The pendulum of the mind
alternates between sense and nonsense,
not between right and wrong. 
- Carl Jung (Memories, Dreams, Reflections)

By Dennis Crouch

In a significant policy shift, Acting USPTO Director Coke Stewart has rescinded the June 21, 2022, Vidal memorandum that had significantly curtailed discretionary denials of PTAB post-grant proceedings. This rescission signals a potentially dramatic return to broader PTAB discretion in denying institution of inter partes reviews (IPRs) in cases with parallel district court litigation. I believe we can expect a significant uptick in discretionary denials of IPR institution petitions. And, patent holders in district court will be looking for ways to quickly move cases forward in order to provide evidence that IPR denial is appropriate.

The tersely worded announcement from the USPTO simply directs parties to once again rely on PTAB precedent for guidance, specifically highlighting the precedential PTAB decisions of Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (PTAB Mar. 20, 2020) and Sotera Wireless, Inc. v. Masimo Corp., IPR2020-01019, Paper 12 (PTAB Dec. 1, 2020). The announcement further states that any portions of PTAB or Director Review decisions relying on the now-rescinded Vidal Memorandum shall not be binding or persuasive.

Since its creation under the AIA, the PTAB has rapidly established itself as America's most active patent litigation forum -- and the only one that is effectively risk-free for patent challengers. Before the AIA created the IPR system, district courts rarely invalidated patents on obviousness grounds because of the doctrine's technical complexity that often went beyond the span of generalist federal judges and juries. PTAB judges are hired for their willingness and ability to dig deeply into complex obviousness arguments involving the combination of multiple references. Over the past decade, the PTAB has invalidated tens of thousands of patent claims as obvious. To put this in perspective, I am fairly confident the PTAB has invalidated more patent claims on obviousness grounds in its short life than all federal courts combined since the founding of our patent system in 1790.  AIA Trials have been a huge shock to the patent system -- a shock that has almost entirely favored patent challengers.  Thus, Director Stewart's new policy change is important as it is likely to redirect access to this powerful alternative forum.

by Dennis Crouch

I sometimes have difficulty following doublethink. The recent implementation of the Republican Administration's executive orders on diversity initiatives has created a nuanced and seemingly contradictory landscape in federal agencies, including the USPTO.

In January 2025, the White House issued executive orders "Ending Radical And Wasteful Government DEI Programs And Preferencing" and "Ending Illegal Discrimination and Restoring Merit-Based Opportunity." These orders were followed by a February 5, 2025 memorandum from the Office of Personnel Management providing additional guidance on implementation. At the same time, the White House has repeatedly offered statements and other executive actions that focus particularly on protecting and "defending women."

The USPTO's implementation response has been notably selective.

by Dennis Crouch

As federal agencies begin to respond to the new Republican Administration's agency reorganization directive, the USPTO finds itself in an unusual position. Unlike many federal agencies, the USPTO operates primarily on user fees rather than appropriated funds. However, this self-funding status does not exempt the agency from the new "Department of Government Efficiency" (DOGE) initiative requiring agencies to develop plans for "large-scale reductions in force" (RIFs) by March 13, 2025.  opm-omb-memo-guidance-on-agency-rif-2-26-2025.

Depending on how Commerce Secretary Howard Lutnick and Acting USPTO Director Coke Stewart interpret and implement these directives, the impact on USPTO operations could be extremely disruptive. Lutnick has indicated he is in favor of major reductions in force, although not speaking directly about the USPTO. These negotiations continue behind closed doors while patent examiners, practitioners and applicants continue to sit in limbo about potential impacts on examination quality, processing times, and the stability of the U.S. patent system.

A new February 26, 2025 memorandum from OMB and OPM directs agencies to take serious steps toward shrinking their activity, workforce, and physical footprint.  Agencies have been directed to focus on "maximum elimination of functions that are not statutorily mandated." The memo notes that agencies should narrowly interpret statutory requirements:

Agency leadership must confirm statutes have not been interpreted in a way that expands requirements beyond what the statute actually requires. Instead, statutes should be interpreted to cover only what functions they explicitly require.

An important note here is that much of the USPTO operation is guided by precedential cases that are effectively already interpreting the statutes. This would seemingly guide any interpretation offered by the agency director.  Although some of this may seem dramatic, the Agency is part of the executive branch, and thus subject to the direction of the President and his sworn duty to "take Care that the Laws be faithfully executed."  Cuts are ongoing, but major systemwide upheavals are unlikely for several more weeks. We should know more after the March 13 agency deadline.

