The lawsuit involved Ironburg Inventions (a subsidiary of Corsair Gaming), who have a patent for a game controller that has back paddles and they've held the patent since 2014. According to the press release, Valve lost the case and so "the jury unanimously found that Valve Corp infringed Ironburg’s 8,641,525 controller patent and awarded Ironburg over $4 million" additionally Valve were apparently aware of it and so the infringement was "willful". Due to this, there's a potential for "enhanced damages up to the statutory limit of treble damages" so the $4 million figure is only the beginning.
Any company that wishes to have back paddles, are then required to license the tech from Ironburg Inventions Ltd which is exactly what Microsoft does for their special Xbox Elite Controller.
The Steam Controller (sadly) was discontinued back in 2019. It was my favourite controller, and I still hope they bring out a proper second generation. Perhaps this was a big supporting reason for why they no longer continued with it? Probably not though, since they're now into VR hardware instead where there's likely a lot more monies.
If they do a second generation, perhaps they will be a little bit more careful with licensing next time and I will still happily be first in line if they do another.