Overview

The changing of the guard at the USPTO brings new changes in the patent dispute landscape. With the uncertainty of Fintiv, United States v. Arthrex, Inc., and pandemic recovery, operating companies have been less contentious than in years past. Despite this ambivalence, a new venue has emerged and more companies are turning to Reexaminations to find certainty in uncertain times. NPEs have continued to increase their assertion, with the TXWD becoming their choice of venue. If 2021 is any indication of what is on the horizon for 2022, it is clear that patent policy may face significant changes and NPEs will continue their assaults. 

Highlights:

• Operating companies account for the slight dip in both district court and PTAB filings. Operating companies filed 5.5% less cases in district court and over 10% less filings in the PTAB.

• The PTAB saw a decline of nearly 12% in filings, while the District Court filings remained unchanged from the previous year.

• Reexaminations continue to gain popularity, with a 47% increase from last year, producing the most filings in the last 6 years. 

• NPEs increased filings by 4%, nearly matching the overall totals from last year. NPEs account for 2,375 district court cases. 

• NPEs account for 87% of all High-Tech assertions in District Court.

• Despite over a dozen Abuse of Discretion on Transfers, Judge Albright’s venue is becoming an NPE hotbed with 83% of all cases brought by a NPE. Overall, the TXWD accounts for 25% of all patent litigation. 

• TXED and TXWD combined account for 37% of all patent litigation.

• Samsung was the most targeted entity in District Court, but also was the most prolific filer at the PTAB. Cedar Lane Technologies was the most active asserted in District Court and WSOU Investments was the most targeted at the PTAB.

• Unified Patents is the 5th overall filer in 2021 with 24. In addition, Unified has filed 23 reexaminations and 17 Chinese oppositions, in addition to the 7 EPO oppositions, 1 UK opposition and 5 Japanese oppositions from last year. 

Figure 1: As 2021 winded down, litigation remained on track from the previous year. The biggest change was seen in an increase of Reexams by 47% from 2020, which played into the decline of PTAB filings this year. Another factor came from operating companies filing 10% less than the previous year. 

Figure 2: Reexaminations have more than doubled since the third quarter of 2020, making up for any decline that can be seen in litigation and PTAB filings. 

Figure 3: TXWD leads other district courts in accounting for over 25% of all patent cases. NPE-related litigation accounts for 83% of the patent cases in this district and almost surpasses the total number of patent cases filed in the District Court of Delaware. View all District Court and PTAB litigation on Unified’s Portal.

Figure 4: High-Tech litigation continues to dominate both district courts and the PTAB, respectively.

District Court

Figure 5: NPE-related litigations out-paced last year’s numbers by 5%, while operating companies have shifted focus on post-pandemic recovery. However, the increase of NPE-related litigation seems to put litigation on par with the last couple of years. 

Figure 6: Looking quarter-by-quarter, NPE-related litigation continues to remain at its 5-year average of 59%.

Figure 7: Cedar Lane Technologies is the highest asserting entity in 2021. Following previous trends, all of the top-10 named asserting entities in 2021 were NPEs.  View District Court litigation on Unified’s Portal.

Figure 8: Samsung entities were the most targeted first-named defendants in 2021. Litigation seems to be centered on network, computer, wireless, and cellular manufacturers. View District Court litigation on Unified’s Portal.

Figure 9: In the first half of 2021, nearly 70% of all new US district court patent cases involve High-Tech companies. This is up 5% from last year. 

Figure 10: NPE activity in the High-Tech sector alone continues to contribute more 2021 patent infringement cases than all non-NPE patent litigation combined. NPEs target the High-Tech sector 95% of the time. View High-Tech litigation on Unified’s Portal.

Figure 11: NPEs accounted for 87% of assertions in High-Tech litigation in 2021.  View all 2021 District Court litigations on Unified’s Portal. Operating companies’ assertions are down 5% overall from last year. 

PTAB Disputes

Figure 12: PTAB filings decreased by nearly 13% this year. This is most likely due to the combination of companies turning to reexaminations, the uncertainty of discretionary denials, and the uncertainty around a new USPTO Director. The Board’s institution rate in inter partes reviews has increased and is now at 59.2%. More details for these PTAB proceedings are available on Unified’s Portal.

Figure 13: This quarter, the PTAB received a total of 304 requests for inter partes reviews, which is on par with previous quarters. Notable absent were operating companies, with 10% less filings compared to 2020. 

Figure 14: Consistent with district court proceedings, approximately 67.7% of petitions filed in 2021 involved High-Tech companies.

Figure 15: Approximately 54% of all AIA challenges filed in 2021 that involved High-Tech companies related to NPE-controlled patents. Explore this data further on Unified’s Portal.

Figure 16: IPRs remained the most popular post-grant proceeding at the PTAB. However, reexaminations account for 19% of all patent challenges at the USPTO. Explore this data further on Unified’s Portal.

Figure 17: The first half saw Samsung as the most frequent petitioner with 130. Unified was the 5th overall filer with 24. This year alone, Unified has filed 23 reexaminations and 17 Chinese oppositions, in addition to the 7 EPO oppositions, 1 UK opposition and 5 Japanese Oppositions from last year. View all of Unified’s cases on Unified’s Portal.

Figure 18: Breaking from previous years, there is now a focus on challenging operating companies rather than NPEs at the PTAB, as only 3 of the top 10 Patent Owners are NPEs. View all PTAB cases on the Portal. 

Reexaminations

Figure 19: Reexaminations continue to increase. This year has already matched last year’s totals, with an expected increase of 47% to 318 for the year. View all reexaminations of 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 December 31, 2021.

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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