Remote Workers? Why They Matter for Venue in Patent Cases FIONA BELL, PHILIP A. ECKERT, SHARON A. ISRAEL
W
orking from home exploded in popularity throughout the pandemic. Remote working raised a host of new issues—both business and legal—for companies. However, there is one issue that may not occur to companies when considering their remote working policies: the effect remote workers may have on where a company can be sued for patent infringement.
Venue for patent infringement cases is different from venue in other federal cases, and litigants often spend considerable time and money fighting over venue in such cases, due to differences—real and perceived—between various district courts.1 Companies that may be subject to patent infringement actions should be aware of how the presence of remote workers, in conjunction with a company’s remote work policies, might affect the courts where they can (and cannot) be sued. Companies can use this knowledge to structure remote work policies in a way that helps prevent or minimize the risk of being subject to venue in district courts that the company may consider to be undesirable, and avoid surprise. What companies may find surprising is that even a single employee working from his or her home may subject them to a patent infringement suit in the district court with jurisdiction over that area (assuming that infringement is alleged to take place in that district). Knowing when and how remote employees can create such a risk is important for companies facing frequent patent litigation. This
article explains patent venue law, and then provides considerations for companies with remote workers that wish to minimize risks associated with being sued in venues with which they have limited connection.
A (Very) Brief Primer on the History of Venue in Patent Infringement Cases Congress made venue in patent infringement actions different from venue in other federal cases over 100 years ago.2 The patent venue statute states that: “any civil action for patent infringement may be brought in the judicial district [1] where the defendant resides, or [2] where the defendant has committed acts of infringement and has a regular and established place of business.”3 Since the late 1800s, the prevailing interpretation of the patent venue statute has swung like a pendulum, vacillating between extremely broad and quite narrow.4 In 1990, the “residence” prong of this test was interpreted broadly by the Federal Circuit, such that a plaintiff could generally maintain venue in any court that had personal jurisdiction over the defendant.5 As a result, companies were subject to patent infringement suits in district courts all over the nation—generally, wherever they sold or offered the product or service at issue. However, in 2017, the pendulum swung back again, with the Supreme Court’s decision in TC Heartland. 6 The Court held that a corporation’s “residence” was limited to the state in which it was incorporated. Accordingly, under the “residence” prong of the statute, venue over a defendant was only proper in the district court(s) within the state in which it was incorporated.7 This caused litigants to refocus their attention on the second portion of the venue statute, which states that venue is proper in disSpring 2023 • THE FEDERAL LAWYER • 43