The USPTO has asked for the public’s feedback on various interim changes made to the Patent Trial and Appeal Board (PTAB). On July 19, the agency filed a Request for Comment on three PTAB processes established and refined during the past several years: the director review program; the Precedential Opinion Panel (POP); and the Circulation Judge Pool (CJP), a new procedure designed to insulate the PTAB’s Administrative Patent Judges (APJs) from perceived political pressure (as detailed in RPX’s recent Q2 in Review). By requesting the public’s input, the USPTO has taken its first step toward formalizing these programs through notice-and-comment rulemaking under the Administrative Procedure Act (APA).

The Director Review Program

The PTAB’s director review program was created as a result of the Supreme Court’s June 2021 decision in Arthrex. That opinion, considering whether the PTAB’s appointment of Administrative Patent Judges was unconstitutional, left the Board largely intact but gave the USPTO director the authority to rehear final validity decisions in America Invents Act (AIA) reviews. The Patent Office—then led by Director Andrei Iancu—implemented the Arthrex holding through an interim director review program created shortly after the decision’s issuance, laying down certain procedural and substantive requirements the following month.

Under that interim program, a separate process is available for director review of both inter partes review (IPR) and post-grant review (PGR) decisions that exists alongside the preexisting panel rehearing system. A party dissatisfied with a panel’s final written decision now has two options to fight that outcome within the PTAB: the dissatisfied party can (1) request director review of the final written decision, or (2) request panel rehearing. Should the party initially seek director review under the first option, a denial by the director removes the option to then request a panel rehearing. If the party first seeks panel rehearing, the party may only subsequently seek director review if the panel granted the rehearing request. The director’s review can address any issue; is conducted de novo (i.e., with no deference to the panel’s ruling); and can even be initiated sua sponte (without a request from either party), either in the first instance or after a panel grants or denies rehearing.

These interim rules also establish that the director review program does not supersede—and exists alongside—the PTAB’s Precedential Opinion Panel (POP). The POP, which was created in September 2018, is comprised of the USPTO Director, the Commissioner for Patents, and the PTAB’s Chief Administrative Patent Judge, and is tasked with deciding issues of “exceptional importance” to the PTAB. Starting in early 2019, the POP has since steadily expanded the circumstances in which the PTAB may opt to exercise its discretion through the issuance of its own rulings and by designating existing PTAB decisions as precedential or informative.

In April 2022, soon after her confirmation as USPTO director, Vidal announced that the USPTO would be seeking to formalize the director review program after stakeholder input through an official Request for Comment filed in the Federal Register. Alongside Vidal’s announcement, the USPTO also further detailed what issues can form the basis of a director review request, building on a prior list of such issues laid out in 2021. That updated list explains that director review may be sought due to intervening changes in law, USPTO procedures, or guidance; “material errors of fact or law” in PTAB decisions; “novel issues of law or policy”; “issues on which PTAB panel decisions are split”; “issues of particular importance to the Office or patent community”; or “inconsistencies with USPTO procedures, guidance, or decisions”.

The USPTO has since issued two updates further delineating the metes and bounds of director review. On May 25, the agency clarified that while parties may only request director review for final written decisions, not institution decisions, the director “has always retained and continues to retain the authority to review such decisions sua sponte”—doing so for the first time in a pair of IPRs at the center of a battle over alleged PTAB gamesmanship, as discussed in RPX’s Q2 report. On June 22, the USPTO also updated its director review page to indicate that parties should highlight issues of first impression when seeking such review.

The Circulation Judge Pool

The CJP, which was created in May 2022, is an interim process for reviewing the decisions of PTAB panels in AIA reviews prior to issuance. Its formation was an attempt to counter the perception that the USPTO director may wield her authority to influence the outcomes of AIA review decisions.

Under that new process, the CJP (formerly known as the AIA Review Committee) comprises at least eight non-management peer judges who review and provide feedback on pending decisions. The process is modeled in part after the Federal Circuit’s ten-day circulation process but differs in one key respect: while Federal Circuit review can result in a decision being blocked, here it is the original PTAB panel that has the authority to makes the final decision. More importantly, the “interim process makes clear that the Director is not involved, pre-issuance, in directing or otherwise influencing panel decisions”.

In recounting the goals behind this new process in the Request for Comment, the USPTO underscored that the CJP was established to ensure “decisional consistency and open decision-making” at the PTAB. Additionally, the agency explained that the CJP allows the director to “be made aware of decisions to consider for sua sponte Director review or POP review, and of areas to consider for issuing new, or modified, USPTO policy to promote a strong intellectual property system”.

The Request for Comment

The USPTO’s Request for Comment, filed in the Federal Register on July 19, stated that the agency “plans to formalize those processes”—the director review, POP, and CJP programs—“through notice-and-comment rulemaking”. The resulting public feedback is intended to “inform such rulemaking, and to inform any modifications to the interim processes pending formalization”.

While the agency indicated that it “welcomes any comments” on these programs, it stated that it was “particularly interested” in a set of issues laid out in 14 questions. Those questions, included in their entirety below, primarily relate to potential changes to the director review program and whether the POP should be modified or eliminated in view of director review:

1. Should any changes be made to the interim Director review process, and if so, what changes and why?

2. Should only the parties to a proceeding be permitted to request Director review, or should third-party requests for Director review be allowed, and if so, which ones and why?

3. Should requests for Director review be limited to final written decisions in IPR and PGR? If not, how should they be expanded and why?

4. Should a party to a proceeding be able to request both Director review and rehearing by the merits panel? If so, why and how should the two procedures interplay?

5. What criteria should be used in determining whether to initiate Director review?

6. What standard of review should the Director apply in Director review? Should the standard of review change depending on what type of decision is being reviewed?

7. What standard should the Director apply in determining whether or not to grant sua sponte Director review of decisions on institution? Should the standard change if the decision on institution addresses discretionary issues instead of, or in addition to, merits issues?

8. Should there be a time limit on the Director’s ability to reconsider a petition denial? And if so, what should that time limit be?

9. Are there considerations the USPTO should take with regard to the fact that decisions made on Director review are not precedential by default, and instead are made and marked precedential only upon designation by the Director?

10. Are there any other considerations the USPTO should take into account with respect to Director review?

11. Should the POP review process remain in effect, be modified, or be eliminated in view of Director review? Please explain.

12. Are there any other considerations the USPTO should take into account with respect to the POP process?

13. Should any changes be made to the interim PTAB decision circulation and internal review processes, and if so, what changes and why?

14. Are there any other considerations the USPTO should take into account with respect to the interim PTAB decision circulation and internal review processes?

The deadline for comments is September 19, 2022. For more on the PTAB—including its controversial practice of discretionarily denying institution in AIA reviews under the NHK-Fintiv rule—see RPX’s Q2 in Review.