Andy Zappia and Bryan Smith break down the USPTO's proposed rule for IPR and PGR proceedings designed to limit multiple validity challenges to patents.
In this episode of the Post-Grant Podcast, Andy Zappia and Bryan Smith break down the USPTO's proposed rule for IPR and PGR proceedings designed to limit multiple validity challenges to patents. They discuss how the proposed rule would limit access to those proceedings, including a mandatory stipulation requirement, an automatic denial of institution if another tribunal has rendered a determination on validity, timing-based denials when parallel cases are likely to finish first, and a proposed narrow "extraordinary circumstances" exception. They also discuss practical implications for forum selection and strategy ahead of the November 17 comment deadline for the proposed rule.
Patents: Post-Grant Podcast — USPTO Proposes New Rules to Limit Multiple Validity Challenges
Host: Andrew Zappia
Guest: Bryan Smith
Recorded: November 4, 2025
Aired: November 13, 2025
Andrew Zappia (00:04):
Greetings and welcome to Troutman Pepper Locke's Post-Grant Podcast series. My name is Andy Zappia and I'm joined today by my colleague Bryan Smith. 2025 has been a whirlwind of change in the practice at the PTAB for IPRs and PGRs, and now we have more potential changes with a new proposed rule that would apply to IPR and PGR practice. We are going to go through that proposed rule and discuss some of its potential impacts. The rule is not final yet. The comment period ends in November, but it does show some of the thinking at the board and at the PTO generally about ways to change practice for IPR and PGRs. Just to set the table a little bit, we discussed in our last episode, in February, a memo was issued by the director that granted guidance on PTAB discretionary denials. There was a prior memo issued by Director Vidal and that memo was withdrawn and a new procedure was established by the PTAB.
Since that happened, there's been a lot of activity and a lot of changes in discretionary denial practice. Just to explain a little bit when we're talking about discretionary denial, if you're not a regular listener to the podcast, for IPR inter partes review and post-grant review proceedings at the Patent Office, there's a section called Section 314 that gives the PTAB discretion whether or not to institute one of these proceedings. In connection with that discretion, there were several decisions from the board, the PTAB, which established that if there's a parallel district court proceeding where the same patents are at issue, that could be a basis to deny institution of a IPR or PGR petition. This started with a case called NHK Spring, and then there's the Fintiv case, which established certain standards for whether or not to deny one of these proceedings based on a parallel district court case.
There've been various guidance on this. For a period of time, the PTAB was denying institution of lots of petitions based on parallel proceedings. Then under Director Vidal's guidance, there were fewer discretionary denials because some of the standards and tests that she established in her memo were a little more favorable to petitioners and allowed avenues to avoid discretionary denial. But the process has changed again under the Trump administration. There are new rules for discretionary denial, including this concept of settled expectations, which we discussed in a recent podcast. Also the process for requesting has changed – there’s now a bifurcated process – so if you're a patent owner and a petition is filed against your patent, two months after the filing date recorded, you can put in a separate brief on why there should be discretionary denial, and that's separate from any other arguments you might have on the merits for why the petition should not be instituted.
It used to be that the panel that looked at your petition on the merits also made these decisions, but there's also been new guidance that the director is now personally making, with helpers, decisions on discretionary denial, and that's separate from the merits panel that might hear the underlying merits of a proceeding. So, we've got change the rules, change in the process, change in the decision maker, and now we've got potentially even more changes coming for this practice because we have a proposed rule, which would formally change some of the regulations that go to this issue of discretionary denial and parallel proceedings. Brian, now that we have this proposed rule, maybe you can just kind of explain for our listeners in general, what is a proposed rule?
Bryan Smith (04:12):
Thanks, Andy. Sure. A proposed rule is a request by the Patent Office to issue new regulations, and these new regulations would be related to new rules of practice before the PTAB which the PTAB is authorized to establish under the America Invents Act. The new rules would focus inter partes review proceedings on patent claims that have not been previously challenged in litigation or a prior litigation which resolved at an early stage. The proposed rules indicate the Patent Office’s reasoning behind the rules and also set forth the rules themselves, and they allow for a comment period in which practitioners and other interested parties can provide comments on the proposed rules. Although this type of rulemaking does not necessarily require notice and comment period, so it'll be interesting to see how much the Patent Office responds to such comments. But after the comment period is over, the PTO can make a decision on whether to issue the new rules in the form that they're in or to make adjustments to those rules going forward to impact how practice before the PTAB will be done.
Andrew Zappia (05:29):
I noticed that in the notice they say that this is not “comment-based rulemaking”, but they're still inviting comments. I guess it's kind of an open question how they're going to deal with those comments, right?
Bryan Smith (05:41):
That's right.
Andrew Zappia (05:42):
If at all. In here, does the PTO explain why they're asking for new rules on this issue?
