WSGR ALERT

Federal Court for the Western District of Texas Projected to Have About a 100 Percent Increase in Patent Complaints Filed in 2019

April 22, 2019

This year the District Court for the Western District of Texas is on track to experience almost a 100 percent increase in patent complaints filed compared to 2018. This significant increase is expected to continue into the foreseeable future and is generally attributed to recent changes in the venue law for patent cases and the recent draft orders for patent cases for complaints filed in the district court’s Waco Division.

The Western District of Texas

The Western District of Texas spans central and western Texas, and includes divisions in cities such as Austin, San Antonio, Waco, Midland, and El Paso. Austin is a high tech hub within this district where hundreds of technology companies have employee offices. The district court has traditionally carried a heavy criminal docket far exceeding its civil cases.1 The number of patent complaints filed in the district has been on the rise since 2009, but in particular, the district court experienced a significant increase late in 2017 and 2018, ending those years with 85 and 89 patent complaints, respectively, as shown in the chart below.

chart
Source: Docket Navigator

Under the current trend, the number of patent case filings in 2019 is projected to increase almost 100 percent year-over-year with about 169 patent filings.

New Judge in the District and Changes to Venue Law

One of the reasons for the significant increase in patent cases filed in the district court is the elevation of Judge Alan Albright, a highly respected litigator whose primary civil practice was patent litigation, to serve as the sole district judge in the Waco division on September 10, 2018.2 Shortly thereafter, Judge Albright convened a group of experienced patent litigators, including the two authors of this note, to assist in molding his court’s order governing proceedings in patent cases.3 That order, which is now published, was drafted to provide a transparent and fair procedure to quickly move patent cases through discovery and trial. Subsequently, a substantial portion of the more recent patent cases in the district court have been filed in Waco. For example, in the first few months of 2019, 80 percent of the patent cases filed in the district court were in Waco.

The second reason for the surge in patent complaints filed in the Western District of Texas is based on recent Supreme Court case law,4 which clarified that the proper venue for a domestic corporate patent litigation defendant is its state of incorporation5 or where it “has committed acts of infringement and has a regular and established place of business.”6 To satisfy the latter phrase, at least three requirements are necessary: (1) a physical presence that is (2) regular and established (3) “of the defendant.”7 Because hundreds of technology companies may be deemed by a court to have “a regular and established place of business” in Austin, the pool of potential defendants that may be sued in a court in the Western District of Texas increased significantly since late 2017.

Key Takeaways

Companies that have a presence in Austin and its surrounding areas should consider it likely that they could be sued for patent infringement in the Western District of Texas. WSGR has maintained an office in Austin for over 20 years and has significant experience defending patent cases in this district.

Please contact Jose Villarreal or Aden Allen of WSGR’s patent litigation group in Austin for questions related to this article.

 


1 Source: United States District Court Western District of Texas 2017 Fiscal Year Statistics.
2 Judge Albright received his commission on September 10, 2018.
4 See TC Heartland LLC v Kraft Foods Group Brands LLC, 137 S.Ct. 1514, 1521 (2017).
5 For corporations in states with multiple districts, this requirement is further limited to the district within the state where the corporation has its principal place of business.  In re Big Commerce, Inc., 890 F. 3d 978 (Fed. Cir. 2018).  For additional information, please see our past Client Alert issued on May 16, 2018.
6 28 U.S.C. § 1400(b).
7 In re Cray Inc., 871 F.3d 1355, 1362-63 (Fed. Cir. 2017).