This week, Senators Flake, Gardner, and Lee introduced a piece of legislation targeting one of the most egregious—and, frankly, ridiculous—problems with our current patent system. Specifically, the Venue Equity and Non-Uniformity Elimination (VENUE) Act would get patent cases out of the Eastern District of Texas, where patent trolls most commonly file their specious lawsuits. Together with the comprehensive reform legislation found in the PATENT Act, this bill would help put an end to a dangerous patent troll problem that continues to prey on this country’s startups and innovators.
In 2015, a whopping 44 percent of all new patent cases across the U.S. were filed in the geographically obscure Eastern District of Texas. That’s more than 2,500 new cases. Fighting a patent lawsuit is hard and expensive enough (and why we need the provisions in the PATENT Act to give defendants a fair shot at putting up a defense for themselves), but it’s absurd that these cases all take place somewhere that is so hard and expensive to even reach.
Imagine you’re a startup being sued by a troll in Texas. You’re almost certainly based somewhere in the country other than the Eastern District of Texas (towns like Marshall and Tyler), but all of a sudden you need to get down there. You’ll have to have to fly, likely on multiple flights, and rent a car, and stay in a hotel, away from your growing business that needs your attention. And in addition to the patent lawyer you’ve probably hired where you are actually based, you’ll need to hire “local counsel,” a second attorney based in Texas. Tack these expenses on top of the already outrageous costs of patent litigation, and you’re even more likely to simply settle to make the suit go away.
Patent litigation is big business in the Eastern District (the town of Tyler advertises itself as “IP Friendly” and as having “plaintiff-friendly" local rules), and breaking its stronghold on patent litigation has proven to be one of the more difficult pieces of patent reform. (If you don’t believe us, check out John Oliver’s hilarious explanation here or EFF's great explanation of what's really going on down there.) Yet, patent litigation should not be “big business,” making it easier for plaintiffs across the board. It goes without saying that patent owners should be able to enforce their rights, but it is equally important that defendants have a chance to defend theirs. The current situation in the Eastern District of Texas makes that exceedingly difficult for defendants—especially cash-strapped startups—to fight meritless lawsuits.
We support the VENUE Act as an important and meaningful effort to level the playing field, giving patent defendants as well as patent plaintiffs access to the courtroom so they can mount a real and meaningful defense.