Excerpts from the New York Times, Sunday, September 24, 2006
So Small a Town, So Many Patent Suits
By JULIE CRESWELL
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ON a crisp Monday morning earlier this month, about 20 lawyers from some of the country’s top law firms shuffled their way into a brightly lit, wood-paneled federal courtroom in this small city in eastern Texas.
What was remarkable about the trial was not the issue being tried or the arguments proffered by each side, but that these big companies — like dozens more from the East and West Coasts — wound up in the Federal District Court here in Marshall, the self-proclaimed Pottery Capital of the World and home to the annual Fire Ant Festival (sponsored by Terminix, the pest-control company).
More patent lawsuits will be filed here this year than in federal district courts in San Francisco, Chicago, New York and Washington. Only the Central District of California, in Los Angeles, will handle more patent infringement cases.
What sets Marshall apart from its neighbors is a red-hot patent docket. Four years ago, 32 patent lawsuits were filed in the Federal Eastern District of Texas, which includes Tyler, Texarkana and Marshall. This year, an estimated 234 cases will be filed in the district, a majority of them in Marshall.
The sounds of hammers and electric saws echo across the brick-paved streets that line its picturesque downtown square as buildings that stood empty for years are being transformed into office space for rent.
Restaurants that depended on tourists drawn to town by the Fire Ant Festival, the Stagecoach Days Festival and the winter Wonderland of Lights display now do a brisk business catering lunches and dinners for visiting lawyers. Some hotel chains along Interstate 20, south of downtown, are running at 95 percent occupancy rates during the week.
“The majority of Marshallites don’t even know the patent docket exists,” said Johnny B. Taylor, a native of Marshall who returned and started an office rental business after spending 31 years as a police officer in Arlington, Tex. “There’s one way the docket affects them: they can’t find parking.”
Patent litigation is a growing business across the country; Marshall is just the most visible example. Among the weightier issues behind the mushrooming of its patent docket is whether the elements that have made it expand — hungry plaintiffs’ lawyers, speedy judges and plaintiff-friendly juries — are encouraging an excess of expensive litigation that is actually stifling innovation.
“It’s not as if you have a situation here where Microsoft is hated or Cisco is spit upon,” Mr. Baxter said. “Whether it happens in Marshall, Tex., or Des Moines, Iowa, these lawsuits are going to happen. They might as well happen here.”
And many in Marshall are looking for ways to profit from the patent gusher.
THE paint is peeling and the wallpaper in the bathroom is nothing short of hideous, but all Johnny Taylor sees as he walks through the former doctor’s office he just bought in town is space for as many as 16 lawyers.
“Furnished office space is renting for $1 to $1.50 a square foot per week. So, a 2,000-square-foot office can get $2,000 per week,” said Mr. Taylor, who has already wired the building for high-speed Internet access and created marshallofficespace.com to highlight offices for rent and offer advertising to local businesses.
One of the first challenges for visiting lawyers arriving in Marshall is cramped quarters. They often roll into town with semitrailer trucks that have traveled from San Francisco or New York containing everything that could be needed to try a case, including volumes of documents, copying machines, desks, video and audio equipment and even cappuccino machines.
Some people in Marshall are trying to save them the trouble by providing fully equipped office space on short-term leases.
“We’re going to have a 6,000-square-foot space for a war room that we can rent out for $7,500 to $10,000 a week,” said Leslie D. Ware, a patent lawyer in Dallas, who bought a former furniture building next door to the federal courthouse. “A firm could basically walk in, plug in their laptops, work and unplug and go home,” he said.
Others are trying to lure patent dollars through different tacks. Fairfield Inn, which bought a subscription to Pacer, the electronic docket, routinely calls law firms to offer rooms for their lawyers with cases scheduled for trial.
“I’m thinking of coming up with a T-shirt for the lawyers,” said Jennie A. Kelehan, a former financial adviser who moved here from Houston three years ago and is now the co-owner of a wine and specialty store called Under the Texas Sun. She estimated that lawyers in town for the patent docket were responsible for about a sixth of her sales.
