Fresh From the Bench: Latest Federal Circuit Court Cases

CASE OF THE WEEK

Board of Regents of the University of Texas Sys. v. Boston Scientific Corp., Appeal No. 2018-1700 (Fed. Cir. Sept. 5, 2019)

This week’s case of the week involves issues relating to venue and state sovereignty. Specifically, the Federal Circuit held that state sovereignty does not grant the right to bring suit in an otherwise improper venue. As background, the Board of Regents for the University of Texas System (“UT”)—which is an arm of the State of Texas—sued Boston Scientific (“BSC”), a Delaware corporation, in the Western District of Texas for infringement of two patents relating to implantable drug-releasing fibers. Conceding that BSC was in fact a Delaware corporation with a principal place of business in Massachusetts, UT asserted that venue in Texas was proper because UT has sovereign immunity and the district court had personal jurisdiction over BSC. As to its state sovereignty assertion, UT explained that because UT is an arm of the State of Texas, it would “offend the dignity of the State to require it to pursue persons who have harmed the State outside the territory of Texas” and that the Eleventh Amendment prevents the State from being compelled to respond to counterclaims outside its territory. In its motion to dismiss or transfer venue, BSC explained that it does not own or lease property in the Western District of Texas, and that while it has 46 employees there, they maintain home offices and do not work in spaces owned, leased, or controlled by BSC. The district court determined that venue in Texas was improper because BSC does not maintain a regular and established place of business there. It also rejected UT’s arguments relating to sovereign immunity, and transferred the case to the District of Delaware.