[Federal Register Volume 90, Number 199 (Friday, October 17, 2025)]
[Proposed Rules]
[Pages 48335-48341]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-19580]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 90, No. 199 / Friday, October 17, 2025 /
Proposed Rules
[[Page 48335]]
DEPARTMENT OF COMMERCE
Patent and Trademark Office
37 CFR Part 42
[Docket No. PTO-P-2025-0025]
RIN 0651-AD89
Revision to Rules of Practice Before the Patent Trial and Appeal
Board
AGENCY: United States Patent and Trademark Office, Department of
Commerce.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The United States Patent and Trademark Office (USPTO or
Office) proposes modifications to the rules of practice for inter
partes review (IPR) before the Patent Trial and Appeal Board (PTAB or
Board) that the Under Secretary of Commerce for Intellectual Property
and Director of USPTO and, by delegation, the PTAB will use in
instituting IPR.
DATES: Comments must be received by November 17, 2025 to ensure
consideration. The Office does not anticipate granting an extension to
the comment period, absent extraordinary circumstances.
ADDRESSES: For reasons of Government efficiency, comments must be
submitted through the Federal eRulemaking Portal at: https://www.regulations.gov. To submit comments via the portal, one should
enter docket number PTO-P-2025-0025 on the homepage and select the
``Search'' button. The site will provide search results listing all
documents associated with this docket. Commenters can find a reference
to this notice and select the ``Comment'' button, complete the required
fields, and enter or attach their comments. Attachments to electronic
comments will be accepted in Adobe[supreg] portable document format
(PDF) or Microsoft Word[supreg] format. Because comments will be made
available for public inspection, information that the submitter does
not desire to make public, such as an address or phone number, should
not be included in the comments.
Visit the Federal eRulemaking Portal for additional instructions on
providing comments via the portal. If electronic submission of, or
access to, comments is not feasible due to a lack of access to a
computer and/or the internet, please contact the USPTO using the
contact information below for special instructions.
FOR FURTHER INFORMATION CONTACT: Sharon Israel, Vice Chief
Administrative Patent Judge, PTAB at 571-272-9797.
SUPPLEMENTARY INFORMATION:
Introduction
The Office is proposing new rules of practice before the PTAB to
focus inter partes review proceedings on patent claims that have not
previously been challenged in litigation or where prior litigation was
resolved at an early stage. This proposed rule is intended to promote
fairness, efficiency, and predictability in patent disputes.
Background
The USPTO is charged with promoting innovation through the issuance
of patents for new and useful inventions. U.S. Const., art. I, section
8. Invention and the issuance of a patent represent just the beginning
of the economic cycle of innovation. After an invention is conceived
and patented, substantial investment is necessary to bring a product or
service to market. Without this additional investment, the invention
may remain in the laboratory, never reaching the public as a commercial
product or service. Reliable patent rights encourage the inventor or
others to invest in the patented technology by giving them confidence
that they, not competitors, will reap the benefits of their efforts.
However, every party accused of infringing a patent receives a full
opportunity to challenge the validity of the patent in district court.
If investors lack confidence that a patent will be found valid when it
is enforced, the patent will not give them the assurances they need to
invest.
District court litigation is not the only forum for challenging
patent validity. In 2011, Congress passed the America Invents Act (AIA)
to ``provid[e] a quick and cost-effective alternative[ ]'' to district
court patent litigation, most notably through inter partes review (IPR)
proceedings. H.R. Rep. No. 112-98, at 48 (2011). IPR proceedings have
many advantages, but are not appropriate in every circumstance. When
IPR proceedings cover the same ground as district court litigation,
they cease to be an ``alternative'' and can substantially increase
litigation costs. That is the opposite of what Congress intended.
