IP Litigation Trends in United States
District Courts: 1994—2014
… Regional Variation
Professor Matthew Sag
Loyola University of Chicago School of Law
September 20, 2014
Please visit www.matthewsag.com or email matthewsag@gmail.com for a copy of these
slides or the underlying data for replication. Working paper available soon at www.ssrn.com
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Substantial regional variation in rates of IP litigation
Instability/Stability in regional allocation
Importance of economic factors
Differences between copyright, patent and trademark
Idiosyncratic factors
• E.g. Copyright John Doe litigation?
• Righthaven LLC in Nevada in 2010
• Forum selling by the ED Texas in patent law
• At the state level things mostly make sense
Table 4: Top 10 States for IP Litigation, with Subject Area and State GDP and Population
Rankings
State
IP cases
Copyright
Patent Trademark
GDP
Pop.
GDP PP
California
1
1
1
1
1
1
11
New York
2
2
4
2
3
3
6
Texas
3
3
2
4
2
2
15
Florida
4
4
6
3
4
4
38
Illinois
5
6
5
5
5
5
13
Pennsylvania
6
5
9
7
6
6
29
New Jersey
7
8
7
6
8
11
7
Delaware
8
42
3
33
41
45
1
Michigan
9
7
8
8
9
8
36
Ohio
10
9
12
10
7
7
31
• We can drill into a lot more detail on the district level
– Trademark and Copyright ranks generally correlate
– Patent ranks generally correlate with
(copyright+trademark)
• Worth thinking about why some districts are
copyright/patent/trademark heavy
Figure 5 District Rankings, Copyright Compared to Trademark (2004-2014)
Figure 6 District Rank in terms of Patent versus Copyright and Trademark
Combined (2004-2014)
Figure 7 District Court Ranks for Patent Litigation 1994-2014
Part IV
THE ROLE OF THE LOCAL ECONOMY IN
FEDERAL INTELLECTUAL PROPERTY
LITIGATION
Analyzing quarterly patent filings from 1971 to 2009, Alan
Marco, Shawn Miller and Ted Sichelman (“MMS”) find that
economic downturns have a counter-cyclical impact on the
initiation of patent litigation.
[A] 1% increase in GDP leads to a 5% decrease in patent
litigation four quarters later in the earlier sub-period
[1971-1991] and a 6% decrease two quarters later in
the later sub-period [1986-2009].
Figure 8 Panel Data on State GDP and Filings
Regression Results
Linear Regression with State Fixed Effects
DV Cases Filed
Independent
Variables
Real GDP
Change in Real GDP
GDP Per Person
GDP (ITC)
Year
Circuit
Nature of Suit
Constant
N
r-squared
(1) All IP
Cases
.0003**
(0)
1.3958**
(.4789)
.0004*
(.0002)
.0009**
(.0003)
(2) Copyright
.0003**
(0)
1.756*
(.8448)
–.0003
(.0002)
.001*
(.0005)
(3) Patent
.0002**
(0)
1.1137
(.8253)
.0016**
(.0005)
.0011**
(.0003)
(4) Trademark
.0004**
(0)
1.2591
(.7338)
.0001
(.0001)
.0005
(.0003)
–.9716**
(.3071)
.7008
(.3739)
.71**
(.1521)
1310.34*
(615.64)
-.5287
(.5721)
-.2658
(.7854)
–1.12
(2.47)
–9.35**
(2.65)
-.09
(.33)
.17
(.38)
1040.12
(1144.86)
721.95
(1187.66)
3971.08**
(790.27)
2044
.78
697
.72
675
.78
690
.88
Variables that ‘predict’ IP litigation
• Real GDP (wealth)
– All models
• Change in Real GDP (growth)
– All IP & Copyright.
– Not in Patent or Trademark (but are significant without SFE)
• GDP per person is negative
– All IP & Patent.
– Not in Copyright or Trademark
– (Trademark and Patent were negative and significant without SFE)
• Real GDP in the Information Technology and
Communications Sector
– All, Copyright & Patent.
– Not in Trademark
Regression Results
Linear Regression with State Fixed Effects
DV Change in Cases Filed
Independent
Variables
Real GDP
Change in Real GDP
GDP Per Person
GDP (ITC)
Year
Circuit
Nature of Suit
Constant
N
r-squared
(5) All IP
Cases
0
(0)
1.98**
(.69)
–.0008
(0)
(6) Copyright
0
(0)
4.46**
(1.63)
--.0013
(0)
(7) Patent
.0001
(0)
.77
(.84)
–.0014
(0)
(8) Trademark
0
(0)
.86
(1.05)
.0005
(0)
–.0001
(0)
.63
(.76)
-2.31
(2.51)
–.76**
(.24)
–565.17
(1506.35)
.0005
(0)
1.89
(1.7)
-.35
(2.97)
–.0009
(0)
.74
(1.22)
-3.76
(6.46)
.0002
(0)
–.73
(.95)
–2.86
(2.85)
–3730.4
(3341.38)
–1364.29
(2399.94)
1477.71
(1878.65)
2477
.03
820
.05
819
.06
838
.05
• Change in cases filed
– Significant
• Change in Real GDP
– for All and Copyright
– Not Patent & Trademark
– Not significant
• Real GDP
• GDP Per Person
• ITC GDP
Regression Results, Linear Regression with State Fixed Effects
DV Cases Filed, Lagged GDP Variables
Independent Variables
Real GDP (1 Year Lag)
All IP Cases
1 year lags
.0003**
(0)
Circuit
Nature of Suit
Constant
N
r-squared
-2.24**
(.41)
.79
(.53)
.49**
(.15)
4049.37**
(826.19)
2326
.64
-1.71**
(.43)
.87
(.52)
.49**
(.15)
2997.87**
(868.39)
2326
.65
.36
(.6)
.0008
(0)
ICT GDP (2 Year Lag)
Year Filed
.0008
(0)
1.58**
(.54)
Change in GDP (2 Year Lag)
ICT GDP (1 Year Lag)
All IP Cases
1 & 2 year lags
.0014**
(0)
-.0012**
(0)
-.87
(.58)
-.57
(.51)
.003
(0)
-.0022
(0)
.0003**
(0)
Real GDP (2 Year Lag)
Change in GDP (1 Year Lag)
All IP Cases
2 year lags
-1.83**
(.37)
.6
(.51)
.55**
(.15)
3177.62**
(732.52)
2469
.65