Number of Patent Litigation Cases Dropping for the First Time in Six Years

The Supreme Court, in Alice Corp. Pty. Ltd. V. CLS Bank International et al, 134 S.Ct. 2347 (2014) encouraged the Court of Appeals for the Federal Circuit and district courts to strike down overly broad claims tied to software and computer-implemented business methods. Along with other landmark cases revolving IP as well as the growing popularity of petitions to review patent validity at the United States Patent Office (“USPTO”), the area of IP law has been rapidly changing, swaying patent holders from filing suits.
From 2009 to 2013, the number of filings increased every year but in 2014, there was a drop of 17%, with the number of filings dropping below 5000, as compared to 2013. However, in 2014 the Patent and Trial and Appeal Board, a panel of judges at the USPTO received 1,679 petitions to review patents.
Further, the court in VirnetX Inc. v. Cisco Systems Inc., 13-1489 (Fed. Cir. 2014) raised the standards and thus made it more expensive to demonstrate a case for damages. 2014 has been an unpredictable year for IP law and the data showing the drop in filings is proof that the effects have rippled past just how the legal standards have changed.