NPE Filings Held Steady in the First Half of the Year Despite Q2 Dip

NPEs added 1,196 defendants to patent litigation campaigns during the first half of 2021, or 7% more than in the first half of the past year (during which NPEs added 1,118 defendants). Most of that increase is due to litigation filed by apparent affiliates of prolific patent monetization firm IP Edge LLC, which were responsible for 307 (or 25.7%) of the defendants added in the first half of this year.

Excluding IP Edge, NPE litigation was still up by 1.4% during the first half of the year, essentially holding steady compared to the same period in 2020. Even without IP Edge, NPEs filed more litigation in the first half of the year than they have during any initial half-year since 2016. With IP Edge included, NPEs had their busiest first half-year since 2017.

Moreover, as reflected in the table below, NPEs added 606 defendants to litigation in the second quarter, 3.2% less than the same period last year. However, Q2 NPE filings exceeded the trailing three-quarter Q2 average by 16.6% and were 2.7% higher than in Q1 2021 (during which NPEs added 590 defendants). NPE filings accounted for 65.1% of the patent litigation filed in the second quarter.

Note that this analysis excludes litigation filed by a small group of design and utility patent owners targeting copycats and counterfeiters selling products online. Such litigation was once rare but spiked starting in Q3 and Q4 2020, and again in the second quarter after subsiding somewhat in Q1.

See RPX’s second-quarter review for a more detailed breakdown of these and other trends impacting patent litigation and the patent marketplace.