New Guidance Regarding Fintiv Discretionary Denial at the PTAB

Two recent memoranda from the Patent Trial and Appeal Board (PTAB or Board) have sought to clarify the factors by which boards will evaluate discretionary denial under Fintiv. This guidance follows the U.S. Patent and Trademark Office's (USPTO) rescission of its earlier June 2022 guidance regarding Fintiv. This post explores the new memoranda and their effect on discretionary denial before the PTAB.

Introduction to Fintiv and Discretionary Denials

The America Invents Act (AIA) established the inter partes review (IPR) procedure as a mechanism for challenging patent validity before the PTAB. The PTAB maintains discretion, however, to deny institution of IPR proceedings under 35 U.S.C. § 314(a), which has resulted in significant uncertainty for IPR petitioners.

In Apple Inc. v. Fintiv, Inc., IPR2020-00019 (Mar. 20, 2020), the PTAB articulated a multifactor test for determining whether to deny an IPR petition when a parallel district court case was pending. The six factors the PTAB evaluates in Fintiv include:

1. whether the court granted a stay or evidence exists that one may be granted if a proceeding is instituted
2. proximity of the court's trial date to the Board's projected statutory deadline for a final written decision
3. investment in the parallel proceeding by the court and the parties
4. overlap between issues raised in the petition and in the parallel proceeding
5. whether the petitioner and the defendant in the parallel proceeding are the same party
6. other circumstances that impact the Board's exercise of discretion, including the merits

Petitioners argue that the six Fintiv factors support institution, while patent owners advocate for denial. Since its introduction, Fintiv has posed challenges for petitioners dealing with imminent trial dates, and the PTAB's use of Fintiv had been criticized as uneven.

In response to the unpredictability surrounding Fintiv denials, former USPTO Director Kathi Vidal issued a memorandum in June 2022 clarifying that the PTAB would not discretionarily deny institution when petitioners agreed to a broad Sotera stipulation (foregoing invalidity arguments in district court that could have been raised in an IPR) or when the petition presented a "compelling unpatentability challenge."

The June 2022 guidance served to curtail the use of Fintiv-based discretionary denials and to resolve some of the uncertainties surrounding institution.

Rescission of Vidal's Memo and the Return of Uncertainty

On Feb. 28, 2025, the USPTO rescinded the 2022 Fintiv memorandum, effectively reinstating the broader discretionary framework of the early Fintiv era. The rescission rendered the June 2022 memorandum no longer binding or persuasive, and petitioners must again navigate the original six-factor Fintiv test without the bright-line rules previously afforded to parties to post-grant proceedings.

The PTAB now has wider latitude to deny IPR petitions based on Fintiv considerations, even if a petitioner offers a Sotera stipulation or presents strong invalidity arguments. This rollback renewed unpredictability in the IPR process.

The New Guidance

Chief Judge Boalick's Memo Further Reinforces Discretionary Denials

On March 24, 2025, Chief Administrative Patent Judge Scott R. Boalick issued a memorandum reinforcing the PTAB's discretionary denial authority by reaffirming the Fintiv factors. The memorandum signaled a return to broader PTAB discretion when deciding whether to institute proceedings.

First, the memorandum states that a Sotera stipulation, which had previously been dispositive of the discretionary denial question, "is highly relevant, but will not be dispositive by itself."

Second, the memorandum states that the six Fintiv factors "considered in the exercise of discretion are part of a balanced assessment of all the relevant circumstances in the case, including the strength of the merits." Whereas the previous guidance put "compelling merits" at the forefront of the Fintiv analysis, the memorandum states that "compelling merits alone is not dispositive in making the assessment."

Third, the memorandum restores the PTAB's ability to defer to district court and International Trade Commission (ITC) schedules, making trial proximity a more significant factor in discretionary denials. It also states, however, that the PTAB will consider any evidence related to the trial date at the district court (or target date for the ITC's final determination). Such evidence includes median time-to-trial date statistics, which indicates that the PTAB will account for the likelihood that trial dates will move.

Fourth, the Feb. 28, 2025 rescission memorandum applies to any petition that has not yet reached an institution decision.

Acting USPTO Director Stewart's New PTAB Workload Management Memo

Just two days later, on March 26, 2025, acting USPTO Director Coke M. Stewart issued a new memorandum outlining interim procedures for the PTAB when handling IPR and post-grant review (PGR) petitions. This memorandum introduces new briefing procedures for discretionary denials:

• Patent owners can file a discretionary denial brief within two months of PTAB's notice of petition filing.
• Petitioners may file an opposition within one month of the patent owner's brief filing.
• Word limits are set at 14,000 for discretionary denial briefing and 5,600 for replies in support. See 37 C.F.R. § 42.24.

Additionally, the March 26, 2025 memorandum establishes a novel bifurcated approach to institution decisions:

• Step 1: The USPTO Director, in consultation with at least three PTAB judges, will determine whether discretionary denial is appropriate based on existing Fintiv factors and other policy considerations.
• Step 2: If discretionary denial is not appropriate, then the case proceeds to a three-member PTAB panel, which will then assess the petition's merits and other nondiscretionary statutory considerations in deciding on institution.

According to Stewart, this new process aims to balance PTAB's statutory obligations to review ex parte appeals while managing its IPR and PGR caseload more efficiently.

Key Takeaways and Strategic Considerations Moving Forward

The rescission of the June 2022 memorandum marks a return to greater discretionary flexibility in PTAB institution decisions and revives the challenges that petitioners faced in the early Fintiv era. As a result of recent developments, petitioners should consider the following strategies moving forward:

• File Petitions as Early as Possible. Doing so will minimize the risk of discretionary denial based on trial timing.
• Evaluate Stipulation Strategies. Although Sotera is no longer a "safe harbor," it may still help reduce overlap-based denials.
• Emphasize the Petition's Merits. A strong invalidity challenge may still weigh against denial.
• Adjust Procedural Expectations. Patent owners should proactively file discretionary denial briefs, while petitioners should be prepared to respond.
• Engage with the New Briefing Process. Parties should consider discussing the factors enumerated in General Plastic and Advanced Bionics, in addition to the Fintiv factors, as well as the Consolidated Trial Practice Guide (Nov. 2019).

In sum, Fintiv's reinstated influence alongside Stewart's new guidance means that petitioners and patent owners alike face renewed uncertainty in how the PTAB will apply the discretionary denial factors in IPR proceedings. Practitioners should closely monitor how the PTAB applies these changes to develop informed and effective strategies for both IPR and PGR proceedings.