Recent Trends in U.S. Intellectual Property Litigation Prof. Matthew Sag Loyola University School of Law

Copyright, Patent and Trademark Filings 1994—2015 (Cases) Patent Litigation Explosion Patent Reform? BitTorrent Monetization / Copyright Trolling Forum Selling by Eastern District of Texas

Forum Shopping and Forum Selling

District Court Ranks for Patent Litigation 1994-2014

Patent Cases Filed in US District Courts 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Texas (ED) 2376 1447 1509 1258 602 301 247 305 361 256 Delaware 548 964 1335 992 482 255 230 170 159 133 California (CD) 283 337 431 518 338 233 277 201 321 265 New Jersey 264 154 163 192 156 150 161 196 138 California (ND) 209 300 266 243 183 166 134 Florida (SD) 132 204 151 81 76 44 36 72 63 Illinois (ND) 149 215 235 231 178 155 141 126 New York (SD) 148 121 142 107 115 111 106 108 Texas (ND) 116 66 82 59 52 41 42 43 California (SD) 83 86 143 57 77 69 67 53

Eastern District of Texas 2002–2010 7.33% patent cases 16.39% patent defendants 2011–2015 26% patent cases 28.36% patent defendants Photo from http://www.businessinsider.com/samsung-fined-16-million-over-bluetooth-2015-2?IR=T

Was there a patent litigation explosion Was there a patent litigation explosion? What did it have to do with ‘patent trolls’? US Patent Litigation Filings, 1994–2014

Patent Cases Filed and Estimated Number of Defendants, 1994—2015 Joinder rules changed in 2011 Steady inflation rather than explosion

Abuse of joinder driven by ED Texas Average Number of Patent Defendants per Filing 1994–2015

Patent Reform is Working, Everywhere but the Eastern District of Texas? Patent Litigation in Eastern District of Texas, All Other Districts

‘Copyright Trolling’ 58% of copyright cases filed in the U.S. in 2015

Some background BitTorrent – U.S. Rules of Civil Procedure – allows many people to illegally file share (download movies, television, software, games) IP addresses easily detectable U.S. Rules of Civil Procedure – allow plaintiff to join many defendants in a single action* allow plaintiff to subpoena Internet Service Providers to match IP addresses to subscriber information* U.S. Copyright Law – allows for statutory damages from $750 to $150,000 per work infringed

How copyright trolling works Identify IP addresses illegally downloading Most commonly of pornography, but not always File “___ v. John Doe” or “___ v. John Does 1-5000” Apply for ‘early discovery’ to get names from ISPs Send enforcement letters Threatening large statutory damages Overtones of extortion in some cases Settle for $3000 – $8000 dollars Repeat

Copyright Cases Filed in U.S. District Courts (1994—2015)

‘copyright trolling’ is idiosyncratic Malibu Media is represented by Michael Keith Lipscomb of Lipscomb, Eisenberg & Baker, PL. Lipscomb also represents ‘copyright trolling’ is idiosyncratic

For More Information and to Stay in Touch Professor Matthew Sag Institute for Consumer Antitrust Studies Loyola University Chicago School of Law msag@luc.edu www.luc.edu/antitrust www.luc.edu/antitrust/globalcompetition