Section 314(d)'s Bar Holds: Federal Circuit Rejects Constitutional and APA Challenges to IPR Institution Denials

by Dennis Crouch

In 2025, the USPTO has dramatically shifted its IPR institution practice -- resulting in an almost incredible uptick in institution denials. One response has been a series of mandamus petitions to the Federal Circuit. The first three of those have now been denied by a three judge panel.

These three focused on the USPTO's February 2025 rescission of Sotera stipulation guidance offered a safe harbor against discretionary denial for petitioners involved in parallel district court litigation over the patent.

The three-judge panel was almost the same of Judges Dyk, Linn (opinion author), and Cunningham (with Stoll replacing Cunningham on the Google decision) rejected constitutional and Administrative Procedure Act (APA) challenges to the policy change, holding that 35 U.S.C. § 314(d) renders institution decisions "final and nonappealable" and that mandamus is ordinarily unavailable to review such discretionary determinations.

The petitioners in all three cases argued that Acting Director Stewart violated due process and the APA by rescinding the Vidal Memorandum and applying that rescission to pending IPR petitions. Motorola Solutions faced the most dramatic procedural harm: the PTAB had initially instituted eight IPRs based on Motorola's Sotera stipulations, but the Acting Director later vacated those institution decisions after rescinding the guidance. Google and Samsung jointly challenged denials of IPR petitions despite Samsung's stipulation, while SAP similarly contested discretionary denials after it had stipulated not to pursue district court invalidity grounds. Each petitioner contended that the policy reversal after they had filed their petitions violated constitutional protections and administrative law principles. The Federal Circuit rejected these arguments across the board, finding no colorable constitutional claim and holding that most APA challenges to institution decisions fall outside the narrow exceptions to § 314(d)'s bar on judicial review.

Several other petitions are pending, but (in my opinion) none of them raise substantially more compelling claims and so are also very likely to be denied.

The decisions carry troubling implications for an even more recent development in IPR practice. In October, 2025 Director John Squires took personal control over all IPR institution decisions (reversing the longstanding practice of delegating that responsibility to PTAB panels) and began issuing summary denial of institutions without any explanation or justification (again, reversing longstanding practice that IPR institution decisions have always offered a reasoned analysis).

The Federal Circuit's treatment of the arbitrary-and-capricious challenge in Motorola suggests that the court may see complaints about summary denials equally unreviewable. In Motorola, the court held that arguments challenging the Acting Director's failure to "offer any reasons for the change" in policy are "the kinds of arguments that we have said are not reviewable in light of § 314(d)" because they ultimately challenge the Director's weighing of factors. The result is what I have called an "unexplained and unreviewable" regime where the Director can deny institution without providing any grounds and courts cannot (or will not) intervene.

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