IP UPDATE
Exploring the latest in intellectual property law
IP UPDATE
Exploring the latest in intellectual property law
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Too late to help: Inventorship fix fails to revive forfeited argument

by | Mar 19, 2026 |

The US Court of Appeals for the Federal Circuit affirmed the Patent Trial & Appeal Board, concluding that the retroactive effect of a correction of inventorship under 35 U.S.C. § 256 does not bar the application of forfeiture principles in inter partes review (IPR) proceedings, and that a patent owner that fails to timely raise an antedating theory during an IPR may forfeit reliance on a later corrected inventorship to resurrect that theory. Implicit, LLC v. Sonos, Inc., Case Nos. 20-1173; -1174 (Fed. Cir. Mar. 9, 2026) (Taranto, Stoll, Cunningham, JJ.)

Implicit owns patents directed to content rendering that originally named Edward Balassanian and Scott Bradley as co-inventors. Sonos filed IPR petitions against both patents, asserting unpatentability under 35 U.S.C. §§ 102 and 103, primarily based on Janevski, which had an effective prior art date of December 11, 2001.

To avoid Janevski as prior art, Implicit argued that the inventions were conceived and reduced to practice before December 11, 2001. It contended that Balassanian and Bradley conceived of the inventions and collaborated with another engineer, Guy Carpenter, to implement the invention prior to December 2001. Implicit argued that Carpenter’s work inured to the benefit of the named inventors, thereby antedating Janevski. The Board rejected Implicit’s argument and found the challenged claims unpatentable as anticipated or obvious over Janevski. The Board found Implicit’s evidence insufficient to establish conception and communication of the invention by Carpenter in a manner that would support an earlier reduction to practice.

Following the Federal Circuit’s and Supreme Court’s decisions in Arthrex v. Smith & Nephew addressing the Appointments Clause as applied to IPR proceedings, the case was remanded to permit Director review. While proceedings were ongoing, Implicit sought correction of inventorship under 35 U.S.C. § 256 to add Carpenter as a co-inventor. The United States Patent & Trademark Office (USPTO) granted the request and issued certificates of correction in August 2022. The Federal Circuit remanded the case to the Board to determine what impact, if any, the corrections had on the prior final written decisions. The Board concluded that equitable doctrines, including forfeiture, precluded Implicit from relying on the corrected inventorship to advance a new antedating theory. Implicit appealed.

The appeal presented two principal questions:

  • Whether the retroactive effect of a correction of inventorship under § 256 forecloses application of forfeiture principles in an IPR proceeding.
  • Whether the Board abused its discretion in finding that Implicit forfeited its right to assert a new antedating theory based on corrected inventorship.

Implicit argued that § 256 contains no temporal limitation and that corrections operate retroactively, requiring the Board to revisit its unpatentability determinations once Carpenter was added as an inventor. Sonos and the USPTO countered that Implicit had litigated the IPRs on a single inventorship theory and waited until after adverse final written decisions to change course.

The Federal Circuit affirmed on both grounds.

First, the Federal Circuit found that forfeiture principles may apply notwithstanding the retroactive effect of § 256. Although [...]

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Separately recited structures must be separately present in accused device

by | Mar 19, 2026 |

The US Court of Appeals for the Federal Circuit explained (again) that when a claim separately recites multiple structural limitations, infringement requires separate corresponding structures. A single component that sequentially or multifunctionally performs the claimed functions is not enough. Magnolia Medical Technologies, Inc. v. Kurin, Inc., Case No. 24-2001 (Fed. Cir. Mar. 6, 2026) (Lourie, Hughes, Freeman, JJ.)

Magnolia Medical sued Kurin for infringement of two patents directed to devices designed to reduce contamination of blood samples by skin microbes during venipuncture. The claimed devices divert the initial portion of blood, which is most susceptible to contamination, into a separate reservoir before collecting the remainder of the sample. Kurin manufactures the Kurin Lock, which separates the initial blood sample from the remaining sample using a porous plug. That plug initially functions as a vent, allowing air to escape, and then expands as it absorbs blood, closing its pores and forming a seal.

The representative claim of one of the asserted patents recites a device comprising a fluid reservoir “at least partially defined by a seal member and a vent.” The representative claim of the other patent recites a “diverter.”

During claim construction, the district court construed “diverter” as a means‑plus‑function term under § 112(f). Because the Kurin Lock lacked a corresponding diverter structure, the parties stipulated noninfringement of that patent.

