New patent case filings declined 10% in 2017 to 4,060 cases – the lowest level of new case filings since 2011 and a third straight year of decline, according to the fifth annual Patent Litigation Year in Review report by research firm Lex Machina.
The report showed the District of Delaware has now overtaken the Eastern District of Texas as the top jurisdiction for new patent cases filed.
For the whole year, the Eastern District of Texas (E.D. Tex.) remained the top court for new patent case filings in 2017 (866 cases) followed closely by the District of Delaware (D. Del.; 777 cases).
However, compared to last year, the TC Heartland v. Kraft decision caused new case filings in E.D. Tex. to fall 48% from 1,662 cases in 2016 and surge 71% in D. Del. from 454 cases.
Since the decision, the District of Delaware has had a greater percentage of the new cases than the Eastern District of Texas, the report said.
In the 180 days before and after the landmark May 22 decision, new case filings in E.D. Tex. fell from 33% to 14%.
Conversely, D. Del. case filings increased from 13% to 24%, while the combined cases filed in all other districts rose from 54% to 62% during that same period.
D. Del. has now overtaken E.D. Tex. as the top jurisdiction for new patent cases filed. However, E.D. Tex. remains an important district to watch, as a significant number of cases are still pending there.
“The Supreme Court’s decision on TC Heartland v. Kraft dramatically changed the landscape of U.S patent law by ending the dominance of Judge Rodney Gilstrap and the Eastern District of Texas and leveling the playing field for defendants,” said Owen Byrd, General Counsel and Chief Evangelist at Lex Machina.
“Practicing patent law is now a whole new ballgame, with new districts, judges, law firms and attorneys rising to prominence – all of which underscores an even greater need for legal analytics to understand the behaviors and track records of opposing attorneys and presiding judges.”
Among the report’s other key findings were:
- Judges: For a fifth straight year, Judge Gilstrap (E.D. Tex.) was assigned more patent cases than any other judge. However, his 550 cases in 2017 were less than half of the 1,119 cases assigned to him in 2016.
- Plaintiffs: 11 of the top 15 plaintiffs were high-volume plaintiffs, with Pfizer, Bristol-Meyers Squibb, Biogen and Biogen International completing the list.
- Defendants: Teva Pharmaceuticals unseated Samsung, the top defendant in 2015 and 2016.
- Of the top 10 defendants, four were pharmaceutical companies (Teva, Mylan, Aurobindo and Sandoz — and six were technology companies (Samsung, Apple, LG, Amazon and two Chinese multinationals – ZTE Corporation and Huawei Device USA).
- Damages: 2017 saw the award of a total of $763 million in reasonable royalty damages and a total of $284 million in lost profits damages. Compensatory damages remain low, with damages awarded in around 2% of the terminated cases filed since 2000.
- ANDA: Case filings increased 29% in 2017, reversing the significant decline of 2016.
- PTAB: IPR petitions have continued to decline from a peak of 548 petitions in Q1 2017 to only 356 in Q4, possibly correlated with uncertainty stemming from the upcoming Supreme Court case Oil States Energy Services, LLC v. Greene’s Energy Group LLC.
“TC Heartland v. Kraft has already created new trends in patent litigation, but the upcoming decision in Oil States v. Greene’s Energy may have an even greater impact on PTAB cases,” said Brian Howard, Lex Machina’s Associate General Counsel and Legal Data Scientist, and author of the report.
“With so much in flux, practitioners should continue to track how these developments play out so they can devise the best legal strategies, provide the best counsel, and make the best business and legal decisions possible.”