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Rule 54(b) doesn’t permit slicing patent’s claims into separate final judgments

by Yuhe Liu, PhD | Oct 8, 2026 | Patents

The US Court of Appeals for the Federal Circuit concluded that Federal Rule of Civil Procedure 54(b) does not permit entry of partial final judgment on some asserted claims of a patent while other asserted claims of the same patent remain unresolved. The Court explained that infringement of different claims of the same patent generally constitutes a single cause of action. ParkerVision, Inc. v. Qualcomm Inc., Case Nos. 26-1033; -1035 (Fed. Cir. Sept. 30, 2026) (Prost, Chen, Stark, JJ.)

ParkerVision sued Qualcomm in 2014 for infringement of two patents directed to electromagnetic signal conversion. One patent included asserted claims directed to down-conversion (receiver claims). The other patent included both receiver claims and asserted claims directed to up-conversion (transmitter claims).

In 2024, the Federal Circuit vacated an earlier summary judgment of noninfringement and remanded. Following claim construction on remand, the parties stipulated to noninfringement of the receiver claims, and the district court entered partial summary judgment. That ruling resolved all asserted claims of the patent directed only to down-conversion but left unresolved the transmitter claims of the patent covering both down-conversion and up-conversion. At ParkerVision’s request, and over Qualcomm’s objection, the district court entered judgment under Rule 54(b) as to the receiver claims and “severed and stayed” the transmitter claims pending appeal. ParkerVision appealed.

The Federal Circuit concluded that Rule 54(b) did not authorize entry of final judgment as to only some asserted claims of the patent covering both receiver and transmitter functionality. Rule 54(b) permits entry of final judgment only as to one or more “claims” for relief, coupled with an express determination that there is no just reason for delay. The Court explained that a “claim” under Rule 54(b) means a cause of action, not an individual patent claim.

Relying on 35 U.S.C. §§ 271(a) and 281 and Federal Circuit precedent, the Court explained that infringement of different claims of the same patent generally constitutes a single cause of action. ParkerVision’s complaint likewise pleaded a single infringement count for the patent covering both down-conversion and up-conversion and did not separately plead causes of action directed to the receiver and transmitter claims. The Court explained that because the receiver and transmitter claims were part of the same cause of action and the transmitter claims remained unresolved, the district court had not entered a final judgment subject to appellate review.

The Federal Circuit also rejected ParkerVision’s alternative jurisdictional arguments. ParkerVision contended that the judgment was final at least as to the patent directed only to down-conversion because all asserted claims of that patent had been resolved. The Court disagreed, explaining that the district court had not been asked to enter a Rule 54(b) judgment limited to that patent and had not made the required express determination that there was “no just reason for delay” as to that patent. Without a valid Rule 54(b) judgment as to the down-conversion patent, there was also no basis for pendent appellate jurisdiction over issues involving the patent covering both down-conversion and up-conversion.

The Federal Circuit [...]

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Epic omission: District court must address pre-suit notice of potential patent ineligibility when denying sanctions, fees

by Richard (Rick) Evans | Oct 8, 2026 | Patents

Addressing a district court’s denial of motions for Rule 11 sanctions and attorneys’ fees and costs, the US Court of Appeals for the Federal Circuit vacated and remanded, finding that the district court had not adequately explained why a patentee’s pre-suit notice of potential invalidity under 35 U.S.C. § 101 did not render its infringement suit unreasonable. Epic Tech, LLC v. Pen-Tech Associates, Inc., Case No. 25-1624 (Fed. Cir. Sept. 30, 2026) (Moore, C.J.; Cunningham, J.; Subramanian, Distr. J., sitting by designation).

Epic Tech owns a patent directed to an electronic gaming system that connects gaming terminals to a server network so that an initial game can run while a secondary game operates in the background. After the patent issued in 2013, several related applications encountered validity problems during prosecution. One related application was rejected on nonstatutory double patenting grounds over claims of the issued patent. After the Supreme Court’s 2014 decision in Alice Corp. v. CLS Bank International, the United States Patent and Trademark Office (USPTO) rejected claims in that application and two other related applications under § 101. Epic Tech ultimately abandoned all three applications.