The district court did not expressly construe the “seal” and “vent” limitations of the other patent at Markman. At trial, however, the jury found that Kurin infringed that patent.

Kurin moved for judgment as a matter of law (JMOL), arguing that it did not infringe because the Kurin Lock did not include separate seal and vent structures. Instead, a single porous plug performed both functions at separate times. The district court agreed and granted JMOL of no infringement. Magnolia appealed.

The Federal Circuit affirmed, rejecting Magnolia’s argument that the district court had improperly adopted a new claim construction at the JMOL stage. While courts may not introduce a materially different construction after trial, they may elaborate on what is inherent in the plain and ordinary meaning of a claim. The Federal Circuit reiterated its prior holdings that when a claim separately lists structural limitations, the plain and ordinary meaning requires separate corresponding structures. Here, the district court merely clarified that requirement, it did not change the construction.

The Federal Circuit found that the asserted claim required separate structures. The use of “comprising,” the introduction of “a” before both “seal” and “vent,” and the use of “and” between them all pointed to distinct components. The specification further reinforced that the seal and vent were described as separate structures.

The Federal Circuit also affirmed the district court’s construction of “diverter” as a means plus function limitation. Although the claim did not use the word “means,” Kurin successfully showed that the term failed to recite sufficient structure, triggering § 112(f).

Practice note: This case is a reminder that when multiple structural elements are separately recited in a claim, courts are likely to require [...]

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Not so fast, Daubert: Expert report OK after all

by | Mar 19, 2026 |

The US Court of Appeals for the Federal Circuit reversed a district court’s exclusion of the plaintiff’s damages expert, finding that a proffered royalty base tied to unaccused products may be permissible when supported by a causal connection to the accused technology. The Federal Circuit vacated the resulting orders denying discovery and granting summary judgment for lack of a remedy. Exafer Ltd. v. Microsoft Corp., Case No. 24-2296 (Fed. Cir. Mar. 6, 2026) (Moore, Taranto, Stoll, JJ.)

Exafer sued Microsoft for patent infringement based on features of Microsoft’s Azure platform. After Exafer served its expert reports, Microsoft filed a Daubert motion, and the district court excluded Exafer’s damages expert because she used unaccused virtual machines as the royalty base. Exafer moved to reopen fact and expert discovery to present an alternative theory, which the district court denied. The district court subsequently granted Microsoft’s motion for summary judgment based on the absence of a remedy. Exafer appealed all three orders.

Exafer argued that the district court erred in excluding its damages theory, which relied on Microsoft’s virtual machine pricing rate to estimate the value Microsoft placed on the accused features. Exafer contended that the district court misapplied the Federal Circuit’s 2018 decision in Enplas Display Device v. Seoul Semiconductor by effectively creating a categorical bar against considering noninfringing activities in a reasonable royalty analysis.

The Federal Circuit agreed, explaining that in Enplas the unaccused products had no causal connection to the accused infringing products. Here, by contrast, the Court found such a connection: Microsoft’s own documents showed that Exafer’s royalty base was tied to a causal connection between the accused Azure features and the operation of virtual machines. The Court concluded that Exafer’s damages expert valued the accused features based on the incremental virtual machines Microsoft could host because of those efficiency gains.

The Federal Circuit rejected Microsoft’s argument that Enplas categorically precluded applying a royalty rate to sales of unaccused products to prevent a patent owner from “expanding its patent monopoly to unpatented products.” The Court explained that the analysis must be conducted on a case-by-case basis to determine how the parties would value the accused technology in the hypothetical negotiation. As an example, the Court noted that claims directed to methods of manufacture commonly use the unaccused product produced by the claimed method as the royalty base.



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Good-faith investigation defeats preindictment delay challenge

by | Mar 12, 2026 |

Addressing the constitutional limits of preindictment delay in a trade secret and wire fraud prosecution arising from alleged misuse of proprietary unemployment insurance software, the US Court of Appeals for the Fourth Circuit clarified both the standard of review for due process claims based on delay and the substantive threshold required to dismiss an indictment on that basis. United States of America v. David Gerald Minkkinen, Case No. 23-4443 (4th Cir. Feb. 26, 2026) (Wynn, Richardson, Rushing, JJ.)

