10 Points on US Patent Litigation

These points are based on the article ‘Understanding the Realities of Modern Patent Litigation’ by Allison, Lemley and Schwartz.

1. The article is based on 949 merits decisions based on infringement suits decided in 2009 to 2013 from every case filed in 2008 and 2009. The decisions come from 462 different cases involving 777 different patents. Of the 949 merits decisions 636 were definitive wins for one side or the other. The remainder were interim wins, usually denial of a summary judgment motion.

2. The most common source of merits rulings were summary judgments of invalidity (430) and non-infringement (473). In contrast patentees were less likely to seek or obtain a summary judgment in their favour. Patentees brought and received rulings on 125 summary judgments on validity and 128 summary judgements on infringement.

3. Of the 949 merits decisions 290 patents went to trial. 273 merits decisions reached a Federal Circuit decision on appeal and another 126 were appealed but settled before decision. 82 of the merits decisions are pending before the Federal Circuit.

4. Less than 10% of the patent lawsuits filed in 2008 and 2009 resulted in a merits decision, i.e. more than 90% of lawsuits were settled before summary judgment or trial.

5. In a study in 1998 it was found that validity challenges were overwhelmingly based on obviousness. In the present study it was found that whilst obviousness was still important, there were fewer summary judgements based on it than anticipation. There are also a growing number of decisions based on patentable subject matter and the largest category of validity decisions was indefiniteness which barely registered in the 1998 study. This is due to indefiniteness being applied on software means-plus-function cases and also the rise of claim construction.

6. Only 31% of invalidity challenges succeeded at summary judgment, overall in 42.4% of cases. However patentees won only 26% of the definitive merits rulings as they do badly on infringement. Accused infringers win 57% of judgements on infringement.

7. Patentees do badly because of ‘fractioning’ of patent law. They have to win every issue of validity and also infringement to win overall. A patentee’s burden for summary judgement for infringement is higher than the accused infringer because they need to show lack of disputed issues for ‘all’ elements of the invention whilst the accused infringers need to show it for ‘any’ element of the invention. Also the patentee must survive at summary judgment and trial, whilst a win at either is sufficient for the accused infringer.

8. Patentees fared better on validity issues in multi-patent decisions.

9. Foreign patents were more likely to prevail in merits decisions, suggesting that foreign plaintiffs were only asserting their best patents.

10. Patent characteristics, such as number of prior art references, seem to have no correlation with overall win rates, validity or infringement outcomes.

The article can be downloaded here.

You may also be interested in related articles 10 Observations on Patent Litigation and Top 8 Disadvantages of a Specialist Patent Court.

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