia, could also see more litigation.

Sam: I think we're also likely to see parties litigate the definition of "regular and established place of business," which is something that was a contentious issue prior to the 1990 VE Holding decision. Modern issues relating to changes of technology might make this more of a tricky thing to figure out.

Matt: What about for the foreign companies who are neither incorporated in the U.S. nor maintain any place of business here? What consequences might a TC Heartland win have for them? For example, could there be no district at all where they could be sued for patent infringement? So perhaps a patent plaintiff might have to resort to the International Trade Commission to sue certain foreign entities?

Doug: Well, the Supreme Court previously held that venue for foreign companies is a unique issue even in patent cases, so even with the TC Heartland win, foreign companies not incorporated in the U.S. could still likely be sued in any district in which the courts have personal jurisdiction. But that is an interesting question and depending on how sweeping the Supreme Court's ruling is in TC Heartland, it may have consequences even for foreign entities especially in light of some other recent Supreme Court decisions involving personal jurisdiction.

Matt: Before we wrap up, with oral argument not scheduled until March 27 and the opinion not likely until May or June, where does that leave patent litigants in the meantime? It seems like an awful lot of uncertainty whether you're involved in a current patent case or planning to file a complaint?

Sam: For a plaintiff looking at filing a potential case in the next couple of months, I think the big question you have to ask is whether it makes sense to sue in a district where venue might not be appropriate under 1400(b). If the Supreme Court rules as many expect, your case might be dismissed for improper venue in just a few months. Notably, for cases involving multiple defendants – such as both customer and supplier – it may actually be difficult to identify a district where venue is proper for all defendants.

Doug: For defendants, it's important to know that venue is an issue that can be waived. So defendants should be thinking about if and how they can challenge venue. Most often this is done on a motion to dismiss or in the answer, but if the case is at a relatively advanced stage, it may be more difficult to mount such a challenge. For defendants early in the case though, one potential strategy would be to file a motion to dismiss for improper venue – if the venue is actually improper under 1400(b) – and then ask the district court to stay the case and consideration of the motion until TC Heartland is decided.

Matt: Interesting considerations for sure. I am personally looking forward to seeing the oral argument. Unfortunately, that is all the time that we have here. Thank you Doug and thank you Sam for joining me in this interesting conversation. I am looking forward to having another Supreme Court preview podcast soon. In the meantime, thank you all for listening and please visit our Capital Insights page at www.ropesgray.com for more news and analysis and noteworthy issues arising out of Washington D.C.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Oblon, McClelland, Maier & Neustadt, L.L.P
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Oblon, McClelland, Maier & Neustadt, L.L.P
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions