Federalist Society Practice Groups Podcasts

The question presented in TC Heartland LLC v. Kraft Foods Group Brands LLC is seemingly straightforward: Does the statute governing venue generally, 28 U.S.C. § 1391(c), supplement the patent venue statute, 28 U.S.C. § 1400(b)? In particular, the issue is whether § 1391(c)(2)’s broad residency definition, which provides that a corporate defendant “shall be deemed to reside . . . in any judicial district in which such defendant is subject to the court’s personal jurisdiction,” should be read into § 1400(b), which provides that a patent infringement action “may be brought in the judicial district where the defendant resides.” If a corporate defendant “resides” wherever a court has personal jurisdiction over it, a patent owner will typically have many choices of where it may sue that corporation for infringement. -- TC Heartland is incorporated and headquartered in Indiana, while Kraft Foods is incorporated in Delaware and headquartered in Illinois. Kraft Foods sued in the District of Delaware, arguing that TC Heartland established personal jurisdiction—and thus venue—when it knowingly shipped a large number of allegedly infringing goods into that forum. The Federal Circuit held that the patent venue statute is supplemented by the broad definition of residency in § 1391(c). TC Heartland now asks the Supreme Court to reverse the decision and to hold that § 1400(b) is the sole and exclusive statute governing venue in patent infringement actions. -- The case itself has garnered much attention because the same broad venue rules also allow non-practicing entities—so-called “patent trolls”—to sue in the Eastern District of Texas. Indeed, the policy implications of the case have taken center stage among many commentators. -- The issue of where patent owners may sue alleged infringers is an important one, and this case will determine whether patent owners, like federal plaintiffs generally, have numerous choices, or whether they are limited by the narrow patent venue rules that the Supreme Court has already said should stand alone. -- Featuring: Prof. J. Devlin Hartline, Assistant Director, Center for the Protection of Intellectual Property (CPIP) and Adjunct Professor, Antonin Scalia Law School, George Mason University.

This Teleforum discussed what Victor Schwartz has labelled "Deep-Pocket Jurisprudence™." According to Mr. Schwartz, this occurs when state appellate courts expand tort law to include an innocent defendant because the wrongdoer is "judgment proof" or cannot be reached by the judicial process. The Supreme Court of Iowa has used the term and condemned the practice. -- This call focused on the possible enactment of federal civil justice reform. On March 9 and 10th 2017 the House of Representatives passed three federal civil justice reform measures, namely the H.R. 720, Lawsuit Abuse Reduction Act, H.R. 725, Innocent Party Protection Act and H.R.925, the Fairness in Class Litigation Act. Each enjoy strong support from Speaker Paul Ryan and this marks the earliest in a congressional term that such federal civil justice reform measures have passed the House. Nevertheless, it remains to be seen whether they will pass through the Senate and be approved by President Trump. -- Featuring: Victor E. Schwartz, Partner, Shook, Hardy & Bacon LLP.

On March 6, 2017, the Supreme Court released its 5-3 decision in Pena-Rodriguez v. Colorado. The majority opinion, written by Justice Kennedy, reveresed and remanded the case holding that when there is a juror's clear statement that he or she relied on racial stereotypes or animus to convict a criminal defendant, the Sixth Amendment requires that the trial court consider the evidence of the statement and any resulting denial of the jury trial guarantee. John Richter, Partner at King & Spalding, joined us to discuss the important ramifications of the Court's striking decision. -- Featuring: John Richter, Partner, King & Spalding.

On March 21, 2017, the Supreme Court will hear oral argument in Microsoft v. Baker. The case involves a class action lawsuit against the Microsoft Company by plaintiffs who alleged that during games on their Xbox video game console, the game disc would come loose and scratch the internal components of the device, permanently damaging the Xbox. Since only .4% of Xbox consoles experienced this issue, the district court determined that "a class action suit could not be certified and individuals in the suit would have to come forward on their own." The named plaintiffs voluntarily dismissed their claims with prejudice. The case was then appealed to the U.S. Court of Appeals for the Ninth Circuit where the court overturned the lower court's decision and held that the district court misapplied the law and abused its discretion in removing the class action allegations. -- As Microsoft v. Baker comes before the Supreme Court, the major question is whether or not appellate courts have the jurisdiction to review a class action suit after the plaintiffs voluntarily dismiss their claims with prejudice. -- Featuring: Cory L. Andrews, Senior Litigation Counsel, Washington Legal Foundation.