Bryan Smith (05:49):
Yes. The Patent Office gives a number of reasons why they're seeking to establish these new rules. As I mentioned previously, they want to focus IPR proceedings on patents that have not previously been litigated or where there was a litigation that was resolved early and therefore it did not reach a resolution on the validity of the patent claims. The PTO’s, really, overarching goal in this instance is to promote fairness, efficiency, and predictability in patent disputes.
Andrew Zappia (06:21):
Yeah, so I guess this kind of runs along the theme we've been seeing, and this is clearly true under the new director, that they don't like it when the same patents are before the PTAB or the board and the district court. It seems to me like they're setting up a lot of rules and procedures to say, look, pick your forum. You don't get both.
Bryan Smith (06:44):
That's right. This really goes to the discretionary denial question again, and the PTO is really looking into this. A lot of the rulemaking discusses the need to have reliability surrounding patents to encourage people to invest in those technologies once a patent's issued. The PTO is interested in providing reliable patent rights that encourage innovation and investment in technology. They noted the problem that if investors lack confidence in granted patents, they're unlikely to devote necessary resources to that patented technology.
Andrew Zappia (07:21):
They talk even about how it can destabilize the patent system, they even say that, right?
Bryan Smith (07:26):
Yes. Yeah, absolutely. The PTO noted that serial challenges create significant unreliability, and they talked about the inherent subjectivity of the invalidity analysis, which is particularly true under 103, and the issues regarding potential hindsight invading that analysis. The PTO is really concerned about subjecting patents serially to essentially de novo review on multiple occasions and the nature of the subjective analysis, increasing the likelihood that a patent will be invalidated. They talk about, they give a particular example of a patent where it's 70% of experienced practitioners might find that patent to be perfectly fine and valid, while 30% might disagree. If you subject that particular patent to multiple de novo reviews, the likelihood that it will eventually be found invalid significantly increases. They view this as a weakening of patent rights that’s a significant harm to technological innovation.
Andrew Zappia (08:36):
They even say it's the opposite of what Congress intended.
Bryan Smith (08:40):
Yes, that's correct. The Congress intended for the IPR proceeding to be an alternative to district court litigation, to limit costs to patent challengers and patent holders in resolving these issues. These serial challenges are viewed by the Patent Office as increasing costs, including costs to deal with the discretionary denial issues. They're looking to clarify that to avoid some of those costs. The Patent Office noted that there's a particular harm to small businesses, given the nature of patent infringement, and that large entities may be more willing to risk patent infringement with the view that they may be able to take several shots of the patent and obtain de novo review to eventually invalidate the patent. They see this as an opportunity to remedy this and hopefully drive technological innovation and fix licensing structures because entities won't take this opportunity to consistently challenge patents into account during those types of negotiations which they view as beneficial to the economy.
Andrew Zappia (09:54):
Then they offer a whole bunch of statistics to back up their position. What kind of stats do they put in there?
Bryan Smith (10:00):
The PTO noted that approximately 54% of all IPR petitions filed since the passage of the America Invents Act in 2013 are one of multiple petitions against the same patent. Since that time in 2013, the PTAB has tried to address these issues by issuing various precedential decisions, including the NHK Spring case you mentioned previously, and outlining factors for discretionary denial. However, it's had limited impact as since 2019, the percentage of IPRs that are won on multiple challenges is still at 45%. However, these statistics might be slightly skewed based on the word limits in IPRs because you might get multiple petitions against the same patent that are really covering different claims. So, there's a little bit of skew in those statistics, but it does show a significant problem. Also, the nearly 80% of IPRs have co-pending litigations, which is unsurprising because the fact that people are in district court and there's an issue of surrounding infringement really drives people back to the Patent Office to deal with IPRs.
Andrew Zappia (11:19):
We’ve seen that in some of our cases, Brian. We've had patents where there's three petitions against a patent just because the number of claims.
Bryan Smith (11:26):
Yeah, the numbers are a little bit skewed, but statistics do show that serial petitions are a problem for the Patent Office to deal with.
Andrew Zappia (11:34):
What does the PTO say would be the benefits of their new rules?
Bryan Smith (11:38):
The overarching theme of the new rules according to the PTO, is to enhance fairness, efficiency, and predictability of patent disputes. The PTO really wants to focus IPRs on cases where the patent has not previous been challenged been, or where the prior litigation was resolved in an early stage. So, cases where the other tribunal has not come to any validity determination. They really want to reduce litigation costs for parties, which was the congressional intent of IPRs to provide an alternative to litigation. This will also allow inter partes review proceedings to be more focused on the technical arguments and not have to deal as significantly with the discretionary denial issues. Particularly as you mentioned how under the new paradigm there's the bifurcated briefing where discretionary denial becomes somewhat of a sideshow to the actual challenge of the IPR, which is to determine the validity of a patent.
