According to an analysis by Law 360, the filing of patent infringement cases in California federal courts fell 30% in 2014.
This drop is even greater than the 19% decrease in the number of patent cases filed in federal courts across the US.
Despite the drop, the Central District of California, which includes Los Angeles, remains the third most popular venue for patent cases to be filed, following the Eastern District of Texas and the District of Delaware.
The Southern District of California was the fourth most popular jurisdiction in which to file patent cases in 2013, but fell to 11th place in 2014.
Patent case filings in the Northern District of California, which includes San Francisco and Silicon Valley, actually increased slightly from 2013 to 2014: from 209 to 219. This is thought to be because many of the patent cases filed in the Bay Area are brought between plaintiffs and defendants that are both based in the area.
The local and nationwide drop is generally attributed to the fallout from the US Supreme Court’s Alice decision.
Alice Corp. v. CLS Bank International presented the issue of whether certain claims of a patent for a computer-implemented escrow service described an un-patentable abstract idea or a patentable invention.
The Supreme Court concluded that the idea was abstract and thus un-patentable.
Although the high court did not hold in the Alice case that all software-related patents were invalid, as some had feared, it did open the door for closer scrutiny of software-based patents.
The Supreme Court did not, however, provide detailed guidance to lower courts about how to distinguish between patentable and un-patentable software inventions.
We have also seen an increased rejection rate based on the Alice decision in software patents, although we have strategies to get around the rejection under the Alice test
The Central District of California was one of the first circuit courts to apply Alice.
In the 2014 Digitech case, the circuit court upheld a district court’s ruling that the asserted method claim for creating a device profile within a digital image processing system encompassed an abstract idea and was thus not eligible for patent protection.
Some patent attorneys see the Digitech case, and other factors, as making the Central District a less favorable environment in which to file patent cases.