Serial or parallel IPR proceedings can also be wasteful, because they
consume Office and party resources re-litigating issues that the Office
is considering, has already considered, or that are being litigated
elsewhere, such as in district court or at the U.S. International Trade
Commission (ITC). Finally, multiple challenges to the same patent
through IPRs jeopardize the reliability of patent rights and incentives
to invest in new technologies. This proposed rule is intended to focus
IPR proceedings on the most appropriate disputes.
Even extremely strong patents become unreliable when subject to
serial or parallel validity challenges.
Determining whether a patent claim meets the statutory requirements
of patentability is frequently a matter of judgment about which
reasonable minds may disagree. For example, new technologies are often
complex. Both the prior art and claim language may be open to multiple
interpretations. The possibility of hindsight bias is also an ever-
present difficulty. Because reasonable minds may, and frequently do,
disagree about whether a particular patent claim meets the statutory
requirements, patents cannot serve their economic function if they are
perpetually subject to de novo review. Consider a hypothetical patent
claim where 70% of experienced patent practitioners would conclude that
the claim was properly granted, and 30% would oppose that conclusion.
Such a patent claim seems reliable, because a substantial majority of
practitioners believe it is patentable and was properly issued.
However, if the patent is subjected to repeated de novo patentability
review each time it is enforced, it will no longer be reliable. For
example, a patent with a 70% chance of surviving one de novo
patentability review has less than a 50% chance of withstanding two or
more de novo patentability challenges. Thus, even extremely strong
patents depend on a presumption of validity for their survival.
[[Page 48336]]
Congress gave the Director broad discretion to identify the
circumstances when IPR proceedings would or would not benefit the
patent system.
IPRs are a powerful tool for reassessing patent validity because
they subject the patent to essentially de novo review. In an IPR
proceeding, the petitioner needs to prove unpatentability by only a
preponderance of the evidence, which is the same standard the Office
used to grant the patent. 35 U.S.C. 316(e). However, when it passed the
AIA, Congress ``recognize[d] the importance of quiet title to patent
owners to ensure continued investment resources'' and did not want
``repeated litigation and administrative attacks on the validity of a
patent.'' H.R. Rep. No. 112-98, at 48 (2011). The AIA House Committee
report found that such repeated challenges ``would frustrate the
purpose of the'' AIA and could destabilize the patent system. Id. In
the Senate committee report, Senator Kyl, one of the bill's sponsors,
and others agreed. ``Whatever post grant system is ultimately devised,
at some point the patent should be final and the inventor should enjoy
the benefit of their invention without a cloud of uncertainty lingering
over it during the full life of the patent.'' S. Rep. No. 110-259 at
71. ``This uncertainty over the patent'' created by unlimited
challenges ``would limit the ability of inventors to attract capital
investment and further develop their innovation and bring it to the
marketplace.'' Id. at 72. Senator Kyl also emphasized that IPRs
``should generally serve as a complete substitute for at least some
phase of the litigation.'' Id.
To protect quiet title to patent rights necessary to drive
investment, Congress left in place the presumption of patent validity
in litigation in district court or at the ITC, and provided the
Director with broad discretion to determine when the strong medicine of
IPR proceedings would be appropriate. H.R. Rep. No. 112-98, at 48; see
35 U.S.C. 315(d), 316(b).
Serial and parallel validity challenges remain a significant
problem for the patent system.
Approximately 54% of all IPR petitions filed since the passage of
the AIA are one of multiple petitions against the same patent. To
address the risks from serial and parallel challenges, and from
challenges using substantially the same prior art and/or arguments
previously presented to the Office, the Office has designated a number
of PTAB decisions as precedential. See, e.g., Gen. Plastic Indus. Co.,
Ltd. v. Canon Kabushiki Kaisha, IPR2016-01357, Paper 19 (PTAB Sept. 6,
2017) (precedential as to section II.B.4.i) (serial petitions); Valve
Corp. v. Elec. Scripting Prods., Inc., IPR2019-00062, Paper 11 (PTAB
Apr. 2, 2019) (precedential) (serial petitions); Comcast Cable
Commc'ns, LLC v. Rovi Guides, Inc., IPR2019-00224, Paper 10 (PTAB Apr.
