The predilection by a US appellate court for one-sentence dispositions of even the most complex of patent cases has long irked litigants to no avail, with the US Supreme Court consistently turning away petitioners taking issue with the practice. The US Patent and Trademark Office is taking a page from that playbook, as well as other steps that lessen the attractiveness of the Patent Trial and Appeal Board for patent validity challenges.
A pair of announcements Friday continued the reimagining of the America Invents Act (AIA) which has played out at the US Patent and Trademark Office since the start of the year.Director John Squires, effective Monday, will gatekeep proceedings before the Patent Trial and Appeal Board in unprecedented fashion, deciding “in consultation with at least three PTAB judges” whether petitions for inter partes review (IPR) or post grant review (PGR) of issued patents present a meritorious challenge.
That will come only after Squires, alone, has assessed whether a discretionary denial is warranted, and those who fail to secure referral to a PTAB panel — for any reason — may never learn why.
In a memorandum to all PTAB judges, Squires indicated a “summary notice” of the decision to refer or not to refer is all that will be issued unless a proceeding presents “novel or important factual or legal issues.”
Even in the latter scenario there are no guarantees: instead, the memorandum states, “the Director may issue a decision on institution addressing those issues.”
That puts parties and counsel who litigate before the US Court of Appeals for the Federal Circuit in familiar territory.
— Duty shirk —
Rule 36 of the Federal Circuit Rules of Practice allows the court to summarily affirm when an opinion would have no precedential value and any of the following criteria are present: the underlying judgment is not clearly erroneous, the evidence supporting a jury verdict is sufficient or the record supports summary judgment, directed verdict or judgment on the pleadings.
It is regularly invoked by the Federal Circuit — tasked, via 28 U.S. Code § 1295, with review of all appeals “arising under . . . any Act of Congress relating to patents” — to uphold the outcome of proceedings before US district courts or the PTAB, no matter the complexity or duration of those proceedings or the significance to the patent bar of the issues presented.
Last week, alone, the Federal Circuit summarily affirmed losses for Smart Mobile Technologies, Google, RapidPulse and Gesture Technology Partners.
Each flowed from decisions by the PTAB, which are statistically more likely to receive the Rule 36 treatment, and although summary affirmances have declined since peaking a decade ago they remain a resource in the Federal Circuit toolkit thanks to a steadfast refusal by the US Supreme Court to intervene.
In March, the justices turned away a petition for writ of certiorari by ParkerVision, who saw its wireless communications patents cancelled by the PTAB in 2022 in response to IPRs initiated by TCL Industries Holdings and LG Electronics.
The Federal Circuit affirmed, via Rule 36, in June 2024.
The same day they rejected ParkerVision’s case, the Supreme Court denied Island Intellectual Property’s bid for review of a May 2024 summary affirmance by the Federal Circuit of a district court summary judgment that its method of allocating interest is ineligible for patenting under Section 101.
PakerVision and Island join a long line of certiorari petitioners to challenge, unsuccessfully, the Federal Circuit’s use of Rule 36, many of which lament the practice as a missed opportunity by the court to clear up uncertainty in areas of patent law that remain hotly contested.
They also say it deprives parties of due process and permits the court to shirk its duty under 35 U.S.C. § 144 to issue an “opinion” when reviewing official action undertaken by the USPTO.
Defenders of the rule, by contrast, say it frees up valuable time and resources which, in turn, enables those that wish to argue the merits of their appeal in person to do so.
That distinguishes the court from its sister circuits who, in FY 2023, held hearings in under a third of cases. The Federal Circuit, over the same time period, heard arguments 71.4 percent of the time, according to its clerk (see here).
— Legal challenges likely —
Squires’ memorandum, similarly, maintains that the new procedure “will maintain PTAB’s capacity to conduct IPR and PGR trials.”
Time will tell whether the introduction of summary notices makes a discernible difference on the PTAB’s workflow.
However, given the high costs of launching a challenge under the AIA — $23,750 in filing fees for IPRs and $25,000 for PGRs of up to 20 claims, alone — as well as the high stakes for petitioners in parallel proceedings, those on the losing end of a Squires-issued summary notice will almost certainly lob many of the same criticisms as those made in connection with Rule 36.
Another announcement Friday likely to elicit legal challenge is that merit-based decisions on whether to institute IPR or PGR will no longer be decided by a three-member panel of PTAB administrative patent judges (APJs), alone.
In correspondence styled “An Open Letter from America’s Innovation Agency,” the director drilled down on his “full” authority to take part in deciding which IPR and PGR petitions are worthy of referral.
The maneuver, Squires said, is intended to “promote consistent application of considerations for institution of trial proceedings before the PTAB,” as necessitated by the “appearance” that “institution decisions affect docket size, credit, and resource allocation.”
Although clarifying that concerns the PTAB is “filling its own docket” are potentially “unfounded,” Squires said the “perception” alone “undermines public confidence in the integrity of our Office’s adjudicatory functions with respect to IPRs.”
In support, Squires pointed to the bifurcation of discretionary denials from the merits introduced this spring by Deputy Director Coke Morgan Stewart. In what he deemed “referral signal bias,” Squires said data shows that petitions referred by Stewart to PTAB panels were being instituted at an “extraordinarily high” rate of, at one point, 95 percent.
“Congress expressly charges the Director — not the Board as delegees — to make institution determinations. Returning this function to the Director realigns our Office’s procedures with the clear language and intent of the statute and returns accountability for such decisions to the Director just as the framework of the AIA provides,” Squires said.
— Comment period opens —
The memorandum and letter came the same day a 30-day window opened for comment on the USPTO’s notice of rulemaking that would clamp down on serial challenges to patent validity (see here).
Under the proposal, petitioners will be required to stipulate they will not challenge the patent’s validity in “any other proceeding” — including in US district court or before the US International Trade Commission — if IPR is instituted, and the PTAB will no longer review patents where “patentability or validity of the claims” has “already” been “adjudicated” in a parallel forum.
Holland & Hart's Molly Kocialski, who stepped down last month as director of the USPTO's Rocky Mountain Regional Outreach Office, predicts that many of the changes under consideration or, in other instances, already being implemented will "fundamentally impact corporate America, particularly startups and the innovation community."
"Companies must now change their approach to patent landscaping, prior art searching, and freedom-to-operate analysis before product introduction. The 'wait and see' strategy — hoping examiners find prior art or that licensing demands don't materialize — is no longer viable unless companies plan to fight all enforcement actions and/or engage in significant third-party licensing campaigns," she tells MLex.*
Although the maneuvering by Squires and his team has been lauded by some as pro-inventor, Kocialski questions whether those benefits will be enjoyed by the many or the few. To that end, by requiring parties to identify and resolve patent conflicts earlier in a product's lifecycle, she says legal expenses which might otherwise be deferred could now be frontloaded — a potential barrier to market entry for startups and small businesses.
The power dynamic is further imbalanced once the high cost of patent enforcement is factored in. That, in turn, creates "an uneven playing field that favors well-funded entities over innovative startups," Kocialski said.
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*Updated on Oct. 20, 2025 at 21:33 GMT: Adds reaction from former USPTO official