2014
`NPE Litigation Report
`
`RPX Exhibit 1049
`RPX v. AIT
`IPR2015-01751
`
`

`
`Summary of Findings
`
`The RPX NPE Litigation Report presents a comprehensive
`overview of the litigation activities of non-practicing
`entities (NPEs) in 2014. This report builds on those of
`previous years, continuing to provide transparency
`through the data needed to inform sound decisions
`concerning NPE litigation.
`
`For example, this year’s data reveal a marked decrease in NPE litigation from 2013
`to 2014. While that drop is noteworthy, a deeper dive into the data within this report
`gives ample reason to be cautious before declaring that drop indicative of a trend,
`much less the beginning of the end of NPE litigation.
`
`NPEs Remain the Largest Drivers of Patent Litigation
`The volume of NPE litigation fell in 2014 for the first time in four years. That drop in the
`overall numbers is unmistakable. Nevertheless, cases filed by NPEs remained the
`most common form of patent litigation in 2014; NPEs continued to find new companies
`to target for patent infringement; and the frequency with which NPEs filed cases
`against smaller companies (by revenue) and private companies has remained
`remarkably steady over time.
`
`RPX Corporation
`
`2014 NPE Litigation Report | Summary of Findings
`
`2
`
`

`
`The number of cases filed by NPEs dropped from around 3,700 in 2013 to roughly
`2,800, but the total volume of patent cases also fell over the same time period, from
`5,500 in 2013 to about 4,500 this past year. And, of those roughly 4,500 patent
`cases filed in 2014, NPEs filed 2,791—63% of the total—while operating companies
`filed only 1,667. NPEs were also responsible for naming 56% of all defendants to
`patent litigations in 2014, adding 3,600 defendants where plaintiff operating
`companies added only about 2,900 defendants.
`
`NPEs Found New Targets in 2014
`NPEs continued to broaden their reach this past year, targeting new companies in patent
`infringement litigation. In 2014, nearly 1,100 companies were first-time defendants
`in an NPE case, and when duplicates are removed from the list of defendants to any
`patent infringement case, 2014 saw about 3,800 unique defendants added. More
`than half of that list (2,072 unique defendants) were added by NPEs.
`
`NPEs Continued Targeting Smaller Companies in 2014
`Large companies (by revenue) and public companies have a higher rate of NPE
`litigation than do smaller and private companies. However, 62% of unique defendants
`in 2014 had less than $100M in annual revenue, and the frequency of NPE litigation
`against smaller companies has remained remarkably steady over the past five years.
`
`Indeed, the data demonstrates that the only appreciable drop in NPE litigation
`frequency has occurred for companies with between $10B and $50B in annual
`revenue. Likewise, while the frequency of NPE litigation against public companies
`has fluctuated from year to year, the frequency of such suits against private
`companies has remained the same for the past five years. Also, private companies
`made up nearly three-fourths of unique defendants in NPE cases in 2014.
`
`Cases Filed
`
`NPE Cases per Unique Defendant by Company Revenue
`
`5,518
`
`1,845
`
`4,721
`
`1,662
`
`3,059
`
`3,673
`
`4,458
`
`1,667
`
`2,791
`
`3,315
`
`1,760
`
`1,555
`
`8.2
`
`4.0
`
`2.1
`
`1.4
`
`1.1
`
`2011
`
`2012
`
`2013
`
`2014
`
`Operating Company Cases
`
`NPE Cases
`
`2010
`
`> $50B
`
`2,491
`
`1,731
`
`760
`
`2010
`
`9.6
`
`4.9
`
`2.6
`
`1.6
`
`1.1
`
`2011
`
` $10B–50B
`
`9.8
`
`3.2
`
`2.1
`
`1.4
`
`1.2
`
`7.3
`
`4.0
`
`2.2
`
`1.5
`
`1.2
`
`7.6
`
`4.2
`
`2.1
`
`1.5
`
`1.1
`
`2012
`
` $1B–10B
`
`2013
`
`2014
`
`$100M–1B
`
`< $100M
`
`RPX Corporation
`
`2014 NPE Litigation Report | Summary of Findings
`
`3
`
`

`
`Other Noteworthy Trends and Constants
`
`PTAB
`The popularity of validity challenges before the Patent Trial and Appeal Board (PTAB)
`continues to grow. Petitions for inter partes review (IPR) against NPEs grew over
`150% from 2013 to 2014 and covered business method (CBM) review against NPEs
`increased more than 80% over the same time period.
`
`Venues
`The Eastern District of Texas and the District of Delaware remain the most popular
`venues for NPE plaintiffs. The two venues accounted for 70% of cases filed and 66%
`of total defendants added.
`
`Software, Mobile
`NPEs continue to favor software and mobile device patents. Patents asserted by
`NPEs in 2014 most often had US Patent Classification (USPC) codes related to
`software and mobile devices. The top five class codes accounted for 31% of unique
`patents asserted.
`
`Acacia
`Acacia remains the most litigious NPE. The top ten NPEs in 2014 accounted
`for 28% of NPE cases filed and 28% of total NPE defendants added. Acacia led
`the pack in both the number of cases filed and total defendants added in 2014.
`Acacia was also the top NPE by NPE cases filed and total NPE defendants added
`over the past five years.
`
`NPE Cases Filed in 2014 by District Court
`
`Texas Eastern
`
`Delaware
`
`California Central
`
`California Northern
`
`New Jersey
`
`Illinois Northern
`
`Florida Middle
`
`Florida Southern
`
`Virginia Eastern
`
`All Others
`
`3%
`3% (87)
`(87)
`3%
`3% (83)
`(83)
`3%
`3% (80)
`(80)
`2%
`2% (59)
`(59)
`2%
`2% (54)
`(54)
`2%
`2% (49)
`(49)
`2%
`2% (46)
`(46)
`
`13%
`13% (368)
`(368)
`
`48%
`48% (1,352)
`(1,352)
`
`22%
`22% (613)
`(613)
`
`The complete 2014 NPE Litigation Report can be found at http://www.rpxcorp.com/
`key-patent-market-trends/reports/.
`
`For further information, e-mail reports@rpxcorp.com
`
`RPX Corporation
`
`2014 NPE Litigation Report | Litigation Volume
`
`4
`
`

`
`Table of Contents
`
`Litigation Volume
`
`Patent Validity Challenges
`
`Venue
`
`Sector and Revenue Analysis
`
`Top Plaintiffs and Defendants
`
`Patent Details
`
`Methodology
`
`About RPX
`
`6
`
`14
`
`21
`
`25
`
`29
`
`32
`
`38
`
`41
`
`RPX Corporation
`
`2014 NPE Litigation Report | Table of Contents
`
`5
`
`

`
`Litigation Volume
`
`Key 2014 Findings
`
`NPEs Still on Top
`• NPE litigation remained the most common form of patent litigation. NPE cases
`accounted for 63% of all such cases, and NPE defendants were 56% of all patent
`infringement defendants. See Charts 1, 2, 3, and 4.
`• Overall 3,768 unique defendants were added to patent infringement cases in 2014.
`Of these, 2,072 unique defendants were added to NPE cases. See Charts 5 and 6.
`• Although the number of new NPE campaigns dropped 10% from 2013 to 2014,
`total NPE campaign defendants made up the majority of campaign defendants for
`the fifth straight year. See Charts 7, 8, 9, and 10.
`
`
`
`Chart 1: Cases Filed
`
`Operating Company Cases
`NPE Cases
`
`3,315
`
`1,760
`
`1,555
`
`2011
`
`2,491
`
`1,731
`
`760
`
`2010
`
`RPX Corporation
`
`5,518
`
`1,845
`
`3,673
`
`4,721
`
`1,662
`
`3,059
`
`4,458
`
`1,667
`
`2,791
`
`PAE Domination
`Inventors, non–competing entities, and universities together accounted for only 11% of
`NPE cases filed in 2014 (9% in 2013) and 14% of total NPE defendants added (13% in
`2013). Patent assertion entities accounted for the rest. See Charts 17 and 18.
`
`One-year Average
`Most NPE cases that ended in 2014 did so within six months of filing. 35% of cases
`lasted more than a year. On average, NPE cases that ended in 2014 lasted 12 months.
`See Chart 13.
`
`New to the Scene
`143 new NPEs filed suit for the first time in 2014, as in 2013. See Chart 19.
`
`Chart 2: NPE Cases Filed as Percentage of All Patent Infringement Cases Filed
`
`65%
`
`67%
`
`63%
`
`47%
`
`31%
`
`2012
`
`2013
`
`2014
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`2014 NPE Litigation Report | Litigation Volume
`
`6
`
`

`
`Chart 3: Total Defendants Added in Cases
`
`Chart 4: Total NPE Defendants Added as Percentage of
`Total Patent Infringement Defendants Added
`
`8,364
`
`3,145
`
`7,543
`
`3,380
`
`7,928
`
`3,004
`
`7,074
`
`2,813
`
`4,163
`
`5,219
`
`4,261
`
`4,924
`
`6,482
`
`2,857
`
`3,625
`
`55%
`
`62%
`
`60%
`
`62%
`
`56%
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`Total Defendants Added in Operating Company Cases
`Total Defendants Added in NPE Cases
`
`Chart 5: Unique Defendants Added in Cases
`Note: Unique counts are not additive.
`
`Chart 6: First-Time Defendants
`Note: Unique counts are not additive.
`
`Total: 5,036
`
`Total: 5,032
`
`Total: 4,393
`
`Total: 4,694
`
`Total: 3,768
`
`Total: 3,566
`
`Total: 3,386
`
`Total: 2,699
`
`Total: 2,817
`
`Total: 2,138
`
`2,552
`
`2,728
`
`2,871
`
`2,426
`
`2,434
`
`2,185
`
`2,702
`
`2,285
`
`2,072
`
`1,902
`
`2,104
`
`1,756
`
`1,887
`
`1,785
`
`1,458
`
`1,543
`
`1,568
`
`1,614
`
`1,291
`
`1,082
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`Unique Defendants Added in NPE Cases
`Unique Defendants Added in Operating Company Cases
`
`First-Time Defendants in NPE Cases
`First-Time Defendants in Operating Company Cases
`
`RPX Corporation
`
`2014 NPE Litigation Report | Litigation Volume
`
`7
`
`

`
`Chart 7: New Campaigns Filed
`Methodology Note: The campaign calculation is defined on page 38 in the
`Methodology section.
`
`Chart 8: NPE Campaigns Filed as Percentage of
`All Patent Infringement Campaigns Filed
`
`1,237
`
`1,255
`
`938
`
`299
`
`2010
`
`887
`
`368
`
`2011
`
`1,106
`
`1,147
`
`732
`
`798
`
`374
`
`2012
`
`349
`
`2013
`
`New Operating Company Campaigns
`New NPE Campaigns
`
`Chart 9: Total Defendants Added in Campaigns
`
`7,628
`
`2,764
`
`7,084
`
`3,155
`
`6,057
`
`2,416
`
`6,669
`
`2,498
`
`3,929
`
`4,864
`
`3,641
`
`4,171
`
`929
`
`624
`
`305
`
`2014
`
`5,343
`
`2,266
`
`3,077
`
`24%
`
`29%
`
`34%
`
`30%
`
`33%
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`Chart 10: Total NPE Defendants Added as Percentage of
`Total Patent Infringement Defendants Added
`
`55%
`
`64%
`
`60%
`
`63%
`
`58%
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`Total Defendants Added in Operating Company Campaigns
`Total Defendants Added in NPE Campaigns
`
`RPX Corporation
`
`2014 NPE Litigation Report | Litigation Volume
`
`8
`
`

