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Guest Post by Greg Reilly

For over a decade, patent litigation has been surprisingly concentrated in a single federal district court. At one time, almost half of the nation’s patent litigation occurred in small towns in eastern Texas.1 Now, 20% of patent litigation occurs before a single judge based in Waco, Texas.2 This concentration of patent litigation is not the result of the inherent characteristics of these districts but instead of the affirmative efforts of particular judges to attract patent cases to their courthouses.3 Scholarly commentary of this forum selling and patent litigation concentration, including by myself, has been largely critical.4 The primary objection is that the districts and judges competing for patent litigation improperly skew procedures in favor of the patentees who make the forum choice.5

Yet, a vocal minority has defended—or at least acceded to—the concentration of patent cases first in east Texas and now in Waco. The defenses I most often hear are: (1) patent litigation concentration results in an effectively specialized patent district court that provides more expert resolution;6 and/or (2) the procedural skewing in favor of patentees counteracts other anti-patentee aspects of the current patent system.7

These defenses are results-oriented arguments that take an “ends justify the means” approach. Because forum selling results in the normative outcomes they prefer (a specialized district court and pro-patentee tilt), defenders ignore the problematic practices that lead to these outcomes and the unseemliness of federal judges actively trying to solicit patent litigation.8 A more process-oriented approach shows that these defenses are analytically bankrupt. The policy outcomes touted by forum selling’s defenders—a de facto specialized district court and pro-patentee advantages—do not result from the considered judgment of those with the legitimate authority to determine national patent policy but instead from the unilateral actions of a single (or a couple) of the nearly 700 federal district judges in one (or a couple) of the ninety-four federal district courts nationwide.9 Importantly, these outlier judges and districts can effectively implement nationwide patent policy not because they have the authority to do so but instead because patent litigation concentrates in these districts and before these judges, assuming their policy choices favor the patentees who choose the forum.10 

However, the Constitution gives Congress broad power to design the patent system and determine national patent policy.11 Congress has delegated some (though not much) of that authority to the Patent Office.12 Moreover, by using broad statutory language that inevitably leaves a lot of room for interpretation and application, Congress has effectively delegated some of that authority to the federal courts.13 But the authority within the federal courts to make patent policy does not rest with a single judge in a single district. Rather, Congress created a specialized appellate court, the United States Court of Appeals for the Federal Circuit, and charged it with shepherding the development of patent law and policy.14 At the same time, “Congress also kept the Supreme Court in the mix so that a generalist tribunal would have ultimate authority over patent jurisprudence.”15 Thus, the Supreme Court and Federal Circuit have the authority within the federal courts for “elucidation of both statutory provisions and common law doctrines.”16

The core problem with the defenses of forum selling and patent litigation concentration as resulting in a de facto specialized patent trial court and a pro-patentee tilt is that these outcomes are inconsistent with the policy choices of those with the legitimate authority to decide patent policy: Congress, the Supreme Court, and the Federal Circuit. Commentators have long proposed a specialized trial court for patent cases.17 But Congress addressed the demand for more expertise in the patent system through other means. It created the Federal Circuit, a specialized intermediate appellate court.18 It launched the Patent Pilot Program, which was meant to increase patent-experience among a few judges in many districts across the country, rather than concentrate patent expertise in a single district court.19 And it gave more power to decide patent validity to the Patent Office’s Patent Trial and Appeal Board (PTAB), an expert panel within the Patent Office.20 Congress could have created a specialized patent trial court pursuant to its Article III power to create inferior federal courts and/or its IP Clause power over the patent system. Instead, it chose alternative ways to introduce expertise into the patent system.

The defense of forum selling as offsetting perceived anti-patentee trends elsewhere in the patent system is a more direct attack on Congress’s and the Supreme Court’s legitimate authority over the patent system. The most common anti-patentee trends identified are Congress’s creation of the PTAB to hear post-issuance invalidity challenges and the Supreme Court’s invigoration of the patent eligibility doctrine in a series of decisions that have expanded the exceptions to patentability for laws of nature, products of nature, and abstract ideas.21 Congress and the Supreme Court are the institutions within the patent system with the ultimate responsibility for maintaining the patent system’s “careful balance” between the need to spur initial innovation and the need to protect competition and follow-on innovation.22 They could have chosen to maintain the previous status quo or tilted the patent system in a more pro-patentee direction, as forum selling’s defenders would have preferred.23 Instead, they created the PTAB and invigorated patent eligibility, which have calibrated the patent system’s balance towards greater competition at the expense of patent owners.