3, 2019) (parallel petitions); Apple v. Fintiv, IPR2020-00019, Paper 11
(PTAB Mar. 20, 2020) (precedential) (co-pending district court
litigation); Advanced Bionics, LLC v. MED-EL Elektromedizinische
Ger[auml]te GmbH, IPR2019-01469, Paper 6 (PTAB Feb. 13, 2020)
(precedential) (prior art considered during examination). Despite the
Office's efforts, serial and parallel patent challenges, including
challenges raising the same or substantially similar prior art and/or
arguments, remain a significant problem. For example, since 2019, the
percentage of petitions that are one of multiple challenges to the same
patent has declined, yet remains above 45%.
Additionally, more than 80% of IPRs have co-pending district court
litigation where the petitioner is also challenging patent validity.
Saurabh Vishnubhakat, Arti K. Rai & Jay P. Kesan, Strategic Decision
Making in Dual PTAB and District Court Proceedings, 31 Berkeley Tech.
L.J. 45 (2016) (available at: https://ssrn.com/abstract=2731002).
Therefore, even when a patent is challenged by only one IPR petition,
it will usually be challenged twice--once in the IPR and once in
district court or at the ITC. PTAB precedent stipulations not to pursue
invalidity challenges in district court or at the ITC based on an
invalidity ground that a petitioner raised or could have raised in an
IPR petition, and the AIA IPR estoppel provisions mitigate these
problems, but petitioners still frequently bring ``repetitive
challenges based on slightly rebranded evidence.'' Contour IP Holding
LLC v. GoPro Inc., No. 17-cv-04738, 2025 WL 1218748, at *13 (N.D. Cal.
Mar. 24, 2025); see, e.g., Motorola Sols. Inc. v. Stellar LLC, IPR2024-
01205, Paper 19 (PTAB Mar. 28, 2025) (Stewart, Acting Director). For
example, the district court's opinion in Contour catalogs a significant
number of cases in which petitioners brought patent challenges in
district court based on physical devices that are ``materially
identical'' to patents and printed publications. Contour IP Holding
LLC, 2025 WL 1218748, at *13.
The Office has also recently published additional information on
multiple petitions filed at the PTAB at https://www.uspto.gov/patents/ptab/statistics.
Moreover, district courts may stay litigation pending the outcome
of IPR proceedings. When the PTAB ultimately cancels all the claims
being litigated, this can improve litigation efficiency and provide a
quicker resolution, but when the patent owner prevails in the IPR, the
effect is the opposite, even if only some claims survive. Resolution of
the dispute is delayed by at least 18 months during the IPR
proceedings, and potentially longer if the stay remains in place
pending any appeal or remand.
Furthermore, the simplification of the district court case is often
limited because the petitioner rarely reduces the number of invalidity
theories it advances in district court. Most often, the petitioner
substitutes a new invalidity theory in district court for the ones it
may be estopped from raising in district court. For example, patent
challengers typically do not receive less summary judgment briefing or
trial time to address validity when there is a parallel IPR, and the
IPR is not likely to simplify expert discovery. Thus, an IPR proceeding
does not often materially reduce the resources necessary to resolve the
district court dispute. Additionally, 35 U.S.C. 315(e) provides for
estoppel following IPR only after the issuance of a final written
decision. Therefore, if the district court case is not stayed, the
defendant may raise any invalidity argument in district court while the
IPR is pending. In these circumstances, IPRs can add significant
expense and delay compared with standalone district court litigation.
These serial and parallel patentability challenges have undermined
the reliability of patent rights and deterred investment in new
technologies. See, e.g., Adam Mossoff, Uncertain Patent Rights and a
Weakening U.S. Innovation Economy, 11 LANDSLIDE 40 (Sept./Oct. 2018);
Kevin Madigan, An Ever-Weakening Patent System Is Threatening the
Future of American Innovation, Ctr. for Protection Intell. Prop. (Apr.
