Patent News

Feb. 5, 2015

Intellectual Asset Management: The trend is clear – patent litigation rates in the US are on the decline, by Richard Lloyd

This post originally appeared in Intellectual Asset Management on February 5, 2015.

Lex Machina has recently published a new piece of analysis on patent litigation rates, which is well worth looking at. The analysis looks deeper into the fall in filing numbers in 2014 and suggests that on a like-for-like basis levels are closer to five years ago. The study also analyses the impact of post issuance proceedings at the Patent Trials and Appeals Board (PTAB) and the effect that the Supreme Court’s decision in Alice v CLS has had on new cases.

Here are a few key points worth highlighting.

The fall in litigation might be bigger than we first thought – One of the most immediate impacts of the America Invents Act was the pronounced spike in litigation rates caused by a change in the joinder rules. Under the AIA, cases involving the same plaintiff and patents could no longer be bundled together as in previous years. Lex Machina’s analysis attempts to get round that change in the joinder rule by counting each defendant in a case separately so that the impact of the AIA can be ameliorated.

By counting what Lex Machina terms as defendant case pairs – plaintiff P suing defendants A, B and C counts for three pairs so that cases can be counted in a way that is not affected by the AIA’s change of rules – the analysis shows that litigation rates in 2014 were actually closer to levels last seen in 2009 and 2010. There was a steady increase in the years leading up to the AIA’s introduction and after it was signed into law in 2011 (apart from a spike just before it came into force), but on the basis of Lex Machina’s defendant case pair analysis levels have actually been falling since the first half of 2013.