`
`NPE Total Active Defendants Backlog Decreases
`The 2014 year-end backlog, a proxy for the overall scope and cost of NPE litigation,
`decreased 25% from 2013 as terminations outpaced new defendants. The rate of new
`defendants added decreased by 27% while the rate of terminations decreased by 6%.
`
`backlog at -17% and -18%, respectively. Companies with $100M–$1B in revenue had
`a backlog decrease of 35% and companies with $1B–$10B in revenue had a backlog
`decrease of 37%
`
`The decrease in year-end backlog was widespread and not attributable to particular
`sectors or segments. The largest decreases came from E-commerce and Software
`(-37%), Networking (-34%), and Finance (-32%). Small (<$100M) and large
`(>$50B) companies experienced the smallest percentage decrease in defendant
`
`Methodology Note:
`“Total active NPE defendants” is the total number of NPE case/active defendant pairings.
`“Backlog” is the number of total active NPE defendants at the end of a given year. For example,
`at the end of 2010 there were 4,659 total active NPE defendants.
`
`Chart 11: Active NPE Defendants Backlog
`
`2011
`Backlog
`5,844
`5,844
`
`5,219
`+5,219
`
`4,052
`-4,052
`
`+4,261
`
`2012
`Backlog
`
`6,053
`
`-5,315
`
`
`4,924
`+4,924
`
`2013
`Backlog
`5,662
`5,662
`
`5,014
`-5,014
`
`2010
`2010
`Backlog
`Backlog
`4,659
`4,659
`
`4,000
`-4,000
`
`2014
`2014
`Backlog
`Backlog
`4,273
`4,273
`
`
`3,625
`+3,625
`
`Backlog
`Terminations
`Additions
`
` 
`
`+1,185 (25%)
`
`+209 (4%)
`
`-391 (-6%)
`
`-1,389 (-25%)
`
`Backlog Growth
`
`RPX Corporation
`
`2014 NPE Litigation Report | Litigation Volume
`
`9
`
`

`
`Defendant Addition Volatility During 2014
`3,625 total defendants and 2,072 unique defendants were added in 2014 to NPE
`cases. The rate at which defendants were added varied significantly throughout
`the year. The median weekly total defendants added and unique defendants added
`in NPE cases decreased 33% and 34%, respectively, from 2013 to 2014. The chart
`below shows the volatility of weekly NPE defendant additions in 2014.
`
`Chart 12: 2014 Weekly Defendants Added in NPE Cases
`
`300
`
`250
`
`200
`
`150
`
`100
`
`50
`
`0
`
`Large NPE Campaigns
`In April 2014, NPEs eDekka and Olivistar filed litigation
`against over 135 companies. The large number of filings
`was likely motivated by proposed legislation that would
`have been retroactive to just after the filings, once again
`demonstrating how NPEs react to potential changes in
`the regulatory landscape.
`
`Octane and
`Highmark
`April 2014 Supreme
`Court decisions
`that lowered the
`standard for awarding
`attorney fees for
`extraordinary cases
`in patent cases.
`
`Alice
`A June 2014 Supreme Court decision which has
`been perceived by many to have made certain
`software patents easier to invalidate. The limits of
`the decision have yet to be fully interpreted by the
`lower courts and some believe that NPEs may be
`waiting on the sidelines or changing strategies in
`light of the decision.
`
`2
`
`4
`
`6
`
`8
`
`10
`
`12
`
`14
`
`16
`
`18
`
`20
`
`22
`
`24
`
`26
`
`28
`
`30
`
`32
`
`34
`
`36
`
`38
`
`40
`
`42
`
`44
`
`46
`
`48
`
`50
`
`52
`
`Week of 2014
`
`Total Defendants
`
`Unique Defendants
`
`RPX Corporation
`
`2014 NPE Litigation Report | Litigation Volume
`
`10
`
`

`
`Chart 13: Duration of NPE Cases Ended in 2014 (N=3,457)
`
`Chart 14: Duration of NPE Cases Active at Year-end 2014 (N=3,070)
`
`42%
`
`24%
`
`22%
`
`35%
`
`27%
`
`20%
`
`9%
`
`2%
`
`1%
`
`1%
`
`10%
`
`5%
`
`2%
`
`2%
`
`0–6 Mos
`
`7–12 Mos
`
`1–2 Yrs
`
`2–3 Yrs
`
`3–4 Yrs
`
`4–5 Yrs
`
`>5 Yrs
`
`0–6 Mos
`
`7–12 Mos
`
`1–2 Yrs
`
`2–3 Yrs
`
`3–4 Yrs
`
`4–5 Yrs
`
`>5 Yrs
`
`Chart 15: Duration of Litigation for Defendants Terminated in 2014 (N=5,014)
`
`Chart 16: Duration of Litigation for Defendants Active at Year-end 2014 (N=4,273)
`
`34%
`
`21%
`
`23%
`
`31%
`
`20%
`
`26%
`
`11%
`
`6%
`
`2%
`
`2%
`
`10%
`
`6%
`
`2%
`
`5%
`
`0–6 Mos
`
`7–12 Mos
`
`1–2 Yrs
`
`2–3 Yrs
`
`3–4 Yrs
`
`4–5 Yrs
`
`>5 Yrs
`
`0–6 Mos
`
`7–12 Mos
`
`1–2 Yrs
`
`2–3 Yrs
`
`3–4 Yrs
`
`4–5 Yrs
`
`>5 Yrs
`
`RPX Corporation
`
`2014 NPE Litigation Report | Litigation Volume
`
`11
`
`

`
`Chart 17: NPE Cases Filed in 2014 by NPE Type
`
`Chart 18: Total NPE Defendants Added in 2014 by NPE Type
`
`2% 1%
`
`8%
`
`2% 1%
`
`11%
`
`University
`NCE
`Inventor
`PAE
`
`University
`NCE
`Inventor
`PAE
`
`89%
`
`86%
`
`Chart 19: New NPEs Filing Suit
`
`158
`
`161
`
`167
`
`143
`
`143
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`RPX Corporation
`
`2014 NPE Litigation Report | Litigation Volume
`
`12
`
`

