NEW YORK: An Introduction to Intellectual Property: Patent

New York: Intellectual Property: Patent 

Patents are documents granted by the U.S. government that award a person or company rights to an invention. Federal law not only sets requirements for obtaining patents, but also provides a mechanism for patent owners to sue others on claims of using the invention of the patent, or selling something that uses the invention, without the patent owner’s permission. That is the essence of patent litigation. This overview covers recent trends in patent litigation.

What Is Patent Litigation? 

Patent litigation typically involves the owner of a patent suing a company for patent infringement. The patent owner argues that, for example, a product the defendant makes or sells includes a component or feature that is covered by claims—numbered clauses articulating the invention—in the patent. Typically, a defendant may be sued where they are incorporated or have an office or other place of business.

Whether the patent owner uses its own invention is typically not an impediment to filing suit. A patent owner who does not make or sell a product that uses its patented invention is sometimes referred to as a Non-Practicing Entity (NPE). NPEs constitute a substantial portion of plaintiffs nationwide in patent cases.

In response, a defendant may argue that it has not infringed the patent’s claims and that the patent is invalid. “Invalid” in this context often means someone else invented the invention before the patent owner, or the patent document itself falls short of meeting certain legal requirements. A defendant may also petition the U.S. Patent Office to review the patent and determine if the patent is invalid—a process called inter partes review—in parallel to the lawsuit in the district court.

If a patent owner wins the lawsuit, they typically win money as compensation. Some patent litigation has resulted in awards of hundreds of millions of dollars or more.

The Pandemic Has Not Slowed Patent Litigation 

The number of patent cases filed in district court in 2020 grew to approximately 4000 compared with approximately 3500 in 2019. In the Western District of Texas alone, new case filing jumped from under 300 in 2019 to over 800 in 2020. And the number of cases filed by so-called NPE plaintiffs in 2020 increased by more than 400 over the previous year.

Though the reasons for the increase nationwide are unclear, what is clear is that the pandemic has not suppressed patent litigation. From the early days of the pandemic, courts handling patent cases in the most prominent districts for such cases did not allow for much delay, which may have helped in not discouraging new filings. Courts handling patent cases reopened their doors, some literally and some virtually, within weeks of the nationwide proliferation of stay-at-home orders. Courts held numerous patent trials during the pandemic, some virtual and some in person.

The Rise Of The Western District Of Texas And Enduring Prominence Of Other Patent Litigation Venues

During the pandemic, the Western District of Texas solidified its position among the most prominent districts for the filing of new patent cases. The Western District saw over 800 new patent cases in 2020. The Western District is known for ambitiously attempting to move cases from complaint to trial in about 18 months, which is attractive to patent holders who are looking to get to trial quickly compared with other districts. The speed of the Western District additionally helps patent holders get to a trial before the Patent Office can reach a final decision on inter partes review of patents asserted in the district court litigation.

Other district courts known for handling much of the nation’s patent caseload did not find themselves short on cases during the pandemic. The Eastern District of Texas and Northern District of California saw a slight uptick in case filings in 2020 compared with 2019, while the District of Delaware and the Central District of California saw modest decreases. Given that the California districts are home to many of the nation’s technology companies, and the District of Delaware is the place of incorporation for many of the companies that are parties to patent litigation, those districts are unlikely to experience significant reductions in caseload.

Desmarais LLP’s Patent Litigation Practice 

Desmarais LLP is a leader in high-stakes patent litigation, particularly cases likely to go to trial, for plaintiffs and defendants. Founded in 2010, DLLP has won numerous high profile trials for defendants wrongfully accused of patent infringement, as well as vindicated the rights of numerous patent owners against infringers.