“The patent lawyers were not in our plans at all,” she said, “but they are definitely a huge asset for us and we will start using that as we start planning for the future.”
Excerpts from the Marshall News Messenger, Monday, July 24, 2006
Filling A Niche Online: Local businessman offers Web service for visiting attorneys
A local businessman believes there's a “cottage industry” in downtown Marshall and he's doing something about it.
Johnny Taylor is the owner of Marshall-based TechnoDev.com, which designs, hosts, and maintains Web sites on the Internet for individuals and businesses. That is a big departure from the Marshall native's other career.
After graduating from high school in 1969, he headed off to school in Arlington and then spent 31 years with the Arlington Police Department. He returned to Marshall about four years ago.
"This is something I wish I'd done sooner," the entrepreneur said.
Taylor recently launched a new Web site, www.MarshallOfficeSpace.com. The site's targeted audience is attorneys who are visiting Marshall while involved in cases at the Sam B. Hall Jr. Federal Building and United States Courthouse.
"The influx of visiting attorneys to Marshall has been the subject of several news stories locally as well as in Dallas, Austin and Houston newspapers," Taylor said. The topic is featured in online law blogs nationwide, he said.
As the result of the Marshall court's "rocket docket" – or ability to get cases to trial faster than other jurisdictions – attorneys and other legal professionals are traveling to East Texas in large numbers.
"And while here they are spending thousands of dollars on office rental, catering, restaurant meals, retail shop gifts, rental cars, hotel rooms, dry cleaning and other services and products," Taylor said.
"I've been studying this phenomenon for the past six months,” he said. “ Some area folks are benefiting greatly while others seem totally uninformed as to the potential profits to be made from this ‘cottage industry'."
Taylor said he sees the new Web site as a "win-win situation" for everybody. Local business people will be able to advertise their services or products on an Internet billboard that can be read from anywhere in the nation, and the visiting attorneys will be able to conveniently find the services, products and temporary office space that is available in Marshall when they're planning their trip months in advance of their local federal court appearance.”
After months of preparation Taylor put the Web site online in May.
“The site has already been indexed by several of the major Internet search engines including Google, Yahoo, and MSN," he said. "We're already receiving visits from as far east as Virginia and west from San Francisco.
Taylor expects the audience to grow as the other search engines and legal blogs pick up the site listing.
"Downtown Marshall is experiencing a long-awaited revitalization and I hope I can contribute to it with the results and impact of this new Web site, ” says Taylor.
Apparently Taylor believes what he preaches as he is in the process of purchasing a downtown building and plans to have TechnoDev.com in new offices near the square by this fall. Taylor's company is responsible for a number of Marshall business Web sites, including www.The-Marshall.com. He is in the process of developing a site for Main Street Marshall.
Taylor can be reached at (903) 926-1114 or (903) 934-9159 or by e-mail at firstname.lastname@example.org.
Excerpts from the Austin American-Statesman, Sunday, April 16, 2006
By Chuck Lindell AUSTIN AMERICAN-STATESMAN STAFF
“… every week, in ever-rising numbers, some of the world's largest companies travel to this dot on the Northeast Texas map to wage multimillion-dollar legal battles.
A new patent case arrives at Marshall's one-story federal courthouse about every other business day, bringing fleets of hotshot lawyers and international executives to the Piney Woods. They rent entire office buildings and fill motels. One even dropped $6,250 on the grand champion steer at last month's junior livestock show.
The surge in court activity has filled once-empty storefronts on Marshall's downtown square with restaurants, shops and expanding law offices. An abandoned eight-story hotel, once the largest pigeon roost in East Texas, will become condos with a rooftop dance hall.
Ecstatic civic and business leaders hope to keep the good times rolling…
Allen said. "When these lawyers gear up for these lawsuits, the amount of money they spend — it's amazing; it's amazing to small-town folks. Of course, there's millions at stake. They don't want to cut corners."
Some of that money has spilled into the town square.
Where there were no restaurants three years ago, there are now six, including R&R Bakery and Coffee, where owner Reese Reed estimates lawyers make up 30 to 40 percent of his bakery and catering clientele.
