Patent Litigation Forum Shopping

Professor Mark Lemley has released a draft of his new study on patent forum shopping titled “Where to File Your Patent Case.” Professor Lemley suggests three primary factors that influence a patentees choice of forum: (1) likelihood of winning; (2) likelihood of getting to trial; and (3) speed of getting to trial. Professor Lemley used the Stanford IP Litigation Clearinghouse database to classify these factors for 25 most-active district courts. (http://ssrn.com/abstract=1597919).

Win Rate: “The variation in win rates ranges from a high of 55% in the Northern District of Texas to a low of 11.5% in the Northern District of Georgia.” Interestingly, Lemley finds that “the Eastern District of Texas, while it has a higher than average plaintiff win rate, is not in the top five districts. And the districts that are in the top five (the Northern District of Texas, the Middle District of Florida, the District of Nevada, the District of Delaware, and the District of Oregon) are not normally thought of as plaintiff patent jurisdictions of choice. Indeed, accused infringers often choose the District of Delaware, filing declaratory judgment actions there. Conversely, patent plaintiffs often file suit in districts like the District of New Jersey that have a surprisingly low win rate.”

Best Venues: When you add-in speed and likelihood of trial, Lemley argues that the best districts include the Middle District of Florida, District of Delaware, Eastern District of Virginia, and the Western District of Wisconsin. The best districts for accused infringers include Eastern District of Wisconsin, the Southern District of Ohio, or the District of Columbia because patent cases in those districts move slowly and more-frequently end with summary judgment in favor of the accused infringer.

Caveats: Prof Lemley hints at a few caveats to his study. Namely, the win-rate in the Eastern District of Texas might be lower than Delaware because of the cases filed there. I.e., patentees with low-quality patents might be more likely to flock to Texas rather than Delaware. 

Read the Paper: http://ssrn.com/abstract=1597919

Note: The data provided here by Prof Lemley is similar to that used by patentees when deciding where to file and in arguing change-of-venue motions.  It is unlikely that the parties are making ignorant choices.  Rather, patentees are deliberately filing cases in the Eastern District of Texas despite these statistics.  The next step in this analysis is to query why?

PatentLawPic984

The heat-map above shows patent litigation filings for the past year and was provided by the Stanford IP Litigation Clearinghouse.

48 thoughts on “Patent Litigation Forum Shopping

  1. The best districts for accused infringers include Eastern District of Wisconsin, the Southern District of Ohio, or the District of Columbia because patent cases in those districts move slowly and more-frequently end with summary judgment in favor of the accused infringer.

  2. Mary, why don’t you go down to your local lumber supply store. There you will find number of ill-dressed workers. Perhaps one of them will act as your videocard driver.

    But watch out if you live in Arizona. There, driver need papers such as a driver’s license.

  3. Help please. I can’t find drivers for my videocard (ATI Radeon Xpress 200 Graphics card). Where I can download it??
    Thanks in advance.
    Mary

  4. At first I thought these fine assemblage of disassociated words were the work of our resident poetess, Sarah. But, I was it does appear that spam bots have located this blog.

  5. There was greater engineer between these than wire: the physical number of the erosion had involved electrical of the northern variety of the high authority and reached to work its winds in co-authors of the significant back council.

  6. It’s presumptuous for the irritant to take credit for the pearl.

    That’s me – spurious and presumptuous.

    But Oh, so ever lovable (must be the lyrics).

  7. “Sounds to me like we have someone with an incredibly biased, partisan attitude (obs. based also in part on your adjacent post).”

    Posted by someone too chickens*** to be associated with what they have to say.

    And from their mindset, I would say a corporate stooge who has probably never had a creative thought in their life.

    America has an underlying competitiveness problem and the only fix for that is patent protected inventions. Big companies file lots of patents mostly on very minor improvements. They surely cannot fix the competitiveness problem.

    Meanwhile, independent, academic and small business inventors produce most of the important stuff. The problem is that crooked transnational companies and their stooges steal their work.

    Now we have those transnational companies moving jobs right and left out of America and we have those same companies stealing inventions and moving the benefits and profits they represent out of the country.

    How can America be competitive if we allow the inventions which would be the basis of new job creation and decent profit out of America?

    boiled_in_HOT-HOT-HOT_Baboooon does not seem to realize that excessive parasitic activity kills the host and without an influx of new inventions his-her-its job would evaporate.

