Volume 163, Issue 3 
February 2015
Articles

Court Competition for Patent Cases

J. Jonas Anderson

There are ninety-four federal district courts in the United States, but nearly half of the six thousand patent cases filed in 2013 were filed in just two of those courts: the District of Delaware and the Eastern District of Texas. In the Eastern District of Texas and the District of Delaware—neither of which is home to a major technology industry —patent litigation comprises an astounding proportion of each court’s docket: twenty-eight percent of 2013 filings in the Eastern District of Texas were patent cases while fifty-six percent of 2013 filings in the District of Delaware were patent cases. In fact, the two judges with the busiest patent dockets—Judge Rodney Gilstrap in the Eastern District of Texas and Judge Leonard Stark in the District of Delaware—have larger patent dockets than does the entire Central District of California, the district that receives the third most patent cases in the country.

While the popularity of the Eastern District of Texas and the District of Delaware with patent plaintiffs is a relatively recent phenomenon, the litigation tactic of selecting the court that offers the greatest odds of success—otherwise known as forum shopping—is not. Forum shopping has been a significant concern in the patent system for over forty years. Forum shopping is generally understood to be driven by the search for favorable substantive law, favorable procedural rules, or “home court advantage.” However, the persistence of forum shopping in patent law cannot be fully explained by substantive legal differences or home court advantage. Patent litigants cannot obtain substantive legal differences by forum shopping because all federal district courts are bound by the same legal rules that come from the U.S. Court of Appeals for the Federal Circuit. Furthermore, the fact that the majority of patent cases are filed in district courts that do not have sizeable technology industries indicates that most forum shopping is not the result of major technology companies seeking the advantages of litigating at the nearest courthouse.

That leaves procedural differences. This Article theorizes that forum shopping in patent law is driven, at least in part, by federal district courts competing for litigants. This competition occurs primarily through procedural and administrative differentiation among courts. All patent infringement cases are heard in federal court and are therefore governed by the Federal Rules of Civil Procedure. Despite the existence of the Federal Rules, district courts across the United States have adopted local rules specifically for patent cases. Intriguingly, some districts have adopted local patent rules despite almost never hearing patent cases in their courtrooms, suggesting that local patent rules serve a signaling function for courts looking to attract potential patent litigants.


Image Is Everything: Corporate Branding and Religious Accommodation in the Workplace

Dallan F. Flake

There is growing tension in the law between an employee’s right to religious expression in the workplace and an employer’s countervailing right to cultivate its corporate image. The existing case law provides little meaningful guidance to employers and employees faced with this conflict. Not only do outcomes vary from court to court, but the analysis and reasoning underlying these decisions are often inconsistent, and sometimes contradictory. I argue that because a company’s image is one of its most valuable assets, courts should more closely scrutinize religious accommodation claims that interfere with a company’s ability to control its image. Such enhanced scrutiny does not require a break from Supreme Court precedent; rather, it requires stricter adherence thereto. I offer three recommendations for how courts can recalibrate their analyses of religious accommodation cases involving corporate image concerns. These recommendations should help produce a more balanced case law that better harmonizes with Supreme Court precedent, while providing employers and employees greater clarity in navigating this sensitive and complex issue.


Tontine Pensions

Jonathan Barry Forman & Michael J. Sabin

Tontines are investment vehicles that can be used to provide retirement income. A tontine is a financial product that combines the features of an annuity and a lottery. In a simple tontine, a group of investors pool their money together to buy a portfolio of investments and, as investors die, their shares are forfeited, with the entire fund going to the last surviving investor. Over the years, this “last survivor takes all” approach has made for some great fiction. For example, in an episode of the popular television series M*A*S*H, Colonel Sherman T. Potter, as the last survivor of his World War I unit, got to open the bottle of French cognac that he and his buddies bought (and share it with his Korean War compatriots). On the other hand, sometimes the fictional plots involved nefarious characters trying to kill off the rest of the investors to “inherit” the fund.

