Beware Pitfalls In North Carolina’s Patent ‘Troll’ Law
Suppose you are a small company in California asserting a patent against a North Carolina-based company. You gathered finances, hired a lawyer, and filed a complaint. Now you are ready to start litigating your patent infringement case, but you receive a summons for violating NC 75 Article 8. This may seem utterly fantastical, but under North Carolina’s anti “patent troll” legislation it is not.
Next to issues surrounding 35 USC section 101, the supposed abusive litigation by “patent trolls” is one of the most discussed issues in patent law. North Carolina, along with several other states, has enacted laws aimed at curbing this practice. The law, however, suffers from several potential pitfalls. It gives North Carolina courts personal jurisdiction over anyone who sues a North Carolina based entity for patent infringement, even if the patent infringement suit takes place in another state. Lack of contacts, other than serving a North Carolina based entity, are irrelevant. Accordingly, a discussion on the likelihood of federal preemption follows.