Epic Tech later asserted another related patent in the US District Court for the Southern District of Texas. That district court found the asserted claims patent ineligible under § 101, although the decision was later vacated.

In 2020, Epic Tech sued Pen-Tech in the District Court for the Northern District of Georgia for infringement of the gaming system patent. On summary judgment, the district court found the asserted claims ineligible under § 101 under the two-step Alice framework. Pen-Tech then sought Rule 11 sanctions against Epic Tech and its counsel, as well as attorneys’ fees and costs under 35 U.S.C. § 285, 28 U.S.C. § 1927, and the court’s inherent authority.

Pen-Tech argued that several developments should have put Epic Tech and its counsel on notice that the asserted patent faced a serious § 101 problem before suit was filed, including the Supreme Court’s decision in Alice, the USPTO’s § 101 rejections in related applications, and the district court’s ineligibility decision involving another related patent. According to Pen-Tech, those circumstances required Epic Tech to conduct a meaningful pre-suit validity investigation.

The district court denied the motions, concluding that Epic Tech’s and its counsel’s positions were not frivolous, that the case was not exceptional, and that the litigation had not been pursued unreasonably or vexatiously. Pen-Tech appealed.

The Federal Circuit vacated, finding that the district court’s explanation was insufficient to permit meaningful appellate review. The Court emphasized that the combination of Alice, the USPTO’s post-Alice rejections of related claims, and the prior district court ineligibility ruling created a “compelling concern over the validity” of the asserted claims. Two of the related applications were particularly significant because the USPTO had previously found their claims patentably indistinct from the asserted patent.

The Federal Circuit found that the district court had not meaningfully addressed Pen-Tech’s notice theory. The district court relied in part on Epic Tech’s pre-suit [...]

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Diamond in the rough: Infringement theory foreclosed by claim construction supports $3.2M fee award

by Hannah Hurley | Oct 1, 2026 | Patents

The US Court of Appeals for the Federal Circuit affirmed an award of more than $3.2 million in attorneys’ fees and non-taxable expenses, finding no abuse of discretion in the district court’s determination that the patent owner and its exclusive licensee continued to pursue an objectively baseless infringement theory after claim construction and discovery foreclosed their position. Carnegie Institution of Washington v. Fenix Diamonds LLC, Case Nos. 24-1804; -1824 (Fed. Cir. Sept. 17, 2026) (Reyna, Taranto, Stoll, JJ.) (nonprecedential).

Carnegie Institution of Washington and its exclusive licensee, M7D Corporation, sued Fenix Diamonds for infringement of two patents directed to methods for producing lab-grown diamonds using chemical vapor deposition. The asserted claims required growing single-crystal diamonds on a growth surface with only insubstantial non-monocrystalline growth. After claim construction, Fenix produced evidence from its manufacturer, Nouveau Diamonds, showing extensive polycrystalline and nondiamond growth. The district court subsequently granted summary judgment of noninfringement.

After the plaintiffs voluntarily dismissed their appeal following M7D’s financial collapse, the district court found the case exceptional under 35 U.S.C. § 285. It concluded that the plaintiffs’ infringement theory became objectively baseless once they received Nouveau’s evidence – approximately one month before the date from which the court ultimately shifted fees. The district court also exercised its inherent authority to award nontaxable expenses, including expert fees, based on what it viewed as vexatious and unreasonable litigation conduct. Among other things, the district court cited a misleading representation concerning access to a facility and the plaintiffs’ eleventh-hour abandonment of one of the asserted patents. Carnegie appealed.

Carnegie argued that its expert’s infringement theory represented a reasonable application of the district court’s claim construction rather than an attempt to relitigate it. The Federal Circuit disagreed. The district court had expressly construed the disputed “growth surface” limitation as not categorically excluding polycrystalline growth. According to the Federal Circuit, the expert’s attempt to exclude a subset of such growth effectively reintroduced a limitation that the district court had rejected. The district court therefore did not abuse its discretion in concluding that the infringement theory was inconsistent with the governing claim construction.