Between 2009 and 2013, David Minkkinen and Sivaraman Sambasivam worked at a business management consulting firm, where they helped develop a proprietary unemployment insurance software platform called uFACTS. In 2013 they both joined Sagitec, where they participated in building a new unemployment claims system for the Maryland and West Virginia Consortium. In 2016, state employees identified references in Sagitec materials that suggested possible use of the prior company’s intellectual property, prompting a federal investigation. Investigators examined whether other former employees transferred design documents or source materials to Sagitec. While some individuals acknowledged retaining prior project materials, they disputed ownership or claimed the materials were only used as templates. The investigation was prolonged and complicated by the unexpected deaths of key witnesses.

In August 2022, Minkkinen and Sambasivam were indicted on charges including trade secret misappropriation, wire fraud, and false statements. Efforts by the defendants to obtain historical project documents were hindered by routine document destruction policies at state agencies. The government also later filed a superseding indictment focused on alleged misuse of the prior company’s proprietary files. The defendants moved to dismiss for unconstitutional preindictment delay, arguing that the loss of witness testimony and documents prejudiced their defense. The district court agreed in part, finding the missing evidence highly significant and the government’s justification for the lengthy investigation insufficient, and dismissed 10 of 14 counts. The government appealed.

The Fourth Circuit determined that in reviewing a claim of unconstitutional preindictment delay, it would apply clear-error review of the district court’s factual findings and de novo review to its legal conclusions. The Court further determined that the specific issue at stake here (i.e., whether the prosecution offended “fundamental conceptions of justice” and society’s sense of “fair play and decency”) was a mixed question of law and fact that should be reviewed de novo. The Court reasoned that the second prong of the preindictment delay test requires courts to apply a broad constitutional standard by balancing the government’s justification for delay against prejudice to the defendant, and appellate courts have a special role in defining the limits of constitutional standards through case-by-case adjudication. Accordingly, the Court concluded it would apply de novo review to the district court’s ultimate due process determination regarding the dismissed counts.

The Fourth Circuit determined that the district court erred in dismissing counts based on unconstitutional preindictment delay. Applying the second prong of the due process analysis, the Court concluded that the government’s delay was attributable to a prolonged good-faith investigation and not to any improper motive, tactical advantage, or [...]

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Coiled in controversy: Summary judgment on Walker Process claim unwound

by | Mar 12, 2026 |

The US Court of Appeals for the Federal Circuit vacated a district court’s grant of summary judgment on inequitable conduct and a Walker Process antitrust claim arising from allegations that a patent owner withheld material prior art during patent prosecution and sought to enforce the patents against a competitor in the coiled tubing market. Global Tubing v. Tenaris Coiled Tubes, Case Nos. 23-1882; -1883 (Fed. Cir. Feb. 26, 2026) (Taranto, Hughes, Stark, JJ.)

Global Tubing filed a declaratory judgment action seeking a ruling that its coiled tubing product did not infringe Tenaris’ patents. After uncovering a document in discovery that it characterized as evidence that Tenaris attempted to withhold material information during patent prosecution, Global Tubing amended its complaint to assert inequitable conduct and Walker Process fraud, alleging that Tenaris sought to use fraudulently obtained patents to monopolize the market. Following the completion of discovery, the parties filed cross-motions for summary judgment. The district court granted summary judgment of inequitable conduct to Global Tubing and summary judgment of no liability for Walker Process fraud to Tenaris. As to the Walker Process fraud claim, the court determined that because Tenaris was such a small market player, Global Tubing could not prove it had the market power sufficient to achieve a monopoly. Both parties appealed.

The Federal Circuit determined that the district court erred in granting summary judgment to Global Tubing, finding that genuine disputes of material fact remained as to whether the single most reasonable inference was that the inventor acted with specific intent to deceive the United States Patent and Trademark Office (USPTO), making summary judgment on inequitable conduct inappropriate.

Addressing the Walker Process fraud claim, the Federal Circuit likewise vacated the district court’s grant of summary judgment in favor of Tenaris, finding that the record contained genuine disputes of material fact that precluded judgment as a matter of law. The Court explained that the evidence could support a finding that the inventor knowingly withheld a material prior art reference from the USPTO with intent to deceive, and that Global Tubing had raised a triable issue as to the first prong of its Walker Process claim: whether Tenaris obtained and enforced the patent through knowing and willful fraud on the USPTO.

Turning to the second prong of a Walker Process fraud claim (attempted monopolization), the Federal Circuit observed that the parties advanced competing definitions of the relevant market. The Court concluded that the district court erred by characterizing Tenaris as a small market participant with no dangerous probability of achieving monopoly power without first defining the relevant product and geographic markets or determining whether genuine disputes of material fact existed on those issues.

