Overview

One area that does not appear to have been affected by a worldwide pandemic are patent disputes, as they appear to be tracking higher than the last several years. The third quarter saw a 13.7% decrease in litigation from last quarter, but assuming this stays the same 2020 litigation is set to reach its highest level since 2017, largely driven by an increase in NPE litigation. On the other hand, PTAB filings increased 16.1% compared to last quarter, its highest level since the fourth quarter of 2018. Combined patent disputes are tracking to increase 12.7% from 2019. One might think a second wave of disputes since winter is coming.

Highlights:

• For the first time since Unified has tracked litigation, an operating company, JUUL Labs, was the most prolific district court asserter.

• Western District of Texas has become so popular with NPEs there are almost as many filings there as total filings in any other district court.

• The district courts continue to see NPEs bring 87.6% of all patent disputes related to high-tech. 

• Unified continues to be a top-10 petitioner coming in with 8 this quarter, bringing the total to 213 petitions. 

• The institution rate continues to slide 3% from last year to 57.1%.

Figure 1: Assuming current trends continue, 2020 litigation is expected to be the highest since 2016 (3777 cases) and PTAB will be the highest since 2018 (1513). View all District Court and PTAB litigation on Unified’s Portal.

Figure 2: The last two quarters have seen 2,809 district filings litigation and PTAB petitions reaching all-time highs since the second and third quarter of 2016 (3,236). View all District Court and PTAB litigation on Unified’s Portal.

Figure 3: The Western District of Texas continues its reign on top of the rocket docket with 510 NPE filings (86% of total filings in the WDTX). This amount alone almost totals the District of Delaware’s 529 total filings thus far.  View all District Court litigation on Unified’s Portal.

Figure 4: 65% of new patent cases continue to involve the High Tech industry. View High-Tech litigation on Unified’s Portal.

District Court

Figure 5: NPE-related litigation continues to remain at its 5-year average of 59%.  View District Court litigation on Unified’s Portal.

Figure 6: JUUL Labs becomes the first operating company to ever be the most prolific asserter in a quarter, while WSOU Investments, an NPE, continues to be the top asserting entity for the entire year (138). NPEs accounted for 8 of the top-10 asserting entities, showing no sign of stopping.  View District Court litigation on Unified’s Portal.

Figure 7: Google was the top named defendant in Q3 2020. View District Court litigation on Unified’s Portal.

Figure 8: 66% of all new Q3 district court patent cases involve High-Tech companies.

Figure 9: NPE activity in the High-Tech sector alone continues to contribute more Q3 patent infringement cases than all non-NPE patent litigation combined. View High-Tech litigation on Unified’s Portal.

Figure 10: NPEs accounted for 87.6% of assertions in High-Tech Litigation in Q3.  View all 2020 District Court litigation on Unified’s Portal.

PTAB Disputes

Figure 11: This quarter, the PTAB received a total 433 requests for inter partes reviews, a 16% increase from last quarter.  Meanwhile, the Board’s institution rate in inter partes reviews increased to 57.1%. More details for these PTAB proceedings are available on Unified’s Portal.

Figure 12: Consistent with district court proceedings, approximately 63% of petitions filed in Q3 of 2020 involved High-Tech companies.

Figure 13: Approximately 55% of all AIA challenges filed in Q3 of 2020 that involved High-Tech companies related to NPE-controlled patents. This is down 5% from the second quarter of 2020. Explore this data further on Unified’s Portal.

Figure 14: In Q3 of 2020, IPRs were the most popular post-grant proceeding at the PTAB. Explore this data further on Unified’s Portal.

Figure 15: This quarter saw Samsung as the most frequent petitioner with 58. Unified came in seventh with 8 petitions. View all of Unified’s cases on Unified’s Portal.

Figure 16: NPEs were the most challenged Patent Owner this quarter, accounting for 7 of the top 10. 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 September 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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