The Federal Circuit also rejected Carnegie’s challenges to the scope and amount of the award. On causation, the Court explained that once a district court identifies the point at which continued litigation became objectively baseless, it need not tie each subsequent fee to a discrete act of misconduct. The district court could therefore shift all reasonable fees incurred after that point.

The Federal Circuit also affirmed the imposition of joint-and-several liability on Carnegie. Although Carnegie characterized itself as a passive licensor, the Court pointed to its close and intertwined relationship with M7D, including shared counsel, joint litigation filings, and consultation rights under the license agreement. Those circumstances supported holding Carnegie responsible for the fee award along with M7D.

Finally, the Federal Circuit affirmed the denial of Fenix’s request for prejudgment interest. Fenix had not sought prejudgment interest before the district court issued its exceptional-case ruling and, when Fenix later raised the issue, [...]

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Hallucinated help: USPTO disciplines patent attorney for failing to verify AI-generated citations

by Taylor MacDonald | Sep 24, 2026 | Patents

The United States Patent and Trademark Office (USPTO) issued a final order approving a settlement between its Office of Enrollment and Discipline (OED) and a registered patent attorney accused of professional misconduct arising from the use of artificial intelligence (AI) in patent litigation. In re Brian E. Mitchell, Proceeding No. D2026-16 (Director July 27, 2026).

Brian Mitchell, a registered patent attorney who had never appeared before the USPTO, used AI to assist in preparing a proposed claim construction chart in a patent case pending in the US District Court for the Eastern District of Pennsylvania. The AI-generated material included several incorrect or fabricated citations to the patent’s intrinsic record.

After the errors were identified, Mitchell corrected them within a day and cooperated fully with OED’s investigation. The final order noted that Mitchell “acknowledged his errors, demonstrated genuine contrition, and accepted responsibility,” and that he had no prior disciplinary history before the USPTO or other tribunals. The district court declined to impose sanctions.

Mitchell nevertheless stipulated that his conduct violated USPTO Rules of Professional Conduct governing competent representation, reasonable diligence, misrepresentation, and conduct prejudicial to the administration of justice. According to the order, the violations arose from Mitchell’s failure to appreciate AI’s limitations (including its propensity to hallucinate) and his failure to verify the AI-generated content before submitting it to the court.

As part of the settlement, Mitchell agreed to a public reprimand, publication of the final order in OED’s electronic Freedom of Information Act Reading Room, and publication of a Notice of Public Reprimand in the Official Gazette. The notice specifically warns practitioners that AI-generated errors “are not limited to extrinsic sources such as statutes, regulations, and case law,” but may also extend to intrinsic evidence.

The order further cautioned that the disciplinary proceeding may be considered as an aggravating factor, or as rebuttal evidence, in any future USPTO disciplinary matter involving Mitchell.

Preamble with backbone: “Universal” limits spinal-implant claims

by Vincent Li, PhD | Sep 24, 2026 | Patents

The US Court of Appeals for the Federal Circuit affirmed summary judgment and a jury verdict of noninfringement, holding that claim preambles reciting a “universal” spinal implant were limiting and that substantial evidence supported the jury’s separate finding of noninfringement. Moskowitz Family LLC v. Globus Medical, Inc., Case No. 24-1696 (Fed. Cir. Sept. 11, 2026) (Prost, Schall, Stoll, JJ.)

Moskowitz sued Globus for infringing three patents directed generally to implant systems used in spinal-fusion surgery. The patents describe implant tools and intervertebral cages. For two of the asserted patents, the central dispute concerned the term “universal,” which appeared in the preambles of certain claims.

The district court construed the term “universal” as recited to mean “an intervertebral bone fusion spacer designed to be inserted between [vertebrae/vertebral bodies] in any region of the spine, i.e., cervical, thoracic, or lumbar, using any approach, e.g., posterior, anterior, or lateral.” Moskowitz conceded that the accused Globus products did not infringe under that construction but argued that the preambles were not limiting. The district court disagreed and granted summary judgment of noninfringement as to those patents. A jury later found that a claim of the third asserted patent was not infringed, and the district court denied Moskowitz’s motion for judgment as a matter of law (JMOL). Moskowitz appealed.