The Federal Circuit also concluded that genuine disputes of material fact remained as to whether Tenaris engaged in predatory or otherwise anticompetitive conduct. The Court noted that there may have been a triable issue regarding the appropriate date at which to measure Tenaris’ share of the relevant yet undefined market. Considering these unresolved factual questions, the Court [...]

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Tree-mendous award: Damages expert royalty opinions are lit

by | Mar 5, 2026 |

The US Court of Appeals for the Federal Circuit affirmed a damages verdict amounting to tens of millions of dollars. The Court found that the patentee’s damages expert correctly apportioned value to the patented feature and rejected challenges to her methodology. Willis Electric Co., Ltd. v. Polygroup Ltd., Case No. 24-2118 (Fed. Cir. Feb. 17, 2026) (Moore, Stark, Oetken, JJ.)

Willis sued Polygroup for infringing its patent related to pre-lit artificial trees with decorative lighting. In response, Polygroup filed multiple inter partes review (IPR) petitions challenging the asserted claims. Following extensive IPR proceedings, only a dependent claim that required coaxial trunk connectors remained for trial.

A jury found the claim infringed and not obvious, and awarded about $42.5 million in damages, equating to a $4-per-tree royalty. Polygroup moved for judgment as a matter of law of obviousness or, alternatively, for a new trial on damages. The district court denied both motions. Polygroup appealed.

Effect of prior IPR ruling

Polygroup argued that because the independent claim from which the asserted claim depended was held unpatentable, damages should be limited to only the incremental value of the coaxial connectors recited in the asserted dependent claim. The Federal Circuit rejected that argument, explaining that the IPR applied the broadest reasonable interpretation standard, while the district court construed the independent claim under the Phillips standard. Under the district court’s construction, the independent claim required forming simultaneous mechanical and electrical connections regardless of rotational orientation, a feature that was not required under the IPR construction. Because the independent claim had not been held unpatentable under the district court’s construction, the Federal Circuit reasoned that the IPR ruling did not preclude Willis from relying on that one-step functionality in calculating the value attributable to the coaxial connectors recited in the dependent claim.

The Federal Circuit emphasized that what value was attributable to the claimed coaxial connectors was a question of fact for the jury. Substantial evidence supported the jury’s finding that the value included rotationally independent, simultaneous connection functionality, not merely the physical presence of coaxial connectors.

Rule 702 and damages methodology

Willis’ damages expert presented two independent apportionment analyses.

Under an income-based approach, the expert compared profit margins for Willis’ “One Plug” trees and Polygroup’s Quick Set trees against comparable noninfringing trees to derive a royalty range. Under a market-based approach, she analyzed several license agreements to establish a reasonable royalty range, which she combined with her income approach to arrive at an expanded reasonable royalty range. She then applied the Georgia-Pacific factors to select a $5-per-tree royalty, resulting in a jury award of $4 per tree.

Polygroup argued that the expert failed to adequately apportion value and relied on non-comparable licenses and improper averaging methods. The Federal Circuit disagreed, emphasizing the district court’s gatekeeping role under Federal Rule of Evidence 702 while reinforcing the distinction between admissibility and weight.

The Federal Circuit explained that reasonable royalty determinations inherently involve approximation and uncertainty. Where an expert’s methodology is grounded in record evidence, including internal sales [...]

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Did you account for the entire corresponding disclosed structure?

by | Mar 5, 2026 |

The US Court of Appeals for the Federal Circuit affirmed the district court’s grant of summary judgment of noninfringement of a means-plus-function claim element, emphasizing that a patentee must compare the accused product to the entire disclosed structure, not just a selected subset. Genuine Enabling Tech. v. Sony Group Corp., et al., Case No. 24-1686 (Fed. Cir. Feb. 19, 2026) (Dyk, Taranto, Chen, JJ.)

Genuine Enabling Technology (GET) sued Sony for patent infringement, alleging that Sony’s PlayStation 3 and 4 infringed its patent related to synchronizing data streams from multiple input devices. The district court ruled in favor of Sony, granting summary judgment of noninfringement and excluding the infringement conclusion of GET’s expert. GET appealed.

The Federal Circuit affirmed. The parties agreed that the term “encoding means” for synchronizing two separate streams, present in each asserted claim, was a means-plus-function limitation under 35 U.S.C. § 112(f). Neither party disputed that the corresponding structure consisted of the entirety of a logic block disclosed in the patent specification.

