Statistics show that an accused infringer usually wins on summary judgment, yet the great majority of accused infringers will settle rather than progress to the merits. The reason is that it often costs too much and takes too long to litigate on the merits. Changing to a non-hourly based fee gives trial counsel the heretofore missing will to find the way to a faster and cheaper adjudication.
Statistics often are misleading. This said, the odds of a patent litigation surviving a motion for summary judgment are strikingly low under any margin for error. PwC’s most recent survey of patent litigation says that in instances where a final decision is reached at summary judgment, lawsuits brought by patent owners who are non-practicing entities (NPEs) are successful only 2% of the time and that lawsuits brought by patent owners who are practicing entities are successful only 9% of the time. While these odds improve to 66% if the patent owner can get to trial, the point is that this is a very hard thing to do.
So based on the empirical data there is a compelling case that the party bringing the patent litigation likely will lose a decision on the merits.
Why then do the great majority of patent litigations, 95% by some accounts, settle instead of progressing to a decision on the merits? (See RPX: From Exposing NPE Myths to Explaining NPE Math) (PwC acknowledges that “[d]ismissals that didn’t occur at trial or summary judgment are not included in this breakdown [of PwC’s reported success rates at summary judgment].”)