PATENT LITIGATION ON THE RISE
The number of patent infringement lawsuits increased by 22 percent during 2011 compared with the year before, reaching the highest level ever recorded, according to a report by PricewaterhouseCoopers.
The increase was due in part to the America Invents Act (“AIA”), which took effect in September of 2011. The AIA changed the joinder rules for patent cases making it more difficult for a plaintiff to sue multiple defendants in the same lawsuit. Naming multiple defendants in the same lawsuit had been a cost saving tactic used by plaintiffs to avoid having to pay separate filing fees for each lawsuit.
Before this change took effect, plaintiffs rushed to the courthouse to take advantage of the cost savings associated with only having to pay the filing fee for one lawsuit even though they were naming multiple defendants. After this change took effect, lawsuits that would have previously been filed as one, were split into several lawsuits for each defendant, thus increasing the total number of patent lawsuits filed.
In addition to the increase in patent litigation in 2011, the report also noted that median damage awards ranged from $1.9 million to $16.1 million between 1995 and 2011. The median damage award from 2006 to 2011 was approximately $4.0 million.
Damage awards for non-practicing entities averaged almost double those for practicing entities over the last decade. Moreover, the disparity between jury and bench awards continued to widen, as the median jury award amounted to more than 20 times the median bench award between 2006 and 2011.
Chart Image Source: PriceWaterHouseCoopers Study