The disregard that defenders of forum selling show for legitimately exercised authority within the patent system echoes that of competing courts in marketing their courts. In addition to adopting outlier procedural approaches that depart from the typical approaches of other courts,24 the forum selling districts have resisted and undercut oversight efforts by Congress, the Supreme Court, and the Federal Circuit to reign in their outlier positions on various issues.25 They also have undercut governing precedent on issues like claim construction and the priority between competing lawsuits.26 

Most directly, the Western District of Texas judge has challenged Congress’s and the Supreme Court’s policy choices regarding the PTAB and the patent eligibility doctrine. The judge purposefully sets a quick case schedule to “get a patent trial resolved more quickly than the PTAB” because he believes that it is his “job to give people the opportunity to have their cases tried in a federal court,” even though Congress created the PTAB to resolve more patent cases in the Patent Office and not in the federal courts.27 He also refused to stay a case pending a PTAB proceeding because he “strongly believes [in] the Seventh Amendment,” despite the fact that Congress assigned the PTAB concurrent jurisdiction over patent validity and the Supreme Court had previously found that the PTAB did not violate the Seventh Amendment.28 On patent eligibility, Jonas Anderson and Paul Gugliuzza have provided a comprehensive analysis of how the Western District judge has ignored, mischaracterized, and undercut Supreme Court and Federal Circuit precedent on both the substantive and procedural aspects of the patent eligibility doctrine.29 Notably, the judge declined to rule on a patent eligibility motion because of the “lack of predictability and consistency” in the Supreme Court’s eligibility doctrine that is supposedly “widely known and extremely problematic,” citing well-known critics of the Supreme Court’s invigoration of the doctrine and Federal Circuit dissenting opinions.30

To forum selling’s defenders, Congress and the Supreme Court have presumably made the “wrong” policy choices, and forum selling is desirable because it leads to the “right” policy choices. But, a process-oriented focus is crucial. Forum selling’s defenders are endorsing the replacement of the policy choices of those with the legitimate authority in the patent system to make these choices with the policy choices of those who lack the legitimate authority to make these choices—a couple of federal district judges and/or themselves.31 This proposed nullification of legitimate and authoritative actions within the patent system is concerning. “[T]he Rule of Law . . . requires also that citizens should respect and comply with legal norms, even when they disagree with them” and “accept legal determinations of what their rights and duties are.”32

Perhaps this seems dramatic. Certainly, these issues are less concerning in an area of economic policy like patent law than in other areas. But we should not hesitate to accurately characterize the results-oriented arguments in favor of forum selling. These arguments contend, in essence, that district judges and patent system participants should be free to disregard duly promulgated legislation and authoritative precedent—in an area of economic policy, mind you, not fundamental rights—simply because they disagree with it. This disregard for proper authority presents a troubling threat to stability, accountability, and legitimacy in the patent system.

I am not surprised that those with short-term financial interests dependent on the outcomes of particular cases involving particular patents would adopt a results-oriented, “ends justify the means” view of forum selling and patent litigation concentration. They are pursuing their own self-interested financial concerns, not a well-functioning patent system. But those who have a stake in the patent system that is more significant than a single patent or a single patent litigation—judges, lawyers, academics, and large-volume patent owners—should be concerned by the way forum selling, and the frequent defenses of it, ignore the legitimate authority in the patent system, even if their underlying policy views align with those of the forum selling districts. A well-functioning patent system requires democratic accountability and adherence to properly enacted legislation and authoritative precedent.

From a more practical perspective, patent policy has proven cyclical over time, alternating between more “pro-patent” and more “pro-competition” periods. Those whose policy views line up with the forum selling districts may regret their contribution to a breakdown in respect for legitimate authority in the patent system when the shoe is on the other foot and those who properly exercise power in the patent system (e.g., Congress, the Supreme Court) favor more “pro-patent” policies and opponents of those policies disregard the proper exercise of authority within the patent system. That time may have already arrived. The Patent Office has exercised its statutory discretion as to whether to institute PTAB review proceedings to decline to institute on various procedural grounds, including due to the advanced stage of related litigation.33 Despite quite clear discretionary authority granted by Congress, opponents have brought strained statutory challenges to the Patent Office’s power to adopt these discretionary denials, challenges that really reflect mere policy disagreement (ironically, often focused on concern with the Western District of Texas).34

It does not have to be this way. The disregard for legitimate authority underlying forum selling, and the defenses to it, is not the inevitable result of a realist view of law or the strong divisions in the patent community over patent policy. Patent system participants undoubtedly will view legal issues through their own self-interest and policy preferences.35 But that does not require them to cravenly pursue their immediate interests at all costs. Regardless of one’s views of patent policy, all participants in the patent system are better off—at least in the long-term—with a more process-oriented approach that respects the proper lines of authority and democratic accountability. Luckily, we have recent models in the patent system of restraint and commitment to the proper process of decision-making. In the patent eligibility context, several Federal Circuit judges have upheld the ineligibility of patents that they believed—as a matter of law and policy—should be eligible for patent protection because they concluded that a contrary result was necessitated by binding Supreme Court precedent.36 In doing so, they provided a model to emulate of how to disagree over patent policy and advocate for policy change in the patent system while still respecting legitimate authority and the proper process of decision-making.