`
`The ITC Continues to Be a Less Popular Venue for NPE Litigation
`NPE litigation in the International Trade Commission (ITC) spiked in 2011 and has
`decreased every year since. This may be attributable to a number of factors, including
`changes in the domestic industry requirement, the perception that the ITC is a
`political body, the political unpopularity of NPE assertions, and public support for
`measures combating NPEs.
`
`• NPEs accounted for 16% of ITC patent investigations in 2014.
`• Samsung was the company targeted the most in the ITC in 2014 with four patent
`investigations, two of which were NPE ITC investigations.
`
`Methodology Note:
`RPX reviewed all initiated Section 337 ITC investigations and identified those involving
`allegations of patent infringement to compile the RPX data set. Investigations were counted
`based on the year an investigation was initiated, and complaints that had not led to an
`investigation by the end of 2014 were not included in the data set.
`
`Chart 20: Total Initiated ITC Patent Investigations
`
`Chart 21: Initiated NPE Investigations as Percent of Initiated
`ITC Patent Investigations
`
`55
`
`50
`
`6
`2010
`
`67
`
`47
`
`19
`
`2011
`
`Operating Company ITC Investigations
`NPE ITC Investigations
`
`37
`
`23
`
`14
`
`2012
`
`38
`
`29
`
`9
`2013
`
`37
`
`31
`
`6
`2014
`
`38%
`
`29%
`
`24%
`
`16%
`
`2011
`
`2012
`
`2013
`
`2014
`
`11%
`
`2010
`
`Chart 22: Total Respondents Added to ITC Investigations
`
`Chart 23: Total NPE ITC Respondents as Percent of Total ITC Respondents
`
`599
`
`345
`
`254
`
`2011
`
`Operating Company ITC Investigations
`NPE ITC Investigations
`
`415
`
`204
`
`211
`
`2012
`
`312
`
`215
`
`97
`2013
`
`385
`
`304
`
`81
`2014
`
`420
`
`382
`
`38
`2010
`
`51%
`
`42%
`
`31%
`
`21%
`
`2011
`
`2012
`
`2013
`
`2014
`
`9%
`
`2010
`
`RPX Corporation
`
`2014 NPE Litigation Report | Litigation Volume
`
`13
`
`

`
`Patent Validity Challenges
`
`Key 2014 Findings
`
`PTAB Popularity
`• The number of IPR petitions filed against NPE patents has increased over 150%
`from 2013 to 2014 (262 to 758). There have been over 1,000 IPR petitions filed
`against NPE patents since September 2012. See Charts 24–28.
`• The number of total covered business method (CBM) petitions filed against
`NPE patents increased over 80% from 2013 to 2014 (48 to 88). There have been
`over 130 CBM petitions filed against NPE patents since September 2012.
`See Charts 30–34.
`
`Chart 24: Total IPR Petitions by Month
`
`Operating Company
`NPE
`
`Top Filers
`Apple filed the most IPR and CBM petitions against NPE patents in 2014,
`with 58 and 24 filings respectively. See Tables 1 and 2.
`
`5
`31
`5
`26
`
`15
`24
`23
`18
`15
`8
`6
`Oct Nov Dec
`
`11
`16
`11
`6
`Sep
`2012
`
`25
`19
`6
`Jan
`2013
`
`44
`24
`
`38
`30
`27
`30
`20
`18
`20
`10
`9
`8
`Feb Mar Apr May
`
`65
`
`42
`
`23
`June
`
`68
`
`37
`
`60
`
`51
`
`31
`
`9
`July Aug
`
`73
`37
`
`36
`
`76
`32
`
`44
`
`98
`
`57
`
`41
`
`86
`
`55
`
`31
`
`Sep Oct Nov Dec
`
`58
`
`48
`
`10
`Jan
`2014
`
`142
`
`61
`
`129
`
`57
`
`184
`
`72
`
`112
`
`176
`
`104
`
`158
`
`94
`
`118
`
`61
`
`114
`
`61
`
`81
`
`72
`
`53
`
`64
`
`57
`
`72
`
`177
`
`65
`
`112
`
`101
`
`54
`
`47
`
`76
`25
`
`51
`
`54
`27
`
`27
`
`Feb Mar Apr May
`
`June
`
`July Aug
`
`Sep Oct Nov Dec
`
`RPX Corporation
`
`2014 NPE Litigation Report | Patent Validity Challenges
`
`14
`
`

`
`Chart 25: Total Patent Families Subjected to IPR Petition by Month
`
`Operating Company
`NPE
`
`10
`14
`10
`4
`Sep
`2012
`
`4
`11
`19
`18
`12
`16
`4
`11
`12
`15
`7
`4
`Oct Nov Dec
`
`14
`20
`14
`6
`Jan
`2013
`
`34
`26
`15
`25
`18
`18
`18
`17
`15
`16
`8
`8
`3
`Feb Mar Apr May
`
`40
`28
`
`12
`June
`
`39
`27
`
`34
`28
`12
`6
`July Aug
`
`39
`21
`
`60
`
`41
`
`54
`29
`
`25
`
`37
`18
`19
`19
`18
`Sep Oct Nov Dec
`
`39
`
`34
`
`5
`Jan
`2014
`
`78
`
`42
`
`73
`
`41
`
`36
`
`32
`
`36
`20
`16
`Feb Mar Apr May
`
`45
`21
`
`24
`
`86
`
`47
`
`39
`
`98
`
`62
`
`80
`
`45
`
`86
`
`53
`
`76
`
`40
`
`35
`
`36
`
`36
`
`33
`
`82
`
`48
`
`34
`
`63
`
`40
`
`23
`
`June
`
`July Aug
`
`Sep Oct Nov Dec
`
`RPX Corporation
`
`2014 NPE Litigation Report | Patent Validity Challenges
`
`15
`
`

