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Patent Litigation in Texas: What Happened in 2022 and What to Expect Next

March 2, 2023

The following alert is included in Insights 2023, a collection of articles and videos addressing important emerging legal issues in the year ahead.

Despite an abrupt mid-year judicial order reassigning Western District patent cases—a change many observers thought would cut off the district’s steady flow of patent litigation—the change so far has not been as dramatic as some expected. But more changes likely to come in 2023 could further alter the landscape.

For the first half of 2022, Judge Alan Albright of WDTX presided over all patent cases filed in the Waco Division—roughly 95% of patent cases in the district, and nearly one quarter of patent cases nationwide. But in an unexpected July 25 order, WDTX Chief Judge Orlando Garcia changed how judges are assigned to patent cases filed in Waco. The order, which applies only to cases filed in Waco, assigns cases randomly to 12 judges across the district.

Since Judge Garcia’s order, new filings in the WDTX have fallen, though not as precipitously as some initially predicted. Plaintiffs filed about 30% fewer cases in WDTX from July 25 through December 31 compared to the same period last year, despite almost no year-over-year change in the number of patent cases filed nationwide. Plaintiffs have been able to keep many new cases before Judge Albright by designating them as “related” to cases he handled previously. As a result, half of the 291 cases filed in the Waco Division since July 25 were assigned to Judge Albright.

Judge Albright continues to move his cases along. He conducted three patent jury trials since July 25, with each resulting in findings of infringement and damages awards: US$1.9 million against an oilfield services company, US$274 million against Lab Corp., and US$949 million against Intel in round three of the VLSI litigation. Plaintiffs have now won 11 of 17 trials; damages awarded have ranged from US$235,000 to US$2.2 billion, with a median of US$14 million.

Next door, in the Eastern District of Texas, Chief Judge Rodney Gilstrap continues to preside over 95% of civil cases filed in Marshall. Following the July 25 order, patent filings in Marshall have ticked up slightly, with 165 cases compared to 147 during the same period in 2021. Judge Gilstrap took nine cases to jury verdicts in 2022, with six resulting in infringement verdicts—including a US$31 million award against Ericsson and a US$218 million award against PNC Bank.

Patent case counts decreased only slightly nationwide in 2022. Plaintiffs filed 5,992 cases in 2022, down from 6,087 cases in 2021. Perhaps as a measure of the impact of the WDTX reassignment order, of the highest-volume patent districts, only the EDTX and Central District of California saw an increase in filings from July 25 through December 31 compared to the prior year. Here is how the numbers break down.

But the dust hasn’t settled in WDTX. In November 2022, Judge Alia Moses in Del Rio succeeded Judge Garcia as the district’s Chief Judge. In this role, Judge Moses will have influence over case assignment procedures across the district, and in a December 16 standing order, Judge Moses kept in place Judge Garcia’s July 25 order. It remains to be seen, however, whether this policy will be permanent. There may be retirements in the district in 2023, which also could affect case assignments.

For now, litigants should assume that the Eastern and Western districts will remain two of the country’s busiest. In Waco, the “related cases” phenomenon will take some time to tail off, and it seems likely there will be at least one other shoe to drop with respect to the adjusted case assignment protocol. And some WDTX courts outside of Waco seem to be positioning themselves to handle patent cases following Judge Albright’s procedures—using the same magistrates, adopting similar practices on technical advisors, and even adopting Judge Albright’s special rules, as already happened in Midland. Meanwhile, EDTX continues to see robust case filings and seems positioned to capture a sizeable share of cases that plaintiffs may divert away from WDTX. In the year ahead, EDTX and WDTX will continue to handle out-sized shares of patent litigation and continue to exert important influence over the direction of patent law.

This memorandum is a summary for general information and discussion only and may be considered an advertisement for certain purposes. It is not a full analysis of the matters presented, may not be relied upon as legal advice, and does not purport to represent the views of our clients or the Firm. Timothy S. Durst, an O'Melveny partner licensed to practice law in Texas, and Cason G. Cole, an O'Melveny associate licensed to practice law in Texas, contributed to the content of this newsletter. The views expressed in this newsletter are the views of the authors except as otherwise noted.

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