Patent Risk Digest

October 2017

A monthly update on market activity, legal developments, and policy related to patent litigation
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Q3 2017 Patent Litigation, by the Numbers

The third quarter of 2017 saw more than 800 new patent infringement cases, hitting upwards of 740 unique defendants. As in previous quarters, defendants representing many different sectors were sued over patents in Q3, including both large and small companies. New litigation campaigns were launched in every month of the third quarter, including one focusing on Quick Response (QR) Codes, and another targeting website security systems.

The defendant counts of several serial litigation campaigns continued to climb during Q3 (and continue to grow as we enter Q4), including that of SportBrain Holdings LLC (a wearables campaign with over 100 defendants); Geographic Location Innovations, LLC (a campaign focused on branch, store, and ATM locator services); and Venadium LLC (which targets website login technology).

Also during Q3, TC Heartland—the Supreme Court’s May 22 ruling that limits venue options in patent litigation—caused the concentration of patent litigation to expand, as plaintiffs looked for additional venues in which to enforce their patents. While a few frequent patent litigators have fought hard to stay in their first venue of choice, many patent plaintiffs have shifted away from the Eastern District of Texas (historically the most popular venue in which to bring patent lawsuits) in favor of venues in Delaware, Illinois, California, and elsewhere.

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Number of Defendants in Inventor’s QR Code Campaigns Approaches 100

Nearly 50 new lawsuits were filed in Q3 against companies that use Quick Response (QR) Codes with their products and services. More than 20 of those cases were filed by prolific inventor and litigator Leigh M. Rothschild in his multiple litigation campaigns targeting QR codes.

Since February 2015, Rothschild’s Symbology Innovations, LLC, RFID Technology Innovations, LLC, and Coding Technologies, LLC have collectively filed approximately 120 lawsuits, accusing the defendants of infringement through provision of advertisements with QR Codes.

Companies across a broad scope of industries have been hit, including the following:

  • Retail (Best Buy, Fiesta Mart, Floor & Décor Holdings, Hallmark Cards, Home Depot, Mary Kay, Sherwin-Williams, Ulta Beauty)
  • Restaurant (Auntie Annie’s, Dickey’s Barbecue Restaurants, Darden Restaurants)
  • Travel and Hospitality (American Airlines, BNSF Railway, Hilton Worldwide, Jet Blue, Omni Hotels)
  • Oil and Gas (Cabot Oil & Gas, Halliburton, Exxon Mobile)
  • Insurance (Aetna, Allstate, CIGNA, GEICO, State Farm)
  • Financial Services (American Express, Bank of America, Citigroup, JPMorgan Chase, SunTrust Banks)
  • Real Estate (Keller Williams, RE/MAX)

 

At least one other frequent patent litigator is currently running a QR Code campaign. As reported in September’s Patent Risk Digest, Kaldren LLC has sued more than 30 companies to date over their use of QR Codes, including manufacturers (General Mills, Procter & Gamble, Medline, Trippe Manufacturing, Wasau Paper, Western States Envelope Company), banks (American Express, Citigroup, SunTrust), insurance providers (Allstate, CIGNA), and social networking companies (Kik, Snap). Kaldren is an affiliate of IP Edge LLC, which was 2016’s most frequent plaintiff in patent litigation. During last year alone, IP Edge affiliates filed over 400 patent cases, targeting a vast range of companies, products, and services.

Website Product Display Campaign Gets a Third Life

During the third quarter, IDB Ventures LLC sued six retailers (Academy, American Eagle Outfitters, Burlington Stores, Charlotte Russe, DSW, and The Buckle) over a patent that has been previously litigated by two other plaintiffs (Execware LLC and Listou Search Technologies LLC) against more than 30 defendants. In all three campaigns, the defendants’ websites, in particular, the tiled product displays presented on based on the selection of certain features (e.g. color, size, etc.), have been accused of infringement. A variety of businesses have been sued, including the following:

  • Retailers (Best Buy, Barneys, Bed Bath & Beyond, Costco, CVS, Dollar General, Macy’s, Nordstrom, Office Depot, Sears, Williams-Sonoma, Home Depot, Men’s Wearhouse, Petsmart, Target, Wal-Mart, Staples)
  • E-commerce companies (Amazon, eBay, Overstock.com, Rakuten, Zappos)
  • Hotels (Hyatt, Marriot)
  • Wireless carriers (AT&T, Verizon)
  • Others (Expedia, Nextag, Yahoo!)

While some of the plaintiffs’ cases have persisted for two years or more, others have been swiftly dismissed, within just a few months of having been filed—suggesting that the parties settled.