`
`Chart 26: NPE Cases Filed Asserting Patents Subject to IPR
`
`Chart 27: Total NPE Defendants Added in Assertions of Patents Subject to IPR
`
`1,112
`1,112
`
`527
`527
`
`516
`516
`
`329
`
`205
`
`1,658
`
`762
`
`695
`
`2012
`
`2013
`
`2014
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`37
`37
`
`2010
`
`146
`146
`
`2011
`
`Chart 28: Unique NPE Defendants Added in Assertions of Patents Subject to IPR
`
`Chart 29: Number of Patents Subject to IPR by Assertion Status
`
`920
`
`492
`
`455
`
`246
`
`1,337
`
`807
`
`553
`
`2011
`
`2012
`
`2013
`
`2014
`
`Asserted Patents
`
`181
`
`2010
`
`248
`
`239
`18
`Non-Asserted Patents
`
`RPX Corporation
`
`2014 NPE Litigation Report | Patent Validity Challenges
`
`16
`
`Operating Company
`
`NPE
`
`

`
`Table 1: Top Filers of IPR Petitions in 2014 Against Patents Owned by NPEs
`
`Rank
`
`IPR Filer
`
`Total Filings Against NPEs
`
`Other Filings
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`Apple
`
`Google
`
`Samsung Electronics
`
`Gillette Company
`
`Microsoft
`
`Intel
`
`Taiwan Semiconductor Manufacturing Company Limited
`
`HTC Corporation
`
`LG Electronics
`
`10
`
`Fujitsu Semiconductor Limited
`
`“Other Filings” is defined as petitions against patents owned by non-NPEs.
`
`58
`
`45
`
`40
`
`33
`
`32
`
`29
`
`26
`
`23
`
`22
`
`17
`
`4
`
`0
`
`0
`
`0
`
`8
`
`0
`
`0
`
`0
`
`15
`
`0
`
`RPX Corporation
`
`2014 NPE Litigation Report | Patent Validity Challenges
`
`17
`
`

`
`3
`
`16
`
`11
`
`7
`
`3
`
`8
`
`3
`Sep Oct Nov Dec
`
`5
`
`5
`
`4
`
`2
`1
`July Aug
`
`4
`
`18
`
`12
`
`7
`
`7
`
`15
`
`4
`
`Feb Mar Apr May
`
`5
`1
`June
`
`5
`
`4
`
`Jan
`2014
`
`5
`
`16
`
`5
`
`3
`
`11
`
`10
`
`6
`
`9
`
`12
`
`4
`
`6
`
`4
`
`July Aug
`
`Sep Oct Nov Dec
`
`Chart 30: Total CBM Petitions by Month
`
`2
`
`5
`
`2
`Oct Nov Dec
`
`Jan
`2013
`
`3
`2
`1
`Feb Mar Apr May
`
`5
`
`5
`
`3
`June
`
`8
`
`Sep
`2012
`
`Chart 31: Total Patent Families Subject to CBM by Month
`
`Operating Company
`
`NPE
`
`5
`
`Sep
`2012
`
`3
`
`2
`Oct Nov Dec
`
`Jan
`2013
`
`2
`3
`2
`2
`1
`Feb Mar Apr May
`
`5
`
`1
`June
`
`5
`
`1
`3
`1
`July Aug
`
`3
`
`9
`
`6
`
`7
`
`3
`
`2
`
`6
`
`2
`Sep Oct Nov Dec
`
`4
`
`3
`Jan
`2014
`
`Operating Company
`
`NPE
`
`3
`
`8
`
`7
`
`7
`
`5
`
`3
`2
`Feb Mar Apr May
`
`4
`
`7
`
`4
`
`3
`July Aug
`
`4
`1
`June
`
`2
`
`7
`
`3
`
`5
`
`4
`
`5
`
`2
`
`4
`
`Sep Oct Nov Dec
`
`RPX Corporation
`
`2014 NPE Litigation Report | Patent Validity Challenges
`
`18
`
`

`
`Chart 32: NPE Cases Filed Asserting Patents Subject to CBM
`
`Chart 33: Total NPE Defendants Added in Assertions of Patents Subject to CBM
`
`307
`
`284
`
`474
`
`345
`
`150
`
`186
`
`201
`
`172
`
`18
`
`2010
`
`26
`
`2011
`
`2012
`
`2013
`
`2014
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`Chart 34: Unique NPE Defendants Added in Assertions of Patents Subject to CBM
`
`378
`
`283
`
`176
`
`178
`
`156
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`RPX Corporation
`
`2014 NPE Litigation Report | Patent Validity Challenges
`
`19
`
`

`
`Table 2: Top Filers of CBM Petitions in 2014 Against Patents Owned by NPEs
`
`Rank
`
`CBM Filer
`
`Total Filings Against NPEs
`
`Other Filings
`
`1
`
`2
`
`3
`
`4
`
`4
`
`6
`
`7
`
`Apple
`
`Samsung Electronics America
`
`Google Inc.
`
`eBay Incorporated
`
`Motorola Mobility LLC
`
`salesforce.com incorporated
`
`Eleven companies with 2 filings against NPEs
`
`“Other Filings” is defined as petitions against patents owned by non-NPEs.
`
`24
`
`10
`
`8
`
`4
`
`4
`
`3
`
`2
`
`0
`
`0
`
`1
`
`6
`
`0
`
`0
`
`0
`
`RPX Corporation
`
`2014 NPE Litigation Report | Patent Validity Challenges
`
`20
`
`

