Semiconductor Litigation Surged in Q3

A breakdown of NPE district court filing trends by market sector shows that Semiconductors was one of the only sectors in which litigation increased during Q3 2022 compared to the same quarter one year ago—with 90 defendants added, or 173% more than the amount seen during Q3 2021. The Networking sector increased just slightly (by 5%), while other sectors dropped significantly.

That surge of new semiconductor litigation included activity from plaintiffs linked to some familiar players in the patent monetization space, nearly all asserting patents from portfolios that originated with notable operating companies.

Among those plaintiffs is Daedalus Prime LLC, which launched its first litigation in August with an ITC complaint and set of district court suits focused on semiconductor products used in the automotive industry, targeting automakers, an infotainment system provider, and a group of chipmakers, among others. In September, the focus shifted to mobile devices incorporating certain systems-on-chip, with another set of cases again filed before both the ITC and in district court. Daedalus Prime acquired the asserted portfolio from Intel in early June 2022; the plaintiff is managed by a patent monetization veteran behind two other entities active in the patent space, Daedalus Group LLC and Daedalus Blue LLC.

Another particularly active plaintiff this past quarter was Bell Semiconductor, LLC (Bell Semic), an assertion vehicle operating under the banner of financial services conglomerate Hilco Inc. (d/b/a Hilco Global) that filed over 40 lawsuits in Q3 alone. Those cases spanned multiple campaigns, including two targeting semiconductor design technology and another focused on chip packaging technology used in various semiconductor devices—e.g., controllers, MCUs, processors, systems-on-chip (SoCs), transceivers, etc.

One more semiconductor campaign with new third-quarter activity was the one waged by Polaris Innovations Limited, a subsidiary of publicly traded Quarterhill Inc., which in early September sued Broadcom over the provision of various semiconductors, integrated circuits, processors, controllers, and SoCs. The case joins active Polaris Innovations litigation against AMD, filed in May 2021, and Xilinx (which AMD acquired in early 2022), filed this past February, and asserts patents from the large portfolio that Polaris received from Infineon in July 2015.

Other plaintiffs hitting the semiconductor space in Q3 included Texas monetization firm IP Edge LLC. In late July, IP Edge plaintiffs Heritage IP LLC and Mallard IP LLC filed a new round of cases in their joint campaign over former Cypress Semiconductor patents—Heritage IP’s litigation hitting products with microcontrollers offering dynamic power management capabilities, and Mallard IP suing makers of devices with DDR4 SDRAM. A third IP Edge plaintiff, Wiesblatt Licensing LLC, also added a second wave of cases to the LPDDR5 RAM campaign it launched last October, asserting a former Seiko Epson patent that it acquired from Japanese monetization firm IP Bridge, Inc. in May 2019.

An additional memory campaign that saw new filings was the one waged by InnoMemory, LLC, an entity linked to another veteran monetization professional behind many other litigating plaintiffs. In July and August, InnoMemory continued to target a host of banks over their use of computing devices that incorporate memory modules compliant with various industry standards. The two asserted patents originated with Integrated Device Technology (since acquired by Renesas Electronics) and the other with Cypress Semiconductor, both acquired in 2018 from Intellectual Ventures LLC.

Yet another plaintiff that doubled down on an existing campaign was Alidouble Inc., which in early August refiled a previously dismissed complaint against TSMC over its manufacture of backside-illuminated (BSI) image sensors, including some made for OmniVision—this time with new counsel. The four patents-in-suit, generally related to semiconductor manufacturing or BSI image sensors, passed from original assignee Tower Semiconductor, an Israeli foundry, through a Hong Kong entity into the Texas plaintiff’s hands.

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