In less than a month, the United States Patent and Trademark Office (“USPTO”) has dramatically reformed its policies and procedures for exercising its discretion to deny institution of AIA post-grant proceedings.
Rescission of June 2022 Memorandum on Interim Procedure for Discretionary Denials in AIA Post-Grant Proceedings with Parallel District Court Litigation
First, on February 28, 2025, the USPTO rescinded its June 2022 memorandum outlining the interim procedure regarding when the Patent Trial and Appeal (“PTAB”) may deny review of patents based on parallel litigation. In a brief email notice, the USPTO advised that parties should instead rely on earlier PTAB precedential decisions for guidance, including the 2020 ruling in Apple Inc. v. Fintiv Inc. that established that the PTAB can choose not to review a patent when related infringement litigation is set to end before the PTAB’s decision is due. The notice further advised that any PTAB or Director Review decisions that rely on the June 2022 memorandum are no longer binding or persuasive on the PTAB.
Guidance on Rescission of June 2022 Memorandum
Second, on March 24, 2025, Chief Administrative Patent Judge Scott Boalick issued a memorandum providing guidance regarding the rescission of the June 2022 memorandum. See https://www.uspto.gov/sites/default/files/documents/guidance_memo_on_interim_procedure_recission_20250324.pdf. According to the Boalick Memo, the rescission restores the PTAB’s reliance on its precedential decisions in Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (P.T.A.B. Mar. 20, 2020), and Sotera Wireless, Inc. v. Masimo Corp., IPR2020-01019, Paper 12 (P.T.A.B. Dec. 1, 2020). Id. at 1. As a result, the PTAB will once again apply the Fintiv framework in cases involving parallel proceedings—an approach that had been curtailed under the June 2022 memorandum.
The guidance reaffirms that:
- The PTAB may deny institution when an International Trade Commission (“ITC”) final determination is projected to issue before the PTAB’s statutory deadline for a final written decision, due to the risk of duplicative proceedings and increased litigation expense.
- A Sotera stipulation—where a petitioner agrees not to pursue in district court or at the ITC any grounds raised or reasonably raisable in an inter partes review (“IPR”) or post-grant review (“PGR”) proceedings—remains “highly relevant,” but is no longer dispositive.
- Trial scheduling evidence, including district court median time-to-trial statistics, may be submitted and considered as part of the PTAB’s proximity analysis under Fintiv.
- Compelling merits will be factored into the overall discretionary analysis, but, standing alone, will not override other Fintiv
Id. at 2-3. The guidance applies to any case where the PTAB has not yet issued a decision on institution or where a request for rehearing or Director Review remains pending. Past institution decisions will not be reconsidered absent “extraordinary circumstances.” Id. at 2.
Interim Processes for PTAB Workload Management
Finally, on March 26, 2025, Acting Director of the U.S. Patent and Trademark Office (USPTO), Coke Morgan Stewart, issued a memorandum introducing a bifurcated approach to institution decisions in IPR and PGR proceedings. See https://www.uspto.gov/sites/default/files/documents/InterimProcesses-PTABWorkloadMgmt-20250326.pdf. Under the new procedure, discretionary denial considerations under 35 U.S.C. §§ 314(a) and 324(a) will be reviewed separately from the substantive merits of a petition. The Acting Director, in consultation with at least three PTAB judges, will make an initial threshold determination as to whether institution should be denied for discretionary reasons. Id. at 1. If such denial is deemed appropriate, the petition will be rejected at that stage. Id. If not, the petition proceeds to a merits panel, which will assess the petition under traditional statutory requirements. Id.
This interim reform—triggered in part by increasing workload constraints at the PTAB—marks a sharp departure from prior practice, where a single PTAB panel assessed both discretionary and merits considerations concurrently. The policy applies to proceedings where the patent owner’s deadline to file a preliminary response has not yet passed. For those cases, the USPTO will now entertain a separate round of briefing focused exclusively on discretionary denial.
The bifurcated process introduced by the USPTO includes a newly established timeline for briefing discretionary denial issues, separate from the existing merits briefing schedule governed by 37 C.F.R. § 42.107(b). The deadlines are as follows:
- Patent Owner’s Discretionary Denial Brief: Within two months of the PTAB’s entry of a Notice of Filing Date Accorded, the patent owner may submit a brief outlining the bases for discretionary denial of institution.