GET’s expert focused solely on the bit-rate clock appearing in the logic block, neglecting most of the other disclosed components, and did not provide an explanation for these omissions in his “way” analysis. The Federal Circuit explained that this approach failed to satisfy the function-way-result test for structural equivalence, which requires demonstrating that the accused product is equivalent to the disclosed structure by showing that both the accused and corresponding disclosed structures perform the identical function in substantially the same way to achieve substantially the same result. The Court clarified that while a component-by-component examination is not necessary, the analysis must consider all components of the identified structure or justify any omissions. GET’s expert did not meet the burden of describing the “way” the “encoding means” structure in the patent performed its function.

GET’s expert attempted to simplify structural equivalence to “anything that synchronizes to a clock.” The Federal Circuit explained that this approach improperly reduced the function-way-result test to function-result alone, contradicting the patent’s specific synchronization scheme. Because of the lack of analytical support for the expert’s structural-equivalence conclusion, the Federal Circuit upheld the district court’s exclusion of the expert’s opinion.

Since GET did not seek discovery of the accused product’s Bluetooth schematics until the end of fact discovery, GET’s expert never examined the internal design of the accused Bluetooth modules. Instead, his infringement theory relied solely on assumptions about generic Bluetooth behavior, which the Federal Circuit found to be conclusory, legally insufficient, and inconsistent with the patent’s detailed circuitry disclosed in the specification. The Federal Circuit affirmed the district court’s partial exclusion of GET’s expert’s testimony.

Practice note: When litigating means-plus-function claims under 35 U.S.C. § 112(f), an opining expert must address the entirety of the corresponding structure disclosed in the specification. Selectively focusing on only one or two elements without explaining omissions can be fatal.



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Manufactured host cells markedly different from naturally occurring cells may be patent eligible

by | Mar 5, 2026 | ,

Addressing subject matter eligibility in the life sciences context, the US Court of Appeals for the Federal Circuit reversed a district court’s summary judgment ruling that certain claims directed to genetically engineered host cells were patent ineligible as directed to a natural phenomenon. The Federal Circuit found that the claimed cells contained recombinant nucleic acid molecules that were markedly different from anything occurring in nature and therefore were patent eligible under 35 U.S.C. § 101. REGENXBIO Inc. v. Sarepta Therapeutics, Inc., Case No. 24-1408 (Fed. Cir. Feb. 20, 2026) (Dyk, Hughes, Stoll, JJ.)

REGENXBIO owns a patent directed to genetically engineered host cells containing a recombinant nucleic acid molecule (adeno-associated virus (AAV) rh.10 sequences). These host cells are human made and do not exist in nature. The recombinant nucleic acid molecule is created by chemically splicing together nucleic acid sequences from two different organisms. REGENXBIO sued Sarepta, alleging infringement of its patent. Both parties moved for summary judgment on whether the asserted claims were patent eligible under Section 101. The parties did not assert that claims were ineligible as an abstract idea but rather debated whether the claims disclosed natural products.

The district court analogized the claims to those considered in the 1949 Supreme Court decision in Funk Brothers Seed v. Kalo Inoculant, where two strains of bacteria from two different organisms were merely put together. The district court concluded that the invention, “taking ‘two sequences from two different organisms and put[ting] them together,’” amounted to merely packaging natural products together and found the asserted claims ineligible. REGENXBIO appealed.

The Federal Circuit reversed. Relying on the Supreme Court’s decisions in Diamond v. Chakrabarty (1980) and Association for Molecular Pathology v. Myriad Genetics (2013), the Federal Circuit explained that the relevant inquiry was whether the claimed composition as a whole possessed “markedly different characteristics” from what occurs in nature. The Court emphasized that the claimed recombinant nucleic acid molecules were not naturally occurring and cannot form in nature without human intervention. The claims required a recombinant molecule encoding both an AAV vp1 capsid protein and a heterologous sequence, created by combining genetic material from different sources.

The Federal Circuit explained that like the engineered bacterium in Chakrabarty, the claimed host cells here were “not nature’s handiwork” but a product of human ingenuity. And like the cDNA claims upheld in Myriad, the recombinant molecules represented something “distinct from” naturally occurring DNA. In contrast to Funk Brothers, where the bacteria performed exactly as they did in nature and were merely packaged together, the claimed host cells here contained a newly engineered molecule that did not exist in nature and that enabled gene therapy applications.

The Federal Circuit also noted that the claimed compositions had the potential for significant utility, specifically in gene delivery and gene therapy, further distinguishing them from the ineligible claims in Funk Brothers. Although the claims did not expressly recite a specific therapeutic use, the Court explained that potential utility may be considered in evaluating whether a composition is markedly [...]

