The Federal Circuit has rejected the Eastern District of Texas’ test for establishing venue in a patent infringement suit. After the US Supreme Court’s holding in TC Heartland which drastically restricted the permissible venues for patent litigation from anywhere in the country wherein the infringing goods have been sold to now only where the business is incorporated or has a “regular and established place of business.”
The Eastern District of Texas was formerly the most popular venue for patent suits for being very plaintiff-friendly and broadly interpreting the venue statute. Recently, it attempted to again widen the scope of permissible venue recently by creating a four-factor test and determining that a Minnesota business could be sued in Texas because one of its employees living in Texas sometimes worked remotely from home.
The Federal Circuit on appeal rejected this interpretation and put forth a new three-part test: there must be (1) a physical place in the district, wherein (2) the company’s business is regularly carried out, and that (3) is owned, leased, or otherwise controlled by the defendant and not merely an employee.