The USPTO has quietly rolled out substantial changes to its examiner Performance Appraisal Plan (PAP) for FY2026. PAP is the formal framework the USPTO uses to measure, evaluate, and rate patent examiners’ job performance. These changes are made easier because of last month's elimination of union rights of patent examiners (POPA) based upon their presidentially declared national security role. However, this post is based upon discussions with examiners because the USPTO has not released documents regarding the plan.
In US Inventor, Inc. v. United States Patent and Trademark Office, No. 2024-1396 (Fed. Cir. Oct. 3, 2025), a group of inventor advocacy organizations petitioned the USPTO for rulemaking that would allow small entity patent owners to opt out of inter partes review and post-grant review proceedings. The USPTO denied their petition and the orgs sued, led by US Inventor. Their lawsuit was dismissed by the district court and the appellate panel has affirmed - holding that the organizations lacked Article III standing because the alleged injury to their members was too speculative, requiring a chain of contingent events largely dependent on the independent actions of third parties.
US Inventor and National Small Business United had filed a rulemaking petition in August 2020 proposing amendments to 37 C.F.R. sections 42.108 and 42.208 that would prohibit institution of IPR or PGR proceedings if the patent owner objected and met certain criteria, including being a small or micro entity who was the original patent applicant and had actually reduced the challenged claims to practice. The USPTO denied the petition in October 2021, explaining that the issues raised overlapped with those in a separate request for comments and that the petition's suggestions would be considered in any future rulemaking. When the organizations challenged this denial in district court under the Administrative Procedure Act, the district court dismissed for lack of standing, and the Federal Circuit affirmed that dismissal applying D.C. Circuit law.
Associational Standing Requirements
Organizations can assert "associational standing" to sue on behalf of their members if three requirements are met: (1) at least one member would have standing to sue in their own right; (2) the interests at stake are germane to the organization's purpose; and (3) neither the claim nor the relief requires participation of individual members. Only the first element was contested in this appeal. To establish individual standing, a plaintiff must show injury in fact that is concrete and particularized, actual or imminent (not conjectural or hypothetical), fairly traceable to the defendant's conduct, and likely redressable by a favorable decision.
In his first Director Review decision, new USPTO Director John Squires has gone the extra mile -- in addition to granting director review and reversing the Board's decision favoring the patent challenger, Dir. Squires also ordered immediate termination of the proceedings based upon unreliable expert testimony. This more dramatic termination is important because that looks more like a withdrawal of institution which is not appealable.
Blackhawk's challenged U.S. Patent No. 11,488,451 a method for selling pre-printed lottery tickets through a retailer’s existing point-of-sale (POS) terminals without requiring specialized lottery hardware. Instead of printing a new ticket at a dedicated lottery terminal, the system uses pre-manufactured tickets that carry unique identifiers and are activated when scanned and paid for at checkout. This framework allows the pre-printed ticket itself (once activated) to serve as the legal lottery instrument, while enabling lottery sales across all checkout lanes without specialized installations.
Nominal damages are proper - The Patent Act sets a "reasonable royalty" damages floor, but only if there is an evidentiary basis.
Comparable-license apportionment is mandatory - when a comparable license covers more than simply the patent at issue, additional evidence must be presented to the jury to explain how to apportion the license value between the patent at issue in the case, and the other rights licensed.
Click to see images from the patents (kind of gross).
There is a lot to question about this decision, but ultimately I think it comes down to the statement that Intuitive's attorney made at oral arguments:
Melanie L. Bostwick: This is not in the record because Rex didn't do its job in present this evidence.
Background: Days before trial, District Judge Maryellen Noreika excluded Rex's damages expert Douglas Kidder from testifying about the key comparable license in the case—a $10 million settlement agreement between Rex and Covidien that covered not only the '650 patent at issue, but also a related patent that had been the subject of a lawsuit (the '892 patent), eight other U.S. patents, seven U.S. patent applications, and nineteen foreign patents or applications. The district court found that Kidder had failed to adequately apportion the license payment among all these patents, rendering his methodology unreliable.
Trial moved forward without expert testimony. The jury was provided the prior license and heard testimony from Rex's president Lindsay Carter, who had negotiated the prior license. Intuitive cross examined Carter, but did not provide any witnesses or other evidence to prove no damages or a lower damages amount. Intuitive had been prepared to call its own damages expert (Todd Schoettelkotte), who had opined that a reasonable royalty would have been about $1–1.6 million. The Jury ultimately found infringement and awarded $10 million in damages.
On post-trial motions, the district court granted judgment as a matter of law reducing the damages award to $1, finding that the jury lacked sufficient evidence to apportion the Covidien license to the '650 patent alone. The court also denied Rex's request for a new damages trial, reasoning that Rex had the opportunity to present other evidence but chose to rely on the very license the court had already precluded its expert from using. Rex appealed both the exclusion of its expert and the reduction of the jury award, while Intuitive cross-appealed on infringement and invalidity grounds.
Rex Medical, L.P. v. Intuitive Surgical, Inc., Nos. 2024-1072, 2024-1125 (Fed. Cir. Oct. 2, 2025).
The federal government shutdown that began at 12:01 AM on October 1, 2025, is creating a patchwork of disruptions across the nation’s intellectual property infrastructure, with each major system affected differently based on their funding structures. The Copyright Office is apparently completely shuttered, its staff unable to access email or respond to inquiries.
As I discussed yesterday, the USPTO remains operational by drawing on fee-based reserve funds built up over recent years. But, the new news is an announced 1% workforce reduction (~1500 people) today along with closure of its Denver Office as part of “mission-prioritization.” Interestingly, the agency cited to a Biden-era report to Congress that “physical office space is less necessary” primarily because of the successful telework policies. The current administration has taken extensive steps to eliminate those policies. [Updated to fix my math – 150 people fired, not 1,500.]
The federal judiciary will continue paid operations through at least October 17 using court fee balances and existing funds, prioritizing criminal matters and emergencies while non-essential civil litigation faces potential delays.
In Focus Products Group International, LLC v. Kartri Sales Co., Inc., No. 2023-1446 (Fed. Cir. Sept. 30, 2025), the Federal Circuit reversed patent infringement findings against one defendant (Marquis Mills) while affirming most findings against another (Kartri Sales).
The most important part of the decision for patent prosecutors focuses on examiner driven restriction practice and how that can be used to define claim scope. The case also delves into trademark and trade dress issues that I leave for a separate post.
The patents at issue—U.S. Patent Nos. 6,494,248, 7,296,609, and 8,235,088—cover “hookless” shower curtains that attach directly to a shower rod through reinforced ring openings with slits. This integrated approach eliminates the need for separate hooks or clips. The representative claims recite shower rings with specific design features: a slit extending through the ring to an opening, and in some claims, a “projecting edge” that extends from the ring’s outer circumference. The accused products, manufactured by Marquis and sold by Kartri under the “Ezy-Hang” brand, featured rings with flat upper edges similar to Fig 21 above —a design feature that became the central battleground for determining infringement.
During prosecution of the ‘248 patent application, the examiner issued a restriction requirement identifying multiple patentably distinct species and defined those species through specific figure groups. Critically, the examiner distinguished “Species IV” (Figures 18-20, depicting rings with projecting fingers or extensions) from “Species V” (Figure 21, depicting rings “with a flat upper edge”). The patentee elected to pursue Species IV without objection – i.e., election without traversal. The patentee then rewrote the claims in a way that no longer focused on the flat upper edge. Except that one such claim slipped in — the patentee had added re-added a dependent claim that expressly “includes a flat upper edge” and the examiner asked it to be withdrawn as a non-elected species. Finally, in the notice of allowance, the examiner indicated that the non-elected claims had been cancelled as “drawn to a non-elected species without traverse;” and the applicant did no object to that characterization or seek reconsideration.
Eventually the Species IV patents issued without any claims focusing on the flat-upper-edge. However, the claim language was broad enough to encompass versions with both curved uppers and flat uppers. The question in the case then is whether the restriction procedure serves as an affirmative disclaimer of the flat upper scope. (more…)
The Federal Government's fiscal year begins on October 1, as does the Supreme Court's term. The new term always begins with a "long conference" that considers certiorari petitions briefed over the court's summer break. The conference was held on September 29, 2025, and we will soon be hearing which of these cases (if any) will be granted certiorari.
Patent
MSN Pharmaceuticals, Inc. v. Novartis Pharmaceuticals Corp., No. 25-225
This case addresses whether courts may consider after-arising technology when evaluating patent validity under 35 U.S.C. § 112(a)'s written description and enablement requirements. Novartis's patent for Entresto (a blockbuster heart failure drug generating over $3 billion annually) claimed a combination of valsartan and sacubitril, but the actual commercial product uses a form discovered four years after the patent filing that was not particularly described in the original specification. The Federal Circuit held that later-discovered technology cannot invalidate patents, creating some tension with precedents like The Incandescent Lamp Patent, 159 U.S. 465 (1895), and Amgen Inc. v. Sanofi, 598 U.S. 594 (2023), which seem to require patents to enable the full scope of their claims.
Gesture Technology Partners, LLC v. Apple Inc., No. 24-1280 and 24-1281
These cases questions whether the PTAB has constitutional authority under Article III and the public rights doctrine to conduct inter partes review proceedings on patents that expired before the IPR petition was filed. Gesture Technology's camera-based sensing patents expired in 2020, but Apple filed an IPR petition in May 2021, and the PTAB subsequently invalidated the claims, extinguishing Gesture's ability to collect damages for past infringement. The Federal Circuit held that PTAB has jurisdiction over expired patents because patent owners retain limited rights (damages for past infringement), but Gesture argues that once exclusionary rights expire, only Article III courts can adjudicate retrospective damage claims. Gesture also argues that Apple should be estopped under 35 U.S.C. § 315(e)(1) because Apple is a member of Unified Patents and should be treated as a real party in interest or privy, but the Federal Circuit held Gesture forfeited this argument.
R.J. Reynolds Vapor Company v. Altria Client Services LLC, No. 25-158
This case addresses whether the Federal Circuit's "built-in apportionment" exception violates Garretson v. Clark, 111 U.S. 120 (1884), which requires patentees to "in every case give evidence tending to separate or apportion the defendant's profits and the patentee's damages between the patented feature and the unpatented features." After a 2022 jury trial, Reynolds was found to infringe Altria's e-cigarette patents and ordered to pay $95.2 million based on a 5.25% royalty rate calculated using a lump-sum license. The Federal Circuit majority affirmed in December 2024, finding sufficient evidence of "built-in apportionment" in the comparable license, but Reynolds argues this undermines the fundamental requirement to separate the patent's contribution from unpatented features. Reynolds alternatively requests a grant-vacate-remand in light of the Federal Circuit's intervening May 2025 en banc decision in EcoFactor, Inc. v. Google LLC, 137 F.4th 1333 (Fed. Cir. 2025), which vacated a $20 million damages award and held district courts must rigorously assess damages expert testimony regarding comparable licenses.
United Services Automobile Association v. PNC Bank N.A., No. 25-149
This case presents an administrative law question about whether the PTAB's IPR decision was arbitrary and capricious under the Administrative Procedure Act (APA) when it reached different conclusions than prior PTAB proceedings involving "saliently similar facts" but different parties. USAA owns patents covering mobile check deposit technology, and when Wells Fargo challenged these patents in IPR using functionally identical prior art, the PTAB denied the challenges and found claims not obvious, leading to a $200 million jury award against Wells Fargo in 2019.
