Andy Zappia, Nick Gallo, and Bryan Smith explore the evolving landscape of estoppel in inter partes review (IPR) and post-grant review (PGR) proceedings at the Patent Trial and Appeal Board (PTAB).
In this episode of the Post-Grant Podcast, Andy Zappia, Nick Gallo, and Bryan Smith explore the evolving landscape of estoppel in inter partes review (IPR) and post-grant review (PGR) proceedings at the Patent Trial and Appeal Board (PTAB). The discussion centers around the recent Federal Circuit decision in the Ingenico case, which narrows the scope of IPR estoppel, and its potential tension with the PTAB's current approach to discretionary denial. The team delves into the implications of this decision for patent challengers, particularly in light of new PTAB guidance and recent cases that highlight the complexities of navigating estoppel and discretionary denial.
Patents: Post-Grant Podcast — Understanding the Impact of IPR Estoppel and PTAB Discretionary Denials
Host: Andy Zappia
Guests: Bryan Smith and Nick Gallo
Recorded: June 18, 2025
Aired: July 1, 2025
Andy Zappia:
Greetings and welcome to Troutman Pepper Locke's Post-Grant Podcast series. My name is Andy Zappia and I'm joined today by my colleagues Bryan Smith and Nick Gallo.
In this installment, we're going to take a look at the changing landscape for estoppel as it applies to IPR and PGR proceedings at the PTAB, and how a recent decision on estoppel might be in tension with how the PTAB is currently dealing with discretionary denial issues.
Just to set the table a little bit, in our last podcast episode, we talked about a memo that was issued by former Patent Office Director Vidal, providing guidance on PTAB discretionary denial for a parallel proceeding, and that's when an IPR is filed where those patents are at issue in say district court at the same time. That memo that Director Vidal had issued was withdrawn and a new memo was issued in March, which changed a lot about how discretionary denial is handled and makes it, in my assessment, more likely that petitions will get discretionarily denied. If you want more details on that, you can listen to our last podcast. But what's happened as a result is there's been a lot of activity on discretionary denial, and in fact, many denials this week that we'll talk about a bit.
Just to give a touch of background without going into all the detail we had in our last episode. Section 314 allows the PTAB discretion whether to institute in a party's review. And starting with the NHK case, Spring case, and the Fintiv case, the PTAB established these standards for determining whether to institute an IPR or PGR petition when there is a parallel, for example, district court case and like a six-factor analysis that the board goes through to decide whether that parallel case, say a district court case, is a basis to deny institution of a petition.
So, that's what this discretionary denial issue is. But before we circle back to discretionary denial, let's talk a little bit about what IPR estoppel is and what this new decision was on IPR estoppel. Bryan, can you explain briefly this concept of IPR or PGR estoppel and what the Federal Circuit recently held on estoppel?
Bryan Smith:
Thanks, Andy. The IPR estoppel provision, and I'll often refer to it as the ISPR estoppel provision, but as Andy mentioned, it also applies to PGRs, which are a bit less common. But that statutory section prevents IPR petitioners from asserting that a claim of the patent challenged in the proceeding is invalid on any ground that the petitioner raised or reasonably could have raised in that proceeding, and that prevents them from raising those issues in a related district court action.
The IPR estoppel applies when the IPR or PGR reaches a final written decision. And the IPR estoppel also applies to other real parties in interest or any privies of the petitioner. So, it can have a significant impact. And as a result of that impact, it's an important consideration that parties must evaluate in choosing whether to file an IPR or potentially to use other post issuance procedures to challenge the patented issue, such as an ex parte reexam.
In the recent Federal Circuit decision, the Federal Circuit held that IPR estoppel does not extend to arguments that the claimed invention isn't valid because it was known or used by others on sale or in public use, because such arguments constitute grounds that cannot be raised in an IPR proceeding, according to the statutory section that establishes that procedure. And we'll talk a little bit more about that Federal Circuit decision a little bit.
Andy Zappia:
Yes, and I think that's the Ingenico decision, right?
Bryan Smith:
Yes, that's correct.
