Patexia Insight 122: Patent Litigation Continued its Upward Trend in 2021
Updated: After a secondary review, the number of ITC cases in 2021 was updated to 71 from 73 (Feb 10, 2022)
As the Pandemic still continues and is entering the third year, surely the world and our lifestyles have changed along with it. The patent litigation trend has continued its upward trends. In 2021 we saw more filings compared to 2020 and this marked the second consecutive year of growth. In 2021, district court patent litigation grew 2.5 percent.
During the last decade, the district court patent litigation rose to new levels and remained so until 2015. Then it declined till the beginning of Pandemic. A number of factors contributed to the decline such as the introduction of IPR in 2011 as well as some changes in the patent law that lowered the value of software patents (Alice Case). Meanwhile the reasons behind the recent rise since 2020, are still in the realm of speculation. What we have identified is the fact that some entities have single-handedly influenced the growth in number of cases. We will cover these entities in deeper detail in our second annual Patent Litigation Intelligence Report coming up in February 2022. In this week’s insight we are going to review the IP activity during 2021 and compare that to prior years.
Excluding the ANDA/Hatch-Waxman cases which follow different trends, a total of 3,967 patent cases were filed which is 2.5 percent higher than the 3,872 patent cases filed in 2020. The numbers seem still lower than those before 2015 however it’s interesting to observe the trend and how much it will continue to grow in the near future and if the numbers will reach new levels once again. Activity and performance are key indicators for the entities that participate in patent litigation so we have evaluated all stakeholders including plaintiffs, defendants, and their representatives (law firms and attorneys) in our Patent Litigation Intelligence 2022 Report. To find the true activity proves to be an enormous challenge but we traced back many companies to their point of origin in order to identify their parent companies. This helped us identify a handful of entities that played a big role in the litigation cases during 2021 as well as contributing to maintaining the high numbers in 2020.
As we have analyzed in Patexia Insight 44, more than 80 percent of IPR filings are directly related to an active district court case. This means that high numbers in DC cases directly impact the IPR trends. This was true for 2020 where the rise in district court litigation translated into a 14 percent growth in IPR. As for 2021, a moderate decline was observed but still the number is higher than that of 2019.
As we know, there is usually a 6 to 12 months delay before defendants file IPR petitions. Therefore the IPR activity in 2022 may be higher than 2021. The following chart shows that in 2021 there were 1,303 IPR petitions compared to 1,443 IPR petitions in 2020.
ITC Section 337 growth continued in 2021 with a 6 percent increase compared to 2020. During the year, a total of 71 cases were filed compared to 67 cases in 2020 which were considerably higher than the relatively lower numbers in 2018 and 2019. During 2021, we also noticed increased interest by AmLaw 100 firms in adding or expanding this practice area. Our recruiting division was also very active helping several firms with this practice area. Considering the recent interest by larger firms, we believe we will see even more ITC complaints filed in 2022. Law firms plan to suggest ITC to their clients as a strategy to run in parallel with the district court case.
When it comes to activity in patent litigation venues, out of 81 district courts with patent cases, Western District of Texas with 981 was the most active court followed by Delaware District Court with 742 cases. This is due to the fact that certain judges whose work will be covered in details in the upcoming Patent Litigation Intelligence Report, are very active when it comes to patent litigation.
Patexia has expanded its Intelligence Reports and plans to publish seven reports in 2022. We are also considering adding a brand new report to cover trade secret litigation in 2022. Here is our publication schedule for this year: