Fintiv: Dir. Vidal calls for Fewer Discretionary Denials of Inter Partes Review Petitions

by Dennis Crouch

When Congress passed the Inter Partes Review (IPR) provisions of the AIA, there was some concern that the USPTO might be overwhelmed with IPR petitions; that patentees might be abusively harassed by IPR petitions; or that IPR petitions might sometimes problematically interfere with ongoing litigation.  One solution offered by Congress was give the USPTO Director discretionary and unreviewable authority to grant or deny IPR petitions.  We know that the PTO Directors have then passed this authority down to the PTAB who decides the institution petitions.  More recently, under Dir. Iancu direction the PTAB developed a more formalized doctrinal process for denying IPR institution when ongoing parallel litigation is already well underway.  See, Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (PTAB Mar. 20, 2020) (precedential).   Because IPR petitions often follow infringement allegations, Fintiv considerations have become a regular aspect of IPR institution. In general, the PTAB  has been considering the following factors:

  1. Is the district court litigation stayed or likely to be stayed if the IPR is granted;
  2. Has the district court set a trial date that is close-in-time to the IPR statutory deadline for a final written decision;
  3. Have the district court and the parties already made substantial investment in the district court proceeding;
  4. Are there substantial overlap between issues raised in the petition and those found in the district court proceeding;
  5. Are the parties to the IPR the same as those in the parallel litigation;
  6. Are there other circumstances that suggest the exercise of discretion in denying the petition — including consideration of the merits of the petition.

In a recent release, USPTO Director Vidal has released a set of interim procedures for the PTAB to follow that somewhat modify Fintiv–and particularly make it less likely that the PTAB will exercise discretionary denials.  New rules:

  1. No discretionary denial if the petition presents “compelling evidence of unpatentability.”
  2. No discretionary denial if the petitioner stipulates that it will not “pursue in a parallel proceeding the same grounds or any grounds that could have reasonably been raised before the PTAB.”  (Can the stipulation be conditional upon the grant of the petition?).
  3. Fintiv precedent does not apply to USITC proceedings.
  4. Some courts regularly set early trial dates and then repeatedly push them back. And, it seems that at least one judge (Judge Albright) has been strategically setting early trial dates in order to trigger discretionary denial. With that in mind, the PTAB’s consideration of trial dates should consider the median time to trial for the district and potentially other aspects of the litigation rather than simply the particular trial date set by the district court.

Read the memo here.

As you can see, the substantive changes all weigh against discretionary denials.  The memo and other sideline discussions also make clear that  the new boss (Dir. Vidal) does not favor discretionary denials.  I.e., in addition to new rules, we are also likely to have a different narrowing interpretation of the denial approach.

24 thoughts on “Fintiv: Dir. Vidal calls for Fewer Discretionary Denials of Inter Partes Review Petitions

  1. 5

    Just take a look at those factors PTAB is using – court this, court that, and of course the hidden unavoidable influence factors (good plaintiff, bad plaintiff, is the defendant on the pto tech advisory board, etc.), do we like the Markman order (not that PTAB gives ANY comity anyways), which claims were asserted? And under the new specific allegation rules – which claim can be bent to foreclose infringement. If I were a federal judge – I would be scratching my head as to how my court has jurisdiction over ANY patent case – my orders are not binding, my jury can be voided, my final judgment is not final as it is subject to collateral attack by the pto, PTAB is under the hood looking at ‘factors’, etc. And not even by an administrative court with a politically protected APJs presiding, but by EMPLOYEES of pto. So the Robert’s doctrine of re-writing statutes to ‘save’ the statutory scheme now compounded by Oil States, the 101 – gist and 103 – common sense test, the issued US patent is more liability than asset under the new world order. And now the PTAB is going to swing between extreme hostile, hostile or more hostile depending on the administration. And you know what? It’s made good, hard working, ethical patent attorneys like you guys (but not that serial infringer shill) into frauds promising fools gold. Just saying.

    1. 5.1

      Well, that was harsh.

      I can see amending my opening client discussions to avoid that “fraud” label though.

      1. 5.1.1

        Yeah, venting. But it’s true. In 20? years the patent system has been demolished – the long march through the institutions reached the patent system. It’s not even a property right anymore, it’s a revokable privilege from the King, and don’t look cross eyed at the King. SCOTUS is clear eyed on most rights. The property right? Not so much.

  2. 4

    Re: stipulation, it appears unclear how this differs from the current estoppel rules at the District Court level. If the stipulation be conditional upon the grant of the petition, this seems to be in line with current estoppel rules so agreeing to the stipulation is a no brainer. Is there some difference between what is waived/estopped? Possibly with regard to all grounds possible vs. specific claims?