May a patent owner use contracts to prohibit any resale or reuse of its patented products beyond the initial purchaser? OnTuesday, March 21, 2017, the Supreme Court will hear oral argument in Impression Products v. Lexmark International, which raises this important question. -- Lexmark makes patented toner cartridges and sells them with a contract restriction that the cartridges not be resold or refilled. Impression Products buys used Lexmark toner cartridges, refills, and resells them. Lexmark argues that because the license accompanying the original sale of the cartridges prohibits transferring the cartridges, any reuse and refilling of the cartridges is an unauthorized use and thus a patent infringement. If Lexmark’s argument wins, then manufacturers of patented goods will be able to restrict downstream uses of their goods by use of licenses, and no privity of contract will be required to hold third parties liable. On the other hand, defendant Impression Products argues that the “patent exhaustion” doctrine should operate here to restrict Lexmark from asserting any patent rights after a first, authorized sale. Also at issue is whether first sales in foreign countries instead of the U.S. should affect the outcome. -- The case will have significant effects on the ability of patent owners to control the downstream uses of their patented products, and may affect the ability of patent owners to prevent the importation of “grey market” goods that have been lawfully sold in other countries, similarly to the Supreme Court’s holding in the 2013 copyright case of Kirtsaeng v. John Wiley & Sons, Inc. -- Professor David Olson of Boston College Law School offered impressions and predictions after the Court heard oral argument. -- Featuring: Prof. David S. Olson, Associate Professor, Boston College Law School.

On March 20, the Supreme Court will hear oral argument in Murr v. Wisconsin. This is a regulatory takings case which addresses the question: should two legally distinct but commonly owned contiguous parcels be combined, as described in Penn Central Transportation Company v. City of New York, for takings analysis purposes? -- In 1960 and 1963, the Murrs purchased two adjacent lots in St. Croix County, Wisconsin, each over an acre in size. In 1994 and 1995, the parents transferred the parcels to their children. These lots became nonconforming due to various setbacks imposed in the 1970s, but a grandfathering provision would have allowed independent and separate uses – but only if the lots were not owned by the same individuals. Seven years later, the children wanted to sell one of the two original lots and were denied permission to do so by the St. Croix County Board of Adjustment. The Murrs sued the state and county and claimed the county’s actions resulted in an uncompensated taking of their property. The trial court granted summary judgement to the state and county and the Court of Appeals of Wisconsin affirmed. -- James Burling, Vice President of Litigation at the Pacific Legal Foundation and Misha Tseytlin, the Solicitor General for the State of Wisconsin, will join us to discuss this interesting case and offer their thoughts following oral argument. -- Featuring: James S. Burling, Vice President of Litigation, Pacific Legal Foundation and Misha Tseytlin, Solicitor General for the State of Wisconsin.

In recent weeks, there has been a flurry of editorials on the proper role of the White House Counsel, driven by criticism of White House Counsel Donald McGahn. After the rollout of President Trump’s Immigration Executive Order, some, like Jack Goldsmith, have written that McGahn should have worked with other agencies before the Order was released to prevent the chaos that ensued. -- But what is the proper role of the White House Counsel? Is it to coordinate inter-agency reaction? Should he or she provide legal support to the President first? Or is his or her real client the office of the presidency? Former White House Counsel C. Boyden Gray and former Deputy White House Counsel Timothy Flanigan joined us to help answer these questions and many others. -- Featuring: Hon. Timothy E. Flanigan, Chief Legal & Compliance Officer, Corporate Secretary, Cancer Treatment Centers of America; Former Deputy White House Counsel to President George W. Bush and Hon. C. Boyden Gray, Founding Partner, Boyden Gray & Associates; Former White House Counsel to President George H.W. Bush.

Today, approximately two billion people lack access to financial services. Because of their exclusive reliance on cash, these individuals operate in a “shadow economy,” are subject to greater criminal activity, higher transaction costs, and do not enjoy the same opportunities, benefits, and protections of traditional bank accounts and financial services. Last year, the World Bank and several organizations from the public and private sector announced a commitment to extend basic financial services to everyone by 2020. -- Shamina Singh, the President of Mastercard’s Center for Inclusive Growth, discussed the importance of financial inclusion to the U.S. and global economy and how governments, private sector leaders and philanthropic organizations have been focused on research and solutions to address these issues and foster greater inclusion. -- Featuring: Shamina Singh, President of the Mastercard Center for Inclusive Growth and Chair of the Corporation for National and Community Service.

Historically, protecting national security meant protecting one’s own citizens and sovereign territory from the threats or opposing interests of other nation-states. The concept has broadened, however, as transnational terrorists act with unprecedented scale and range: the threats they pose are of a magnitude previously only possible for nation-states, and they act indiscriminately among the several countries they feel justified in attacking. The United States’ interest in defeating these actors, then, is one that is shared by many other countries that are not necessarily our allies in a larger sense. -- In this the final episode of our three-part Security Partnership Series, we discussed the benefits and limits of partnerships with foreign government agencies for counterterrorism purposes. What conditions form the basis of a productive partnership? How might such partnerships compromise our operations? How do we decide how much information to share? Does partnering with a foreign country’s intelligence agency limit our own independent intelligence gathering capabilities? Perhaps most controversially – what limits can or should be imposed on the methods used to collect the counterterrorism intelligence to be shared? Of the foreign governments that have publicly complained about the United States’ use of certain signals intelligence capabilities, do their intelligence agencies nevertheless desire the information collected? Likewise, although the United States has banned certain interrogation methods domestically, might our intelligence agencies nevertheless want to obtain human intelligence information gathered by foreign agencies using those or other similar methods? -- Featuring: Amb. Ryan C. Crocker , Dean of the Bush School of Government and Public Service, Texas A&M University; William K Lietzau, Vice President, Deputy General Counsel, PAE; and Salli A. Swartz, Partner, Artus Wise Partners. Moderator: Adam Pearlman, Special Advisor to the International and National Security Law Practice Group.

In June 2013, documents leaked by Edward Snowden sparked widespread debate about secret government surveillance of Americans. Just over a year later, the shooting of Michael Brown, a black teenager in Ferguson, Missouri, set off protests and triggered concern about militarization of law enforcement and discriminatory policing. In Unwarranted, Barry Friedman argues that these two seemingly disparate events are connected?and that the problem is not so much the policing agencies as it is the rest of us. We allow these agencies to operate in secret and to decide how to police us, rather than calling the shots ourselves. And the courts, which we depended upon to supervise policing, have let us down entirely. -- The book's author, Professor Barry Friedman, the Jacob D. Fuchsberg Professor of Law at New York University School of Law, Professor Orin Kerr the Fred C. Stevenson Research Professor of Law at The George Washington University Law School, and John Malcolm, Director and Senior Legal Fellow at the Edwin Meese III Center for Legal and Judicial Studies for the Heritage Foundation, joined us to discuss this new book. -- Featuring: Prof. Barry Friedman, Jacob D. Fuchsberg Professor of Law, New York University School of Law and Prof. Orin Kerr, Fred C. Stevenson Research Professor of Law, The George Washington University Law School. Moderator: John G. Malcolm, Director and Ed Gilbertson and Sherry Lindberg Gilbertson Senior Legal Fellow, Edwin Meese III Center for Legal and Judicial Studies, The Heritage Foundation.

The Federalist Society will host a teleforum discussion of Impression Products v. Lexmark International, which is scheduled for argument before the Supreme Court March 21, 2017. At issue in the case is whether a patent owner may use a combination of patent rights and contract law to restrict what purchasers of patented printer toner cartridges may do with the cartridges. Lexmark makes patented toner cartridges and sells them with a restriction that the cartridges not be resold or refilled. Impression Products buys used Lexmark toner cartridges, refills, and resells them. Lexmark argues that Impression Products’ toner refilling activities violate Lexmark’s patent rights because the license to use the patented product that was given to consumers prohibited refilling, thus putting such use and resale of the patented products outside of the scope of the patent license, in violation of Lexmark’s patent rights. For its part, Impression Products argues that the “patent exhaustion” doctrine should operate here to restrict Lexmark from asserting any patent rights after a first, authorized sale. Also at issue is whether first sales in foreign countries instead of the U.S. should affect the outcome. -- The case will have significant effects on the ability of patent owners to control the downstream uses of their patented products, and may affect the ability of patent owners to prevent the importation of “grey market” goods that have been lawfully sold in other countries, similarly to the Supreme Court’s holding in the 2013 copyright case of Kirtsaeng v. John Wiley & Sons, Inc. -- Featuring: -- Prof. Adam Mossoff, Co-Founder, Director of Academic Programs & Senior Scholar, Center for the Protection of Intellectual Property; Professor, Antonin Scalia Law School, George Mason University; Prof. David Olson, Associate Professor, Boston College Law School; and Mr. Steven Tepp, President & CEO of Sentinel Worldwide; Professorial Lecturer in Law, George Washington University Law School. Moderator: Prof. Kristen Osenga, Professor of Law, University of Richmond.

On February 21, the Supreme Court heard argument in Hernandez v. Mesa. In July of 2010, a 15-year-old adolescent named Sergio Adrian Hernandez Guereca and his friends were playing along a concrete structure on the border of the U.S. and Mexico. When Jesus Mesa, Jr., a U.S. Border Patrol Agent arrived, he detained one of the youths on the border, and shot and killed Hernandez, who was hiding behind a pillar of the Paso Del Norte Bridge on the Mexican side of the border. Hernandez’s parents sued Agent Mesa under the Fourth and Fifth Amendment for the use of unlawful and disproportionate force. Agent Mesa argued that the Fourth and Fifth Amendments did not apply because Hernandez was not a U.S. citizen. -- The District Court found for Agent Mesa, while the U.S. Court of Appeals for the Fifth Circuit held that the Fifth Amendment protections against deadly force applied but the Fourth Amendment did not, and that Agent Mesa should not receive qualified immunity. The main questions for the Supreme Court to answer are: Does the Fourth Amendment apply? Should qualified immunity apply to the border patrol agent? And can Agent Mesa make a Bivens claim? -- Steve Giaier of the House Committee on Homeland Security attended oral argument and shared his perceptions. -- Featuring: Steven Giaier, Senior Counsel, House Committee on Homeland Security

Hardie v. NCAA is a recently argued case from the Ninth Circuit. It involves a NCAA ban on all convicted felons from coaching in NCAA-certified tournaments held for recruiting student-athletes to NCAA Division I schools. The key question is whether this policy has a “disparate impact” (disproportional statistical effect, but without any racially discriminatory intent) on African Americans -- and whether Title II of the 1964 Civil Rights Act, which precludes “discrimination or segregation on the ground of race, color, religion, or national origin” in “places of public accommodation,” bans such disproportionate results. The district court ruled that Title II did not cover disparate impact, but, in a surprising move, the NCAA abandoned that winning argument on appeal. -- Pacific Legal Foundation Senior Attorney Joshua Thompson discussed the parties’ arguments and explained why PLF as amicus was the only party to support the lower court’s judgment. Roger Clegg, President and General Counsel of the Center for Equal Opportunity, will also join us to moderate the call. -- Featuring: Mr. Joshua P. Thompson, Senior Attorney, Pacific Legal Foundation and Moderator: Mr. Roger Clegg, President & General Counsel, Center for Equal Opportunity.

On Saturday, March 11 the House passed the Fairness in Class Litigation Act by a vote of 220-201. The stated purpose of the Act is to “(1) assure fair and prompt recoveries for class members and multidistrict litigation plaintiffs; (2) diminish abuses in class action and mass tort litigation; and (3) restore the intent of the framers…by ensuring Federal court consideration of interstate controversies of national importance consistent with diversity jurisdiction principles” (H.R.985, 2017). -- The Bill amends the federal judicial code’s standards for the certification of class action. For example, the bill requires that proposed class members to show that they suffered the same type and degree of injury. The bill also limits the amount and timing of attorney’s fees in a class action. Attorney’s cannot be paid more than the class members, and they must be paid after the class members receive payment. -- Andrew Grossman Partner at Baker & Hostetler LLP and Adjunct Scholar at the Cato Institute will join Professor Howard M. Erichson of Fordham to discuss the legislation as deliberations begin in the Senate Judiciary Committee. -- Featuring: Professor Howard M. Erichson, Professor of Law, Fordham University School of Law and Andrew Grossman, Partner, Baker & Hostetler LLP, Adjunct Scholar, the Cato Institute.

During the 2008 financial crisis, Congress provided Fannie Mae and Freddie Mac with billions of dollars in emergency funds to keep them afloat, supplemented by the investments of private investors who bet that these entities would return to profitability. In 2012, just as Fannie and Freddie were indeed becoming profitable again, the Government instituted a "net worth sweep" that required them to remit to the government nearly all of their profits every quarter. Fannie and Freddie have paid the government over $246 billion so far. In the process, the stock was rendered virtually worthless. Investors filed myriad lawsuits as the net worth sweep came into effect. After four years of litigation and an initial dismissal by the district court, the D.C. Circuit has now largely affirmed but also sent key contract-based claims for monetary relief back to the district court for further review. This Teleforum discusses this historic litigation, its implications for the housing market and the proper role of the Government, and the investors' prospects for success on their claims. -- Featuring: John Carney, Editor, Breitbart News and Jason A. Levine, Litigation Partner, Vinson & Elkins LLP.