Anticounterfeit Litigation Spiked Again in the Second Quarter

RPX’s latest quarterly report shows that operating company litigation was down by 8% in Q2 2022—a decline that was even steeper, at 17%, when excluding Abbreviated New Drug Application (ANDA) litigation targeting generic drugmakers. However, that data also exclude a distinct category of litigation filed by a small group of design and utility patent owners targeting copycats and counterfeiters selling products online.

As covered in prior reports, RPX omits such “e-seller” cases from analyses of district court litigation because they tend to follow a different dynamic compared to a typical patent suit: These e-seller actions sometimes name hundreds of defendant entities at once, many of which may be merely online storefronts for the same ultimate parent. Additionally, plaintiffs mainly seek injunctive relief instead of damages, and their cases often end with the e-seller defendant’s failure to answer, followed by a default judgment.

This category of litigation, which began to spike in Q3 2020, is shown in grey below to illustrate its magnitude. As evident from the rightmost bar, e-seller litigation in Q2 2022 was nearly as high as it was in Q3 2020, at 1,561 defendants added—accounting for 63% of all litigation during the quarter (subject to the caveat about defendants with multiple online storefronts noted above).

See RPX’s second-quarter review for more on this and other trends impacting patent litigation and the patent marketplace.