Surprising PwC Study Finds NPEs Awarded Largest Damages

Submitted by patentadmin on Tue, 01/11/2011 - 09:27

January 11, 2011 - For all the fuss about non-practicing entities (NPEs), and all the proposed patent reforms aimed at controlling them, they are still winning the largest damages awards on average in patent infringement cases.

That was the finding of the PricewaterhouseCoopers LLP's 2010 Patent Litigation Study, which also revealed that:

  • The median damages awarded to patent holders in 2009 was about $9 million.
  • A non-practicing entity, Johnson & Johnson's Centocor Ortho Biotech Inc., won the biggest-ever patent damages award in its lawsuit against Abbott Labs: more than $1.8 billion. (That award is being appealed in the Court of Appeals for the Federal Circuit, or CAFC).
  • NPEs - also known as "patent holding companies" or, less civilly, "patent trolls" - have lower overall win rates than practicing entities (31 percent as opposed to 41 percent). But when NPEs do win, their damages are an average of three times larger than those of their patent-practicing counterparts.

PwC's study also found that there was a decrease in patent litigation cases filed in 2009, putting an end to a three-year growth spurt in patent lawsuit filings. But the number of U.S. patent applications continued to grow in 2009, despite the economy and the Patent Office's well-known backlog of applications.