USPTO's Recent Memo on Discretionary Denials: A Step in the Right Direction for Patent Owners
On March 26, 2025, Acting Director of the USPTO Coke Stewart issued a memo addressing discretionary denials in inter partes review (IPR) and post-grant review (PGR) proceedings.This memo marks a significant shift toward a more balanced and consistent application of discretion, offering a welcome reprieve for patent owners who have long faced duplicative challenges in both district courts and at the PTAB.
Aligning with the Intent of the America Invents Act (AIA)
The PTAB's memo reinforces the original intent of the America Invents Act (AIA), which established IPR proceedings as an alternative to litigation, not a parallel track. The AIA was designed to provide a streamlined, cost-effective mechanism for resolving patent validity disputes, while reducing redundancy and the burden on courts. The recent memo clarifies that the PTAB will more actively exercise its discretion to deny IPR petitions when the same issues are already being litigated in district court.
Congressional Record
The legislative history of the AIA provides clear evidence that Congress intended IPR to serve as an alternative to litigation, not a duplicative process. During the AIA's passage, Senator Patrick Leahy, one of the bill's lead sponsors, stated:
“The bill will also improve upon the current system for challenging the validity of a patent at the PTO. The current inter partes reexamination process has been criticized for being too easy to initiate and used to harass legitimate patent owners, while being too lengthy and unwieldy to actually serve as an alternative to litigation when users are confronted with patents of dubious validity.”
— 157 Cong. Rec. S5326 (Sept. 6, 2011)
Similarly, Representative Lamar Smith emphasized that post-grant review was meant to be an alternative path:
“The reexam proceedings are a cheaper, quicker, better alternative to resolve questions of patentability than costly litigation in Federal court, which can run into the millions of dollars and last for years.”
— 157 Cong. Rec. H4495 (June 23, 2011)
These statements highlight Congress's clear intent to create a choice of forum for petitioners, rather than encouraging duplicative, parallel proceedings. The PTAB’s increased willingness to deny institution when a parallel district court case is underway directly reflects this legislative intent.
Statutory Support for Bifurcating IPR and Litigation
The AIA statute itself supports the goal of preventing duplicative challenges. Under 35 U.S.C. § 316(b), the Director is mandated to consider:
"the effect… on the economy, the integrity of the patent system, the efficient administration of the Office, and the ability of the Office to timely complete proceedings" when prescribing regulations. This provision provides a clear statutory basis for the PTAB's discretion in denying petitions when district court proceedings are already addressing the same issues.
Additionally, 35 U.S.C. § 325(d) allows the PTAB to deny institution if:
"the same or substantially the same prior art or arguments" were previously presented. This provision gives the PTAB flexibility to avoid redundant challenges, preserving efficiency and reducing wasteful parallel litigation.
Short-Term Burdens, Long-Term Clarity
While the recent guidance may create an initial burden for both patent owners and petitioners, the long-term benefits far outweigh the short-term challenges. Petitioners will need to carefully evaluate the timing and forum of their challenges, while patent owners may face more upfront costs to argue for discretionary denial. However, the consistency and clarity that will emerge from this approach will ultimately reduce uncertainty in the long run. By bifurcating the question of discretionary denial from the full merits evaluation, the PTAB is helping to prevent premature or conflicting validity determinations. This separation reduces the likelihood of wasteful parallel litigation and offers greater predictability for future filings.
A Win for Patent Owners and the USPTO
For patent owners, this memo is a clear win. It reduces the risk of duplicative proceedings, which have historically drained resources and created uncertainty. It also restores some balance to the system by encouraging the PTAB to consider the broader legal landscape before instituting a review.
Additionally, this shift benefits the USPTO’s post-grant proceedings by improving efficiency and reducing unnecessary resource allocation to redundant cases. By enabling the PTAB to deny petitions that are already being addressed in district court, the Office can focus its resources on resolving truly novel or unique validity challenges.
Conclusion
The recent PTAB memo on discretionary denials is a welcome and necessary step toward creating a more predictable and fair patent system. By aligning with the AIA's original purpose and the clear intent expressed in the Congressional Record, it reduces redundancy, protects patent owners from unnecessary challenges, and enhances the efficiency of the USPTO's post-grant proceedings. While the transition may bring some initial friction, the long-term clarity and consistency it brings will benefit both patent owners and petitioners alike.
Superpowers to make patents less painful.
