Overview

A new venue is beginning to emerge this quarter for NPEs as they continue their assault on the High-Tech sector. Over the past few years, filings for both the District Court and PTAB proceedings have steadily declined but are now beginning to level off. 

Highlights:

• While Delaware is a preferred venue for patent litigation outside of the PTAB, the Western District of Texas has not only become a hotbed for patent litigation, but a preferred venue for NPEs. The Western District of Texas is on pace to have over 600 patent related cases, which NPEs comprise 80% of all cases. This is partly due to Judge Alan D. Albright, a former patent litigator appointed to the bench. 

• Filings for both PTAB and District Court appear to be leveling off, with a similar amount of cases as compared to last year. 

• Small-to-medium enterprises (SME) made up 32% (270 cases) of all patent litigation defendants, primarily sued by NPEs, and were responsible for less than 10 of all Q1 PTAB challenges.

• NPEs continue to bring the most patent disputes in the High-Tech sector for both District Court and PTAB proceedings. NPEs accounted for 85% of patent assertions in District Court and were responsible for 68% of all PTAB proceedings in the High-Tech Sector. 

Figure 1: Assuming current trends continue, 2020 disputes are expected to be nearly the same as last year. View all District Court and PTAB litigation on Unified’s Portal.

Figure 2: The quarter-by-quarter analysis shows a decline in both PTAB and District Court filings. As mentioned above, Q1 saw 841 District Court filings and 329 PTAB filings compared to 799 District Courting filings and 340 PTAB filings in Q1 of 2019. Again, this illustrates that filings for both PTAB and District remain flat since Q3 of 2017. View all District Court and PTAB litigation on Unified’s Portal.

Figure 3: Although the PTAB remains the most popular venue for patent disputes overall, the Western District of Texas has become the most popular venue for NPEs in 2020. On the other hand, the District of Delaware had more filings by both NPEs and operating companies combined. View all District Court litigation on Unified’s Portal.

Figure 4: Assuming this trend continues in the Western District of Texas, the venue will have increased 700% in the last 4 years to become almost equal in patent cases (632) as the District of Delaware (696). View all District Court litigation on Unified’s Portal.

Figure 5: The majority of new patent cases continue to involve the High-Tech industry. View High-Tech litigation on Unified’s Portal.

District Court

Figure 6: Patent litigation has continued to remain static over the last 3 years. In the first quarter of 2020, NPEs are responsible for 489 new patent infringement cases (over 58% of all patent litigation). View District Court litigation on Unified’s Portal.

Figure 7: Castlemorton Wireless, an NPE, was the top asserting entity in Q1 2020. View District Court litigation on Unified’s Portal.

Figure 8: Samsung was the top named defendant in Q1 2020. View District Court litigation on Unified’s Portal.

Figure 9: Small-to-medium enterprises (SME) made up 32% of all patent litigation in Q1 2020. View all District Court litigation on Unified’s Portal.

Figure 10: Nearly 62% of all new district court patent cases involve High-Tech companies.

Figure 11: NPE activity in the High-Tech sector alone contributes more new patent infringement cases than all non-NPE patent litigation combined. View High-Tech litigation on Unified’s Portal.

Figure 12: NPE accounted for 85% of assertions in High-Tech Litigation. View all 2020 District Court litigation on Unified’s Portal.

PTAB Disputes

Figure 13: The PTAB received a total of 329 requests for inter partes reviews.  Meanwhile, the Board’s institution rate in inter partes reviews decreased to 54.8%. More details for these PTAB proceedings are available on Unified’s Portal.

Figure 14: Consistent with district court proceedings, approximately 65% of petitions filed in 2020 involved High-Tech companies.

Figure 15: Approximately 68% of all AIA challenges filed in 2020 that involved High-Tech companies related to NPE-controlled patents. Explore this data further on Unified’s Portal.

Figure 16: In 2020, IPRs were the most popular post-grant proceeding at the PTAB. Explore this data further on Unified’s Portal.

Figure 17: Samsung was the most frequent petitioner with 44 petitions filed. View all of Unified’s cases on Unified’s Portal.

Figure 18: Cellect and Uniloc were the top two most frequently challenged patent owners this quarter. View all PTAB cases on the Portal.

Definitions

Sectors

High-Tech = Technologies relating to Software, Hardware, and Networking

Medical = Technologies relating to Pharmaceuticals, Medical Devices, Health Related Technologies

Other = Technologies relating to Mechanical, Packaged Goods, Sporting Equipment and any other area outside of high-tech and medical patents.

Entities

Non Practicing Entity (NPE) = Company which derives the majority of its total revenue from Patent Licensing activities.

Operating Company or Op. Co. = Company which derives most of its total revenue from Product Sales or Services. Could be an SME or a large company.

Other Entity = Universities / Non-Profits / Government / Non-Governmental Organizations (NGOs)

NPE (Patent Assertion Entities) = Entity whose primary activity is licensing patents and acquired most of its patents from another entity

NPE (Small Company) = Entity whose original activity was providing products and services, but now is primarily focused on monetizing its own patent portfolio.

NPE (Individual) = Entity owned or controlled by an individual inventor who is primarily focused on monetizing inventions patents by that individual inventor.

Venues

CACD = Central District of California

CAND = Northern District of California

DED = Delaware

NJD = New Jersey

NDIL = Northern District of Illinois

SDNY = Southern District of New York

TXED = Eastern District of Texas

TXWD = Western District of Texas

Methodology

This report includes all District Court and PTAB litigations between January 1, 2015 and March 31, 2020.

Total number of reported cases can vary based on what is included. Unified made its best attempt to eliminate mistaken, duplicative, or changes in venue filings, hence the totals may vary slightly compared to other reporting entities. Statistics include litigations initiated by NPEs or Declaratory Judgments (DJs) initiated by operating companies against NPEs.

Unified strives to accurately identify NPEs through all available means, such as court filings, public documents, and product documentation.

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