New Jersey companies that hold patents have likely heard of patent trolls. Patent trolls are people or companies that buy unused patents and then sue large companies with the goal of extracting money from them. In the past, many patent trolls chose to file their cases in the U.S. District Court for the Eastern District of Texas because of favorable decisions they received there.
That particular federal court has a reputation for quickly bringing patent cases to trial and then giving huge awards to plaintiffs who sue large corporations, such as Apple or Dell. A decade ago, plaintiffs had a 70 to 80 percent chance of prevailing in their cases in the Eastern District of Texas. Now, the likelihood of winning has fallen to 60 percent. The court is now granting a much higher number of defense requests to transfer cases out of the district with 57 percent approved.
Some trade groups are pushing Congress to limit where cases can be filed, and they are also asking the Supreme Court to weigh in as well. The top 10 companies that have filed lawsuits are responsible for 12 to 14 percent of all of the patent lawsuits that have been filed each year since 2012. The lawsuits are filed in order to get settlements out of the companies, which will often settle just to make the nuisance suits go away.
Companies that hold patents that they believe are being infringed by other companies might want to consult with an intellectual property attorney. In many patent lawsuits, the losing party is ordered to pay the winner’s attorney fees and legal costs. This makes it important that plaintiffs do not file frivolous lawsuits or those that may not have a good likelihood of succeeding.