The Federal Circuit affirmed. As to the claims containing the “universal” language, the Court found the preambles limiting for two reasons. First, other terms in the body of the claims, such as “the intervertebral cage” and “the first integral screw guide,” relied on the preambles for antecedent basis. The Court explained that this dependence was a “strong indication that the preamble acts as a necessary component of the claimed invention.”

Second, the specifications confirmed that universality was a fundamental characteristic of the claimed inventions rather than merely an intended use. Without the preamble limitation, the claims would fail to capture that characteristic.

Moskowitz argued that “universal” should be separated from the remainder of the preamble, relying on cases in which the Federal Circuit treated different portions of a preamble differently. The Court rejected that argument, finding that “universal” was “intertwined with the remainder of the preambles” and did not merely recite an intended use. Even considered independently, universality remained a fundamental characteristic of the claimed invention, the Court explained.

The Federal Circuit also rejected Moskowitz’s argument that the district court’s construction improperly required a physically impossible “one-size-fits-all” implant. The Court explained that the patents instead described a design adaptable for use across different regions of the spine and with multiple surgical approaches. The construction did not require a single implant size or a single manner of insertion.

Turning to the patent that proceeded to trial, the Federal Circuit affirmed the denial of JMOL. The asserted claim required a gripper “cooperating with” a handle. Because neither party sought construction of “cooperating,” the jury was instructed to apply the term’s plain and ordinary meaning.

Globus’ expert testified regarding that ordinary meaning and explained why the accused products did not [...]

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Sold but not shown: Private sale does not always constitute public disclosure

by Keval Amin | Sep 24, 2026 | Patents

The US Court of Appeals for the Federal Circuit found that a commercial sale did not qualify as a “public disclosure” under 35 U.S.C. § 102(b)(1)(B) where the sale did not make the relevant aspects of the invention available to the public. NCS Multistage Inc. v. Nine Energy Service, Inc., Case No. 25-1000 (Fed. Cir. Sept. 14, 2026) (Cunningham, Reyna, Hughes, JJ.)

NCS Multistage sued Nine Energy Service for infringing claims of a patent directed to a “float tool” used in the oil and gas industry to help run casing strings to the bottom of a wellbore. The claimed invention uses a rupture disc to seal the casing during installation and rupture once the casing is positioned, avoiding the need to drill out plugs.

At trial, Nine argued that a prior-art device (the TDP-PO tool, which a third party, TCO, sold to Apache in August 2012) anticipated the asserted claims. NCS responded that its own earlier sale of an AirLock device to Tundra in July 2012 constituted a “public disclosure” under § 102(b)(1)(B), thereby removing the later Apache sale from the prior art. The jury returned a verdict in favor of NCS on both infringement and no invalidity. Nine appealed.

The Federal Circuit disagreed with NCS, concluding that the AirLock sale was not a public disclosure as a matter of law. Relying on its 2024 decision in Sanho Corp. v. Kaijet Technology Int’l Ltd, Inc., which interpreted the same “publicly disclosed” language in § 102(b)(1)(B), the Court explained that placing an invention “on sale” does not necessarily mean that the invention has been publicly disclosed. NCS privately sold the AirLock to a single customer. The device was delivered inside a sealed black tube that had to be cut open to inspect its internal components. There was no evidence that receipt of the tube made the claimed features available to the public, including the rupture disc’s configuration and its relationship to the casing string’s internal diameter. Although the transaction was not subject to a nondisclosure agreement, there was likewise no evidence that the invention’s relevant features were communicated beyond Tundra, and NCS’s own technical materials were marked confidential. On those facts, the Court concluded that the AirLock sale did not qualify as a public disclosure under § 102(b)(1)(B).