[1] Daniel Klerman & Greg Reilly, Forum Selling, 89 S. Cal. L. Rev. 241, 248–49 & n.25 (2016).

[2] J. Jonas Anderson & Paul R. Gugliuzza, Federal Judge Seeks Patent Cases, 71 Duke L.J. 419, 445–52 (2021).

[3] Klerman & Reilly, supra note 1, at 270–80; Anderson & Gugliuzza, supra note 2, at 445–52.

[4] See, e.g., Klerman & Reilly, supra note 1; J. Jonas Anderson, Court Competition for Patent Cases, 163 U. Pa. L. Rev. 631 (2015); Anderson & Gugliuzza, supra note 2.

[5] Klerman & Reilly, supra note 1, at 250–70; Anderson, supra note 4, at 666–77; Anderson & Gugliuzza, supra note 2, at 452–76.

[6] Cf., e.g., Timothy T. Hsieh, Approximating a Federal Patent District Court after TC Heartland, 13 Wash. J.L. Tech. & Arts 141, 143 (2018) (defending patent litigation concentration because “the Eastern District of Texas became in essence a specialized federal district patent court”); Xuan-Thao Nguyen, Justice Scalia’s “Renegade Jurisdiction”: Lessons for Patent Law Reform, 83 Tul. L. Rev. 111, 114 (2008) (“[I]nstead of . . . the condemnation of the EDTX, reformers should view the EDTX as part of the solution—a case study of how a district court has actively transformed itself into a knowledgeable court with strong expertise in solving patent disputes.”).

[7] See, e.g., Gene Quinn, The Federal Circuit’s Obsession with Judge Albright is Becoming Increasingly Bizarre, IPWatchdog (Sept. 29, 2021), https://www.ipwatchdog.com/2021/09/29/federal-circuits-obsession-judge-albright-becoming-increasingly-bizarre/id=138182/ [https://perma.cc/4DDC-YF2G] (suggesting that objections to the Western District of Texas patent docket “Comes Down to Anti-Patent Ideology”).

[8] See Klerman & Reilly, supra note 1, at 250–77 (describing the ways and reasons judges attract patent cases to their districts).

[9] Anderson, supra note 4, at 666–77 (noting the tools such as patent local rules and case management that district judges can use to increase the appeal of the district court as a forum).

[10] Klerman & Reilly, supra note 1, at 308.

[11] Graham v. John Deere Co. of Kan. City, 383 U.S. 1, 6 (1966) (“Within the limits of the constitutional grant, the Congress may, of course, implement the stated purpose of the Framers by selecting the policy which in its judgment best effectuates the constitutional aim.”).

[12] See generally Melissa F. Wasserman, The Changing Guard of Patent Law: Chevron Deference for the PTO, 54 Wm. & Mary L. Rev. 1959 (2013).

[13] Craig Allen Nard, Legal Forms and the Common Law of Patents, 90 B.U. L. Rev. 51 , 68–77 (2010).

[14] Rochelle Cooper Dreyfuss, The Federal Circuit: A Case Study in Specialized Courts, 64 N.Y.U. L. Rev. 1, 6–7 (1989).

[15] Rochelle C. Dreyfuss, Percolation, Uniformity, and Coherent Adjudication: The Federal Circuit Experience, 66 SMU L. Rev. 505, 506–07 (2013) (citing Daniel J. Meador, Origin of the Federal Circuit: A Personal Account, 41 Am. U. L. Rev. 581, 587 (1992).

[16] Id. at 522, see also id. at 506–22.

[17] Amy Semet, Specialized Trial Courts in Patent Litigation: A Review of the Patent Pilot Program’s Impact on Appellate Reversal Rates at the Five-Year Mark, 60 B.C. L. Rev. 519, 524–33 (2019) (describing calls for greater specialization).

[18] The Federal Court Improvements Act of 1982, Pub. L. No. 97-164, 96 Stat. 25 (relevant provisions codified as amended in scattered sections of 28 U.S.C.).

[19] Semet, supra note 15, at 539-541.

[20] Wasserman, supra note 12, at 1976 (citing America Invents Act, 125 Stat. 284 (to be codified in scattered sections of 35 U.S.C.)).