Andy Zappia:
So, Nick, this Ingenico decision, how could that be in tension with the PTAB's current approach on discretionary denial, just to give a summary before we get into the detail?
Nick Gallo:
Yes, it's interesting because since the Ingenico holding limits the scope of IPR estoppel, it may encourage more petitioners to utilize IPRs to challenge patents. But ironically, that decision comes at a time when the USPTO has altered its standards on discretionary denials of IPR petitions ostensibly to manage PTAB workload and avoid overburdening the office.
Also, the PTAB is clarifying that petitioners have a burden to explain how an examiner aired when an IPR petition relies on prior art, cited in an IDS, but not utilized during prosecution to reject any claims, which may make it more difficult to rely on that art in increased instances of discretionary denial.
In general, we may see more interest in IPR proceedings, even as the discretionary denial rate increases and petitioner space and increased burden with respect to prior art of record during prosecution.
Andy Zappia:
Yes, and one of the things I've been thinking about here is that one of those Fintiv factors for discretionary denial is whether the same issues will be presented in the parallel proceeding, for example, in district court, right? When you have this narrowing of estoppel, it means that the petitioner, like you said, there might be more petitioners, they're more interested in filing, estoppel is not as broad. But to get instituted, a petitioner might have to agree and stipulate that it's not going to raise certain grounds in a parallel proceeding to get instituted. So, even though estoppel is narrowed by this decision, petitioners might have to agree to stipulate not to pursue arguments in district court in a manner that's broader than the estoppel rules actually require, just to get instituted. That's what I've been scratching my head about, that how these two things work together.
But Brian, let's talk a little more detail about what the Ingenico court actually held on this estoppel question.
Bryan Smith:
Sure. The appellant in Ingenico argued that the district court improperly allowed the introduction of certain prior art evidence that, according to the appellate, should have been precluded based on the statutory IPR estoppel provision. In just a little bit of background, Ingenico filed an IPR challenging IO Engine's patents, which were also the subject of an underlying district court action. The IPR reached the final written decision invalidating certain claims of those patents, which meant the IPR estoppel provision could apply.
At trial, Ingenico relied on a prior device as well as written documentation describing that device in order to show that the claimed invention was invalid as being known or used by others on sale or in public use before the date of invention. The jury returned a general verdict finding the claimed invention invalid as being anticipated and obvious in view of the prior art device, but did not specifically point to whether it was known or used by others on sale or in public use. As a result of the jury verdict, IO Engine appealed, arguing in part that IPR estoppel should have precluded the introduction of the documentation related to the prior art device. And the basis for that was that they believed Ingenico reasonably could have raised that material as part of the IPR and that IPR estoppel should bar the introduction of that evidence.
As a result, the Federal Circuit took this opportunity to review the scope of the IPR estoppel provision. And, for the first time, interpreted the meaning of the term ground which appears in the IPR estoppel statute, but is not expressly defined. And the Federal Circuit took this opportunity based on a split among the district courts about how the term ground should be interpreted, and therefore, how IPR estoppel should be applied.
The Federal Circuit found that the term ground in the context of an IPR or PGR is a theory of invalidity that is available to challenge a claim under either anticipation or obviousness. And importantly, the Federal Circuit determined that the ground is not the specific prior art presented. It's the theory of invalidity under anticipation or obviousness. So, that's an important distinction that the Federal Circuit made.
The Federal Circuit went on to note that IPR challenges are statutorily constrained to invalidity challenges under either the anticipation or obviousness section, and that those challenges have to be based on prior art consisting of patents or printed publications. Thus, under the statutory framework an IPR petitioner cannot raise a challenge that the claimed invention was known or used by others on sale or in public use. Since those theories cannot be raised in an IPR petition, they would not be subject to the IPR estoppel provision.
Andy Zappia:
Well, this is complicated, as I think about it. So, Nick, could maybe you talk a little more about how the Federal Circuit differentiated between a ground and the prior art that's cited in the petition for invalidity?