Andrew Zappia (12:42):
To me, I would think about is like a gating item. Basically. They're going to look at this first. They're not even going to reach the merits if they think you're raising the two arguments potentially in two places, they're just going to say no. That's my read on it.
Bryan Smith (12:55):
Yeah, I think that's correct. The PTO also noted another benefit, which a lot of I think practitioners will appreciate, is that keeping IPRs focused on the type of cases they want to look at will limit the overall number of IPRs and allow the administrative procedure judges who handle these types of cases for the PTAB to have more time to deal with some of their other obligations, which include ex parte appeals for matters being handled in the Patent Office, which have traditionally had a very long lag time in being heard. They view it as an opportunity to improve the overall patent system by allowing APJs to focus on those types of proceedings.
Andrew Zappia (13:42):
Yeah. Well, hey Brian, we've created all this suspense, but we haven't really said what the new rules are yet. Let's talk about that. What are these new proposed rules?
Bryan Smith (13:53):
Sure. So, the first proposal is to add a requirement that stipulations be filed in all IPR proceedings as well as any related proceeding that's ongoing regarding the patents, that the petitioner, as well as any real parties and interests and privies of the petitioner, will forego any 102, 103 arguments, the prior art based arguments that are available for IPRs in other venues. This had developed as a practice among IPR petitioners to deal with some of the discretionary denial issues, but this will create a rule that expressly requires those stipulations to be filed as a gatekeeper to the IPR.
Andrew Zappia (14:44):
Let me ask – something I noticed in the wording of this proposed rule. It doesn't say challenged claims, it says patent – which is interesting, right? Because normally you do a stipulation on the challenged claims. So, say a patent has 20 claims and only five are at issue in the district court, and maybe it's not full overlap with what you're challenging in the IPR. But it says patent in there, so it's broader than the traditional thinking. Also, it says 102 or 103, but there's certain arguments under 102 or 103 that you can't raise in an IPR for example. IPRs are limited to patents or printed publications. PGRs you can raise any argument, so you could read this as broader than the normal understanding, don't you think?
Bryan Smith (15:33):
Yeah, certainly. I think that was a problem that the PTO was directly trying to address, in that, kind of savvy petitioners, were trying to get around the stipulations they were filing by saving art that wasn't necessarily a patent or printed publication, so kind of industry art for a later challenge. This would definitely preclude that, so it's much broader than what had previously been done.
Andrew Zappia (16:00):
Yeah, like on sale, right? Because on sale is not something you could raise in an IPR, so you could keep that in your back pocket in district court, but this would potentially foreclose that.
Bryan Smith (16:11):
That's correct. It also is broad in that it extends to any dependent claims, and it applies to district court and the ITC. It's a very broad preclusion that must be now filed in a stipulation according to these rules if they are passed.
Andrew Zappia (16:27):
It's mandatory because – used to be, I used to call them Sotera stipulations, maybe they still call them that. It might change if this rule's allowed, but used to be your choice, whether you wanted to put one of those in. Now basically you're going to be compelled to do it.
Bryan Smith (16:41):
Absolutely. It would be mandatory. It's a required stipulation for efficiency is actually the title of the rule, so it would be a mandatory stipulation just to get in the door for an IPR proceeding.
Andrew Zappia (16:52):
Well, that's the first paragraph in here. What's the next one?
Bryan Smith (16:55):
The rest of the rulemaking precludes IPR challenges where the claims have been found valid in prior proceedings. If this is to avoid circumstances where the PTO views that the claims at issue or any dependent claims have been adequately evaluated by another tribunal, it's going to preclude access to IPR proceedings. It extends to various different procedures, and it can relate to a district court finding a validity or finding the claims not invalid after trial, or the district court finding the claims not invalid on summary judgment. It can also be related to ITC final or initial determinations, as well as PTAB final written decisions.
Also included are issues that have gone before the Federal Circuit where a claim was found unpatentable or invalid, and that decision was reversed. Interestingly, it can also apply to ex parte reexamination. If there's an office action issued in an ex parte re-exam indicating that the claim is valid, then that would preclude IPR. I think that one raises an interesting issue because in ex parte re-exam, there is the opportunity to amend. I think the argument would be there if a patent owner amends to get issuance in an ex parte re-exam, that that would not necessarily be the claim that was challenged, that that's a new claim. I think that's an open issue, but that'll be an interesting one, and I was somewhat surprised that they included that in a list of the prior validity proceedings that would impact the access to inter partes review.
Andrew Zappia (18:57):
So as I look at this, what they're basically saying is, with regard to particular claims, if some tribunal has looked at this and passed on them saying, these claims look valid to me, Federal Circuit, district court, ITC, re-exam, another panel at the PTAB – don’t come back to us for an IPR because someone's already looked at this, we're not looking twice.
