Numerous Online Storefronts Targeted over Copycat Products in Q1

RPX’s latest quarterly report shows that operating company plaintiffs added 270 defendants to patent litigation campaigns in Q1 2024, essentially holding steady compared to Q1 2023 (when such plaintiffs added 269 defendants) and Q4 2023 (274 defendants) and exceeding the trailing average by 6%.

However, that data exclude another distinct category of litigation filed by a small group of design and utility patent owners targeting copycats and counterfeiters selling products online. RPX excludes such “e-seller” cases from analyses of district court litigation because they tend to follow a different dynamic compared to what one might consider the usual patent suit. These e-seller cases sometimes name hundreds of defendant entities, many of which may be merely online storefronts or aliases for the same ultimate parent. Also, plaintiffs primarily 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 shown by the rightmost bar, e-seller litigation in Q1 2024 accounted for 3,150 defendants added, or 82% of all litigation during the quarter—though this number remains subject to the caveat about defendants potentially having multiple online storefronts noted above.

See RPX’s first-quarter review for more on the key trends that shaped patent litigation in Q1 2024.