The country’s two most popular phone makers, Apple (AAPL) and Samsung, are still getting smacked by dozens of lawsuits from so-called “patent trolls,” which are shell companies that make no products.
Meanwhile, a single district in Texas, which the late Justice Antonin Scalia once branded a “renegade jurisdiction,” continues to occupy an outsize role in this ongoing patent pileup.
Those are two of the most notable takeaways that can be found in a new report on U.S. patent trends in 2015. Published by patent analytics firm Lex Machina, the report adds new grist to a debate over U.S. innovation policy at a time when patent reform in Congress has foundered once again.
Here are some of the key findings from the report:
- Samsung (64 cases) overtook Apple (57 cases) as the most-sued defendant. Other popular targets include Amazon (AMZN) (47 cases), HP (HP) (36 cases), and Dell (33 cases)
- The top ten plaintiffs were all non-practicing entities (commonly known as patent trolls), led by eDekka LCC and Data Carriers LLC, which respectively filed 101 and 85 new patent lawsuits.
- The Eastern District of Texas accounted for an eye-popping 44% of the 5,819 new patent cases in 2015, with one Texas Judge, Rodney Gilstrap, overseeing a staggering 80% of those cases.
Little of this will come as a surprise to those who have followed the debate over U.S. patent policy in recent years, which has seen Congress propose multiple measures to curb the role of patent trolls, but deliver no new laws since 2011.
For the tech industry, which has endured patent trolls as a tax of sorts for years, the new report does include a few bright spots. Namely, the overall number of lawsuits did not grow significantly from 2014 and tailed off significantly from November to December. That drop-off reflects a change in patent procedure that requires plaintiffs to put forward specific allegations rather than just rely on a generic legal form.
Still, patent trolls remain a major thorn in the side for tech companies, as evidenced by a $625 million verdict a Texas jury awarded against Apple last month.
If you’re curious why the towns of east Texas are so popular for patent lawsuits, the answer appears to be that the local economy relies in part on litigation. As Corporate Counsel explains:
Before the Eastern District became a hub of patent litigation, Marshall, Texas was a center for litigation involving personal injury cases related to chemicals and toxins exposure. But after broad tort reform was enacted limiting damage, it looked as if the legal community would suffer. Some have suggested the Eastern District went out of its way to create an environment that would ensure that litigation there would continue. … Justice Anton Scalia referred to the district as a “renegade” jurisdiction.
In the absence of action in Congress, the tech industry is likely to look to the courts as the best hope for reforms. Currently, an appeals court is considering a case that could change venue rules and significantly limit the role of Texas.