[21] See id.; Alice Corp. v. CLS Bank Intern., 134 S. Ct. 2347 (2014); Association for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107 (2013); Mayo Collaborative Servs. v. Prometheus Lab’ys, Inc., 132 S. Ct. 1289 (2012); Bilski v. Kappos, 561 U.S. 593 (2010).

[22] Bonito Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141, 146 (1989).

[23] See Klerman & Reilly, supra note 1, at 278–80 (highlighting that forum selling involves procedures and outcomes attractive to patentees).

[24] Klerman & Reilly, supra note 1, at 251–57, 263–64, 268–70 (describing the Eastern District of Texas’s outlier approach to summary judgment, judicial case assignment, stays, and discovery); Anderson & Gugliuzza, supra note 2, at 455–61, 467–68 (describing the Waco judge’s outlier approach to case schedules)

[25] Klerman & Reilly, supra note 1, at 258, 261 (describing how the Eastern District of Texas undercut Congressional efforts to address its broad joinder rules and resistance to stays and Federal Circuit efforts to address its resistance to transfer). After the Supreme Court restricted venue in patent cases in part due to the Eastern District of Texas problem, the Federal Circuit repeatedly granted mandamus to overrule the Eastern District’s narrow interpretation of this decision. See In re Cray, 871 F.3d 1355 (Fed. Cir. 2017); In re Google LLC, 949 F.3d 1338 (Fed. Cir. 2020).

[26] Anderson & Gugliuzza, supra note 2, at 45 (describing how the Waco judge has refused to apply patent law’s customer suit exception that allows a manufacturer’s declaratory judgment action to proceed before an infringement suit against the manufacturer’s customer); Greg Reilly, Patent “Trolls” & Claim Construction, 91 Notre Dame L. Rev. 1045, 1067 (2016) (describing how the Eastern District of Texas cited a patentee-friendly claim construction decision that was previously renounced by the en banc Federal Circuit far more frequently than other districts).

[27] Britain Eakin, West Texas Judge Says He Can Move Faster Than PTAB, Law360 (Nov. 27, 2019), https://www.law360.com/articles/1224105/west-texas-judge-says-he-can-move-faster-than-ptab [https://perma.cc/3SKV-SJTJ]; see also Anderson & Gugliuzza, supra note 2, at 468.

[28] Anderson & Gugliuzza, supra note 2, at 460 & n.238.

[29] Id. at 468–75.

[30] Id. at 473.

[31] See Graham v. John Deere Co. of Kan. City, 383 U.S. 1, 6 (1966) (“Within the limits of the constitutional grant, the Congress may, of course, implement the stated purpose of the Framers by selecting the policy which in its judgment best effectuates the constitutional aim.”).

[32] See Jeremy Waldron, The Rule of Law, The Stanford Encyclopedia of Philosophy (Summer 2020 Ed. Edward N. Zalta, ed.), https://plato.stanford.edu/archives/sum2020/entries/rule-of-law/ [https://perma.cc/4PUX-JRP9].

[33] Mylan Pharms., Inc. v. Bayer Intell. Prop. GmbH, No. IPR2018-01143, Paper 13 (P.T.A.B. Dec. 3, 2018); NHK Spring Co. v. Intri-Plex Techs., Inc., No. IPR2018-00752, Paper 8 (P.T.A.B. Sept. 12, 2018) (precedential).

[34] Google LLC, v. Uniloc 2017 LLC, No. 20-2040, (Fed. Cir. Oct. 30, 2020); In re Cisco Sys., Inc., No. 2020-148 (Fed. Cir. Oct. 30, 2020).

[35] Klerman & Reilly, supra note 1, at 270–80 (explaining motives and explanations for forum selling).

[36] Ariosa Diagnostics, Inc. v. Sequenom, Inc., 788 F. 3d 1371, 1380–81 (Fed. Cir. 2015) (Linn, J., concurring) (“I join the court’s opinion invalidating the claims of the `540 patent only because I am bound by the sweeping language of the test set out in Mayo . . . . But for the sweeping language in the Supreme Court’s Mayo opinion, I see no reason, in policy or statute, why this breakthrough invention should be deemed patent ineligible.”); Ariosa Diagnostics, Inc. v. Sequenom, Inc., 809 F.3d 1282, 1287 (Fed. Cir. 2015) (Lourie & Moore, JJ., concurring in the denial of rehearing en banc) (“[I]t is unsound to have a rule that takes inventions of this nature out of the realm of patent-eligibility . . . . But I agree that the panel did not err in its conclusion that under Supreme Court precedent it had no option other than to affirm the district court.”).