  3. 3

    To me, it seems like this memo is a huge shift in the IPR/PGR landscape. Pursuing a discretionary denial used to be the focus of the POPR when there was parallel litigation. It seems like that is no longer going to be the case. Rather, the POPR – which a patent owner only has 3 months to prepare – is likely to lean on an expert declaration to combat merits based arguments. More than ever, this highlights how important it will be to act quickly upon receiving a petition (to line up the expert, analyze the prior art, etc.).

    1. 2.1

      Standing was directly up before Congress in the discussion of the AIA – they did not want that.

      1. 2.1.1

        Re: “Standing was directly up before Congress in the discussion of the AIA – they did not want that.”
        Yes, that Congress was well aware of the practice of some PAEs of sending many hundreds of patent-threatening letters to small businesses that had [typically] purchased some off-the-shelf products with no patent indemnity and could not afford to defend themselves, while never suing the product manufacturer or seller.


          Put your pom-poms down – the “0h N0es, Tr011s” boogeyman propaganda is NOT at point here.

          Clearly – any of those who may be the target of non-practicing entities would have standing.

          Paul – it is exactly this type of cheerleading by you – off-point and needless – that contributes to your lack of credibility on the topic.


            Patent attorneys should know at least some of what actually happens to inspire Congressional action like the APA [as well as some state legislation]. As you yourself have noted several times, a small number of greedy bad actors publicly tarred the rest of the patent profession in the eyes of Congress members and public media. There is no way to credibly defend or reality-deny deliberately only sending suit threatening license-extracting letters to businesses too small to defend themselves or even be worth actually suing. That practice only stopped after the FTC and some state AGs took action.
            Nor, as these interim rules show, was reliance by clever patent owners on clearly unrealistic projected single judge trial dates for thousands of patent suits filed in WDTX Waco, to avoid any IPR invalidity challenges, going to escape notice by key members of Congress, both in their confirmation hearing questions and their letters for the new Director, and their recently introduced patent legislation.


              Children be aware of – and beware:

              There is no way to credibly defend or reality-deny..

              Propaganda runs rampant because propaganda works.

              Follow the money — who exactly coined and proliferated the term “Patent Tr011” — and more importantly, to whose benefit?


                “who exactly coined and proliferated the term “Patent Tr011” ”

                Who exactly got totally bent out of shape about a perfectly appropriate descriptive term such that they are still whining about it like a baby in a wet diaper decades later?


                LOL. Peter Detkin takes credit when he was IP-GC at intel. Of course, it’s took on a life of it’s own – just like ‘bad patents.’

    2. 2.2

      There is real estoppel for whatever is, or could reasonably have been raised, in losing IPRs [only patent and publication prior art]. Standing is required for any petitioner appeal to the Fed. Cir. Both are meaningless if the petitioner fully wins.

      These interim guidelines will have no significant effect on the number of PTAB refused IPRs other than for patent suits filed in WDTX Waco. [Which this reduced-IPR-avoidance will thereby make somewhat less attractive.]

      1. 2.2.2

        Stand and real estoppel go hand-in-hand.

        You need standing otherwise third-parties can file an IPR petition against your claims and not have to worry about estoppel.

        And real estoppel? Not really when you look at some of the real cases.

      2. 2.2.3

        Yeah and what is the justification for doing this?

        A district court gives people a speedy trial and the PTO tries to negate that by having an IPR hovering over their head or force the parties to go to the PTO.


          If you are still trying to imply that District Court patent trials are faster than IPRs, or that they even regularly occur before IPR decisions, you must know by now that that is clearly disproven by actual statistics.
          Also you cannot validly deny the statistics showing that the vast majority of IPRs are filed by defendants being sued on or threatened by the subject patents – a real party in interest. A truly unaffected third party, with no possible infringement exposure, has no financial incentive to conduct an IPR, with some exceptions: a few would-be settlement shake-down artists, would-be stock price manipulators, and some trade organizations. It is my understanding that the new PTO director is seeking inputs on how to deal with some of those.


            Nice smoke and mirror there Cheerleader.

            I noticed you moved to “actual trials,” but that omits the FACT that scheduling the trial prompts resolution (and time thereof) without actual trials needing to be conducted.

            You cannot omit the time factor of that result — leastwise in an inte11ectually honest manner.


              Saying that projected trial dates which parties know are not realistic is comparable [for IPR initiation, not some other possible purpose*] to more realistically-predictable trial dates is directly contrary to what was just actually decided here for these interim guidelines based on documented Congressional and other complaints. If you have any actual relevant evidence re these interim guidelines for future rulemaking the public comment opportunity for this is open.
              *inducing more litigation with more settlement payments on invalid patents with no validity determinations was definitely not the intent of Congress for IPRs.


                Nice dance.

                You quite missed the point though.

                Try again, maybe without the pom-poms.

    3. 2.3

      If you want real estoppel, we have that with PGRs. So get rid of IPRs and just make all patents PGR-eligible without any nine-month time limits.

  4. 1

    I think Night Writer gets a little credit with this bit of “showing of color.”

    Favor (as expected) hews to the Party controlling the White House.

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