The Federal Circuit also reversed two claim construction rulings. First, it found that the term “internal diameter” has a single meaning (i.e., a measured diameter across the width of the casing string) and rejected the district court’s construction permitting the term to refer either to that measurement or to an inner surface. Second, the Court found that the term “casing string” should not be limited to casing measuring at least 4.5 inches because the specification’s permissive language did not establish either lexicography or disavowal.

The claim construction errors, together with the erroneous treatment of the AirLock sale, required a new trial on infringement and invalidity. Accordingly, the Federal Circuit vacated and remanded for further proceedings.

Practice note: Patent owners seeking to invoke [...]

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License to litigate: Exclusive licensee may sue without patent owner

by Lauren Hong | Sep 24, 2026 | Copyrights, Patents

The US Court of Appeals for the Federal Circuit reversed dismissal of a patent and copyright infringement action, finding that an exclusive license remained in force, transferred all substantial rights in the asserted patents, and permitted the licensee to sue without joining the patent owner. TexasLDPC Inc. v. Broadcom Inc., Case No. 25-1074 (Fed. Cir. Sept. 14, 2026) (Moore, Chen, Bissoon).

TexasLDPC exclusively licensed a portfolio of low-density parity check (LDPC) technology patents and related copyrights from Texas A&M University. The agreement granted TexasLDPC broad rights to make, use, sell, sublicense, and enforce the licensed technology, as well as to recover damages for infringement. Texas A&M retained limited rights, including rights for research and educational purposes, certain rights associated with a preexisting Marvell license, and approval rights over assignment.

After TexasLDPC was unable to secure customers or sublicensees, it shifted its business toward patent and copyright enforcement and sued Broadcom, Avago, and LSI for infringement.

The district court dismissed the action on two grounds. First, it concluded that the exclusive license automatically terminated when TexasLDPC abandoned commercial development and became an enforcement-focused entity, reasoning that TexasLDPC had “cease[d] its business operations.” Second, the district court held that, even if the exclusive license remained in effect, TexasLDPC had not received all substantial rights in the asserted patents and therefore could not sue without joining Texas A&M, which had asserted sovereign immunity and refused to join the lawsuit. TexasLDPC appealed.

The Federal Circuit rejected both of the district court’s conclusions and reversed.

As to termination, the Federal Circuit found that patent enforcement qualified as a contemplated “business operation” under the agreement. Several provisions expressly treated enforcement as part of TexasLDPC’s “commercially reasonable efforts,” and the agreement separately granted TexasLDPC the right to bring infringement actions and retain infringement recoveries. The Court therefore concluded that TexasLDPC did not cease its business operations merely because it stopped pursuing commercialization and focused instead on enforcement.

The Federal Circuit next found that the agreement transferred all substantial rights in the asserted patents. Considering the agreement as a whole, the Court emphasized TexasLDPC’s exclusive rights to make, use, and sell licensed products; sublicense the technology; bring infringement actions; and collect damages without Texas A&M’s approval. Although Texas A&M retained certain rights, including limited practice rights and the ability to enforce against Marvell, the Court found those reservations insufficient to defeat TexasLDPC’s status as the holder of all substantial rights. TexasLDPC therefore had standing to sue in its own name without joining Texas A&M.

Finally, the Federal Circuit found that Texas A&M was not otherwise a required party under Rule 19. The district court had reasoned that Texas A&M’s absence could impair access to potentially relevant discovery. The Federal Circuit rejected that rationale, explaining that “Rule 19 is not a discovery tool.” The fact that an absent party may possess relevant evidence does not, standing alone, make that party necessary where the court can otherwise accord meaningful relief.

Settlement dispute not arising under patent law doesn’t “survive” Federal Circuit jurisdiction

by Tyler Jackson | Sep 17, 2026 | Patents

The US Court of Appeals for the Federal Circuit concluded that it lacked appellate jurisdiction over a contract dispute arising from a patent settlement agreement because resolving the dispute did not necessarily require deciding a substantial question of patent law. The Court transferred the appeal to the Fifth Circuit. T-Mobile US, Inc. v. KAIFI LLC, Case No. 25-1006 (Fed. Cir. Aug. 28, 2026) (Taranto, Schall, Chen, JJ.)

