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USPTO Issues Interim Guidance Modifying and Clarifying PTAB's Application of "Fintiv" Factors When Making AIA Post-Grant Proceeding Institution Decisions

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In the precedential decision of the USPTO’s Patent Trial and Appeal Board (PTAB) styled Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (PTAB Mar. 20, 2020), the PTAB is directed to consider six factors when deciding whether to exercise its discretion to deny institution of an AIA post-grant proceeding (including both Inter Partes Review and Post-Grant Review) when there is a parallel litigation involving the same patent that has been challenged by a petitioner.  For a review of the “Fintiv” factors and the ongoing controversy surrounding the PTAB’s use of them, see our previous articles on the subject.[1]


On June 22, 2022, the USPTO issued interim guidance[2] regarding the application of the so-called “Fintiv” factors the PTAB considers in determining whether to institute an AIA post-grant proceeding where there is parallel district court litigation or ITC administrative proceedings.  The interim guidance appears likely to narrow the circumstances, and thereby reduce the number of times, when the PTAB will use its discretionary denial authority.The interim guidance provides four clarifications with respect to PTAB consideration of AIA proceeding petitions. 

First, while Fintiv Factor 6 directs the PTAB to consider the merits of a petitioner’s validity challenge, it was far from clear how, or even if, the PTAB actually did so, or what effect such consideration had, or was supposed to have.  Now, if the PTAB determines that the information presented at the institution stage presents a “compelling unpatentability challenge,” then institution of the AIA proceeding will not be denied on the basis of Fintiv.

Second, while the Fintiv factors are focused on the interplay between IPRs and U.S. district court litigation, the PTAB had more recently applied the Fintiv factors to deny institution on the basis of parallel International Trade Commission (ITC) “unfair importation” investigations.  The PTAB did so even though “the ITC lacks authority to invalidate a patent and the ITC’s invalidity rulings are not binding on the [USPTO] or on district courts.”  The interim guidance puts an end to that PTAB practice, which was heavily criticized as unjustifiable and unjustified even by the precedential Fintiv decision itself, which dealt only with parallel district court litigation.  

Third, the interim guidance raises the importance of Fintiv Factor 4, that is, the extent of overlap between issues raised in the AIA petition and in the parallel court proceeding.  When a petitioner agrees not to pursue in a parallel district court proceeding the same grounds as set forth in the petition or any grounds that could reasonably have been raised in the petition (known as a Sotera stipulation), this will mitigate concerns of potentially conflicting decisions and duplicative efforts between the district court and the PTAB.  Accordingly, the PTAB will not deny institution on Fintiv grounds where a petitioner commits to a Sotera stipulation.  In effect, The IPR/PGR estoppel effect of the AIA proceeding is accelerated from the date of the PTAB’s issuance of the final written decision to the earliest stages of the proceeding.  This procedure has the potential to streamline district court litigation in previously unachievable ways (other than a complete stay of litigation), saving the parties a tremendous amount of effort and money in the process. 

Fourth, Fintiv Factor 2 directs the PTAB to consider the proximity of the district court’s trial date to the PTAB’s projected statutory deadline for a final written decision.  Patent owners routinely used trial dates set forth in early case management schedules, often set without regard to the case congestion realities of the particular court in which the litigation was pending, and were clearly faster than could realistically be achieved or expected, in order to convince the PTAB to deny AIA petitions.   The PTAB did so despite clear evidence that such litigation trial are often unreliable and subject to multiple delays.  Accordingly, the PTAB will now consider the actual median time-to-trial for civil actions in the district where the parallel litigation is pending, rather than relying on the court’s stated trial date alone.  The PTAB will also consider the particular federal district judge’s caseload.  This revised approach to the PTAB’s consideration of Fintiv Factor 2 should further reduce the number of Fintiv-based discretionary denials. 

Finally, the interim guidance reminds petitioners that, even if institution of the AIA proceeding is not denied as a matter of discretion under the Fintiv factors, institution may still be denied for other reasons as a matter of discretion under 35 U.S.C. §§ 314(a), 324(a), and 325(d).

The USPTO is currently studying comments previously received on the PTAB’s approach to exercising discretion on whether to institute AIA proceedings, before issuance of the interim guidance.  The June 22, 2022 interim guidance applies to all currently pending PTAB proceedings and will remain in effect until replaced.