Each year PriceWaterhouseCoopers (PwC)conducts studies on patents and patent litigation, where the organization analyzes statistics relating to “hot” topics of patent law. This year PwC looked at nonpracticing entities (NPEs – companies that do not design, manufacture, or distribute products) and their effect on litigation.
The study found that, adjusting for inflation using the Consumer Price Index, the annual median damage award has ranged from $2.2 million to $10.6 million, with a median award of $4.4 million over the last 14 years. Overall, this statistic has been more-or-less consistent during this time.
However, damage awards for NPEs have risen considerably in recent years. In fact, the median damages award for NPEs was more than triple the award for practicing entities over the last seven years ($12 million for NPEs, and $3.4 million for practicing entities). Contrasted with 1995-2001, the median damages award for NPEs was about the same when compared with practicing entities (roughly $5 million).
One obvious explanation could be that NPEs have become more sophisticated in selecting patents to litigate, and understanding the markets to sue against. However, another explanation may have something to do with the use of jury trials – juries decided only 14 percent of the cases with damages awards during the 1980s and 24 percent during the 1990s. In this decade, juries have decided 51 percent of the cases with damages awards.
via The 271 Patent Blog: PwC Releases 2009 Patent Litigation Study.