Nick Gallo:
Yes, sure. So, as Bryan mentioned, the Federal Circuit held that grounds are not co-extensive with the prior art asserted. In other words, the prior art cited as evidence of the asserted ground, but not the ground itself. When the Federal Circuit stated that IPR estoppel, does not preclude an IPR petitioner from relying in district court on the same patents and print of publications used in an IPR proceeding, if the invalidity theory is that the claimed invention was known or used by others on sale or in public use.
So, IPR estoppel does not preclude a petitioner from asserting the same prior art relied upon in an IPR in district court and merely constrains the particular invalidity theories for which that prior art may be utilized in district court.
You could imagine a product manual that could be a printed publication used to support an invalidity ground in an IPR and also available for use to support a system or an area of invalidity in district court, for example.
Andy Zappia:
Right. So, as I kind of think about it, so say an IPR petition has a ground for anticipation with one reference. It'd probably be pretty hard to use that reference for anticipation in district court, right? In district court, in theory, you could combine that with a second reference for obviousness, and that wasn't the ground in the petition. So theoretically, you could pursue that in district court. Is that how this might play out?
Nick Gallo:
I think that's right. That's an interesting way to think about it.
Andy Zappia:
So, Bryan, do you think the Federal Circuit clarified issues or just created more complexity here?
Bryan Smith:
Well, As I mentioned, the Federal Circuit decision certainly resolved the split among the district courts, so it clearly established what the impact of IPR estoppel is for certain grounds and to some degree narrowed that impact. So, this holding may encourage patent challengers to utilize the IPR procedure, particularly where they have arguments available in district court that the challenge patent is invalid as being known or used by others on sale or in public use.
However, as Andy mentioned, this Ingenico decision comes at a time where the PTAB is increasingly denying IPR petitions based on discretionary denial where there's a co-pending district court litigation. And the idea behind that is to manage the overall PTAB workload. So, while Ingenico might narrow IPR estoppel and encourage more petitions, it won't necessarily increase the number of institutions that are granted. And a lot of this goes into the change in the standards at the PTAB based on the new memos that Andy was discussing with how the PTAB is going to look at discretionary denial and apply the Fintiv factors, including the overlap in issues between the IPR petition and parallel district court proceedings.
So, an attempt to avoid discretionary denial, and I think as Andy touched on this a bit, petitioners may resort to providing broader Sotera stipulations, which may essentially nullify the impact of the narrower IPR estoppel because the stipulations may have to be broad enough to cover these additional arguments.
Andy Zappia:
Yes. So, maybe petitioners, they kind of have a choice here, they could benefit from this narrow estoppel, but they're taking a risk on institution, right? Because under the board's current approach on discretionary denial for parallel proceedings. Although, I guess this decision does really help petitioners where there is no parallel proceeding, right? If there is no parallel proceeding, this creates some significant additional incentive to file an IPR and take it to the end because the estoppel is, in that context, it is narrow and you can take advantage of it if there's no parallel proceeding.
Nick Gallo:
I think also if you have some confidence that you don't have the type of art, system art, or public use that you're not going to use in district court, you might feel better about using that broader stipulation and proving your chances of institution.
Andy Zappia:
For sure. So, we've been talking quite a bit about discretionary denial and there's been some decisions recently, so maybe to wrap this up, Nick, do you want to talk about some of this recent stuff we've seen on discretionary denials because it kind of adds an emphasis to this risk issue we've been talking about in connection with this estoppel decision?
Nick Gallo:
Yes, definitely. We are certainly seeing discretionary denial rates increase based on the new PTAB guidance, and I'm just going to discuss a few recent decisions. One is Solus Advanced Materials v. SK Nexilis, and in that case, the PTAB said, "Sotera stipulation weighs strongly against exercising discretion to deny institution.” And it stated that, "Sotera stipulation, that does not move all invalidity issues before the district court, such as invalidity assertions based on combination of art with unpublished systems prior art, is less effective and will not necessarily outweigh other Fintiv factors that favor discretionary denial.”