28, 2017); les Nouvelles Menno Treffers et al. Creating SEPs--A Risky
Business For SMEs (Sept. 2017). The weakening of patent rights caused
by these repeated patentability challenges presents a threat to
America's continued technological leadership. See Gupta et al.,
Protecting Intellectual Property for National Security, Center for
Strategic and International Studies (Mar. 25, 2025). Finally, there is
a bipartisan consensus that small and medium-sized businesses are
especially harmed by weakened patent rights because they are more
likely to rely on superior technology protected by patent rights to
challenge market incumbents. See National Economic Council, The
Economics of Investing in America (2023) at 12 (``The
[[Page 48337]]
evidence is clear that new small and medium-sized businesses are
drivers of innovation. Yet when a few firms (or one single firm)
dominate a market, they can stifle and stymie disruptive startups and
other new businesses.''); Kolev et al., Of Academics and Creative
Distruction: Starup Advantage in the Process of Innovation, National
Bureau of Economic Research at 5 (2022) (``We find strong evidence for
startup advantage in both average forward citations and the rate of
outlier patents (in the top 5% of the citation distribution),
supporting our first hypothesis. We also find that startup patents
score higher in terms of originality and generality relative to patents
from established firms.'').
By far, the most frequent users of IPR proceedings are large
technology companies. When a large company is free to copy a patented
invention because it believes it can invalidate the patent through
multiple validity challenges, the large company's other advantages,
such as superior brand recognition and manufacturing scale, will often
give it an edge over smaller competitors. Thus, weakened patent rights
can contribute to market concentration in innovative industries. See
Jonathan Barnett, Why Big Tech Likes Weak IP, Regulation (Spring 2021).
The proposed rule is intended to enhance fairness, efficiency, and
predictability in patent disputes.
Congress provided that the Director ``may not authorize an inter
partes review'' unless a petition meets a minimum ``[t]hreshold'' for
institution. 35 U.S.C. 314(a). Yet the same provisions provide the
Director broad discretion to decide not to proceed with institution,
even if a petition satisfies the minimum statutory threshold for
instituting an IPR. The AIA allocated expansive authority to the USPTO
to prescribe regulations governing AIA proceedings, including IPRs. 35
U.S.C. 316(a). Among other things, Congress instructed the Director to
provide regulations ``governing . . . the relationship of [inter
partes] review to other proceedings under this title.'' 35 U.S.C.
316(a)(4). Title 35 encompasses other challenges before the Office
(e.g., under Title 35 Chapters 30 (ex parte reexamination) 31 (inter
partes review), and 32 (post-grant review)), as well as parallel
district court infringement actions (i.e., under Title 35 Chapter 29).
See, e.g., 35 U.S.C. 281 (``A patentee shall have remedy by civil
action for infringement of his patent.''). In establishing these
regulations, the Director ``shall consider the effect of any such
regulation on the economy, the integrity of the patent system, the
efficient administration of the Office, and the ability of the Office
to timely complete proceedings instituted under this chapter.'' 35
U.S.C. 316(d). Separately, Sec. 315(d) provides that the Director may
determine the manner in which an IPR or other USPTO proceeding may
proceed during the pendency of an IPR involving the same patent,
including ``providing for stay, transfer, consolidations, or
termination of any such matter or proceeding.''
In addition to taking the steps discussed above to address
inappropriate uses of IPR proceedings, the Office has requested
comments on a wide variety of proposals to promote fairness and
efficiency in IPR proceedings. See, e.g., Request for Comments on
Discretion To Institute Trials Before the Patent Trial and Appeal
Board, 85 FR 66502 (Oct. 20, 2020); Changes Under Consideration to
Discretionary Institution Practices, Petition Word-Count Limits, and
Settlement Practices for America Invents Act Trial Proceedings Before
the Patent Trial and Appeal Board, 88 FR 24503 (Apr. 20, 2023); Patent
Trial and Appeal Board Rules of Practice for Briefing Discretionary
Denial Issues, and Rules for 325(d) Considerations, Instituting
Parallel and Serial Petitions, and Termination Due to Settlement
Agreement, 88 FR 28693 (Apr. 19, 2024). This proposed rule has both
similarities and differences with prior proposals and past practices.
