Now that we have crossed the halfway point of 2025, it is as good a time as any to take a look at the numbers underlying modern patent litigation. Making this exercise more timely and useful is the recent floating by Trump administration officials of a “patent tax” to replace the current maintenance fee system. Under the (admittedly sketchy at best) details of that proposal, patent holders would pay between 1%-5% of patent value as a tax — immediately raising the question of how patent valuation would be handled under the proposed new scheme. While we can speculate as to whether this trial balloon will float toward a successful implementation or get popped before really taking flight, we do have concrete data as to how patent owners can use the litigation process to generate value from their infringed patents. That data, available in Lex Machina’s Damage Awards Litigation Report 2025, helps us better understand just what kind of results one can expect from successful patent assertion.
As with my prior takes on other Lex Machina reports, what follows are three idiosyncratic takeaways based on my review of their newest release. First, the report’s context on the “dramatic growth” of patent litigation awards relative to other areas of litigation deserves further consideration. Second, the continued rise in both the average and median jury award in patent cases is pretty wild. Third, the sharp decline in damages awarded in cases before the WDTX’s Judge Albright, as well as the dominance of SDNY judges at the top of the “Total Damages Awarded” chart, provides an interesting denouement to what seemed an unstoppable Waco-based patent train just a few years ago.
To start, I commend a full read of the report’s “Executive Summary,” with its discussion of the interplay between the litigation and insurance industries as framed by the current debate around “social inflation.” In an environment where across-the-board damages awards are increasing, disagreements as to the cause of that growth are bound to occur. For insurers, “social inflation” is the bogeyman, as it has “resulted in rapid increases in claim costs for key liability insurance lines.” Likewise, defendants in patent cases and their allies have raised the alarm for years about the ill effects engendered by the introduction of third-party litigation funding into the patent litigation mix. In that vein, as the report notes, litigation funding and sophisticated plaintiff persuasion tactics “may have recently allowed damage awards to flourish” at a rate exceeding even that of inflation.
Yet, the report suggests caution is warranted in terms of assuming that there is a “clear answer about whether and to what extent ‘social inflation’ applies across various types of civil litigation.” Undergirding that suggested caution is the fact that “[p]ractice areas differ wildly in terms of changing values of damage awards from 2015-2024.” So even though “patent infringement and trade secrets, have experienced dramatic growth” in terms of damages awarded, other areas of law have seen less action, with decreases “in both volume and value.” Further, the report suggests that the current period of generally rising damages awards could be “a normal fluctuation not in and of itself sufficient evidence of changing societal norms about lawsuits.” In short the proverbial jury is out, with the only assurance that the debate will continue to rage.
Second, the report’s insights into the “dramatic growth” in patent damages awards are worthy of further investigation. Perhaps the biggest driver of that growth is the increasing willingness of juries, especially post-Covid, to award large damages to patent owners that are able to shepherd their cases to trial and verdict. To illustrate this growth, let’s take a look at a few numbers disclosed in the report. Prior to 2020, 2017 was the year that saw the most patent cases get to a jury verdict, with 34 such verdicts. In 2023 and 2024, however, the number of cases where a jury awarded damages leapt up to 50 each year, which means that we are getting at least one more patent case a month going to trial successfully for plaintiffs, than we did in the best year for such results pre-Covid.
Likewise, prior to Covid, 2018 was the year with the highest average jury award for patentees, to the tune of a bit over $32 million. Since trials resumed in 2020? We have not seen a year where the average jury verdict was less than close to $39 million — and the numbers for 2022-2024 are staggering, with average jury awards at $74 million, $58 million, and $83 million respectively. Dramatic growth indeed, with more cases getting to verdict and juries awarding ever-higher verdict amounts as well. While it seems clear that the demanding standards of both contingency law firms and third-party litigation funders may be contributing to better case selection and more staying power for patent plaintiffs, it also seems like patent trial lawyers and their damages experts are doing a better job than ever getting juries to reward patent owners at trial. All these effects are linked, at least to some extent, because one of the ways a patent case becomes attractive to contingency lawyers and funders is where the damages potential is sky high, leading to more cases going to trial against large defendants, whose revenues from sales of infringing products contribute to large damages awards. And so the circle continues to turn with no end in sight, subject of course to the Federal Circuit’s wielding of its mega horsepower damages award weed whacker, which it is not shy about doing.
Lastly, it is a humbling reminder for the patent bar that while we may handle large cases, when it comes to generating headline-worthy verdicts, big-ticket class action cases continue to generate the largest damages awards. With a real concentration of the biggest such cases in the Southern District of New York, it is no surprise to see SDNY judges at the top of the charts in terms of damages awards from 2022-2024 nationwide. The only “patent judge” in the top 10, WDTX’s Judge Alan Albright, actually saw a big decline in damages awarded year over year from 2022-2024. After a high-water mark of $1.44 billion in 2022, 2024 saw only $318 million in damages awarded in his court, which is a large number. But that number is more comparable nowadays to a single healthy EDTX patent verdict, rather than evidence that WDTX juries are super willing to reward patentees at trial. It will be interesting to see if the WDTX can keep pace with EDTX going forward on this front, or if the decline in jury awards will cement EDTX’s “top spot as the leading venue for patent litigation in the United States.”
Ultimately, we once again can see from the report’s presentation of data that modern patent litigation remains a vibrant and challenging pursuit for both plaintiffs and defendants. At the same time, the continued changes in the patent space, both implemented and being proposed, promise to make the upcoming years even more exciting — and if the amount of damages awarded in patent cases continues to increase, even more lucrative for successful litigants, their counsel, and the litigation funders that were fortunate enough to have backed the winners. I am sure that many in this readership feel the same way. Thanks once again to Lex Machina for pulling together and presenting the data in a way that highlights how well our little area of law continues to adapt and grow.
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.
The post 3 (IP) Takeaways From The Lex Machina 2025 Litigation Damages Report appeared first on Above the Law.