Five years ago, one in four downtown buildings stood vacant. Today, all are filled — or will be. "I don't know of a single building that is vacant that doesn't have a pending building permit or is transferring ownership," said Bo Ellis, manager of the town's Main Street program.
Randy Touchstone is a Dallas developer closing on his first deal in Marshall, buying and renovating a former furniture store next to the federal courthouse. Its 18,000 square feet, with underground parking, will be marketed to law firms.
"I think the federal court is a cottage industry in Marshall," he said. "There is unsatisfied demand. Isn't that every real estate developer's hope?"
The signs are everywhere. Sleek corporate jets swoop into the county airport about three times a month. Lawyers drink in the Red-Headed Lady bar and grill and go to the Monarch Body Works for $35 massages that would cost $160 in New York.
Excerpts from the Marshall News Messenger, Thursday, April 6, 2006
‘Rocket Docket’ has economic benefits for town playing host
Commentary by Mike Elswick, Managing Editor
“… as a spin-off of the job Judge Ward has done, the city of Marshall is reaping some economic benefit.
The ‘rocket docket’ reputation has resulted in attorneys from across the nation spending weeks in Marshall. They stay in the city’s hotels and bed & breakfast inns, eat in local restaurants and buy gas and other necessities locally.
So the name of Marshall is being spread near and far while at least some of the city’s hotels are being filled with legal types and expert witnesses.
Other businesses are also benefiting from the ‘rocket docket’ even if we do not totally understand all the legal ramifications behind it.”
Excerpts from the Dallas Morning News, Sunday, March 26, 2006
By ALLEN PUSEY, WASHINGTON BUREAU, DALLAS MORNING NEWS
Patent lawyers flock to East Texas court for its expertise and 'rocket docket'
“For the past five years, a steadily increasing stream of intellectual property lawyers from Boston, New York, San Francisco and all points Texas have filled the chain hotels along U.S. Highway 59, making the town of Marshall an unlikely hub in the lucrative universe of patent infringement litigation.
Patent litigation "is a big deal here, a really big deal," said Connie Ware, president of the Marshall Chamber of Commerce. "And we're glad to have it."
Excerpts from CAL LAW:
California’s Online Legal News Source, June 16, 2003
THE MARSHALL PLAN
By Brenda Sandburg, The Recorder
“Marshall is one of the hottest venues in the country for patent litigation. And though residents may not be holding a festival in their honor, patent lawyers are finding the city -- or more accurately, the federal courthouse there -- a fast and efficient venue for high-stakes litigation
"It's a lawyer's dream," said K.T. "Sunny" Cherian, a San Francisco partner at Washington, D.C.-based Howrey Simon Arnold & White who has tried several cases in Marshall. The town has a "fair, fast court, a knowledgeable court. The kind of things that are a luxury."
Patent lawyers say they believe the district has the third-largest docket of patent cases in the country, behind that of the Eastern District of Virginia and the Northern District of California. While Marshall has dealt with patent suits for more than a decade, its workload has mushroomed in the past three or four years.
So how did a rural community better known as the former home of Lady Bird Johnson become a magnet for patent litigation?
Every month, big city patent attorneys trek to Marshall's single federal courtroom to do battle.
Of course, to work in Marshall, it helps to know the lay of the land. The city -- 148 miles east of Dallas near the Louisiana border -- spawned PBS mainstay Bill Moyers and boxer-turned-grill pitchman George Foreman. It was one of the last capitals of the Confederacy, and of course there's the fire ant festival.
"It's a cross between 'Hee Haw' and 'Twin Peaks' out here sometimes," said Michael Smith, a partner at Marshall's Roth Law Firm.
And it's not just the lawyers who are benefiting. The main hotel, the Hampton Inn, gets a steady flow of business, as do restaurants and other shops.
"It dumps a lot of money into the economy of the town," Roth's Smith said.
Patent lawyers expect to continue spending a lot of time in Marshall.
That hasn't happened in the Eastern District of Texas, and many lawyers believe the courts will hold onto their caseload no matter how heavy it gets. And for the local bar and many out-of-towners, that's good news.”