The memo from OPM creates a framework for analyzing which USPTO functions might be vulnerable to cuts -- some aspects of this are discussed in below.  The rest of this post talks through various USPTO functions -- considering ones that are statutorily mandated versus those that are discretionary as one approach to seeing where cuts might occur.

by Dennis Crouch

Since late 2022, the extraordinary demand for glucagon-like peptide-1 receptor agonists (GLP-1s) like Eli Lilly's tirzepatide (marketed as Mounjaro for diabetes and Zepbound for weight loss) has created a persistent nationwide shortage. This shortage opened a temporary but lucrative opportunity for compounding pharmacies, which the Federal Food, Drug, and Cosmetic Act permits to produce copycat versions of branded drugs during officially declared shortages. In December 2024, the FDA abruptly determined that the tirzepatide shortage had resolved and removed these products from its shortage list, effectively terminating compounders' legal authority to produce these drugs. With the recent transition to the Trump administration—whose leader has repeatedly criticized pharmaceutical companies for "getting away with murder" on pricing and specifically targeted the cost of weight loss medications—I have wondered whether the FDA might reverse course under new leadership and side with compounders offering lower-priced alternatives.  The FDA's new court filing indicates that the agency is standing firmly with patent holders and the drug approval system that grants market exclusivity.  [FDA Brief ZepBound]

The compounding pharmacies have been providing much cheaper versions of the drugs and apparently different dosing regimens.

A number of plaintiffs sued the FDA in 2024, seeking a preliminary injunction to permit ongoing compounding. Outsourcing Facilities Ass'n v. U.S. Food & Drug Admin., No. 4:24-cv-00953-P (N.D. Tex. filed 2024).   In its brief opposing the preliminary injunction, the FDA defends its data-driven conclusion that "Lilly's supply is currently exceeding demand and will meet or exceed projected demand across all strengths of Mounjaro and Zepbound." The FDA's determination relied heavily on confidential data provided by Lilly. I expect that this brief will effectively end the case for the plaintiffs, although they will likely continue to fight for some time.

by Dennis Crouch

A new petition for certiorari in Atturo Tire Corp. v. Toyo Tire Corp. highlights an interesting procedural quirk in Illinois law that may require Supreme Court intervention to resolve an important state law question about the scope of litigation privilege. The case started as a patent importation dispute that Toyo filed with the ITC against various tire manufacturers, but not against Atturo. Toyo settled those cases with provisions requiring the settling parties to stop selling Atturo's tires. After Atturo won a $10 million jury verdict under Illinois law for tortious interference and related claims, the Federal Circuit reversed based on Illinois' absolute litigation privilege.  Atturo believes the scope of litigation privilege should be referred to the Illionois Supreme Court.  But, the Supreme Court's rules only allows certification from the US Supreme Court or Seventh Circuit -- that meant that the Federal Circuit could not certify the case.

Atturo has asked the Supreme Court to exercise its unique certification authority to get definitive guidance from the Illinois Supreme Court. See Ill. Sup. Ct. R. 20(a).

Read my post about the Federal Circuit's original decision here: Dennis Crouch, Treading Carefully: Federal Circuit Expands “Absolute Litigation Privilege” and Affirms Trade Dress Invalidity in Toyo Tire v. Atturo Tire, Patently-O (October 6, 2024).

The rest of this post talks through both the scope of litigation privilege and the certification process.

by Dennis Crouch

Statutes of limitations occupy a peculiar position in our legal system - both shield and sword. While they play a vital role in promoting social stability by preventing stale claims and encouraging prompt resolution of disputes, their rigid application can sometimes feel like permitting theft by other means. When an otherwise valid claim is barred simply because time has passed, the law effectively transforms a wrongful act into a permitted one.  The Supreme Court recognized this tension nearly 150 years ago in Wood v. Carpenter, acknowledging that statutes of limitations were both "bane and antidote," necessary for societal order yet potentially harsh in their operation. 101 U.S. 135 (1879). This fundamental tension is particularly acute in copyright cases where the limitations period is quite short - only three years and where creative works can be exploited for years before their owners discover the infringement.

by Dennis Crouch

The Supreme Court's 2024-2025 patent docket has a growing number of cases awaiting consideration. I count fifteen pending cases that could reshape multiple facets of patent law. At the heart of this term lies a set of challenges to the Federal Circuit's Rule 36 summary affirmance practice, with five separate petitions (ParkerVision, Island IP, ATOS, Audio Evolution Diagnostics and Converter Manufacturing) arguing that the court's frequent use of one-word affirmances undermines transparency and violates statutory requirements for reasoned decision-making and demands supervision from the Supreme Court. This procedural theme extends beyond Rule 36 to encompass broader questions about how patent cases should be adjudicated, with three petitions (BBiTV, Island IP, and Brumfield) challenging the Federal Circuit's approach to resolving factual disputes at summary judgment, particularly in patent eligibility cases. Impact Engine and Audio Evolution Diagnostics also challenge the eligibility framework, with Audio Evolution specifically questioning whether medical diagnostic machine patents should be considered abstract ideas under Alice/Mayo.