Bryan Smith (19:21):
That's correct. They're really getting rid of the second bite of the apple. If you've received a validity determination, they want to establish that reliability and give patent owners some confidence that that claim will not subsequently be subject to another de novo review.
Andrew Zappia (19:37):
All right, but there's more, there's another paragraph in here, parallel litigation.
Bryan Smith (19:43):
Yes. There're also limiting inter partes review if it's more likely than not that certain validity determinations will be made before the inter partes review would reach a final written determination. If it's before the due date of the final written determination that you will receive verdict in a district court trial, or if an initial or final determination at the ITC or a PTAB final written decision on a parallel challenge, then any of those would preclude the institution of an IPR. It just has to be more likely than not that those things would occur before the final written decision of the subject inter partes review.
Andrew Zappia (20:31):
Right. This timing notion, ever since discretionary denial became a thing, this timing notion has been there, but it's been one of many factors. Now it's determinative, right? If you have a district court proceeding and there's a potential trial date, and that's before a final written decision deadline, basically that is now a basis for denial of institution.
Bryan Smith (20:54):
Yes, it's very expressed in the new rule that the inter partes review shall not be instituted if it's more likely than not, then one of those things will occur before your final written decision. It is definitely determinative now.
Andrew Zappia (21:06):
Then they do have a clause at the end for those who love filing IPRs and after reading this are super depressed, they have a little clause there that doesn't really make you feel any better. It's this extraordinary circumstances clause. What does that thing say?
Bryan Smith (21:22):
Yeah, I wouldn't get too excited about this extraordinary circumstances clause given how limited it is, but it gives some authority for the director to go outside of these rules and the panel can refer a decision to the director under these extraordinary circumstances, but it expressly defines the extraordinary circumstances as being limited to where the prior challenge was in bad faith or where there's a significant change in the law. It also includes a section that says what extraordinary circumstances are not, and I think that's even more important. It says it shall not include new or additional prior art, new expert testimony, new case law, except under the changes of law that were mentioned, and it does not include new legal argument or a prior challenger’s failure to appeal. I think the extraordinary circumstances are going to be very limited, and it'll be interesting to see what develops because I'm not exactly sure what kind of factors would go into making a determination that a prior challenge was in bad faith.
Andrew Zappia (22:32):
So basically, if there's a parallel proceeding where validity was challenged and the director determined that that challenge was done in bad faith and they give an example that you put it in just to stop someone from filing an IPR, that could be a basis or if there's a substantial change in law. Say there was some change in the standards for obviousness, like it's a different test than it used to be. That's the sort of thing.
Bryan Smith (22:57):
Yeah, which seems unlikely.
Andrew Zappia (22:58):
It's a very narrow path, pretty extraordinary. Then it says at the end there, except for what they expressly say, you still have to comply with the rest of the rule. This doesn't allow the director to not comply with the rest of the rule, except for the reasons set forth in that clause.
Bryan Smith (23:13):
Exactly. It also indicates that frivolous or abusive petitions under this paragraph may be appropriately sanctioned, including attorney speak, so. Something to keep an eye on.
Andrew Zappia (23:24):
You combine this with a settled expectation doctrine where basically if a patent's been around for a long time, has been challenged, that's another reason that you say no to a petition, right? So, you combine those things, it creates an interesting environment.
Bryan Smith (23:37):
Yeah. Patent filers should certainly be a little bit excited about this in that they're really trying to give reliability to the patent system and to drive investment in technological innovation.
Andrew Zappia (23:49):
As I look at it, there's a pro patent owner mindset here. I mean, they're saying, yes, you can challenge validity, but you can't do it in multiple forms. You can't do multiple tries, right? You have to pick your venue to make your arguments, and you can't double up. We see it a lot in litigation. There's the lawsuit and then the IPRs, and they're going in parallel and you see it all the time, right?
Bryan Smith (24:15):
Absolutely. This will certainly limit that.
Andrew Zappia (24:17):
Well, comments are due November 17. We're going to see, I'm sure quite a few of them, especially from the plaintiffs. I think the patent owners are going to like these rules. The plaintiffs are probably not going to like it as much because it limits the options to attack validity. Right? My guess is you'll see negative comments from more patent plaintiff-focused constituencies, and you'll see more positive comments from patent owner-focused constituencies. That'd be my guess.
Bryan Smith (24:45):
I agree completely.
Andrew Zappia (24:46):
Well, we'll see if they actually issue these rules and if they modify them, and we'll do another podcast when that day comes. Thanks, Bryan. I appreciate it. 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 and our series on Post-Grant Procedures, including on Apple, Google, Spotify. Thank you very much, and we'll see what happens with this new rule.
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