Accordingly, the Office requests comments on this distinct proposed
rule.
The Office believes that this proposed rule will enhance fairness
and efficiency in patent disputes by focusing IPR proceedings on cases
where the patent has not previously been challenged in litigation or
where prior litigation was resolved via settlement at an early stage.
The Office expects that this proposed rule will have a positive
impact on the economy. First, as discussed above, the rule will
increase the reliability of patent rights and the predictability of
patent disputes. This will further innovation and economic growth. The
rule will also decrease overall expenditures of patent litigation and
the transaction costs for patent licensing. As previously discussed,
most IPRs have been one of multiple of petitions against the same
patent and a large majority of patents challenged in IPRs are also
being challenged in district court or at the ITC. This proposed rule
will reduce litigation costs by foreclosing most IPR challenges where
patent validity has already been tested during examination at the USPTO
and at least once in another proceeding (e.g., at the USPTO, in
district court, or at the ITC). Similarly, the proposed rule will also
reduce costs by requiring a stipulation by the petitioner regarding
litigation issue overlap. Patent owners often spend substantial funds
defending their rights against multiple or duplicative challenges,
which would be avoided under the proposed rule. Patent challengers also
expend significant resources raising such challenges, which would also
be avoided. Patent challengers find that this expenditure serves their
private interests, because the possibility of patent invalidation
reduces the risk that the challenger will be compelled to compensate a
patent owner for infringement and may reduce amounts patent owners
accept in license fees. The risk-adjusted amounts a petitioner may
avoid in licensing fees or litigation judgments may exceed the costs a
petitioner expends when filing an IPR, thus making the IPR economically
rational from the perspective of the petitioner.
However, the licensing fees or judgments that a patent challenger
may avoid paying are reduced compensation for innovators whose patent
claims have already been adequately tested. This reduced compensation
for patent owners harms the broader public interest in incentivizing
innovation and investment in the commercialization of new technologies.
Additionally, allowing multiple, often duplicative, patentability
challenges against the same patent can reduce competition in the
economy by allowing market incumbents to copy the innovations of
smaller rivals and maintain their dominant market positions. Michel &
Dowd, Patent Protection: A crucial Antitrust Tool for Increasing
Innovation, Competition Policy International, TechREG Chronicle (Sept.
2024) (``[E]ven after the innovation is created and disclosed in a
patent, IP rights enable SMEs to grow into larger, more integrated
companies with commercialization and/or manufacturing capabilities. . .
. [L]arger firms tend to have lower-cost access to non-patent
mechanisms for extracting returns from innovations. . . . [They] can
rely on their market dominance and vertically integrated structures to
ensure reasonable financial returns on their R&D efforts. . . .
Reliable patent protection can allow startups to enter markets and
disrupt entrenched firms.''). It is well-established that increased
market concentration and reduced competition stifle economic growth.
[[Page 48338]]
The Office also believes that the proposed rule will promote
consistency across IPR proceedings, which is vital to the ``integrity
of the patent system.'' 35 U.S.C. 316(b). The proposed rule draws
clearer lines around the circumstances when IPRs should or should not
be instituted, thus enabling PTAB panels to render more consistent
decisions. By limiting the circumstances in which a district court and
the PTAB will consider the same or closely related issues, the proposed
rule also reduces the risk of the Office and a district court rendering
inconsistent decisions.
Clearer lines will also help parties determine before filing an IPR
petition whether the petition is likely to be granted, thus enabling
them to focus their briefing on the patentability of the challenged
claims, rather than the Director's discretion to institute. This will
also improve the reliability of patents by focusing the Office's
efforts on the technical merits of disputes.