Of course, tontines can be designed to avoid such mischief. For example, instead of distributing all of the contributions to the last survivor, a tontine could make periodic distributions. Historically, for example, governments issued tontines instead of regular bonds. In those tontines, the government would keep the tontine investors’ contributions but make high annual dividend payments to the tontine, dividing those payments among the surviving investors. When the last survivor died, the government had no further debt obligation. For example, in 1693, the English government issued a tontine to raise one million British pounds to help pay for its war against France. At a time when the regular bond interest rate was capped at 6%, King William’s 1693 tontine, as it is known, entitled the surviving investors to share in 10% dividend payments to the tontine for the first 7 years and to 7% dividend payments thereafter.

Over the years, tontines like King William’s became quite popular. At one point, Alexander Hamilton, the United States’s first Secretary of the Treasury, suggested that the United States could use a tontine to pay off its Revolutionary War debt. All in all, government tontines played an important role in government finances over a couple of centuries, but they have since disappeared.

After the Civil War, tontines emerged as a popular investment for individuals in the United States, but they fell out of favor at the beginning of the twentieth century. The problem was not with the tontine form but with embezzlement and fraud by the holders of tontine funds. Investigations of the insurance industry in New York led to the enactment of legislation in 1906 that all but banned tontines, and tontines have since been replaced by life insurance and similar financial products.

We believe that the time has come to revive tontines as a way of providing reliable, pension-like income for retirees. Specifically, we believe that variations on the tontine principle—that the share of each member of the tontine, at her death, is enjoyed by the survivors—can be used to develop a variety of attractive retirement-income financial products. For example, tontines could be used to create “tontine annuities” that could be sold to individual investors. These tontine annuities would make periodic distributions to surviving investors, but unlike traditional tontines, tontine annuities would solicit new investors to replace those that have died. Structured in this way, a tontine annuity could operate in perpetuity.


Comments

An Inconvenient Truth: How Forum Non Conveniens Doctrine Allows Defendants to Escape State Court Jurisdiction

Brian J. Springer

Imagine you are a foreign citizen. You have been injured in a foreign country due to the negligence of a U.S. company and have a legitimate tort claim for millions of dollars against the company. You file suit in the state court in Missoula, Montana—located at 200 W. Broadway, Missoula, Montana 59802. The defendant company removes the case, on the basis of diversity of citizenship, to the United States District Court of Montana—located at 201 E. Broadway, Missoula, Montana 59802 —and argues that the case should be dismissed under the doctrine of forum non conveniens. The state court probably would not have granted the motion, but rather would have allowed the case to proceed to the merits. But now that the case has been moved just two blocks away to a federal district court, that court can exercise its discretion under federal forum non conveniens doctrine and dismiss the case. This sequence of events does not occur infrequently.

Because almost every federal court applies federal forum non conveniens law in diversity cases, defendants can remove cases to federal court solely for the purpose of getting them dismissed on forum non conveniens grounds. In cases where a state would not dismiss under its own forum non conveniens doctrine, it is unfair for defendants to exploit removal to obtain dismissal. Allowing defendants to engage in this practice undercuts the rights of the parties and undermines the purpose of the forum non conveniens doctrine.

The appropriate remedy is for courts to find that defendants who remove from state court waive their right to argue forum non conveniens in federal court when the state would not have dismissed the case under its forum non conveniens law. This would prevent the injustice of defendants using removal as a mechanism for dismissal. However, courts may be unwilling to adopt waiver. Ultimately, I propose that Congress remedy this injustice by amending the removal statute to permit remand to the state court when the federal court dismisses on forum non conveniens grounds.


Proposing a Transactional Approach to Civil Forfeiture Reform

Michael van den Berg

Civil forfeiture is a truly extraordinary legal doctrine—so much so that those who find themselves subject to a forfeiture proceeding frequently express disbelief that such an action could exist in the United States. The Kafkaesque civil forfeiture system is ancient, labyrinthine, and impermeable to the uninitiated. Despite its esoteric nature, federal, state, and local authorities commonly utilize this legal doctrine. While the practice once had reputable roots, it has become a tool with enormous potential for abuse. This Comment explores the doctrine of civil forfeiture at a macro level before suggesting some specific recommendations for reform.


Issues - Print Edition - PennLawReview.com