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The final 2015 US patent litigation and PTAB filing figures

With 2015 now behind us, it is a time for both looking back at the year just gone and forward to what that will mean for 2016. Some such as Erich Spangenberg are forecasting a stronger patent market

The headline news is that 2015 was the second-highest US patent litigation year ever, as I analysed in my story published today (subscription or a trial needed to view).

According to figures from the Docket Navigator database, some 5,774 patent cases were filed in US district courts in 2015. This was 15% higher than the 5,006 cases filed in 2014, but 5% lower than the 6,094 cases filed in the record 2013 year.

In addition, NPEs increased their share of the patent cases filed in district courts, according to a study released by Unified Patents this week.

Unlike for district court patent cases, last year was a record year for Patent Trial and Appeal Board (PTAB) filing, with 1,797 petitions. This was up 7% on the 1,677 filed in 2014. Some 92% of the PTAB petitions filed last year were inter partes review (IPR) petitions.

ptab and patent litigation

This record year proves how popular the PTAB has become in the past few years. The pace of PTAB filing slowed near the end of the year, however. The number of fourth quarter petitions was a 9% drop on the third quarter and was down 20% on the fourth quarter of 2014.

Managing IP will be running detailed analyses of 2015 US patent litigation and PTAB filing in the coming weeks, revealing the biggest filers, defendants, law firms and more, so keep a look out for that.

Looking ahead to 2016

The increase in patent litigation has surprised some. In a blog post this week, Erich Spangenberg gave his predictions for the year ahead while also grading his predictions for last year. He gave himself an “F” for his prediction that patent lawsuits will continue to decline but an “A” for predicting that IPRs will increase but not for the reasons most think.

Spangenberg believes that 2016 will see the bottom of the IP market, which has been in disarray since 2010. The America Invents Act, Alice v CLS Bank, and other Supreme Court and Federal Circuit decisions have created great uncertainty for patent owners, not to mention the continued focus on patent reform in Congress.

“It’s no surprise, then, that the billion-dollar-plus patent deals or patent-driven M&A activity we saw back in 2011 and 2012 seem like relics of the distant past,” says Spangenberg. “I predict that in 2016 we’ll see an event that in hindsight will be acknowledged as the bottom of the fall and the beginning of the turnaround.” 

He said there are lots of potential candidates for what that event may be, including a potential sale of Intellectual Ventures and its 70,000 at market bottom prices (“Yes, the company denies it’s for sale… but so what?” asks Spangenberg), an IP investment fund exiting, patent assertion entities going bust, or a big IP-based transaction blowing up.

“We’ve had a bull market in patents for over 25 years. Nothing lasts forever; we were due for a bad five years to correct the imbalance,” says Spangenberg.

He identified several things likely to contribute to the recovery, including it becoming easier to enforce patents in China and the Unified Patent Court becoming a reality in late 2016. “Most importantly, many large patent owners are starting to wake up to the fact that what’s good for Google is not necessarily good for them,” said Spangenberg.

He concluded: “As a result, by the end of 2016 I expect to see a stronger patent market, with both increased transaction volume and higher prices.”

What do you think? Is Spangenberg’s assessment of 2016 right? What will be the big issues for the year? 

Other blogs have also been assessing what 2016 holds in store. The IP Watchdog blog canvassed a number of IP practitioners for their patent and trade secret wishes for 2016 in an enjoyable post. Drinker Biddle’s Bob Stoll noted the importance of this year’s US presidential election. He too noted a change in mood around patents.

“The pendulum is already beginning to swing back towards our historical roots that recognize the importance of strong patent protection as an engine for economic growth and I predict that 2016 will set the stage, with modest improvements for patent holders, for more sweeping changes in 2017,” said Stoll. 

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