PublishedMay 14, 2020

Thryv, the PTAB, and the APA

April’s Thryv decision by the Supreme Court clarified the nonappealability of institution decisions in inter partes review (IPR).  But by placing an absolute bar on appeal of institution decisions, Thryv effectively insulated the PTO’s choice of institution rules from appeal.  That’s not a good situation, and it’s one which the Director should actively seek to correct.


The bar on appeal of institution decisions is intended to keep IPRs a relatively quick and efficient process.  Instead of permitting parties to challenge the decision to proceed to a final decision, dragging IPRs out for years, they can only appeal the final decision.  In many ways, it’s analogous to how courts disfavor interlocutory appeals.

But there’s really two kinds of decisions at the institution stage that parties might want to challenge—decisions about how the relevant rule applies to the present case, and decisions about what the relevant rule is supposed to be.

Rules and Applications

When parties seek to challenge an institution decision, it’s rarely the kind of fact-specific challenge to the particulars that the non-appealability bar was intended to block.  Instead, their real challenge is to the underlying rule of decision.

That’s not a trivial distinction.  It’s one thing if a particular judge gets the application of a rule wrong in a particular IPR—any error is undesirable, but that impacts only a single case.  It’s a bigger problem if the entire agency is applying a rule that’s non-compliant with the statute.  That means that every single case could be decided incorrectly.

In the context of the courts, you’d just appeal the decision that created an incorrect rule.  But in the context of institution decisions, there’s no recourse when a decision that creates an incorrect rule.  The AIA states that “the determination by the Director whether to institute an inter partes review under this section shall be final and nonappealable” and Thryv makes clear that the AIA’s drafters meant what they said.  

And that means that if the Patent Trial and Appeal Board (PTAB) gets an institution rule wrong, it’s impossible to challenge it.

Making Sure The PTAB Thrives

This is, in large part, a problem created by the Patent Office’s decision to create precedential rules by an informal process as part of a single IPR, instead of conducting notice-and-comment rulemaking to set the rule and then applying it in IPRs.

And it’s a problem for everyone—patent owners, petitioners, and the public.  Whether you’re faced with an IPR that’s allowed based on a voluntarily dismissed complaint not triggering the time bar or an inability to challenge a rule that prevents government contractors from challenging patents, an inability to challenge incorrect rules isn’t good for anyone.  And it’s bad for the Patent Office as well—an inability to fix problems harms the perception of fairness that Director Iancu has championed.

The solution is simple and already within the power of Director Iancu.  Instead of the ad hoc Precedential Opinion Panel process the PTAB currently uses, just require that all rules pertaining to IPR be made via notice-and-comment rulemaking.  Given 35 U.S.C. § 316(a)’s command that “[t]he Director shall prescribe regulations,” including regulations governing inter partes review, this clearly seems to be what Congress intended.

Doing rulemaking via Administrative Procedure Act procedures ensures that the entire public has proper notice of the proposed and final rule and a chance to participate in the process of setting it.  And if someone thinks the PTAB sets the wrong rule, they can bring a challenge to the rule under the APA.  That allows parties to challenge the kind of broad rules on institution that should be appealable, while avoiding the problem of parties appealing every single institution decision that doesn’t go their way because of disagreement over the facts of the case.

If an individual IPR requires the creation of a new rule, whether at institution or at final written decision, that IPR can be paused until the rulemaking is completed.  At that point, the PTAB judges will be applying a properly promulgated rule created via normal agency procedures.

All Director Iancu needs to do is to start making the rules the right way.

Josh Landau

Patent Counsel, CCIA

Joshua Landau is the Patent Counsel at the Computer & Communications Industry Association (CCIA), where he represents and advises the association regarding patent issues.  Mr. Landau joined CCIA from WilmerHale in 2017, where he represented clients in patent litigation, counseling, and prosecution, including trials in both district courts and before the PTAB.

Prior to his time at WilmerHale, Mr. Landau was a Legal Fellow on Senator Al Franken’s Judiciary staff, focusing on privacy and technology issues.  Mr. Landau received his J.D. from Georgetown University Law Center and his B.S.E.E. from the University of Michigan.  Before law school, he spent several years as an automotive engineer, during which time he co-invented technology leading to U.S. Patent No. 6,934,140.

Follow @PatentJosh on Twitter.

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