So, in Solus, the PTAB denied institution under the Fintiv factors despite the Sotera stipulation provided by the petitioner. This goes back to how broad of a stipulation petitioners are comfortable providing. While Ingenico narrowed IPR estoppel, petitioners might nevertheless consider providing a relatively broad stipulation that effectively forecloses any invalidity challenges in the co-pending district court action that rely on the particular prior art references raised in the IPR petition in order to reduce the risk of discretionary denial. So, that's the balance that Andy mentioned earlier.
Other issues that previously were not squarely within the scope of discretionary denial have also been used recently to reject IPR petitions. For example, assignor estoppel, especially does not apply in IPRs for the Federal Circuit, but the PTAB in Tessell v. Nutanix held that unfair dealing can be considered as a discretionary denial factor.
In that case, inventors of a patent left Nutanix to form a competing company, and later attempted to invalidate the same patent via IPR. Nutanix persuaded the PTAB that it was unfair for inventors of a patent to later advocate for its unpatentability, and the PTAB denied institution.
Another example, an iRhythm v. Welch Allyn, the PTAB held the iRhythm citation of the challenged Welch Allyn patent on an IDS during prosecution of one of its own patents 12 years earlier, indicated a long awareness of that patent and settled the expectations of Welch Allyn with respect to reliance on its patent and its beliefs that the patent would not be challenged in an IPR.
Since the parties' expectations were settled, the PTAB denied institution. I know that case in particular has seen some strong opinions on both sides from practitioners.
Andy Zappia:
Yes, because in my recollection, that's sort of a new theory to deny institution. Basically, petitioner, you knew about this patent for a long time. So, now filing this petition, given the party's settled expectations, we're going to deny institution. That's kind of a new, at least to me, that's a new theory.
Nick Gallo:
It is, and yes, I read and knew about the patent for 12 years, but hadn't been sued on it.
Andy Zappia:
Yes, and you have that one-year time period from when you're sued to file a petition, right?
Nick Gallo:
Right.
Andy Zappia:
But you knew about this patent. The patent owner waited, sued you after a long time. You'd file your petition within the one year, but you get denied anyways. Who knows? It's a very interesting world we’re living in.
Nick Gallo:
Yes, it is. How proactive do you want to be?
Andy Zappia:
So, Bryan, I'll let you wrap this up. What do you think the ultimate impact of this Ingenico decision might be?
Bryan Smith:
It's really unclear at this time because IPR estoppel is obviously a very big factor that needs to be taken into consideration before parties proceed with filing an IPR petition. Certainly, the narrowing of that Estoppel provision, you would think would encourage petitioners to file more IPR proceedings, but there is quite a bit of tension with this increased discretionary denial and the fear that the IPR petition may be rejected based on a parallel proceeding.
So, it's hard to know if it'll make people flood to the PTAB with IPRs or if they'll really maintain the status quo because parties might have to give these increased Sotera stipulations just to get in the door. It's really unclear at this time, and it may encourage parties to seek other post-issuance proceedings such as ex parte reexam where the estoppel provisions are not applicable.
Andy Zappia:
It's a very interesting area. A lot of things are changing, and we'll keep our eye on it, and we'll do more podcasts if there are more developments on this. Thanks, Nick and Bryan. It was really great. Troutman Pepper Locke's Intellectual Property Team will continue helping its clients develop and implement global protection and commercialization strategies for intellectual property.
For more information on how we could help you, please visit our website, troutman.com. You can also subscribe and listen to this and other podcasts in our series on post-grant procedures, including on Apple, Google, and Spotify. Thank you very much, and we'll see what happens.
Copyright, Troutman Pepper Locke LLP. These recorded materials are designed for educational purposes only. This podcast is not legal advice and does not create an attorney-client relationship. The views and opinions expressed in this podcast are solely those of the individual participants. Troutman does not make any representations or warranties, express or implied, regarding the contents of this podcast. Information on previous case results does not guarantee a similar future result. Users of this podcast may save and use the podcast only for personal or other non-commercial, educational purposes. No other use, including, without limitation, reproduction, retransmission or editing of this podcast may be made without the prior written permission of Troutman Pepper Locke. If you have any questions, please contact us at troutman.com.