For the fifth 12 months in a row, it’s time for this column to share some ideas on the discharge of the Lex Machina Patent Report. As all the time, I extremely advocate that readers register for the report and provides it a learn, as there could also be extra related info within the report than what follows for any given reader.
As in prior years, what follows are three idiosyncratic takeaways primarily based on my assessment of the report. First, as all the time, the report’s info on the variety of patent case filings deserves additional consideration. Second, we should always talk about the explanations behind the EDTX’s resurgence to the highest of the charts by way of patent litigation workload — and why adjustments on the PTAB may serve to cement EDTX because the busiest patent trial courtroom for the foreseeable future. Third, we’ll verify in on the upward development in patent damages awards, with at the least a nod to the potential influence third-party litigation funding is perhaps having in that regard.
In final 12 months’s assessment, I discussed the general decline in patent case filings in 2023, which this 12 months’s report categorizes as a “sharp decline.” On the similar time, I made clear that “the (2023) report takes pains to notice that a lot of the lower is definitely attributable to a decline in what the report calls circumstances filed by HVPs — or high-volume plaintiffs.“ 2024, nevertheless, noticed a “notable surge in filings from plaintiffs who aren’t labeled as high-volume plaintiffs,” serving to gas a 22% in circumstances filed in 2024 over 2023. Nonetheless, the report notes, “the general quantity of patent complaints in 2024 nonetheless fell wanting the three-year common of three,930 filings noticed from 2020 by way of 2022.” Changing the high-volume plaintiff circumstances that helped gas that 2020-22 common had been ANDA case filings (21.6% enhance over 2023) and design patent filings (34.2% enhance over 2023.) Briefly, 2024 noticed an general enhance of patent circumstances filed, whereas additionally heralding a brand new mixture of plaintiffs — a combination much less pushed by decrease worth high-volume plaintiff circumstances and extra by claims arising out of generic pharma challenges and design patent assertions.
The present mixture of plaintiffs in patent circumstances is in some methods extra reflective of the place patent litigation may help drive vital worth for these initiating it. Maybe the simplest instance is ANDA litigation, the place a profitable consequence for a generic challenger can unlock gross sales that can rapidly dwarf the price of litigation and the prices of looking for regulatory approval to market a generic drug in practically all cases. Likewise, design patent homeowners are sometimes ready to make use of their patents to get injunctive aid and even default judgments towards infringers, making the funding in patent filings mandatory to acquire these cures effectively price it. And the rise of circumstances being filed by “non-HVPs” is probably going being pushed by the supply of third-party funding, in addition to the promise of upper damages rewards for events capable of efficiently navigate their circumstances to trial. Larger worth for plaintiffs equals extra patent litigation, so it is going to be attention-grabbing to see if 2025 matches or exceeds 2024 in general variety of circumstances filed.
Second, the report’s insights into the resurgence of EDTX as the popular venue for non-ANDA and nondesign patent litigation is of curiosity. As hanging as it’s to see over a thousand new patent circumstances filed in EDTX in 2024, it’s maybe much more hanging to see the decline in recognition of each Delaware and WDTX — the 2 hottest districts in 2022 — as a venue of alternative for patent homeowners. With respect to Delaware, the decline in filed circumstances from 668 in 2022 to beneath 400 in 2024 is notable, particularly contemplating the uptick in ANDA patent circumstances that’s possible buttressing Delaware’s tally. It isn’t shocking to see patent homeowners, significantly these partnering with a third-party funder, selecting to take their enterprise elsewhere in gentle of sure disclosure obligations in entrance of at the least one among Delaware’s judges. Likewise, the altering guidelines in WDTX which have eliminated the knowledge for plaintiffs in securing Choose Albright for his or her circumstances have greater than halved the variety of case filings in WDTX from 2022 to 2024.
Wild stuff, with the cumulative impact of cementing EDTX because the go-to jurisdiction for patent circumstances, for causes that almost all if not the entire readership are effectively conscious of. That may possible proceed if the PTAB continues with its present discretionary denial observe in IPRs, which have put a premium on fast and sure trial dates as potent instruments for securing patent owner-friendly denials — with trial timing and certainty an space the place EDTX continues to shine. Put one other approach, for these of us who bear in mind what it was prefer to go to a movie show, the present dominance of EDTX is the equal of a weekend the place a brand new Marvel blockbuster got here out and was exhibiting on each display screen. Certain, you could possibly additionally purchase tickets for the romantic comedy, however it might in all probability be at an off-hour within the screening room with the prime mixture of damaged seats and sticky ground.
Lastly, the statistics for patent homeowners concerning damages awards stay on an encouraging upward development in line with the report. For the fourth 12 months in a row, awarded patent damages that haven’t (but) been reversed on attraction exceed $1 billion, with 2023 and 2024 seeing awarded damages in extra of $3.5 billion. Maybe extra importantly, the variety of circumstances seeing a damages award has skilled an increase as fast as Ozempic customers shed weight, from 57 circumstances in 2021 to almost 95 final 12 months. That vital leap might mirror the elevated presence of third-party litigation funding available in the market, which in principle could be contributing to higher number of circumstances prone to win at trial, in addition to elevated endurance for patent homeowners to say no earlier settlement in favor of rolling the trial cube. Whereas the report accurately notes that “latest figures for reversed harm awards might change,” the elevated success that patent homeowners have seen in circumstances that go to trial ought to solely serve to encourage extra such efforts within the coming years.
Finally, we as soon as once more can see from the report’s presentation of information that fashionable patent litigation stays a vibrant and difficult pursuit for each plaintiffs and defendants. As all the time, I think about myself blessed to have discovered a profession in such an attention-grabbing and ever-changing space of observe. I’m certain that many on this readership really feel the identical approach. Thanks as soon as once more to Lex Machina for pulling collectively and presenting the info in a approach that highlights how effectively our little space of regulation continues to adapt and develop.
Please be happy to ship feedback or inquiries to me at [email protected] or by way of Twitter: @gkroub. Any matter solutions or ideas are most welcome.
Gaston Kroub lives in Brooklyn and is a founding companion of Kroub, Silbersher & Kolmykov PLLC, an mental property litigation boutique, and Markman Advisors LLC, a number one consultancy on patent points for the funding neighborhood. Gaston’s observe focuses on mental property litigation and associated counseling, with a robust give attention to patent issues. You may attain him at [email protected] or comply with him on Twitter: @gkroub.