Two cases raise what I see as core substantive patent law issues outside of eligibility:

• Converter Manufacturing questions the court's long-standing approach to prior art enablement.
• Celanese raises questions the the scope of the on-sale bar under the America Invents Act, particularly for secret processes.

These substantive challenges are complemented by cases addressing remedial issues, including DISH Network's questions about attorney fee liability and IPR-related costs, and Provisur's challenge to the Federal Circuit's review of jury willfulness findings.

The following list loosely categorizes the pending cases and you'll find details about each via the hyperlink.

Federal Circuit Rule 36 Challenges

• ParkerVision v. TCL (No. 24-518) - Rule 36 summary affirmances in PTAB appeals
• Island IP v. TD Ameritrade (No. 24-461) - Rule 36 practice and transparency
• Audio Evolution v. United States (No. 24-806) - Rule 36 use in eligibility determinations
• Converter v. Tekni-Plex (No. 24-866) - Rule 36 in prior art enablement context
• ATOS v. Allstate (No. 24A777) - Matches ParkerVision.

Patent Eligibility Cases

• Impact Engine v. Google (No. 24-836) - Eligibility framework and preemption analysis
• Audio Evolution v. United States (No. 24-806) - Eligibility of medical diagnostic "machine" patents
• Island IP v. TD Ameritrade (No. 24-461) - Eligibility determinations at summary judgment
• Brumfield v. IBG (No. 24-764) - Eligibility determinations for GUI patents at summary judgment
• BBiTV v. Amazon (No. 24-827) - Eligibility determinations at summary judgment

Other Core Patent Law Issues

• Celanese v. ITC (No. 24-635) - AIA on-sale bar for secret processes
• Converter v. Tekni-Plex (No. 24-866) - Presumption that prior art references are enabling

Additional Procedural & Remedial Issues

• DISH v. Dragon IP (No. 24-726) - Attorney fee liability and IPR-related costs
• Provisur v. Weber (No. 24-723) - Appellate review of jury willfulness findings
• Lighting Defense v. SnapRays (No. 24-524) - Personal jurisdiction in e-commerce patent disputes
• Peterson v. Minerva (No. 24-712) - Deference to arbitration awards in patent context
• Koss v. Bose (No. 24A577) - Issue preclusion in parallel patent litigation
• Brumfield v. IBG (No. 24-764) - Standards for Rule 60(b)(3) relief from judgment

Pending/Potential Filings

• Hikma v. Amarin (No. 24A652) - May address induced infringement for generic drug "skinny labels"

by Dennis Crouch

Federal Circuit recently issued a Rule 36 summary affirmance in Converter Manufacturing, LLC v. Tekni-Plex, Inc. (Fed. Cir. Sept. 9, 2024).  The case is now on petition for writ of certiorari to the US Supreme Court and raises significant questions about the burden of proving enablement of prior art references in patent cases.  The case also raises a challenge to the Federal Circuit's aggressive approach to issuing judgments without opinion. [Read the petition in 24-866]

Converter Manufacturing holds a number of patents covering thermoformed plastic food trays with rolled edges.  The dispute in the IPR centered primarily on whether the three prior art references were sufficiently enabling.  While creating rolled edges on circular plastic items (like cups) was well-known, doing so on rectangular trays presented a pretty tricky challenge because the plastic would pucker and wrinkle at the corners where the material has to travel different distances compared to the straight edges. This technical difficulty explains why industry participants considered rolled edges on rectangular trays "impossible" before CM's invention, despite the seemingly simple concept.

Science fiction is fun to read, but it typically cannot invalidate real innovations because (typically) the SciFi author does not actually teach the details of how to make the futuristic technology -- i.e., the work does not enable the invention.  Even in cases involving real prior invention, the public nature of patent law requires that the prior art evidence enable the invention. This requirement serves a crucial policy goal: ensuring that patents are only invalidated by prior art that genuinely placed the claimed technology within public possession, not by mere conceptual descriptions that fail to teach the public how to actually implement the invention. 

by Dennis Crouch

The Federal Circuit has reversed a controversial ITC decision that had invalidated composition of matter claims as abstract ideas. US Synthetic Corp. v. Int'l Trade Comm'n, No. 23-1217 (Fed. Cir. Feb. 13, 2025). This case marks an important limitation on the seemingly ever-expanding realm of patent ineligibility under Section 101. Writing for a unanimous panel, Judge Chen wrote that US Synthetic's patent claims covering polycrystalline diamond compacts (PDCs) used in drill bits are patent eligible, rejecting the ITC's determination that claims defining a composition by its material properties could be deemed abstract ideas.

