AIA Review Institution Rates Level Out as Parties Stipulate Around NHK-Fintiv
June 8, 2022
The Patent Trial and Appeal Board (PTAB) instituted trial in 62% of the America Invents Act (AIA) review petitions addressed in the first quarter of 2022. Last year the institution rate was 58.7%, a slight increase from 2020’s 58.2% but still down from 2019’s 61%.
That prior decline can be attributed partly to a pair of precedential PTAB decisions known together as the NHK-Fintiv rule, which allows the Board to use its discretion to deny institution in AIA reviews based on several factors related to the status of parallel district court litigation. The most hotly debated of those factors has been one that allows the PTAB to deny institution when its final decision would be due close to the district court’s scheduled trial date. This practice has been especially problematic from a strategic perspective because it forces petitioners to file as early as possible—effectively, further compressing the one-year window defendants already have to file an IPR—based on an aspect of litigation, trial scheduling, that is inherently outside of a petitioner’s control and is subject to change.
That said, additional decisions from the PTAB have allowed petitioners to stipulate around other NHK-Fintiv factors, which may be contributing to the leveling-out of year-over-year institution rates. In Sand Revolution II v. Continental Intermodal Group – Trucking (issued May 2020; designated as informative that July), the PTAB granted institution after the petitioner agreed not to assert the same invalidity grounds in district court that it did in its IPR petition. That same December, the Board accepted an even broader type of stipulation in its Sotera Wireless v. Masimo decision (designated as precedential two weeks later), after the petitioner informed the district court that it would not pursue “any ground raised or that could have been reasonably raised in an IPR” after institution. Some practitioners have indicated that the PTAB has been more amenable to the latter, broader type of stipulation.
The ongoing NHK-Fintiv debate will likely be top-of-mind for new USPTO Director Kathi Vidal, who was confirmed by the Senate on April 5 after more than a year during which the agency lacked a permanent head. Unsurprisingly, the rule was among the most frequent topics of questioning during Vidal’s confirmation process last year, with Senator Thom Tillis (R-NC) taking particular issue with the NHK-Fintiv factor tying institution to district court trial dates—a practice that Vidal, at his request, agreed to study and review.
See RPX’s first-quarter review for more on this and other trends impacting patent litigation and the patent marketplace.