`
`Venue
`
`Key 2014 Findings
`
`ED Tex, D. Del.
`The Eastern District of Texas and District of Delaware were again the most popular
`venues for NPE activity, together representing 70% of cases filed and 66% of total
`defendants added. See Charts 35 and 36.
`
`Backlogs
`Districts with highest NPE litigation volumes also have the largest backlogs.
`The Eastern District of Texas and District of Delaware accounted for over half of the
`
`
`Chart 35: NPE Cases Filed in 2014 by District Court
`
`total pending cases (62%) and total active NPE defendants (58%) at the end
`of 2014. See Charts 37 and 38.
`
`DJs Spread Out
`Declaratory judgment actions were spread out among districts in 2014. Delaware
`had the most by volume (17%) while Arizona had the most by proportion (29%).
`See Charts 39 and 40.
`
`Texas Eastern
`Texas Eastern
`
`Delaware
`Delaware
`
`California Central
`California Central
`
`California Northern
`California Northern
`
`New Jersey
`New Jersey
`
`Illinois Northern
`Illinois Northern
`
`Florida Middle
`Florida Middle
`
`Florida Southern
`Florida Southern
`
`Virginia Eastern
`Virginia Eastern
`
`All Others
`All Others
`
`RPX Corporation
`
`3% (87)
`
`3% (83)
`
`3% (80)
`
`2% (59)
`
`2% (54)
`
`2% (49)
`
`2% (46)
`
`22% (613)
`
`48% (1,352)
`
`13% (368)
`
`2014 NPE Litigation Report | Venue
`
`21
`
`

`
`19% (674)
`
`47% (1,715)
`
`Chart 36: Total NPE Defendants Added in 2014 by District Court
`
`Texas Eastern
`
`Delaware
`
`California Central
`
`Florida Middle
`
`New Jersey
`
`California Northern
`
`Florida Southern
`
`Illinois Northern
`
`Virginia Eastern
`
`All Others
`
`4% (152)
`
`4% (133)
`
`3% (114)
`
`3% (92)
`
`2% (78)
`
`2% (77)
`
`2% (72)
`
`14% (518)
`
`RPX Corporation
`
`2014 NPE Litigation Report | Venue
`
`22
`
`

`
`Chart 37: NPE Cases Pending at Year-end 2014 by District Court
`
`Texas Eastern
`
`Delaware
`
`California Northern
`
`5% (168)
`
`New Jersey
`
`California Central
`
`Michigan Eastern
`
`Illinois Northern
`
`Texas Western
`
`California Southern
`
`All Others
`
`3% (101)
`
`3% (99)
`
`2% (60)
`
`2% (60)
`
`2% (59)
`
`2% (55)
`
`Chart 38: Total Active NPE Defendants at Year-end 2014 by District Court
`
`Texas Eastern
`
`Delaware
`
`California Northern
`
`California Central
`
`New Jersey
`
`Florida Middle
`
`Illinois Northern
`
`Texas Western
`
`6% (270)
`
`4% (171)
`
`4% (151)
`
`2% (98)
`
`2% (92)
`
`2% (87)
`
`26% (783)
`
`36% (1,118)
`
`18% (567)
`
`21% (914)
`
`37% (1,580)
`
`California Southern
`
`2% (73)
`
`All Others
`
`20% (871)
`
`RPX Corporation
`
`2014 NPE Litigation Report | Venue
`
`23
`
`

`
`Chart 39: District Courts with Largest Volume of Declaratory Judgment
`NPE Cases Filed in 2014
`
`17%
`
`16%
`
`16%
`
`22%
`
`Delaware
`
`California
`Central
`
`California
`Northern
`
`DJs
`
`13
`
`12
`
`12
`
`7%
`
`Virginia
`Eastern
`
`5
`
`5%
`
`5%
`
`4%
`
`4%
`
`4%
`
`Illinois
`Northern
`
`4
`
`Florida
`Southern
`
`4
`
`Texas
`Western
`
`3
`
`Michigan
`Eastern
`
`3
`
`Georgia
`Northern
`
`3
`
`All Others
`
`17
`
`Chart 40: District Courts with Largest Proportion of Declaratory Judgment
`NPE Cases in 2014
`
`Methodology Note:
`“Districts” expressly denoted in Chart 40 are limited to those with at least
`five NPE cases filed in 2014.
`
`29%
`
`23%
`
`17%
`
`17%
`
`16%
`
`13%
`
`12%
`
`10%
`
`10%
`
`Arizona
`
`DJs
`
`2
`
`Georgia
`Northern
`
`3
`
`Alabama
`Northern
`
`North Carolina
`Western
`
`Michigan
`Eastern
`
`California
`Northern
`
`California
`Central
`
`Connecticut
`
`1
`
`1
`
`3
`
`12
`
`12
`
`1
`
`1%
`
`All Others
`
`31
`
`Virginia
`Eastern
`
`5
`
`RPX Corporation
`
`2014 NPE Litigation Report | Venue
`
`24
`
`

`
`Sector and Revenue Analysis
`
`Key 2014 Findings
`
`E-commerce and Software
`NPEs targeted a broad range of sectors but focused most on E-commerce and
`Software litigations. See Chart 41.
`
`High Revenues
`In 2014, companies that were sued most frequently by NPEs generated high revenues
`and most commonly were defendants in Mobile and Consumer Electronics cases.
`See Chart 42.
`
`Private Companies
`Nearly three fourths of the unique NPE defendants added and over one half of the
`total NPE defendants added in 2014 were private companies. See Chart 43.
`
`Smaller Companies
`Companies with less than $100M in revenue accounted for over 60% of the unique
`NPE defendants added and over 40% of total NPE defendants added. See Chart 44.
`
`Methodology Note:
`“Total NPE defendants added by sector” is based on the classification of the relevant case.
`Accordingly, a company may be included as an “NPE defendant added in multiple sectors”
`to the extent it was in cases classified in multiple sectors.
`
`32%
`32%
`
`Chart 41: Total NPE Defendants Added in 2014 by Sector
`
`E-commerce and Software
`E-Commerce and Software
`
`Consumer Products
`Consumer Products
`
`Consumer Electronics
`Consumer Electronics and PCs
`and PCs
`Mobile Communications
`e Communications and Devices
`and Devices
`
`Networking
`Networking
`
`Media Content
`Media Content and Distribution
`and Distribution
`
`Financial Services
`Financial Services
`
`Automotive
`Automotive
`
`12%
`12%
`
`11%
`11%
`
`10%
`10%
`
`7%
`7%
`
`5%
`5%
`
`4%
`4%
`
`4%
`4%
`
`Semiconductors
`Semiconductors
`
`4%
`4%
`
`Medical
`Medical
`
`Logistics
`Logistics
`
`3%
`3%
`
`3%
`3%
`
`Energy
`Energy
`
`2%
`2%
`
`Other
`Other
`
`3%
`3%
`
`RPX Corporation
`
`2014 NPE Litigation Report | Sector and Revenue Analysis
`
`25
`
`

