PTAB Institution Rates Hold Steady as Vidal Teases Possible Reforms
October 18, 2023
The Patent Trial and Appeal Board (PTAB) instituted trial for 65% of the America Invents Act (AIA) review petitions addressed in Q3, down from that same quarter last year (during which the institution rate was 71%) and from the prior quarter this year (68%). The institution rate for Q1-Q3 2023 was 66%, down slightly from that same period last year (68%).
The PTAB’s institution practices have been top-of-mind for many stakeholders over the past few years—in particular, its use of discretionary denials under the NHK-Fintiv rule, which in part allows the Board to deny institution based on the status of a parallel district court proceeding. The ongoing debate over NHK-Fintiv became even more heated in April, when the USPTO released an Advance Notice of Proposed Rulemaking (ANPRM) that detailed a potentially sweeping revamp of PTAB proceedings that would, in part, codify certain aspects of the rule and exempt petitions from discretionary denials if they meet a new “compelling merits” standard. Another proposed rule would essentially impose a standing requirement, limiting what types of entities may and may not file PTAB petitions based on an expanded view of corporate relationships and certain exceptions concerning business models.
USPTO Director Kathi Vidal has since clarified in public comments that the agency designed the ANPRM as more of a kitchen-sink approach to soliciting feedback than a final package. In late July, Vidal confirmed in testimony to the Senate IP Subcommittee that the USPTO would only move forward on some of the proposals in the ANPRM in response to stakeholder comments, and that the ANPRM was overinclusive by design, encompassing outside proposals not necessarily favored by the Patent Office: “Instead of the USPTO making a decision without data, we decided to float all of those in the [notice] so that we could receive data from stakeholders and determine what to move forward on”. Moreover, Vidal floated the possibility that the USPTO would release two rulemaking notices to vet the final rules with the public, “one more procedurally focused and one more substantively focused”.
Vidal has not conclusively stated which substantive proposals will make the cut, but she expressed some openness to a standing requirement for the PTAB at that July hearing. In particular, Vidal remarked that such a requirement could serve to prevent parties from “trying to monetize and otherwise use the PTAB for personal gain as opposed to its original intent”—ostensibly, a reference to the debacle over third-party gamesmanship that culminated earlier this year.
See RPX’s third-quarter review for more on the PTAB, and for further analysis of other trends impacting patent litigation so far this year.