TC Heartland v. Kraft: Supreme Court Limits Patent Forum Shopping, Curbing Eastern District of Texas Troll Haven

The Supreme Court unanimously rules in TC Heartland LLC v. Kraft Foods Group Brands LLC (581 U.S. 258) that for patent infringement suits, a domestic corporation ‘resides’ only in its state of incorporation under 28 U.S.C. § 1400(b), overturning nearly 30 years of Federal Circuit precedent that allowed venue anywhere the defendant ‘does business.’ Justice Clarence Thomas delivers the opinion reaffirming the 1957 Fourco Glass precedent, rejecting the expansive venue interpretation that enabled rampant forum shopping to the Eastern District of Texas. The decision has immediate impact: patent case filings in the Eastern District of Texas, which handled over 40% of all U.S. patent cases (2,540 cases in 2015), drop by 820 cases. Judge Rodney Gilstrap, who personally handled 25%+ of all national patent cases, sees his docket shrink significantly. However, the decision doesn’t eliminate forum shopping—it redirects it. Delaware (a state of incorporation for many companies) becomes the new preferred venue, with patent cases surging there. The Federal Circuit’s subsequent In re Cray decision (reversing Judge Gilstrap) establishes a three-part test for ‘regular and established place of business’ venue, further limiting Eastern District jurisdiction. This represents rare Supreme Court intervention to correct judicial capture, yet illustrates the resilience of extractive systems: patent trolls adapt to new rules, seeking alternative favorable venues. The decision reduces but doesn’t eliminate systematic forum advantages that enable NPE rent extraction.