KAIFI sued T-Mobile in the US District Court for the Eastern District of Texas, alleging infringement of a patent directed to Wi-Fi calling technology. T-Mobile subsequently requested ex parte reexamination (EPR) of the patent. While the EPR remained pending, the parties settled the infringement action.

Under the settlement agreement, T-Mobile received a license to the patent, made an initial payment, and agreed to make an additional contingent payment if any “Asserted Claim survives the EPR.” The agreement defined the asserted claims as the patent claims KAIFI had accused T-Mobile of infringing and included a covenant by T-Mobile not to challenge the validity or enforceability of the licensed patents. Texas law governed the agreement.

The United States Patent & Trademark Office (USPTO) later issued a Reexamination Certificate confirming the patentability of multiple asserted claims without amendment. T-Mobile nevertheless declined to make the contingent payment and filed a declaratory judgment action. T-Mobile argued that a claim “survived” reexamination only if it retained sufficient scope to support KAIFI’s previously asserted infringement theory. T-Mobile also asserted frustration of purpose and lack of mutual assent. KAIFI counterclaimed for breach of contract.

The district court granted summary judgment for KAIFI, concluding that the settlement agreement was unambiguous and that an asserted claim “survives” an EPR if the USPTO confirms the claim as patentable in the Reexamination Certificate. The court ordered T-Mobile to make the additional payment under the agreement. T-Mobile appealed to the Federal Circuit.

The Federal Circuit independently considered its jurisdiction under 28 USC § 1295(a)(1). Because KAIFI’s breach of contract claim arose under state law, Federal Circuit jurisdiction depended on whether the claim fell within the “special and small category” of state-law claims satisfying the Supreme Court’s four-part test of Gunn v. Minton (2013). That test assesses whether a federal issue is:

Necessarily raised;
Actually disputed;
Substantial; and
Capable of resolution in federal court without disrupting the federal-state balance.

The Federal Circuit concluded that the first Gunn requirement was not satisfied because KAIFI could prevail on its contract claim without resolving any patent-law issue. One permissible interpretation of “survives the EPR” was its ordinary meaning, which is that an asserted claim survives when the USPTO confirms its patentability rather than cancels it. That interpretation required only consideration of the agreement and the Reexamination Certificate, not resolution of claim construction, prosecution disclaimer, inequitable conduct, or another issue of substantive patent law.

The Federal Circuit rejected T-Mobile’s argument that determining whether the claims “survived” necessarily required analyzing whether KAIFI altered the scope of the claims through positions taken during reexamination. The Court explained that T-Mobile’s theory was [...]

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APA compliant? Board’s use of invalidity basis not raised in IPR petition may be harmless

by Cecilia Choy, PhD and Lisette Donewald | Sep 17, 2026 | Patents

The US Court of Appeals for the Federal Circuit concluded that the Patent Trial & Appeal Board’s use of a reference that was not urged by the petitioner in an inter partes review (IPR) petition was harmless since the Court agreed with the Board’s analysis and conclusion that all challenged claims were unpatentable as obvious on alternative grounds raised in the petition. Netlist, Inc. v. Micron Technology, Inc., Case No. 2024-1707 (Fed. Cir. Sept. 2, 2026) (Reyna, Linn, Stark, JJ.)

Netlist owns a patent directed to improving the performance and memory capacity of memory boards. The patent describes using buffers between a memory controller and memory devices. Those buffers contain data paths that can be selectively enabled during read and write operations. Samsung filed a petition for IPR challenging certain claims of the patent as obvious over the combination of two prior art patents, Ellsberry and Halbert. The Board instituted review and determined that Samsung met its burden to show that the challenged claims were obvious over Ellsberry alone or in combination with Halbert. Netlist appealed.

