Brannock & Humphries Prevails In Case About The Limits Of Federal Patent Jurisdiction

In one of the most comprehensive opinions concerning patent jurisdiction since a seminal 2013 Supreme Court decision on the issue, the United States Court of Appeals for the Federal Circuit ruled today that a Florida federal court lacked subject matter jurisdiction to hear a breach of contract case involving a patent license agreement, throwing out the district court’s judgment and holding that the lower court had incorrectly characterized the state-based lawsuit as a case arising under the patent laws.

The Federal Circuit’s ruling was a long time coming.  The case began in early 2016 as a diversity action in West Palm Beach federal court.  It involves a business dispute between Brannock & Humphries’ client, who invented unique children’s car seats in the shape of cartoon and comic book characters, and his former company, who began selling the car seats in major retailers around the country after forcing him out as CEO.  When the district court denied the inventor’s claims, Brannock & Humphries entered the case and appealed to the Eleventh Circuit.

At that point, everyone suddenly realized that diversity of citizenship among the parties was lacking, suggesting that the case didn’t belong in federal court after all.  Sensing that it was about to lose the victory it had won at the trial level based on this jurisdictional problem, the company argued for the first time that the case presented federal questions involving the patent laws.  Upon remand from the Eleventh Circuit, the district court agreed, upholding its earlier judgment and also awarding the company its attorneys’ fees.  The Eleventh Circuit then transferred the case to the Federal Circuit, which has exclusive jurisdiction to hear appeals involving patents.

Brannock & Humphries briefed and orally argued the jurisdictional issue, the merits of the case, and the fee issues in the Federal Circuit.  And today, the Federal Circuit adopted Brannock & Humphries’ jurisdictional analysis, holding that the claims at issue sounded in state, not federal, law.  Thus, the court vacated the merits judgment and the attorneys’ fee judgment.

Brannock & Humphries’ client will now have a chance to present his claims in a Florida state court.