`
`Chart 42: NPE Case Frequency per Company by Sector and Revenue
`
`Methodology Note:
`Companies were categorized based on the most common RPX sector of cases they were
`added to in 2014. Revenue is based on data from third-party providers and is for annual
`results available at year-end 2014 (typically 2013 results).
`
`Google
`
`Microsoft
`Amazon
`
`LG Electronics
`
`Sony
`
`Samsung
`Apple
`
`AT&T
`Verizon
`
`HTC
`
`Pantech
`
`Fujitsu
`
`Blackberry
`
`T-Mobile
`
`ZTE
`
`Huawei
`Sears
`
`Facebook
`ASUSTek
`
`Nokia
`
`Canon
`
`500
`500
`
`5,000
`5,000
`(cid:4)(cid:9)(cid:15)(cid:14)(cid:16)(cid:17)(cid:9)(cid:8)(cid:1)(cid:4)(cid:9)(cid:19)(cid:9)(cid:13)(cid:18)(cid:9)(cid:1)(cid:20)(cid:23)(cid:3)(cid:1)(cid:11)(cid:13)(cid:1)(cid:2)(cid:14)(cid:10)(cid:1)(cid:5)(cid:7)(cid:6)(cid:12)(cid:9)(cid:21)(cid:1)
`Reported Revenue ($M in Log Scale)
`
`Sprint
`
`Hewlett-Packard
`
`Dell
`Cisco
`
`Target
`Nissan
`
`Toshiba
`Best Buy
`
`50,000
`50,000
`
`Wal-Mart
`
`BMW
`Honda
`
`500,0
`500,000
`
`60
`60
`
`50
`50
`
`40
`40
`
`30
`30
`
`20
`20
`
`10
`10
`
`NPE Cases in 2014
`NPE Cases in 2014
`
`0
`0
`
`50
`
`50
`
`Mobile Communications and Devices
`
`Networking
`
`Consumer Electronics and PCs
`
`E-commerce and Software
`
`Other
`
`RPX Corporation
`
`2014 NPE Litigation Report | Sector and Revenue Analysis
`
`26
`
`

`
`Chart 43: NPE Defendants Added by Ownership Type
`
`Chart 44: NPE Defendants Added by Company Revenue
`
`100%
`
`90%
`
`80%
`
`70%
`
`60%
`
`50%
`
`40%
`
`30%
`
`20%
`
`10%
`
`0%
`
`Public
`26%
`
`Private
`74%
`
`Public
`41%
`
`Private
`59%
`
`Unique Defendants
`Unique defendants
`
`Total Defendants
`Total Defendants
`
`100%
`
`90%
`
`80%
`
`70%
`
`60%
`
`50%
`
`40%
`
`30%
`
`20%
`
`10%
`
`0%
`
`> $50B+
`3%
`
`$10B–50B
`7%
`
`$1B–10B
`16%
`
`$100M–1B
`12%
`
`< $100M
`62%
`
`> $50B+
`16%
`
`$10B–50B
`13%
`
`$1B–10B
`19%
`
`$100M–1B
`10%
`
`< $100M
`42%
`
`Unique Defendants
`Unique Defendants
`
`Total Defendants
`Total Defendants
`
`Methodology Note:
`Companies were categorized based on the most common RPX sector of cases they were
`added to in 2014. Revenue is based on data from third-party providers and is for annual
`results available at year-end 2014 (typically 2013 results).
`
`RPX Corporation
`
`2014 NPE Litigation Report | Sector and Revenue Analysis
`
`27
`
`

`
`Chart 45: NPE Cases per Unique Defendant by Ownership Type
`
`Chart 46: NPE Cases per Unique Defendant by Company Revenue
`
`9.6
`
`4.9
`
`2.6
`
`1.6
`
`1.1
`
`8.2
`
`4.0
`
`2.1
`
`1.4
`
`1.1
`
`7.6
`
`7.3
`
`4.0
`
`2.2
`
`1.5
`
`1.2
`
`4.2
`
`2.1
`
`1.5
`
`1.1
`
`9.8
`
`3.2
`
`2.1
`
`1.4
`
`1.2
`
`3.2
`
`1.4
`
`2.5
`
`1.3
`
`2.8
`
`1.4
`
`3.0
`
`1.4
`
`2.7
`
`1.4
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`2010
`
`2011
`
`2012
`
`2013
`
`2014
`
`Public
`
`Private
`
`> $50B
`
` $10B–50B
`
` $1B–10B
`
`$100M–1B
`
`< $100M
`
`Methodology Note:
`Revenue is based on data from third-party providers and is for annual results available at
`time of report (typically 2013 results). Determination of ownership type is also based on
`data from third-party providers. Ownership type may change across time as companies
`switch from private to public and vice versa.
`
`RPX Corporation
`
`2014 NPE Litigation Report | Sector and Revenue Analysis
`
`28
`
`