- Petitioner’s Opposition Brief: The petitioner may file a responsive opposition no later than one month after the patent owner’s brief is filed.
Id. at 2. Both briefs are subject to a 14,000-word limit, consistent with the constraints in 37 C.F.R. § 42.24. Id. A reply brief, if permitted, must not exceed 5,600 words and will only be allowed upon a showing of good cause. Id.
The schedule for the patent owner’s preliminary response (“POPR”) addressing the merits of the petition remains unchanged. Id. As before, a POPR must be filed within three months of the notice of the petition’s filing date, and parties may separately request rehearing or Director Review following institution decisions. For proceedings where the deadline for filing a POPR has not yet passed but the time to file a discretionary denial brief under the new procedure has already elapsed, the memorandum permits the patent owner to submit the discretionary denial brief within one month of the memorandum’s issuance date (i.e., by April 26, 2025). Id. at 3.
Under the new procedure, parties may present arguments on a broad range of factors relevant to discretionary denial, including, but not limited to:
- Parallel Proceedings: Whether the PTAB or another tribunal, such as a district court or the ITC, has already adjudicated—or is likely to adjudicate—the validity or patentability of the challenged claims.
- Strength of the Petition: The perceived substantive strength of the unpatentability grounds may be a relevant factor, particularly in cases where the record appears to lack compelling merits.
- Reliance on Expert Testimony: The extent to which the petition depends on expert declarations may now serve as an independent basis for discretionary denial, raising new strategic considerations in how petitioners frame their initial filings.
- Settled Expectations: The age of the patent and the duration for which the claims have been in force may weigh against institution, particularly where long-standing rights or reliance interests are implicated.
- Public Interest Factors: Parties may now argue that compelling economic, public health, or national security considerations either support or weigh against institution.
- Administrative Efficiency: The Director will also consider the PTAB’s ability to meet statutory deadlines and manage its existing workload, as authorized by 35 U.S.C. § 316(b).
Id. at 2-3. This expansive list introduces new framing opportunities for both petitioners and patent owners, while also increasing the complexity of the pre-institution phase. Notably, the absence of safe harbors previously available under prior guidance—such as stipulations to avoid Fintiv—suggests that each petition will now be subject to a case-specific, holistic evaluation of discretionary factors.
Takeaways
The rescission of the June 2022 memorandum and the interim bifurcation of discretionary and merits review in AIA trial proceedings marks a procedural inflection point for PTAB litigation.
By rescinding the June 2022 memorandum and reverting to the Fintiv and Sotera standards, the PTAB has signaled a return to case-specific, multifactor balancing without categorical exclusions. This shift revives several contested grounds for discretionary denial and may increase the procedural uncertainty facing petitioners with concurrent district court or ITC proceedings.
By centralizing discretionary denial determinations in the hands of the Acting Director—alongside a select panel of judges—and allowing separate briefing, the agency has reoriented the early-phase dynamics of inter partes and post-grant reviews. Practically, the procedural shift erects an additional institutional gate that petitioners must pass through before their challenges are even evaluated on the merits. The expansion of discretionary denial factors—ranging from reliance on expert testimony to the settled expectations of the parties—signals a more expansive and possibly less predictable review framework. Although the Acting Director characterizes these changes as temporary, their implementation coincides with judicial staffing reductions and suggest a structural recalibration in how the USPTO prioritizes administrative efficiency over expansive review.
Patent owners may view these developments as a favorable recalibration, offering a renewed opportunity to foreclose institution at an earlier stage and on broader grounds. For petitioners, however, the procedural landscape has become more uncertain and potentially more resource-intensive. Instead of relying primarily on the strength of the petition’s merits, petitioners must now develop full-fledged arguments on why discretionary denial should not apply, without knowing whether the PTAB will ever reach the merits. And they must do so with limited insight into how newly introduced factors will be applied in practice.
In the near term, parties should anticipate a period of doctrinal development as the PTAB begins issuing discretionary denial decisions under the new framework. But ultimately, one would expect the USPTO’s new policies to lead to more discretionary denials given the greater scrutiny these issues will receive before any consideration of the merits of a petition and the PTAB’s interest in managing its workload.