    Ronald J. Riley,

    I am speaking only on my own behalf.
    Affiliations:
    President – http://www.PIAUSA.org – RJR at PIAUSA.org
    Executive Director – http://www.InventorEd.org – RJR at InvEd.org
    Senior Fellow – http://www.PatentPolicy.org
    President – Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.

  8. (at least the starting points of those pearls)

    It’s presumptuous for the irritant to take credit for the pearl.

  9. spam filter in overdrive this morning.

    Ah, the pearls of wisdom lost…

    (at least the starting points of those pearls)

  10. Is it some kind of revelation that patentees might choose a forum based on a “likelihood of winning?” Is this supposed to be pithy stuff?

  11. All of this wonderful data notwithstanding, a savvy litigant may find a good reason to choose a venue that has relatively few patent cases…

  12. Another factor Lemley’s study does not consider is affirmances at the Federal Circuit. We all know your patent case isn’t finished until the Federal Circuit speaks. I can tell you from first-hand experience that the Eastern District of Texas has a high affirmance rate on all issues at the Federal Circuit. This tells you the judges there know the law and apply it correctly, all while getting your case to trial much faster than most crowded patent jurisdictions. How ’bout them apples?

  13. an incredibly biased, partisan attitude

    someone’s projecting their daydreams onto the posts of others

    Is that Url boiled in a pot or in a kettle?

  14. Now, just to add fuel to this discussion, I have had jury consultants advise, when thinking about suing Asian companies, choosing the South because of the alleged bigotry against Asians.

    I was also advised that you need to have local counsel argue, else the Yankee accents will lose your case.

    What does Lemley have to say about this?

  15. BJA writes, “…college degrees… just show that you managed to postpone life for 6 more years. Most of the people without college degrees I know are smarter than the people with them.”

    Really? Really and truly? The vast majority of the people I know with college degrees are engineers and chemists. While I know a couple of non-degreed folks who are plenty smart and could keep up with them, by and large the smart people I know figured out a way to get that piece of paper. What sort of degreed people do YOU hang out with? Eng.Lit majors? Basquette Weavers?

    6 years? In my program, you got your 134 semester hours done in 8 semesters – or you were out on your butt.

  16. Mr. Riley writes, “Sounds to me like we have a sore loser. ”

    Sounds to me like someone’s projecting their daydreams onto the posts of others (I didn’t lose).

    Sounds to me like we have someone with an incredibly biased, partisan attitude (obs. based also in part on your adjacent post).

  17. I haven’t read his study, but I would also agree that win percentage is not a reason for forum selection. Unless one could actually measure the win rate of the same patent in various jurisdictions, one would have to assume that the win rate would be equal everywhere given the same type of patent because all appeals are to the same court, the Federal Circuit.

    The contrary is not true of procedures. They vary greatly from court to court. As was noted above, patentees generally prefer speed and accused infringers generally prefer delay. So, if forum is not dictated by some other concern, such as proper venue concerns, one would think Lemley study to show this.

  18. There are also some other factors at play.

    Note the relatively high filing rate in the Northern District of Georgia against its lowest patentee win percentage in the nation.

    The corporate headquarters of the vast majority of the US flooring industry companies are in this district and this is where they fight it out.

  19. Lemley’s observations can be very misleading.

    Lemley’s an academic, no? Whadda ya expect?

  20. Has anyone done analysis on the individual arts within each district? I imagine the statistics for drug patent litigation will be significantly different than that of software patent litigation. Taking into account some of these districts are more likely to receive certain types of patent litigation of specific arts, Lemley’s observations can be very misleading.

  21. “I’ve had suits in EDTX and in CDCA (but not in NDCA), and I can tell you there are indeed substantial differences as between the first 2 venues, at least in my limited experience.”

    Sounds to me like we have a sore loser.

    Here is something to really show you up. Texas has greatly benefited from both their court’s patent expertise and the venue issue. Now inventors have a very good reason to flock to Texas and set up housekeeping there. I predict that this will lead to a new silicon valley situation and prosperity for certain regions of Texas.

    This is incredibly funny, unintended consequences.

    Ronald J. Riley,

    Speaking only on my own behalf.
    President – http://www.PIAUSA.org – RJR at PIAUSA.org
    Executive Director – http://www.InventorEd.org – RJR at InvEd.org
    Senior Fellow – http://www.PatentPolicy.org
    President – Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (810) 597-0194 – (202) 318-1595 – 9 am to 8 pm EST.

