Examining the Supreme Courtts TC Heartland Decisionn: Testimony before the House Judiciary Committee, Subcommittee on Courts, IP, and the Internet

Abstract

In TC Heartland v. Kraft Foods, the United States Supreme Court construed the venue provision in the patent statute, limiting the filing of lawsuits against defendant corporations to the districts in which they are incorporated. Chief Justice Roberts’ opinion ostensibly frames the issue as one of only statutory interpretation. But we cannot assess TC Heartland’s impact on patent owners and on the innovation economy generally without first understanding the past decade of extensive lobbying and strategic litigation that have narrowed or outright eliminated U.S. patent rights. TC Heartland is part and parcel of this broader campaign to weaken U.S. patent rights. Empirical studies confirm that TC Heartland does not change the concentration of patent lawsuits in a few districts -- the alleged ill that TC Heartland was supposed to end. It merely shifts lawsuits from one district to two other districts that are widely recognized as favorable to defendants sued for patent infringement. Thus, it increases costs for the enforcement of all U.S. patent rights -- harming the patent owners who are the foundation of the innovation economy, such as individual inventors, startups, universities, and small businesses, among others. If Congress considers further revisions to the patent statutes, it should not pursue any legislation that further weakens the patent rights that have been the fountainhead of the U.S. innovation economy for over two hundred years. A decade of court decisions, regulatory actions, and legislation already have undermined the promise of stable and effective property rights once secured by the gold-standard U.S. patent system. Congress should do no further harm to the U.S. patent system, killing the jobs and economic growth created by the innovation economy.