As the post-pandemic world begins to shape up, the patent litigation world has seen billion dollar verdicts to record-breaking amounts of litigation financing. The explosive growth in litigation financing has come from a backlog of capital during the covid pandemic and investors seeking non-cyclical returns. As highlighted from last year’s report on NPE patent financing in the Western District of Texas, this trend can be seen among the top-5 patent venues. From Waco to Silicon Valley to Delaware, the effect of aggregations and financing can be seen.
These venues were chosen, since the Western District of Texas now accounts for 25% of all patent litigation, while the remaining four account for 43% in the first quarter of 2021. Collectively, these five venues have seen the most litigation over the last five years, with nearly 70%.
As identified last year the rise, anecdotally, seemed tied to frequent filers, co-owned entities, and entities underwritten by private litigation financing. Unified examined public databases, such as Edgar, to determine if there was an aggregator and known financing. NPE aggregators were defined as NPEs that have more than one affiliated subsidiary also bringing patent litigation. Third-party financing was defined as any third party with a financial interest, other than the assertors.
When looking at the new rocket docket, the Western District of Texas, the momentum has not stopped. Nearly 64% of all cases can be attributed to patent aggregators---i.e., entities like WSOU or Uniloc.
