The Director Unbound: Federal Circuit Holds NHK-Fintiv Exempt from APA Rulemaking

by Dennis Crouch

In Apple v. Squires, the Federal Circuit has again reinforced the USPTO Director's broad and largely unchecked discretionary power at the IPR institution stage. Over the past several years, the court has systematically closed every door that petitioners have tried to open. Most recently, it denied a wave of mandamus petitions challenging Director Squires' discretionary denials, holding that 35 U.S.C. § 314(d) bars review of institution decisions even when petitioners raise constitutional and APA claims. In its 2023 decision in this very case, the court held that substantive challenges to the NHK-Fintiv framework were themselves unreviewable. Apple Inc. v. Vidal, 63 F.4th 1 (Fed. Cir. 2023). Now, in the new decision, the court closed the next (and potentially last remaining) opening: the claim that the NHK-Fintiv instructions should have been adopted through notice-and-comment rulemaking under the Administrative Procedure Act. Apple Inc. v. Squires, No. 2024-1864 (Fed. Cir. Feb. 13, 2026).

Background:

• Dennis Crouch, L'Office, C'est Moi: Director Squires and the Parchment Barriers of PTAB Institution Precedent, Patently-O (Jan. 13, 2026)
• Dennis Crouch, When the Director Can Do Anything: Apple v. Squires and the Limits of APA Process, Patently-O (Jan. 5, 2026).
• Dennis Crouch, Section 314(d)'s Bar Holds: Federal Circuit Rejects Constitutional and APA Challenges to IPR Institution Denials, Patently-O (Nov. 6, 2025);
• Dennis Crouch, The Unreviewable Director: How § 314(d) Shields the USPTO's IPR Denial Regime from Judicial Oversight, Patently-O (Dec. 10, 2025).
• Dennis Crouch, Unexplained and Unreviewable: The New Normal for IPR Institution, Patently-O (Oct. 17, 2025)

Writing for a panel that included Judges Lourie and Chen, Judge Taranto held that the NHK-Fintiv instructions are a "general statement of policy" exempt from APA rulemaking requirements under 5 U.S.C. § 553(b). The reasoning rests on a structural feature of post-Arthrex patent administration that carries consequences well beyond the Fintiv factors themselves: because the Director is the statutory holder of institution authority, and the PTAB acts only as a delegatee whose decisions the Director can always displace, instructions to the Board about how to exercise that delegated authority cannot "bind" the agency in the APA sense.

The decision seems to confirm that there is no procedural legal constraint, short of a major constitutional challenge, on the Director's power to restrict or shut down IPRs through internal policy pronouncements.