Introduction The USPTO Director is under no obligation to institute petitions for inter partes review, even if a petition technically meets all of the requirements for institution. There are two well-known flavors of discretionary denial upon which the Director may rely to deny institution. The first falls under 35 U.S.C. § 314(a), which provides the minimum requirements for a petition while otherwise granting the Director broad discretion in determining which proceedings to institute. The second falls under 35 U.S.C. § 325(d), which deals with the relationship of inter partes review to other proceedings before the Office and allows the Director to deny institution where “the same or substantially the same prior art or arguments previously were presented to the Office.”The Director’s discretion under Section 314(a) is provided in the Interim Guidance concerning application of the Fintiv1case and informs parties on how the Director is likely to exercise their broad discretion in granting inter partes review petitions. That guidance has changed from administration to administration, depending on the priorities of the current Director.The statutory discretion provided in 35 U.S.C. § 325(d), however, remains more consistent. For example, the proportion of institution decisions addressing Section 325(d) has hovered around 25% since 2018. And since our last report,2 the Director has been active in providingadditional guidance to panels regarding the Section 325(d) analysis through the Director Review process.Figu

SummaryThe USPTO Patent Trial and Appeal Board (PTAB) has increasingly used its discretionary denial authority in recent years. Although the PTAB’s discretion under 35 U.S.C. § 314(a) and Fintiv grabbed many headlines in 2021, the PTAB’s discretion under 35 U.S.C. § 325(d) can be equally fatal to an America Invents Act (AIA) petition. This articles focuses on the PTAB’s discretion under Section 325(d).

s. The new process allows for the filing of three additional papers before institution without prior Board authorization: The patent owner can file a request for discretionary denial limited to 10 pages within two months of the Board issuing a notice granting a filing date to the petition; The petitioner can file an opposition to the patent owner’s request for discretionary denial limited to 10 pages and due within one month of the patent owner’s request; and The patent owner can file a reply in support of the request for discretionary denial limited to five pages within two weeks of the petitioner’s opposition. The proposed rules would not preclude petitioners from presenting discretionary arguments in the petition, although the rules do require patent owners to address discretionary arguments outside of the POPR, unless otherwise authorized by the Board.The patent owner’s request can address any applicable basis for discretionary denial, including those under 35 U.S.C. §§ 314(a) and 325(d), except for arguments regarding parallel petitions. Under the proposed rules, and consistent with current practice, petitioners would still be permitted to file a separate five-page ranking paper alongside a parallel petition to address reasons that it believes justify the parallel petition, and patent owners would still be permitted to file a five-page response to the ranking paper to voice their objections. The proposed rules are also clear that parties are not to address merits issues through the new briefing process — even if merits issues are intertwined with a party’s discretionary denial arguments. The NPRM instead states that “parties may direct the Board’s attention to the petition and [POPR] for discussion of the merits as contained in those documents.”Finally, the proposed rules provide that the Board may raise discretionary denial issues sua sponte. In that case, the parties will be provided with the opportunity for briefing on the relevant factors. Factors for discretion

a combined Oral Hearing that, “[i]f the Board determines that [Petitioner] have met their burden of proof with respect to those claims [Patent Owner] hasn’t filed any opposition.” The Director vacated the decision, holding that Patent Owner’s statements were not “an unequivocal abandonment of the contest” and were “contingent on the Board determining that Petitioner met its burden of proving by a preponderance of the evidence that the challenged claims are unpatentable.” The Director thus remanded for further proceedings.Non-Precedential Director Review Decisions1Discretion under §325(d)Keysight Technologies, Inc. v. Centripetal Networks, Inc., IPR2022-01421, Paper 14 (August 24, 2023) (sua sponte Director Review decision regarding § 325(d) discretionIn response to Petitioner’s rehearing request to the Precedential Opinion Panel, the Director vacated and remanded the Board panel’s decision denying institution. In the underlying panel decision, the Board exercised its discretion under 35 U.S.C. § 325(d) and denied institution. During prosecution of the challenged patent, a Final Written Decision for a related patent, relying on the same asserted references, was cited on an Information Disclosure Statement. Petitioner argued that this IDS disclosure did not meet Advanced Bionics step 1, which asks whether the same or substantially the same art or arguments were previously presented to the Office. The Petitioner thus did not present specific allegations of error under Advanced Bionics step 2. The Board panel disagreed. It determined that the IDS reference was sufficient to meet step 1, and because Petitioner had not alleged error under step 2, it denied institution. The Director vacated the decision, first confirming that, “[u]nder current policy, . . . the first part of the Advanced Bionics framework is met” when art was previously presented to the Office on an Information Disclosure Statement. She indicated “the first part of the Advanced Bionics framework does not require that an Ex

