The US patent litigation market has evolved significantly over the past few years. Two main drivers are responsible for most of these changes.
The first is 2012’s America Invents Act which introduced the Patent Trial and Appeal Board (PTAB) and established inter partes reviews (IPR) as a new tool to challenging the validity of patents. The second was the Supreme Court’s 2017 ruling in TC Heartland LLC v Kraft Foods Group Brands LLC which changed the distribution of patent disputes at the various district courts.
The traditionally busy Eastern District in Texas has lost out in national importance, but remains a key venue for patent infringement suits alongside the ‘Rocket Docket’ in the Eastern District of Virginia. The district courts of Northern California and Delaware have seen a significant uptick in filings, while the Western District of Texas is slowly emerging as a new patent hub.
In a third major development the number of patent disputes at the International Trade Commission (ITC) has increased considerably and now regularly includes cases from sectors traditionally missing from the ITC’s caseload, such as pharmaceutical litigation. Though I have yet to find a patent litigator who can pinpoint exactly what moved firms to try more matters before the ITC, some suggest the introduction of IPRs has been an important contributing factor, given they can cause a stay in district court litigation, but not in cases tried before the ITC.
Last, the overall number of patent disputes involving non-practicing entities (NPE) has decreased while the sophistication of the remaining cases has increased, a development many practitioners also trace back to the arrival of IPRs.
How do these changes affect how firms maintain their reputation and how young litigators build their own reputation? None of the practitioners interviewed for this article considered the above changes an impediment to a successful career. On the contrary, the changes were exclusively considered to be a springboard for firms, and especially their younger practitioners, to showcase their skills in the courtroom.
Flexibility
The redistribution of the patent cases to several district courts, rather than just one or two exceedingly busy venues, has required firms to become familiar with all venues. Bert Reiser of LathaM&Amp;Watkins remarks ‘it is critical for firms seeking to compete for business to demonstrate to potential clients that they have successful experience in these jurisdictions, understand how they work internally, and are comfortable and confident litigating there’.
For Reiser, this requirement opens a path for young practitioners to win their first signature trial victory in key venues as firms can rely on ‘associates and junior partners to develop expertise in these jurisdictions’ in addition to ‘developing strategic partnerships with local counsel’.
Competitor litigation has increased in importance, but NPEs are a continued presence in district courts across the US. Firms ‘that have demonstrated the ability to understand the relative significance of the case to their client’s businesses, to litigate them appropriately, and to achieve economically rational results continue to handle a high volume of such cases’, observes Reiser. As such, his firm ‘involves its associates in NPE matters when possible’.
Given the increase in ITC litigation, many firms train their teams in ITC litigation, both in traditional cases involving electronics and high-tech patents and in cases regarding patents for pharmaceuticals and medical devices.
Mareesa Frederick, partner at Finnegan, Henderson, Farabow, Garrett&Dunner, considers this broader sector spread a great opportunity for attorneys as it ‘ultimately gives more associates an opportunity to get real, substantive experience very early on in their careers’, providing ‘excellent training’.
Thanks to the rapid pace of ITC litigation, ‘associates are often given opportunities that may be difficult to obtain in slower-moving district court cases. Many associates’ first deposition or first cross-examination of a witness occurs during an ITC case,’ Frederick points out.
Additionally, it’s likely that junior attorneys will benefit from participation in cross-border mandates and become familiar with their peculiarities. ‘Strong international capabilities in patent litigation is a must’, says DLA Piper litigator Sean Cunningham, especially ‘as jurisdictions like Germany and China are seeing rising popularity as faster and more efficient venues to resolve IP disputes than a lot of options in the US.’
Outreach
‘IP litigation is a small world’, says DLA Piper partner Erin Gibson. As such it offers an opportunity for young practitioners to earn lasting respect by staying ‘laser-focused on the merits’ of a case and acting as a reasonable, but tough opponent. ‘Your litigation opponent may soon be your client or co-counsel, or may support organisations that are dear to you,’ she explains.
Cunningham recommends the participation in joint defense groups as they ‘provide unique opportunities for younger lawyers to get their names out across many firms and in-house contacts at once, and to display talent, good judgement, and diplomacy’.
Jeanna Wacker, a life sciences specialist from Kirkland&Ellis, concurs and also proposes co-chairing a committee, volunteering to moderate a panel discussion, as well as writing articles or speaking on panels as good ways to connect with other patent litigators.
On a similar note, next generation practitioners hoping to set themselves apart from the pack should become experts in new legal precedent, a feat much more difficult to achieve with less current topics.
Kevin Wheeler, partner at LathaM&Amp;Watkins, points to the discussion about subject matter eligibility following the Supreme Court’s 2014 decision in Alice Corp v CLS Bank International as a prime example of an opportunity several of his colleagues have taken advantage of. Others are likely to follow as Wacker assesses that court opinions on subject matter eligibility regarding pharmaceuticals and biotechnological patents ‘have been very inconsistent and it seems likely the Supreme Court will eventually provide further clarification’, opening up room for young lawyers to explore this new terrain in more depth.
Budget constraints
An exceedingly important factor to remain competitive is to offer clients a service that fits with their budget restraints and business goals. In times when ‘litigation and in-house legal budgets are more closely scrutinised than ever before,’ Reiser notes, ‘firms must demonstrate the desire and ability to work closely with the client to work out a budget and to faithfully adhere to it. Very good relationships can be harmed irretrievably by unexpected blown budgets’.
Frank DeCosta of Finnegan, Henderson, Farabow, Garrett&Dunner notes ‘for many types of cases, teams are now smaller than they used to be’, requiring the modern day litigator to be ‘nimble’ and ‘play multiple roles within a case’, in addition to balancing a docket of cases moving in parallel in districts, the ITC, and PTAB.
This requirement for leaner staffing models due to the increasing financial pressure on clients ‘has been a career development opportunity for young lawyers’ who must now ‘ramp up very quickly,’ reports DeCosta.
The ability to produce excellent work is still of crucial importance. Kirkland&Ellis’ Michael De Vries puts it in a nutshell: ‘There is no shortcut to success: reputation comes, deservedly, from the outstanding results that typically flow from hard work, diligence, and creativity’. It is also the minimum requirement for young practitioners to earn the trust of senior partners.
Outlook
Patent litigation practices need to build teams which can skilfully handle every ball thrown at them. This challenge is an opportunity for the next generation of first chair trial lawyers to put their own stamp on litigation strategies. As Adam Alper from Kirkland&Ellis highlights: ‘There is no substitute for out-of-the-box-thinking. By-the-book strategies tend to be wasteful of court and client resources. Young lawyers on the team can often provide the spark that drives creative, game-winning strategies.’