The Federal Circuit reviewed the Board’s decision for compliance with the Administrative Procedure Act (APA) and agreed with the Board’s technical review of the prior art in finding the challenged claims obvious. The APA requires that a Board decision identify the reasons and bases in the record for reaching its conclusions. In an IPR proceeding, this generally requires the Board to proceed in accordance or conformance with the challenge grounds presented in the IPR petition, and the Board may not “depart from the petition and institute a different IPR of its own design.” In the past, the Federal Circuit has found error where the Board held claims unpatentable based on grounds that were not urged by the IPR petitioner.

Netlist argued that even if the Board had substantial evidence to find that Ellsberry taught most limitations at issue, the Board erred by using a Netlist patent in its analysis to fill a gap in terms of a claimed limitation. The Board cited the Netlist patent for its teaching that an additional clock cycle could account for delay as data traveled through a buffer. Netlist argued that it was improper to use the Netlist patent to supply a teaching of a claim limitation when Samsung did not present this reference as an invalidity ground in its IPR petition. Netlist argued that the Board expanded the role of the Netlist patent from being mere evidence of general skill in the art to that of a prior art reference in violation of the APA restriction against departing from the petition to find claims invalid on grounds of “its own design.”

The Federal Circuit concluded that any potential error arising from the Board’s use of the Netlist patent was harmless since the Board found alternatively that Ellsbery alone without relying on the Netlist patent taught the limitations in the challenged claims.

Practice note: The decision leaves unresolved when the Board’s use of a reference not relied on in the [...]

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No venue, no problem: Improper venue doesn’t bar district court from deciding validity challenge

by Vincent Li, PhD | Sep 10, 2026 | Patents

The US Court of Appeals for the Federal Circuit affirmed a district court’s dismissal on both improper venue and patent eligibility grounds, finding no abuse of discretion in the district court’s decision to decide a Rule 12 (b)(6) patent eligibility challenge after first determining that venue was improper. AML IP, LLC v. Bath & Body Works Direct, et al., Case No. 2025-1280 (Fed. Cir. Aug. 28, 2026) (Prost, Bryson, Reyna, JJ.)

AML IP sued Bath & Body Works Direct in the US District Court for the Eastern District of Texas, alleging infringement of a patent directed to e-commerce methods. The defendants moved to dismiss under Federal Rule of Civil Procedure 12(b)(3) for improper venue and Rule 12(b)(6) for failure to state a claim, arguing that the asserted patent claims were ineligible under 35 USC § 101. The district court first determined that AML had failed to establish proper venue under 28 USC § 1400(b), concluding that “[f]or this reason alone, the case should be dismissed.” It nevertheless proceeded to the defendants’ Rule 12(b)(6) arguments and concluded that the asserted claims were patent ineligible under § 101. AML appealed.

AML did not challenge the merits of either ruling. Instead, it argued that once the district court determined that venue was improper, it should have stopped and dismissed the case solely on that basis rather than addressing patent eligibility.

Because AML’s challenge concerned the district court’s docket-management authority (an issue not unique to patent law), the Federal Circuit applied Fifth Circuit law and reviewed the district court’s decision for abuse of discretion. The Federal Circuit emphasized that AML did not contend that the district court lacked authority to decide the Rule 12(b)(6) motions after finding venue improper. Rather, AML argued only that the district court should have declined to do so.

The Federal Circuit rejected AML’s reliance on cases stating that venue motions should receive “top priority.” Those cases, the Court explained, generally require a district court to address venue before proceeding to substantive matters, but they do not necessarily restrict what a district court may do after determining that venue is improper. The district court here complied with that principle by resolving venue first and even staying the litigation while the dismissal motions were pending.

The Federal Circuit also noted that the “top priority” principle is intended primarily to protect a party challenging venue from being forced to litigate substantive issues in an objectionable forum. Here however, it was AML – the plaintiff that had selected the Eastern District of Texas – that sought to invoke the priority principle, rather than the defendants that had challenged venue.

AML separately relied on district court decisions in which courts resolved venue motions without deciding pending merits motions. The Federal Circuit found those decisions distinguishable. They reflected the “common-sense principle” that district courts ordinarily should decide venue first when transfer may be appropriate so that the transferee court can resolve substantive issues. No transfer was at issue here. The district court dismissed for improper [...]

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