Patent litigation in Delaware has experienced a notable decline following a judicial order mandating the disclosure of litigation funding. Since April 2022, Delaware Chief Judge Colm F. Connolly has enforced a rule requiring parties involved in patent lawsuits to reveal any third-party financial support. This order has been linked to a 41% reduction in patent filings within Delaware over the subsequent two-year period, as highlighted by a University of Utah study. In contrast, the nationwide decrease in patent filings over the same timeframe was around 15%.
The implications of this trend suggest a broader reluctance among litigation funders to engage in cases within jurisdictions that require such disclosures. As noted by Jonas Anderson, a legal scholar involved in the study, there is considerable evidence to support the argument that funders prefer to maintain confidentiality regarding their involvement.
This development in Delaware underscores the impact that procedural changes can have on litigation dynamics, especially in key jurisdictions known for handling a substantial volume of patent cases. The shift may prompt affected cases to be redirected to other courts where disclosure requirements are either less stringent or non-existent. The complete analysis of the phenomenon and its repercussions can be accessed in the original report from Bloomberg Law here.