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Provider’s degree of control affects DMCA safe harbor

by | Feb 26, 2026 |

The US Court of Appeals for the Second Circuit affirmed dismissal of a photographer’s Digital Millennium Copyright Act (DMCA) claims against a digital media platform for lack of scienter but vacated summary judgment on copyright claims. The Second Circuit remanded the case to the district court with instructions to assess whether the accused infringer can claim protection under the DMCA’s service provider safe harbor. McGucken v. Shutterstock Inc., Case No. 23-7652 (2nd. Cir. Feb. 10, 2026) (Lynch, Lee, Perez, JJ.)

Elliott McGucken, a professional photographer, discovered that several hundred of his copyrighted photographs were uploaded to Shutterstock by three user accounts that generated more than $2,000 in licensing revenue. Shutterstock removed the images within four days of receiving takedown notices and terminated the uploading accounts. McGucken nevertheless sued, alleging copyright infringement under 17 U.S.C. § 106 and false copyright management information (CMI) under 17 U.S.C. § 1202. The district court granted summary judgment for Shutterstock on all claims. McGucken appealed.

The Second Circuit agreed that McGucken failed to raise a triable issue on Shutterstock’s scienter regarding CMI under the DMCA. First, the Court found that Shutterstock’s practice of placing a watermark on all images on its site did not demonstrate that it knowingly affixed false CMI to McGucken’s works for the purpose of facilitating infringement. Second, the Court found that Shutterstock’s automated removal of CMI from all uploaded images, which is done to avoid malware and strip personally identifiable information, did not show that Shutterstock knew it was removing McGucken’s CMI without authorization or that Shutterstock intended to conceal infringement. On these grounds, the Court affirmed dismissal of the § 1202 claim.

As for the safe harbor provision regarding the copyright infringement claim, the Second Circuit agreed that Shutterstock qualified as a “service provider” with a repeat infringer policy and no interference with standard technical measures. The Court also affirmed that Shutterstock lacked actual or red flag knowledge of the infringement and acted expeditiously once notified.

The Second Circuit found triable issues of fact, however, on two critical safe harbor elements under § 512(c)(1). The first issue was whether the storage was “at the direction of the user.” The Court stated that the factfinder must determine whether Shutterstock’s review of uploaded material involved “substantive and discretionary control” over what appears on the platform, including the level of aesthetic or editorial judgment applied when deciding which images to accept.

The second issue assessed was whether Shutterstock had the “right and ability to control” the alleged infringing activity. The Second Circuit explained that safe harbor is unavailable where the provider exercises “substantial control” over users’ activities, such that decisions about what content is allowed on the site go beyond promoting or demoting material. The Court noted that control may also be inferred if the provider selectively reviews only a subset of uploaded content rather than reviewing all user submissions.

Since these issues remained unresolved, the Second Circuit vacated summary judgment on the copyright claim and remanded for further proceedings.

Practice note: The Second Circuit’s clarification of [...]

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USPTO Director IPR institution discretion survives APA challenge

by | Feb 26, 2026 |

The US Court of Appeals for the Federal Circuit concluded that the United States Patent and Trademark Office’s (USPTO) framework for discretionary denials of inter partes review (IPR) is a general statement of policy, not a substantive rule, and therefore is exempt from the Administrative Procedure Act’s notice‑and‑comment requirements.

The USPTO Director issued a trio of related instructions to the Patent Trial & Appeal Board for its exercise of delegated non-institution authority, addressing the common situation where the IPR petitioner and the patent owner are already involved in a district court litigation over the patent at issue. Two of the instructions were in the form of precedential Board decisions, which set forth six exclusive factors, weighing in favor or against institution, that the Board must assess. These instructions are generally referred to as the NHK-Fintiv instructions that, as Board precedent, bind only the Board and not the USPTO Director.

Several IPR petitioners argued that the Director’s instructions to the Board effectively bind the USPTO as an agency and thus should have been promulgated through formal rulemaking.

The Federal Circuit disagreed, emphasizing that institution decisions rest ultimately with the USPTO Director. The Court explained that while the NHK-Fintiv framework provides guidance on how that discretionary authority may be exercised, the Director retains the ability to depart from the framework in any given case. To that end, the guidance does not carry the force and effect of law and does not impose legally binding obligations on the agency or the public.

Practice note: The decision reinforces the Federal Circuit’s post‑Arthrex theme that the Director enjoys broad and largely unreviewable discretion at the IPR institution stage.



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