U.S. Patent litigation declined significantly in the first quarter of 2023 over the same period in 2022, despite increases in issued patents, the difficulty of non-contentious patent licensing in many industries and the increased availability of litigation funding.
According to data compiled by RPX the decline was attributed “to a pause by a single NPE. Patent monetization firm IP Edge LLC, historically the most litigious NPE, stopped filing litigation altogether in late November after facing pressure over disclosure rules.
Operating company litigation was up 8% over the same period.
A second factor in the decline, said RPX, is due to a downturn in the Western District of Texas, specifically, in the Waco Division, “where defendants added by NPEs in Q1 fell 55% from 190 to 85 as compared to the prior-year period.”
Added together, the reductions from IP Edge and in Waco (231 defendants in total, adjusting for the overlap in IP Edge and Waco cases) accounted for 100% of the decline in NPE activity.
Less Litigation Amidst Greater Challenges
Not considered in the data is why there has not been a greater increase in operating company, independent inventor and non-practicing licensing company suits over that period, given the conditions. The cost, protracted timeline of litigation and the difficulty of plaintiffs prevailing in court with significant damages awards were likely factors.
Unified Patents projects an even more dramatic decrease in patent litigation for 2023 :
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With only 588 cases thus far, 2023 litigation is projected to be down 51% compared to 2022 (see graph).
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NPE (PAE) Activity has dropped nearly 54% to 187 from Q1 of 2022 with 410 cases and 407 in Q4 of 2022.
For the RPX report, go here.
Image source: unifiedpatents.com
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