  22. “Namely, the win-rate in the Eastern District of Texas might be lower than Delaware because of the cases filed there. I.e., patentees with low-quality patents might be more likely to flock to Texas rather than Delaware. ”

    Unadulterated bunk, which is not a surprise considering Lemley’s business connections. Inventors like the Eastern District of Texas because the court does not tolerate the kinds of delaying tactics which patent pirating large companies like to use to bankrupt independent inventors. They know that if they can delay judgment day long enough that they will get away with larceny on the grandest of scales.

    No one risks millions of dollars on a patent they think is low quality. The reason that companies lose so many cases in the Eastern District of Texas is that only the best cases make it to court. I believe that for every case which has its day in court that those whose business model is based on intentional infringement get away with stealing at least one order of magnitude more from less fortunate inventors than what they are forced to pay for by the courts.

    Ronald J. Riley,

    Speaking only on my own behalf.
    President – http://www.PIAUSA.org – RJR at PIAUSA.org
    Executive Director – http://www.InventorEd.org – RJR at InvEd.org
    Senior Fellow – http://www.PatentPolicy.org
    President – Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (810) 597-0194 – (202) 318-1595 – 9 am to 8 pm EST.

  23. Looks like patent litigation in Alaska is only slightly more likely to happen than getting a 105 rejection…

  24. boiled, you’re out of it. A college degree is meaningless these days. They just show that you managed to postpone life for 6 more years. Most of the people without college degrees I know are smarter than the people with them.

  25. @IANAE: It is patentee, not plaintiff, win rates — that is, the data is adjusted for declaratory judgments.

  26. “I doubt you’d see a substantial difference in juror education level between EDTX and CDCA or NDCA. ”

    I’ve had suits in EDTX and in CDCA (but not in NDCA), and I can tell you there are indeed substantial differences as between the first 2 venues, at least in my limited experience. No one in the entire EDTX pool had a college degree, while we were within shooting distance of half @ CDCA. As you mention, if any had been PhD chemists, you’re quite correct that one side or the other would have used a peremptory. But it’s still nice to have people who are less susceptible to the “oooh, aahhh, it’s shiny” effect.

  27. Although this information is useful and interesting, the data considered won’t tell you why patentees file in East Texas. Personally, I don’t understand why a patent-holder who *can* file in East Texas would even consider filing elsewhere.

    East Texas judges won’t extend trial dates and sit on summary judgment motions until during or even after trial. This forces Defendants to choose between financing the insanely expensive final months of litigation before trial (in the hopes the judge reads the SJ papers before trial and grants the motion so that it won’t have to actually flip a coin for tens of millions of dollars with the jury) or settle. Also, East Texas judges know how to construe patent claims, believe in broad, fast discovery, and aren’t afraid to impose severe sanctions during discovery.

    Win-rates don’t capture it.

  28. a nicely uneducated jury pool

    I doubt you’d see a substantial difference in juror education level between EDTX and CDCA or NDCA. Any potential juror with an educational or work background relevant to the patent in suit will be removed during selection anyway, assuming both sides have competent counsel.

  29. Indeed, accused infringers often choose the District of Delaware, filing declaratory judgment actions there.

    Does the paper compare patentee win rates, or plaintiff win rates? It appears to be the latter, which may undermine some of the conclusions.

  30. The whole point of EDTX is speed and experience. The win rate is only secondary to getting a judgement in our lifetimes.

  31. Namely, the win-rate in the Eastern District of Texas might be lower than Delaware because of the cases filed there. I.e., patentees with low-quality patents might be more likely to flock to Texas rather than Delaware.

    “Where the truth is the truth.” (Tm)

  32. I worry that Lemley’s “caveat” might throw off the entire analysis – the amount of cases making it past SJ are likely influenced strongly by the strength of the patents in suit.

    There’s also a sizable “chicken and egg” problem with analyzing settlement vs. trial rates by venue, since the strategy and interests of the litigants will influence the rate of trial more than the court itself will.

    Finally, I believe that generating aggregate rankings is moving in the wrong direction. Selecting a venue for a patent suit is necessarily an individualized and forward-looking task. It would be more useful to break things down further, to quantify things like home-field advantage, or the way different arts are handled by particular courts. It would be better to isolate individual elements of the strategic calculus to help litigators balance them in the particular case they are facing.

    Rank-ordering these factors also ignores the magnitude of some differences; for example the difference in trial rate between Delaware and the EDTX is bigger than the difference between the EDTX and the next 3 venues following it.

    It’s great to have statistics on this, but (baseball analogy incoming) at this point it feels like we’re looking at RBI instead of OPS+. It’d be best if there were efforts to isolate and quantify specific aspects of strategic forum selection, instead.

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