The Supreme Court placed limits on where patent lawsuits can be filed, protecting companies from "patent trolls" who purchase patents to squeeze large payouts from major companies.

The unanimous decision on Monday protects businesses like major tech companies by making it so defendants can only face patent litigation in the state where the business is incorporated. For example, Apple would deal with patent lawsuits only in California. Previously, the so-called trolls would buy patents and then sue larger companies for royalties or damages. This ruling hurts those companies since they can no longer file in remote federal courts that have a reputation for friendliness to plaintiffs.

The Electronic Frontier Foundation, a non-profit organization that aims to defend civil liberties in the digital era, called for the end of that Supreme Court loophole in an October 2016 blog post. In the same piece, it also criticized the Eastern District of Texas, calling it "a sparsely populated region of Texas probably more well-known as the birthplace of George Foreman than for any technological industry."

Samsung is so familiar with the eastern city of Marshall, Texas, where it's been sued multiple times, that it sponsored several holiday festivals and an ice-skating rink in front of the courthouse, according to The Wall Street Journal. What's more, a judge in Marshall handled nearly a quarter of all patent cases across the country, more than the number overseen by federal judges in New York, California, and Florida combined, according to The New York Times.

Since 2016, the EFF and major tech companies like Adobe, HP, and Oracle have filed briefs urging the Supreme Court to hear an appeal from TC Heartland, a company that makes food sweeteners and faced a patent suit from Kraft Foods. While the suit had nothing to do with technology, it highlighted the practice of "forum shopping" by forcing TC Heartland to face a suit in Delaware instead of Indiana, where it's based.

Published on: May 23, 2017