TAKEAWAY: The Director (or Acting Director) of the USPTO will now be directly involved in discretionary denial decisions in IPR or PGR cases.
On March 26, 2025, the USPTO issued a memorandum titled “Interim Processes for PTAB Workload Management,” addressed from Acting Director Coke Morgan Stewart to all judges of the Patent Trial and Appeal Board (“PTAB”). The memorandum communicates significant changes to the way discretionary denials are handled at the agency.
What the Memo Says
First, the memorandum establishes that decisions on whether to institute an inter partes review (IPR) or post-grant review (PGR) will be “bifurcated” between (i) discretionary considerations and (ii) merits and other non-discretionary statutory considerations. Decisions on institution determine whether an IPR or PGR trial will be instituted, and the Director holds authority under 35 U.S.C. 314(a) and 324(a) to discretionarily deny petitions for such review proceedings. Up until now this decision was delegated to the three PTAB judges empaneled to hear the merits (and non-discretionary statutory considerations) of the case.
According to the memorandum, the Director (or presumably, the Acting Director), in consultation with at least three PTAB judges, will determine whether discretionary denial of institution is appropriate. If they decide discretionary denial is “appropriate,” the Director will issue a decision denying institution. If they decide discretionary denial is “not appropriate,” the Director will issue a decision regarding that determination and refer petition to a three-member panel of the PTAB chosen according to Standard Operating Procedure 1 (SOP 1 Rev. 16), who will then handle the case normally by addressing the merits and non-discretionary statutory considerations. The three PTAB judges assisting the Director in the discretionary denial decision will be different from the three-member panel determining the merits of the case.
Second, the memorandum provides for new discretionary denial briefing separate from the petitioner’s petition or patent owner’s preliminary response. Namely, the memorandum outlines that within two months of the date on which the PTAB enters the “Notice of Filing Date” that is accorded to a petition, a patent owner may file a brief explaining any applicable basis for discretionary denial. Petitioners may file an opposition brief no later than one month after patent owner files its brief. The memorandum notes that the briefing schedule on the merits and the schedule for requesting a rehearing or Director Review as to a decision on institution will remain unchanged.
Third, the memorandum recognizes specific factors for discretionary denial considerations, namely:
- whether the PTAB or another forum has already adjudicated the validity or patentability of the challenged patent claims;
- whether there have been changes in the law or new judicial precedent issued since issuance of the claims that may affect patentability;
- the strength of the unpatentability challenge;
- the extent of the petition’s reliance on expert testimony;
- settled expectations of the parties, such as the length of time the claims have been in force;
- compelling economic, public health, or national security interests; and
- any other considerations bearing on the director’s discretion.
The memorandum adds an additional consideration not included in the bulleted list, namely, the ability of the PTAB to comply with pendency goals for ex parte appeals, its statutory deadlines for AIA proceedings, and other workload needs.
Additional information regarding the USPTO’s new bifurcated process for IPRs and PGRs can be found on its website here. The text of the Acting Director’s memorandum can be found here.