NPEs Receive Higher Median Damages Awards: PWC 2010 Patent Litigation Study
PWC recently released its 2010 Patent Litigation Study (available here), and the results may be somewhat surprising. On the one hand, it should surprise no one that juries continue to hand down higher patent damages awards than judges, and the disparity between the two is growing larger. In the 1990s, the median award was $5.5 million for jury trials and $3.4 million for bench trials. In the 2000s, the median award for jury trials increased dramatically to $10.7 million, while the median award for bench trials dropped precipitously to just $0.7 million.
What may be surprising, however, is the success that Non Practicing Entities (NPEs) are having in persuading juries to award substantial damages awards. During the 14-year period of the study, both NPEs and practicing entities have an approximate two-third success rate at trial. However, the tables have turned as to who now gets higher damages awards. From 1995-2001, NPEs were awarded a median of $5.2 milliion in damages, compared with $6.3 million for practicing entities. From 2002-2009, by contrast, those roles were reversed, with NPEs receiving a median damages award of $12.9 million, compared with $3.9 million for practicing entities.
And not surprisingly, the PWC study concludes that the venue still matters very much to the outcome of any patent litigation. The District of Delaware, and the Eastern Districts of Texas and Virginia, continue to favor patentholders, who enjoy faster times to trial, higher success rates, and higher median damages awards there than in other districts. In fact, the Eastern District of Virginia issued the highest median damages award from 1995-2009 at $30.3 million (Delaware came in second at $21.6 million, and the ED Texas third at $19.7 million).
In light of recent damages rulings by the Federal Circuit, including the January 4 decision in Uniloc v. Microsoft, however, it remains to be seen whether these numbers will continue to remain at these levels.