Interim procedure for discretionary denials in AIA post-grant proceedings with parallel district court litigation

Rescinded on February 28, 2025. The memorandum sets interim Board practice on discretionary denial under the Fintiv factors where there is parallel litigation. The PTAB will not deny institution under Fintiv (i) when the petition presents compelling evidence of unpatentability, (ii) when the request rests on a parallel ITC proceeding, or (iii) when the petitioner stipulates not to pursue in district court the same grounds or any grounds that could reasonably have been raised in the petition. It also directs that, under factor two, the Board will consider median time-to-trial statistics for the district rather than taking scheduled trial dates at face value. Petitioners got three routes around Fintiv denial: a showing of compelling merits, a Sotera-type stipulation, or reliance on the fact that the only parallel proceeding is at the ITC. Patent owners could no longer rely on an earlier trial date alone, and had to address time-to-trial statistics and the court-specific supporting factors the memorandum lists. The memorandum says it rests on the Director's authority to issue binding agency guidance (35 U.S.C. 3(a)(2)(A) and SOP 2) and on the Fintiv, NHK Spring and Sotera decisions. It also says the Board keeps its authority to deny institution under 35 U.S.C. 314(a), 324(a) and 325(d), for example for abuse of process. WHAT IT DOES: Says the PTAB will not rely on the Fintiv factors to deny institution where the petition presents compelling evidence of unpatentability, meaning evidence that, if unrebutted at trial, would plainly lead to a conclusion that one or more claims are unpatentable by a preponderance of the evidence. Says the Board will not discretionarily deny based on applying Fintiv to a parallel ITC proceeding. Says the Board will not deny where the petitioner stipulates not to pursue in a parallel district court proceeding the same grounds or any grounds that could have reasonably been raised in the petition. Says that under factor two, proximity to trial should not alone outweigh all other factors when they weigh against denial or are neutral. Says the Board will weigh factor two against denial if the median time-to-trial is around the same time as or after the projected statutory deadline for the final written decision. WHO AND WHEN: Applies to IPR and PGR proceedings (the memorandum also refers to CBM) with parallel district court litigation, and to all proceedings pending before the Office. It is dated June 21, 2022, addressed to members of the PTAB, and remains in place until further notice. The Office expected to replace it with rules after formal rulemaking. KEY QUOTE: "Consistent with Congress's giving the Office the authority to revisit issued patents, the PTAB will not deny institution based on Fintiv if there is compelling evidence of unpatentability." (p. 5) EARLIER GUIDANCE AFFECTED: Clarifies the PTAB's application of Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (precedential), and limits its precedential import to its facts. Follows Sotera Wireless, Inc. v. Masimo Corp., IPR2020-01019, Paper 12 (precedential as to section II.A), on stipulations. Builds on NHK Spring Co. v. Intri-Plex Techs., Inc., IPR2018-00752, Paper 8 (precedential). Changes the practice of taking courts' trial schedules at face value, as in Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 15 (informative). Notes past Board denials based on parallel ITC investigations, such as Philip Morris Prods. S.A. v. Rai Strategic Holdings, Inc., IPR2020-00919, Paper 9. PRACTICE TIP: Petitioners facing a Fintiv argument should lead with the strength of the merits, consider offering a Sotera stipulation covering the same grounds and any grounds that could reasonably have been raised, and support factor two with current median time-to-trial statistics and the judge-specific supporting evidence the memorandum mentions. Patent owners should not rely on a scheduled trial date alone. Issued by Katherine K. Vidal, Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office.