State Sovereignty Does Not Grant State the Right to Sue in Improper Venue

In Board of Regents of the University of Texas System v. Boston Scientific Corporation, No. 2018-1700 (Fed. Cir. Sept. 5, 2019), the Federal Circuit found it had jurisdiction to resolve University of Texas’s (UT) appeal from a district court’s venue transfer order, and held that state sovereignty principles did not grant UT the right to sue in an improper venue.

UT sued Boston Scientific Corp. (BSC) in the Western District of Texas for allegedly infringing its patents covering drug-releasing fibers. BSC is a Delaware corporation having a principal place of business in Massachusetts. Based on patent venue rules, BSC obtained an order transferring the case to Delaware. UT appealed from the transfer order on the basis of state sovereignty.

The Federal Circuit concluded it had jurisdiction to hear the appeal under the collateral order doctrine, an exception to the final judgment rule. On the merits, the Court rejected UT’s argument that state sovereignty allows a state to control where it litigates. The Court held state sovereignty applies only to suits “against” a state, and that it could not apply to UT because UT was the plaintiff. By suing in a federal court, UT subjected itself to federal court jurisdiction and the associated federal rules, including the governing venue rules.