In re: Vivint, Inc., Appeal No. 2020-1992 (Fed. Cir. Sept. 29, 2021)In an appeal from the United States Patent Trial and Appeal Board, the Federal Circuit addressed whether a party may challenge the validity of an issued patent by ex parte reexamination when the challenger has repeatedly tried to use inter partes review (“IPR”) to forward the same argument. The Federal Circuit held that, when applying 35 U.S.C. § 325(d), the Patent Office cannot deny institution of IPR based on abusive filing practices and then grant a nearly identical reexamination request that is even more abusive.In 2015, Vivint sued Alarm.com for infringing four patents, including U.S. Patent No. 6,717,513 (the “Patent”).

Director Vidal recently vacated a decision denying institution of an inter partes review (“IPR”) to allow Google, the Petitioner, to brief whether discretionary denial was warranted under Section 325(d) in view of a European counterpart that was of record during prosecution.On July 5, 2022, Google filed a Petition requesting inter partes review of various claims of U.S. Patent No. 6,816,809 (“the ’809 Patent), assigned to Valtrus Innovations Ltd. Google challenged certain claims of the ’809 Patent as obvious over U.S. Patent No. 4,924,428 to Vea (“Vea”). In its Petition, Google addressed 35 U.S.C. § 325(d), which provides in pertinent part that “[i]n determining whether to institute or order a proceeding . . . the Director may take into account whether, and reject the petition or request because, the same or substantially the same prior art or arguments previously were presented to the Office.” In particular, Google noted that discretionary denial was not warranted under Section 325(d) because “[n]one of the Ground’s references were before the Office during the ’809 Patent’s prosecution.”In its Preliminary Response, Valtrus noted that an Information Disclosure Statement (“IDS”) submitted to the Office during prosecution of the ’809 Patent included Vea’s European patent counterpart EP0320329, the disclosure of which is “substantively identical” to Vea. Valtrus argued that the inclusion of the European counterpart in the IDS implicated Section 325(d) and that “the Board should exercise its discretion under 325(d) to deny the petition.” Google thereafter requested authorization to file a r

Opinion by Deshpande, joined by Fink and Horner.The Patent Trial and Appeal Board exercised its discretion to deny institution of an IPR under 35 U.S.C. § 325(d).Section 325(d) gives the Board discretion to deny institution when “the same or substantially the same prior art or arguments previously were presented to the Office.” The Board set forth the following two-part framework for determining whether to exercise its discretion under § 325(d): “(1) whether the same or substantially the same art previously was presented to the Office or whether the same or substantially the same arguments previously were presented to the Office; and (2) if either condition of [the] first part of the framework is satisfied, whether the petitioner has demonstrated that the Office erred in a manner material to the patentability of [the] challenged claims.”

The PTAB recently designated two decisions as informative that concern its discretion to deny institution of an IPR/CBM petition. Under 35 U.S.C. § 325(d), “In determining whether to institute or order a proceeding . . . the Director may take into account whether . . . the same or substantially the same prior art or arguments previously were presented to the Office.” The PTAB periodically designates decisions as “informative” for several reasons, including that they illustrate norms on recurring issues, guidance on issues of first impression, or guidance on PTAB rules and practices.

On September 29, 2021, the Federal Circuit in In re: Vivint, Inc. (Fed. Cir. 2021) held that 35 U.S.C. § 325(d) applies to both inter partes review (IPR) petitions and requests for ex parte reexamination. Accordingly, the Federal Circuit found that “the Patent Office, when applying § 325(d), cannot deny institution of [an] IPR based on abusive filing practices [and] then grant a nearly identical reexamination request that is even more abusive.”

The statute provides that the Board, in determining whether to institute an IPR or CBM, “may take into account whether, and reject the petition or request because, the same or substantially the same prior art or arguments previously were presented to the Office.” 35 U.S.C. § 325(d). A survey of the Board decisions to date demonstrates that different Board panels have exercised this discretion differently.