For companies that get hit with lawsuits over obvious patents, the best chance they've got to fight back is last year's Supreme Court decision in Alice v. CLS Bank. Now patent defendants are often able to get a judge's opinion at an early stage of the case about whether the patent was too obvious to grant in the first place.

Patent cases still aren't cheap, but for those willing to fight, Alice is turning the tide in defendants' favor—just not in East Texas.

US District Court Judge Rodney Gilstrap, who presides in Marshall (pop. 25,000), hears more patent cases than any other judge in the country. He has gone out of his way to place additional barriers in the way of defendants seeking to knock out bad patents under Section 101 of the patent laws. That's the section that Alice relates to, which the Supreme Court said should be used to knock out "do it on a computer"-style patents.

Recently, Gilstrap published an order saying any defendant who wants to file an early motion under Section 101 "may do so only upon a grant of leave from the Court after a showing of good cause, which shall be presented through the letter briefing process."

The letter briefing process essentially means defendants have to file a kind of Cliff's Notes version of their motion, a five-page letter explaining why it's worthwhile. It's up to the judge when to allow filing of the motion or whether to respond to the letter at all. Meanwhile, the unforgiving deadlines of East Texas patent litigation march forward.

Expensive delays

East Texas has long had a reputation as a venue that makes it easy on plaintiffs and tough on defendants, with rulings on summary judgment motions that are often delayed until the eve of trial. That's made it a boon for shell companies known as "patent trolls," which find the district amenable to extracting large settlements from companies.

Now, in the wake of Alice, the imbalance is becoming more visible. The Supreme Court has made it clear that the Alice inquiry is supposed to be done early in a case—but Gilstrap's most recent order makes it clear that's not how things are going to happen in his East Texas courtroom.

The combination of tight discovery deadlines and delayed consideration of Section 101 motions virtually guarantees that patent defendants in East Texas will face much higher defense costs than in other courts.

The difference between winning a case on an early motion on "abstraction" grounds and winning at a later stage can amount to millions of dollars. Taking a patent case through trial often costs $2 to $4 million; cases where patents get knocked out on Section 101 grounds can cost less than $300,000.

"The Supreme Court made it pretty clear this is something that could be decided at the outset of cases," said Peter Brann, whose Maine law firm often represents retailers who get sued for patent infringement. "He [Gilstrap] is saying, I'm going a different route than what is being directed from the Supreme Court, and we're going to kick the can down the road. It's important to defendants, because once you get into the case, there's all sorts of expenses that come about—disclosure of documents, source code, and you have to scour the world looking for prior art."

It would be one thing if the other tightly scheduled aspects of litigation were stopped, said Brann. But in Texas, that doesn't happen. The combination puts enormous pressure on defendants to pay up and settle their case.

Brann believes the new rules don't square with the Federal Rules of Civil Procedure, and he isn't the only one.

The "ask permission first" requirement is on top of an already-existing requirement that parties ask permission to file summary judgment motions. Yesterday, Electronic Frontier Foundation lawyer Vera Ranieri wrote a blog post objecting to Gilstrap's rules, stating her belief that parties have "a clear procedural right" to file such motions.

"The reason we file these motions is to avoid the cost and risk of a trial," said Brann. "Instead, you have to get ready for trial anyway."