`
`Top Plaintiffs and Defendants
`
`Key 2014 Findings
`
`Targeted Industries
`The most popular defendants for NPEs in 2014 were in the mobile and consumer
`electronics industries and included 13 of the top 15 companies targeted in 2013.
`LG Electronics and HTC joined the list, while Blackberry and Huawei fell off.
`See Table 3.
`
`Tech Giants
`In 2014 AT&T took over the number one spot for active cases at year-end. Fourteen of
`the 15 top defendants by active cases were also top 15 companies in 2013. Toshiba is a
`newcomer while Huawei fell off. Among the top 15 defendants by active cases at
`year-end, a slight majority (nine) had fewer suits pending at year-end 2014 than
`year-end 2013. See Table 4.
`
`Table 3: Top 15 NPE Defendants
`by New Cases
`
`Table 4: Top 15 NPE Defendants
`by Active Cases at Year-end
`
`Defendant
`
`2014
`
`2013
`
`Defendant
`
`2014
`
`2013
`
`1 Google
`
`2 Samsung
`
`3 Apple
`
`4 Microsoft
`
`5 Amazon.com
`
`6 AT&T
`
`45
`
`42
`
`39
`
`38
`
`35
`
`34
`
`32
`
`43
`
`39
`
`41
`
`27
`
`39
`
`54
`
`42
`
`1 AT&T
`
`2 Google
`
`3 Apple
`
`4 Samsung
`
`5 Amazon.com
`
`6 Verizon
`
`7 LG Electronics
`
`73
`
`71
`
`65
`
`60
`
`56
`
`53
`
`46
`
`70
`
`72
`
`68
`
`63
`
`54
`
`46
`
`42
`
`Private Companies
`Acacia led NPEs in both the number of NPE cases filed and total NPE defendants
`added in 2014. See Tables 5 and 6. Acacia was also the top NPE by NPE cases filed
`and total NPE defendants added over the past five years. See Tables 7 and 8. The top
`ten NPEs in 2014 accounted for 28% of NPE cases filed and 28% of total NPE
`defendants added. See Tables 5–8.
`
`7 Verizon
`
`8 LG Electronics
`
`9 HTC
`
`10 Sony
`
`11 T-Mobile
`
`12 Hewlett-Packard
`
`12 Sprint Nextel
`
`14 ZTE
`
`15 Dell
`
`31
`
`28
`
`25
`
`22
`
`20
`
`20
`
`18
`
`17
`
`28
`
`29
`
`34
`
`31
`
`29
`
`29
`
`28
`
`37
`
`8 Microsoft
`
`9 Sprint Nextel
`
`10 Sony
`
`11 T-Mobile
`
`12 HTC
`
`13 Dell
`
`14 Hewlett-Packard
`
`14 Toshiba
`
`44
`
`42
`
`39
`
`38
`
`37
`
`26
`
`25
`
`25
`
`39
`
`41
`
`58
`
`39
`
`42
`
`41
`
`40
`
`36
`
`RPX Corporation
`
`2014 NPE Litigation Report | Top Plaintiffs and Defendants
`
`29
`
`

`
`Table 5: Top Ten NPEs by Cases Filed in 2014
`
`Table 6: Top Ten NPEs by Total Defendants Added in 2014
`
`Rank
`
`NPE
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`7
`
`9
`
`Acacia Research Corporation
`
`eDekka LLC
`
`Marathon Patent Group Incorporated
`
`IPNav
`
`Empire IP LLC
`
`Olivistar LLC
`
`Logitraq LLC
`
`Simon Nicholas Richmond
`
`Hawk Technology Systems LLC
`
`10
`
`Penovia LLC
`
`2014
`
`Active at
`YE 2014
`
`Rank
`
`NPE
`
`134
`
`127
`
`107
`
`73
`
`64
`
`62
`
`58
`
`58
`
`54
`
`49
`
`188
`
`21
`
`83
`
`39
`
`113
`
`23
`
`28
`
`68
`
`30
`
`13
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`Acacia Research Corporation
`
`eDekka LLC
`
`Marathon Patent Group Incorporated
`
`IPNav
`
`Empire IP LLC
`
`Olivistar LLC
`
`Simon Nicholas Richmond
`
`Logitraq LLC
`
`Hawk Technology Systems LLC
`
`10
`
`LPL Licensing LLC, Phoenix Licensing LLC
`
`2014
`
`250
`
`131
`
`125
`
`98
`
`85
`
`69
`
`68
`
`62
`
`57
`
`54
`
`Active at
`YE 2014
`
`336
`
`23
`
`107
`
`89
`
`126
`
`23
`
`94
`
`32
`
`29
`
`69
`
`Table 7: Top Ten NPEs by Cases Filed 2010–2014
`
`Table 8: Top Ten NPEs by Total Defendants Added 2010–2014
`
`Rank
`
`Defendant
`
`Past 5 Years
`
`2014 Only
`
`Rank
`
`Defendant
`
`Past 5 Years
`
`2014 Only
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`Acacia Research Corporation
`
`IPNav
`
`Empire IP LLC
`
`Arrivalstar SA|Melvino Technologies Limited
`
`Marathon Patent Group Incorporated
`
`eDekka LLC
`
`Uniloc Corporation Pty Limited
`
`Novelpoint Holdings LLC
`
`Altitude Capital Partners
`
`10
`
`Pragmatus
`
`799
`
`444
`
`351
`
`351
`
`321
`
`147
`
`146
`
`139
`
`123
`
`117
`
`134
`
`73
`
`64
`
`7
`
`107
`
`127
`
`43
`
`22
`
`6
`
`19
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`Acacia Research Corporation
`
`IPNav
`
`Empire IP LLC
`
`Arrivalstar SA|Melvino Technologies Limited
`
`Marathon Patent Group Incorporated
`
`Geotag Incorporated
`
`PJC Logistics LLC
`
`Uniloc Corporation Pty Limited
`
`Patent Properties Incorporated
`
`10
`
`Select Retrieval LLC
`
`1,686
`
`1,044
`
`542
`
`496
`
`459
`
`369
`
`320
`
`242
`
`224
`
`218
`
`250
`
`98
`
`85
`
`7
`
`125
`
`1
`
`0
`
`48
`
`16
`
`0
`
`RPX Corporation
`
`2014 NPE Litigation Report | Top Plaintiffs and Defendants
`
`30
`
`

`
`Chart 47: Share of NPE Filings from Top Ten NPEs in 2014
`
`Chart 48: Share of NPE Filings from Serial NPEs in