USPTO Shakes Up IPR Practice with Expanded Discretionary Denials

Even without a Senate-confirmed director in place, the U.S. Patent and Trademark Office (USPTO) under the new Trump administration is taking a bold new direction. Acting Director Coke Morgan Stewart has greatly expanded the use of discretionary denials of inter partes review (IPR) petitions—injecting fresh uncertainty into the process.

Basics and the Role of Discretion

The IPR process was created by the 2011 Leahy-Smith America Invents Act (AIA) as a faster, more cost-effective alternative to challenging patent validity in court. Most often used by defendants in infringement cases, an IPR begins when a petitioner files with the Patent Trial and Appeal Board (PTAB), laying out arguments for why a patent claim should be invalidated.

If the PTAB finds the petition has merit—specifically, that there’s a reasonable likelihood of success on at least one challenged claim—it may “institute” a full review. But under 35 U.S.C. § 314(a), the PTAB also has discretion to deny review for reasons beyond the merits.

In 2020, the PTAB formalized this discretion by making the decision in Apple v. Fintiv precedential. That decision outlined six factors for evaluating whether to deny institution when there is parallel litigation:

1. Whether a stay has been granted or could be granted in the court case;
2. The closeness of the court’s trial date to the PTAB’s decision deadline;
3. How much the court and parties have invested in the case;
4. Overlap between the court case and IPR issues;
5. Whether the petitioner is also the defendant in the court case; and
6. Any other relevant circumstances, including the merits.

The Fintiv Memo: 2022 Attempt at Clarity

In 2022, the USPTO tried to clarify how the PTAB should apply these factors in a memo titled “Interim Procedure for Discretionary Denials in AIA Postgrant Proceedings With Parallel District Court Litigation”—widely referred to as the Fintiv .

The memo limited the use of Fintiv-based denials in three key scenarios:

• When the petition presents compelling evidence of unpatentability;
• When the parallel case is at the International Trade Commission; and
• When the petitioner stipulates not to pursue in court any grounds also raised (or that could have been raised) in the petition.

It also clarified that, when weighing the timing of the court case, the PTAB should consider how quickly the district court is likely to reach trial.

2025 Reversal: Return to Broad Discretion

On February 28, 2025, the USPTO the Fintiv Memo. Practitioners were told to rely on PTAB precedent for guidance, including the Fintiv decision and other cases addressing discretionary denials.

Shortly after, on March 24, the USPTO issued new “” that effectively rolled back the restrictions the Fintiv memo had put in place. Two days later, the acting director released another titled “Interim Processes for PTAB Workload Management.”

That memo introduced a new bifurcated review structure for institution decisions:

1. Discretionary factors are reviewed by the Director, in consultation with at least three PTAB judges;
2. Merits-based and statutory factors are reviewed separately by a three-judge panel.

It also set out a schedule for briefing discretionary denial issues and outlined several new considerations, including:

• Whether validity has already been adjudicated elsewhere;
• Whether changes in law or precedent affect the patent’s strength;
• The strength of the petitioner’s challenge;
• Reliance on expert evidence;
• How long the patent has been in force (“settled expectations”);
• Economic, public health, or national security concerns;
• Any other factor relevant to the Director’s discretion.

2025: A Spike in Denials in an Evolving Landscape

The new approach has resulted in a sharp rise in discretionary denials. What’s more, the tone and depth of denials have changed. Whereas past denials included detailed analysis of both the Fintiv factors and the merits, recent decisions from the acting director are often just a few pages long and offer only a broad rationale.

One of the most controversial developments is the increased emphasis on “settled expectations.”  In Dabico Airport Sols. Inc. v. AXA Power ApS, the acting director reasoned that a patent’s age alone—eight years in that case—was enough to justify denial. The logic: the longer a patent has been in force, the more “settled” expectations become, even if no one had actual notice of the patent or potential infringement.

This rationale, tied to the six-year damages limit under 35 U.S.C. § 286, could dramatically limit IPRs as a tool for accused infringers.

Ultimately, the deciding question seems to be whether proceeding with the IPR is a “proper use of Office resources”—a broad, subjective standard that remains murky.

Why it matters:

This shift in policy is reshaping how both challengers and patent owners approach IPRs.

Challengers now must weigh previously irrelevant factors and prepare for early dismissal based on policy arguments rather than the merits alone.

Patent owners, in contrast, have gained powerful new tools to block IPR petitions at the institution phase—making it easier to defend their patents without a full review.

Though this evolving system has already sparked debate—and may face legal challenges—as intended, it marks a clear tilt in favor of patent owners.

These new procedures also apply to Post Grant Review (PGR) proceedings, also established by the AIA, which can be filed up to nine months after a patent issues.  35 U.S.C § 321.

Apple Inc. v. Fintiv, Inc., IPR2020-00019, Paper 11 (PTAB Mar. 20, 2020) (designated precedential May 5, 2020).

Dabico Airport Sols. Inc. v. AXA Power ApS, IPR2025-00408, Paper 21 at 2–3 (Director June 18, 2025).