Lex Machina has released their annual Litigation trends report. Although there are an increasing number of competitors in the legal analytics market, Lex Machina still offers the most sophisticated platform offering users the ability to create an almost limitless array of custom insights. Although Lex Machina launched as a product offering patent litigation analytics, Lex Machina has followed an aggressive scheduled for adding new modules since its acquisition by LexisNexis. During the past year Lex Machina released analytics for Bankruptcy Appeals, Securities, Labor and Products Liability in additional the commercial and antitrust modules that were previously added.
Overall federal litigation continues to trend down, but I was surprised to see that the one area where litigation is increasing is securities litigation. Securities Litigation is trending up and is at its highest level since 2009
Below are the trends highlighted in the Lex Machina press release:
- The most notable event of 2017 was the Supreme Court issuing its opinion in T.C. Heartland on May 22, holding unanimously that, under 28 U.S.C. § 1400(b) (the statute governing venue in patent suits), a domestic corporation “resides” only in its state of incorporation.
- Since that landmark decision, the number of cases filed in the E.D. Tex has significantly declined and been overtaken by the number of cases filed in the District of Delaware.
- Other districts including the D. Mass, the W. and S.D. Tex, and the W.D. Wash all saw significant increases in terms of percentage over 2016.
- While the first quarter of 2017 saw a record high number Inter Partes Review (IPR) petitions filed at PTAB (548 petitions), each successive quarter has seen a drop in filings
- This crest/trough may be related to the Supreme Court’s granting of certiorari in Oil States Energy Servs., v. Greene’s Energy Grp. in June 2017 – a case in which petitioners argue that IPR is unconstitutional, as a non-Article III forum extinguishing a property right without a trial by jury.
- The filing of new trademark cases has declined at a slight rate over the last few years. The fourth quarter of 2017 (953 cases) represents a continuation of this trend.
- From its apogee in Q1 of 2015 at over 900 cases, the number of file sharing cases filed each quarter declined steadily and rapidly until Q2 of 2016, which saw only 262 cases. Since then, the number of cases has been less predictable – Q4 2017 (367 cases) returns to the levels seen in late 2016, after two low quarters of around 150 cases.
- Fewer cases were filed in Q4 2017 than in any of the first three quarters, but the 406 cases filed still represents nearly twice the volume of quarters from 2010-2016.
- The top five districts accounted for just under half (44.2%) of the cases filed in the first half of 2017. Those districts are the S.D.N.Y. (16.2%), the N.D. Cal (8.8%), the C.D. Cal (7.0%), the D. Del (6.1%) and the D.N.J.(6.0%).
- 121 cases were filed in the fourth quarter of 2017, consistent with the recent trend of 100-150 cases per quarter, but is still down from the peak, occurring from the third quarter of 2015 and into the first quarter of 2016, which saw nearly three times as many cases.
- The number of Commercial cases filed each quarter has generally declined over the last several years. The 1,500 cases filed in the fourth quarter of 2017 is the lowest quarter total on record (back to 2009). Lex Machina’s Commercial cases involve claims for breach of contract or business torts between or among businesses. The decline in these cases has correlated with recovering economy in the years since 2009.
- Since the last quarterly update, Lex Machina has broadened our coverage of employment litigation. In addition to cases brought under federal employment civil rights statutes alleging discrimination, harassment, and/or retaliation, we now also include wage and hour claims under the FLSA, as well as interference and retaliatory claims under the FMLA.
- Figures in the update show 1) Employment cases filed 2011-2017 Q4 by quarter and 2) FLSA, FMLA cases filed, 2011-2017 Q4, by quarter.
Bankruptcy Appeals in U.S. District Court
• Lex Machina has analytics for Bankruptcy appeals in the district courts, including the ability to filter cases by the various chapters, by business or individual debtor, and by whether the case is an adversary proceeding.
• Figures in the update show 1) : Bankruptcy appeals filed in U.S. District Courts, 2011-2017 Q4, by quarter and 2) Bankruptcy appeals filed in U.S. District Courts, 2011-2017 Q4, by tag
• Since the last quarterly update, Lex Machina has also introduced Legal Analytics for Product Liability cases – practice area that approximately doubled the number of cases in our system.
• This update includes a figure showing product liability cases filed from 2011-2017 Q4, broken down by quarter and product classification, and using a logarithmic scale. (Otherwise the large number of medical device / pharmaceutical cases would dominate the scale.)