Finally, in addition to IPR proceedings, the PTAB also handles ex
parte appeals from examination and post-grant reviews. The time
administrative patent judges (APJs) spend dealing with IPRs reduces an
APJ's ability and time to address ex parte appeals and vice versa. The
Office must balance the potential benefits of IPR proceedings to the
patent system with the costs of taking resources from ex parte appeals.
For example, delayed resolution of ex parte appeals can prevent or
delay business formation or capital raising which, in turn, delays
releasing or launching patented technologies to market. Reducing the
time APJs have to consider ex parte appeals increases the risk that the
Office will allow unpatentable claims or reject patentable ones. For
several years, ex parte appeal pendency has been well-above the
Office's pendency goals. The Office believes it is appropriate to focus
APJ time on ex parte appeals, because that is the sole forum for
reviewing whether patent application claims should issue, or whether
patent claims should be confirmed in ex parte reexamination
proceedings. Applicants appealing an examiner decision must have their
case heard by the PTAB in order to either receive their patent or seek
judicial review of the Office's rejection. 35 U.S.C. 134(a), 141(a). By
contrast, IPRs are not the only mechanism for challenging the validity
of an issued patent. In most instances, IPR petitioners are already
challenging patent validity in district court litigation. If they are
not already in the process of litigating, they could initiate district
court litigation challenging patent validity without any action by the
Office. 28 U.S.C. 2201. Patent challengers also have the ability to
raise a patentability challenge by filing an ex parte reexamination
request, which patent examiners handle in the first instance. By
focusing IPRs on patents that have not already been tested in
litigation or other Office proceedings, the proposed rule will help
ensure that sufficient APJs are available for its essential ex parte
appeal mission.
The Office invites comments from the public on whether this
proposed rule strikes the appropriate balance between efficiency,
fairness, and stability in the patent system.
Discussion of Proposed Changes
In this section, the Office describes the proposed changes to
specific sections in 37 CFR part 42. Each subsection describes a
related group of regulatory changes. The Office solicits comments
supporting, opposing, or suggesting modifications on each specific
proposed change.
Sec. 42.108 Institution of Inter Partes Review
Section 42.108(d): Required stipulation for efficiency. Under the
proposed revisions, this section would provide that the Office will not
institute an IPR when a petitioner intends to pursue invalidity
challenges under Sec. Sec. 102 or 103 in other venues, such as
district court or the U.S. International Trade Commission. This
proposed section would further require the Petitioner to file the
stipulation in any other venue where it is litigating with the patent
owner. The Office's view is that this requirement would promote
fairness and efficiency by channeling similar patent challenges to a
single forum and ensure that IPRs ``should generally serve as a
complete substitute for at least some phase of the litigation.'' S.
Rep. No. 110-259 at 72.
Section 42.108(e): Claims found valid in prior proceedings. This
proposed section addresses circumstances in which institution of an IPR
proceeding may be unwarranted, because the claim (or an independent
claim from which it depends) has already been adequately reviewed
through both examination at the USPTO and in another proceeding before
a district court, the USPTO, or the U.S. International Trade
Commission. The rule would extend to dependent claims where the
independent claim on which each depends has already received scrutiny,
because if an independent claim satisfies Sec. Sec. 102 and 103, each
dependent claim necessarily does as well. Proposed subparagraphs (1)
and (2) provide circumstances in which an IPR may not be instituted
because the claims were previously found not invalid by a district
court. Proposed subparagraph (3) provides circumstances in which an IPR
may not be instituted because the claims were previously found not
invalid by the U.S. International Trade Commission. Proposed
subparagraphs (4) and (5) provide circumstances in which an IPR may not
be instituted because the claims were previously found patentable or
not unpatentable by the USPTO in an IPR, post-grant review, or
reexamination proceeding. Proposed subparagraph (6) provides the
circumstances in which an IPR may not be instituted because the Federal
Circuit reversed a decision finding the claims invalid or unpatentable.
