3 Takeaways From The Lex Machina 2021 Copyright And Trademark Report

Our clients deserve our well-informed opinions on IP issues, opinions based on data, rather than anecdotal evidence.

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Back in March, I shared some insights from Lex Machina’s 2021 Patent Litigation Report, which centered on COVID-19’s impact on nationwide patent litigation activity. Now, we have a chance to consider the findings of Lex Machina’s 2021 Copyright and Trademark Litigation Report (available with registration here), which considers data from cases filed from the start of 2018 through the end of 2020. As with all of Lex Machina’s analysis and reporting, the newly issued report is worth a read by IP lawyers, even if they don’t practice copyright and trademark litigation. Because our clients deserve our well-informed opinions on IP issues, opinions based on data, rather than anecdotal evidence.

As an initial matter, the longer duration of the data set in the report is helpful, since it allows us to consider the features of modern copyright and trademark litigation with a slight remove from the impact of the pandemic, while not ignoring the fact that COVID-19 did impact on IP litigation activity throughout most of 2020. At the same time, the 3-year period also allows us to fully appreciate the impact of what Lex Machina calls “massive filers” on the copyright and trademark litigation landscape, with certain types of cases being major drivers of litigation activity.

One example of the type of case filed by massive filers in the trademark realm are mass counterfeiting disputes. I covered some of the idiosyncrasies of those types of cases on these pages in January of last year. For our first takeaway from the new Lex Machina report, we can consider how the intensive litigation activity in the mass counterfeiting space continued to unfold over the course of 2020, even as the pandemic raged. For one, the presence of a heavy mass counterfeiting docket helped the Northern District of Illinois take pole position in terms of trademark cases filed, with many of those cases filed by the same Chicago-based IP law firm, Greer Burns & Crain. More importantly, the 14% decline in all types of trademark cases filed in 2020 helped increase the impact of mass counterfeiting cases on the overall trademark litigation docket. As the report notes, mass counterfeiting cases were 16% of all trademark cases filed in 2020, up from only 3% of trademark filings in 2015. Definitely a trend to watch, especially as online sales continue to grow and major online retailers like Amazon continue to invest heavily in stopping counterfeit products before they can even be offered to customers.

While mass counterfeiting cases continue to earn trademark litigation market share, for our second takeaway, it is interesting to look at the types of trademark causes of action that have seen decreased activity. Two examples of such claims are highlighted by the report: dilution and cybersquatting. On the dilution front, the report notes an over 50% decline in cases asserting a dilution claim, a decline “likely attributed to plaintiffs no longer being able to meet recognized standards for fame or not wanting to spend the resources needed to prove fame.” Add in the fact that dilution claims often met an ignominious demise at the pleadings stage, and it is no surprise that their appeal has waned.

While a change in the law helped push dilution claims deeper into the trademark owner’s toolbox, the decline in cybersquatting cases is attributed to a decline in demand for those cases in federal court. Here too, we see a 50% decline in the number of cases filed containing a cybersquatting claim, with plaintiffs choosing to avail themselves of the UDRP as a cheaper and more focused alternative to active litigation. Plus, by now, the message has surely gotten out that cybersquatting is not a lucrative or scalable business — at least partly because the UDRP makes it easy for trademark owners to get unauthorized domains transferred or delisted.

For our last takeaway, let’s take a look at the volume filers and defendants in copyright cases. On the plaintiff’s side, it should be no surprise that adult content companies find themselves having to police distribution of pirated videos — and have the wherewithal to bring their claims in court. Likewise, the large number of cases filed over pirated broadcasts of pay-per-view boxing and UFC events should also not be a surprise, since there remains a sizable number of sporting (along with porn, one imagines) aficionados who feel hard done by needing to actually pay for the content they consume.

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In terms of frequent copyright defendants, while copyright assertion activity on the apparel side definitely declined in 2020 — with only seven cases against perennial defendant Ross Stores filed in 2020, as opposed to 21 in 2018, likely due to the pandemic shutting stores — it is interesting to see that complaints against larger tech companies like Apple, Amazon, and Google increased or remained steady despite the pandemic. Moreover, the tech defendants were forced to contend with copyright cases filed against them over a broader range of district courts, with each being sued in over 10 different district courts between 2018 and 2020. Deciding to offer products nationally and expecting copyright claims nationally is the apparent order of battle for large tech companies.

Ultimately, the great thing about the report is that it has useful information for anyone with clients impacted by copyright or trademark litigation. While I chose to focus on these three idiosyncratic takeaways, there is plenty of other material in the report for fellow IP lawyers and their clients to digest. Once again, we can thank Lex Machina for the analytics and insights as we strive to get as clear a picture as possible about the IP litigation landscape we inhabit.

Please feel free to send comments or questions to me at gkroub@kskiplaw.com or via Twitter: @gkroub. Any topic suggestions or thoughts are most welcome.


Gaston Kroub lives in Brooklyn and is a founding partner of Kroub, Silbersher & Kolmykov PLLC, an intellectual property litigation boutique, and Markman Advisors LLC, a leading consultancy on patent issues for the investment community. Gaston’s practice focuses on intellectual property litigation and related counseling, with a strong focus on patent matters. You can reach him at gkroub@kskiplaw.com or follow him on Twitter: @gkroub.

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