When Foreigners Infringe Patents: An Empirical Look at the Involvement of Foreign Defendants in Patent Litigation in the U.S.

INTRODUCTION Enforcement of intellectual property rights, including enforcement across national borders, is crucial for the effective protection of those rights. Many scholars have debated whether the protection of intellectual property is desirable at all, or what the appropriate level of such protection might be; however, this article does not enter this debate. instead, it is written on the premise that as long as laws exist to protect intellectual property rights, those laws should be enforceable, regardless of the geographical location of the infringers of the rights. Recent international treaties concerning intellectual property reflect the interest of countries in the effective enforcement of intellectual property rights. (1) The treaties address enforcement through criminal laws and customs measures; they also set minimum standards for certain features of enforcement through civil litigation. However, the treaties remain silent on issues concerning cross-border enforcement through civil litigation, as if that type of enforcement presented no difficulties that could be solved by international treaties. Notwithstanding this silence in international treaties, a number of intellectual property scholars in the U.S. and other countries claim that cross-border enforcement problems in intellectual property litigation exist, and therefore a need also exists for a smoother mechanism for the recognition and enforcement of foreign judgments than the one currently available. (2) The scholars have cited isolated individual cases to illustrate the enforcement problems but have lacked more substantial empirical evidence for their claims. (3) The research presented in this article offers the missing evidence; it shows the magnitude of cross-border litigation as it exists today and suggests how problems might increase in the future. The evidence contributed in this article is based on a statistical analysis of an extensive population of all patent cases filed in U.S. federal district courts in 2004 and 2009. The use of data from these two years (4) allowed me to compare the two populations of cases and draw conclusions about the magnitude of changes over time. The most important finding of this research confirms that there is a growing need for a recognition and enforcement mechanism. in the realm of U.S. patent litigation, not only do cases exist in which cross-border recognition and enforcement may become a problem, (5) but the absolute number of these cases and their percentages with respect to all patent cases filed increased from 2004 to 2009. In addition to this basic important finding, my research brought some additional findings and also some unanticipated results. i found an increase in the number of cases in which at least one foreign defendant was sued in 2009. I also determined that more patents were at stake that would probably have a significant impact on U.S. economic interests. These two findings provide a strong argument for the need to create a viable mechanism for the recognition and enforcement of foreign judgments in patent matters. Unanticipated results revealed interesting facts about the patent litigation landscape in the U.S. and how it changed from 2004 to 2009. For instance, my data show that many foreign parties do not fit the classical profile of a "bad infringer"--a pirate hiding in an exotic rights haven. (6) Instead, many foreign defendants are generic drug manufacturers who are being sued as they prepare to launch into the U.S. market their generic versions of brand-name drugs protected by a U.S. patent. (7) Other data suggest that after certain changes in jurisprudence regarding venue, some plaintiffs might have used foreign defendants as part of a strategy to obtain the litigation venue of their choice. Plaintiffs might have sued foreign defendants together with a U.S. out-of-state defendant to avoid a transfer of venue in situations where the plaintiffs' choice of venue would not be defensible if only the U. …