For years, the Eastern District of Texas was the favored stomping ground for patent trolls. Short times from filing to trial, shorter trials, judges with local rules friendly to patent plaintiffs, and a jury pool that tended to be friendly to plaintiffs all contributed to this. It probably didn’t hurt that Eastern District judges were significantly less likely than average to grant defendants summary judgment and, more recently, significantly less likely to stay a case pending IPR.
And NPEs were likely particularly interested in the fact that the Eastern District gave NPEs a win at trial almost twice as often as the average court would.
But with the Supreme Court’s 2017 TC Heartland decision, NPEs had a much harder time suing defendants in the Eastern District. Since most defendants had no presence in the district, NPEs could no longer rely on it being an option in their lawsuits, especially after some of the more far-reaching attempts to keep cases in Eastern Texas were slapped down by the Federal Circuit.
Enter Judge Alan Albright and the Western District of Texas.
Judge Albright came to the federal bench in 2018 after more than two decades as a patent litigator. He immediately went on a tour around the country doing what the Waco Tribune characterized as “drumming up business”—patent litigation business. Later, the invitation for a dinner with Judge Albright characterized it as a casual opportunity to hear the Judge “spread the word far and wide about how his WACO court would be a great place to try IP cases.” (The dinner was hosted by Ocean Tomo—a company that provides patent auction and expert witness services and thus has a vested interest in patent litigation.)
Following on from this charm campaign, Judge Albright created a set of local patent rules designed to result in extremely quick times to trial. He’s also publicly stated that he will not stay cases pending IPR absent exceptional circumstances—a complete inversion of the view expressed by at least one Federal Circuit judge, who stated in an opinion while sitting by designation that “after the PTAB has instituted review proceedings, the parallel district court litigation ordinarily should be stayed.”
The Invitations Worked
Many litigators predicted a rise in litigation in the Western District of Texas. They were right. Since Judge Albright was seated, patent filings in his court have risen significantly. In the first four months of 2020, 258 new patent cases were filed in the Western District. That’s an eightfold increase over the same period in 2018, before Judge Albright was seated.
And this isn’t an instance in which productive companies are flocking to the district to file their cases. This increase has been driven mostly by NPEs. Unified Patents attributes more than 70% of the new cases to an NPE, and the vast majority of those are from the sort of large patent aggregators that the AIA and TC Heartland decisions had the largest impact on.
That shouldn’t be surprising. The presence of many tech companies in Austin—inside the Western District—combined with Judge Albright taking a very harsh view of motions to transfer cases means that those cases won’t go elsewhere. And once you’re in Judge Albright’s court, a plaintiff can rest easy in the knowledge that patent trolls who file cases in his court can almost definitely never face an IPR.
By setting a trial timeline that is similar to the PTAB timeline, Judge Albright has made it possible for effectively any plaintiff in his court to argue that a trial will conclude around the same time as the PTAB will issue a decision. Under Director Iancu’s recent precedential decisions , that means that the PTAB will refuse to institute an IPR even if the patent is clearly completely invalid. Congress intended the PTAB to serve as a complement to litigation. By adopting a rule that bars IPRs if a trial will occur in a similar timeframe, the PTAB has abandoned this role. And Judge Albright’s swift timelines provide exactly the tool that patent trolls need to avoid having the Patent Office use its expertise to reexamine a patent.
At least for the foreseeable future, any patent troll that files in Western Texas can laugh at the idea of their patent facing an IPR all the way to a jury trial.