Numerous Online Storefronts Targeted over Counterfeit Products in Q3

RPX’s latest quarterly report shows that operating company plaintiffs added 283 defendants to patent litigation campaigns in Q3 2024, which was up by 11% from the year-ago quarter, up by 13% compared to the trailing Q3 average for 2021-2023, and down by 5% compared to the preceding quarter. Year-to-date operating company litigation was up by 10% compared to Q1-Q3 2023.

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 Q3 2024 accounted for 2,363 defendants added, or 76% 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 third-quarter review for more on the key trends that shaped patent litigation in Q3 2024.