As I wrote in an October 2024 post, this case raised fundamental questions about whether composition of matter claims could ever be considered abstract ideas simply because they included functional limitations or defined the composition through its properties rather than manufacturing steps. The ITC's decision had drawn criticism from PhRMA and others as an unprecedented expansion of abstract idea analysis.

At oral arguments, Judge Dyk explained that the court was taking the case seriously:

This case is breaking new territory. If we were to affirm, then this very crude tool of patentability, known as patent eligibility, start running random through composition of matter claims, just as it has through computer software and diagnostic claims.

Oral args at 15:10.

by Dennis Crouch

I have been looking at after final practice, and potential changes going forward in how applicant's respond to this important decision point.

The chart above looks at fate of patent applications that received final rejections in January 2024 -- and shows an optimistic picture one-year out. Among the 15,813 applications tracked, nearly half (48%) have issued as patents or at least received a notice of allowance, suggesting that a final rejection, while a significant hurdle, is far from the end of the road for many applications. And, that an allowance may well be on the horizon. A substantial percentage of these cases used the now defunct After Final Consideration Pilot (AFCP 2.0) to transform the rejection into allowance.  Moving forward, applicants will likely instead need to file a Request for Continued Examination (RCE) or appeal.

by Dennis Crouch

In a surprising decision today, Judge Stephanos Bibas ruled that ROSS Intelligence's use of Westlaw content to train its legal AI system constituted copyright infringement. Thomson Reuters Enter. Ctr. GmbH v. Ross Intel. Inc., No. 1:20-cv-613-SB (D. Del. Feb. 11, 2025).  I have been following a number of AI intellectual property challenges. Most of these have favored the makers and users of AI over the owners of the IP (typically copyright holders).

In 2023, Judge Bibas largely denied Thomson Reuters' motions for summary judgment on copyright infringement and fair use. Thomson Reuters Enter. Ctr. GmbH v. Ross Intel. Inc., 694 F. Supp. 3d 467 (D. Del. 2023). However, while preparing for the scheduled August 2024 trial, the judge reconsidered his earlier ruling.  The new opinion granted Thomson Reuters summary judgment on direct copyright infringement for 2,243 specific headnotes (detailed in a sealed appendix), including a finding of no fair use.  It looks like the only remaining factual issue for trial regarding these headnotes is whether some of their copyrights have expired.  There are also another set of headnotes that the judge concluded were not original enough to be clearly copyrightable -- those would go to a jury for consideration. [Read the Decision: 1739288038966]

The Federal Circuit has significantly limited the reach of inter partes review estoppel in Kroy IP Holdings, LLC v. Groupon, Inc., No. 2023-1359 (Fed. Cir. Feb. 10, 2025). The court held that a PTAB unpatentability finding cannot create collateral estoppel (issue preclusion) against asserting other claims from the same patent in district court - even if those other claims are materially identical for invalidity purposes. The decision, authored by Judge Reyna, emphasizes the critical distinction between IPR's preponderance standard and district court litigation's clear and convincing evidence requirement.  This case builds upon ParkerVision, Inc. v. Qualcomm Inc., 116 F.4th 1345 (Fed. Cir. 2024).

The case arose after Kroy sued Groupon for infringing U.S. Patent 6,061,660, which relates to incentive programs over computer networks. After Groupon successfully challenged some claims in IPR proceedings, Kroy amended its complaint to assert different claims that had not been challenged in the IPRs. The district court dismissed the case, finding that collateral estoppel barred assertion of the new claims since they were not materially different from the claims found unpatentable by the PTAB.

by Dennis Crouch

Over the past decade, the rate at which applicants file a Notice of Appeal (NOA) following a Final Office Action has steadily declined. This chart presents a quarterly snapshot of appeal activity by dividing the count of NOAs filed by the number of final rejections issued in that same period. Unlike a cohort analysis that tracks the fate of individual applications, this approach provides a broad view of how frequently applicants are choosing to challenge examiners' decisions via the Patent Trial and Appeal Board (PTAB).  To control for distortions, this dataset is limited to published applications, ensuring that the numbers are not skewed by the fact that non-published applications are generally only accessible when a patent issues.  During this time, the USPTO has issued lots more final office actions 50% more at the end of calendar year 2024 as compared with 2021-2022.  But, although rejections have risen, NOA filings have not.