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Litigation and IPRs: More
Dangerous Than You Thought?
This is part 5 of a 6-part series on our 2016 Patent Market Report. To begin reading from
the beginning please see 2016 Patent Market Report: An Overview.
Litigations and inter partes reviews are always a risk when dealing with patents. That’s why
it’s so important to always have a strategy in place to combat such risks. Of all packages sold,
10.2% have at least one US patent litigated a er the listing date. We have a much better data
set this year and the rates are much higher than previously reported. We strongly recommend
revising any models based on the old data.
We analyzed all of the packages in our database to look at the use of the assets a er receipt of
the package by the broker. Because we used a better source of US litigation and inter partes
review data this year, it makes it impossible to compare our results to our previous year’s
analysis. Focusing on package-level analysis for packages received in the market years from
2012 to 2016, and looking for packages with at least one litigation or inter partes review as of
October 2016, we found that the sold packages are litigated and inter partes reviewed to a
greater degree than packages generally (Table 9). For inter partes reviews, Table 9 focuses on
packages listed in the market years 2014 to 2015, since we wanted to account for full
implementation of the America Invents Act.
By Kent Richardson & Erik Oliver & Michael Costa
April 25, 2017
Print Article

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Table 9 suggests that purchased patents are used in either litigations or perhaps private
assertions (not all inter partes reviews have corresponding litigations) with much greater
frequency than previously found. When analyzed on a per-US patent basis, about 1.2% of US
patents presented are litigated.
Our new data source allows us to better analyze the timing of the first litigation for the sold
packages (Figure 18). Surprisingly, the filing of litigations is somewhat delayed a er a
purchase. Litigations start in earnest around four months from the sales date, with around
half of all first litigations filed around one year. The tail is long, though – nearly 20% of
litigated sold packages are not first litigated until more than two years from the sale (43
months is the longest delay from sale to first litigation in our data set).
When developing a strategy for addressing the risk of litigation from packages listed on the
brokered patent market, it is important to look at which packages get litigated. Figure 19
examines the proportion of litigations that came from sold and unsold packages. All of the
packages in this dataset have at least one US-issued asset which was litigated a er the listing
date, while 56% of all litigations a er a listing are from sold patents. This highlights the
importance of a robust risk clearance function for the in-house team. A combination of cross-
licenses, license on transfer agreements and membership of defensive aggregators can reduce
these litigation risks. Similarly, the remaining 44% of litigations came from assets that never
changed hands – the original owner could not sell the patents and sued. This suggests that
monitoring the brokered patent marketplace and defensive purchasing can be valuable as
well.

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Tags: 2016 patent market, 2016 Patent Market Report, Guest Contributor, inter partes review,
IPR, patent, Patent Litigation, patent market, patents
Posted In: Guest Contributors, IP News, IPWatchdog Articles, IPWatchdog.com Articles,
Patent Business & Deals, Patent Litigation, Patents
Je Lindsay April 25, 2017 9:21 pm
Thank you for this valuable information. I look forward to the further upcoming reports and to your
ongoing analysis. Vital and important.
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CLICK HERE to CONTINUE READING… In Part 6 of our 2016 Patent Market Report, we’ll look at the
current market size and conclude with our key findings and action items for the year.
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