In the circumstances described in this paragraph, the USPTO believes
that the claims at issue have received adequate scrutiny in a prior
proceeding and it is not in the interests of the patent system or the
economy for the USPTO to conduct another review of the claims. Any
parties accused of infringing the claims would have a full opportunity
to challenge validity again in district court.
Section 42.108(f): Parallel Litigation. This proposed section
addresses circumstances in which a parallel proceeding is likely to
reach a decision regarding the validity of the patent under Sec. Sec.
102 or 103 before the final written decision.
Section 42.108(g): Institution in extraordinary circumstances. This
proposed section would allow institution, notwithstanding paragraphs
(d), (e), or (f), based on extraordinary circumstances. To ensure the
predictability of institution decisions, this proposed section
identifies specific examples of potential extraordinary circumstances
and examples of circumstances that are not extraordinary.
Rulemaking Considerations
A. Administrative Procedure Act: The changes proposed by this
rulemaking involve rules of agency practice and procedure, and/or
interpretive rules, and do not require notice-and-comment rulemaking.
See Perez v. Mortg. Bankers Ass'n, 575 U.S. 92, 97, 101 (2015)
(explaining that interpretive rules ``advise the public of the agency's
construction of the statutes and rules which it administers'' and do
not require notice and comment when issued or amended); Cooper Techs.
Co. v. Dudas, 536 F.3d 1330, 1336-37 (Fed. Cir. 2008) (stating that 5
U.S.C. 553, and thus 35 U.S.C. 2(b)(2)(B), do not require notice-and-
comment rulemaking for ``interpretative rules, general statements of
policy, or rules of agency
[[Page 48339]]
organization, procedure, or practice''); In re Chestek PLLC, 92 F.4th
1105, 1110 (Fed. Cir. 2024) (noting that rule changes that ``do[ ] not
alter the substantive standards by which the USPTO evaluates trademark
applications'' are procedural in nature and, thus, ``exempted from
notice-and-comment rulemaking''); and JEM Broadcasting Co. v. F.C.C.,
22 F.3d 320, 328 (D.C. Cir. 1994) (``[T]he `critical feature' of the
procedural exception [in 5 U.S.C. 553(b)(A)] `is that it covers agency
actions that do not themselves alter the rights or interests of
parties, although [they] may alter the manner in which the parties
present themselves or their viewpoints to the agency.' '' (quoting
Batterton v. Marshall, 648 F.2d 694, 707 (D.C. Cir. 1980))).
B. Regulatory Flexibility Act: As prior notice and an opportunity
for public comment are not required pursuant to 5 U.S.C. 553 or any
other law, neither a Regulatory Flexibility Act analysis nor a
certification under the Regulatory Flexibility Act (5 U.S.C. 601 et
seq.) is required. See 5 U.S.C. 603. Nonetheless, for the reasons set
forth below, the Senior Counsel for Regulatory and Legislative Affairs,
Office of General Law, USPTO, has certified to the Chief Counsel for
Advocacy of the Small Business Administration that changes set forth in
this notice of proposed rulemaking (``proposed rule'') would not have a
significant economic impact on a substantial number of small entities.
The changes in this proposed rule would modify the rules of practice
before the Patent Trial and Appeal Board (Board) to focus inter partes
review (IPR) proceedings on patent claims that have not previously been
challenged in litigation or where prior litigation was resolved at an
early stage. The USPTO does not collect or maintain statistics on the
size status of IPR petitioners or patent owners whose patents are being
challenged in an IPR proceeding, which would be required to determine
the number of small entities that will be affected by the rule.
However, in a study on patent litigation and USPTO trials, the USPTO
found that roughly 30% of the patents challenged in an IPR proceeding
were granted to owners who were small entities.\1\ The study did not
specifically address the percentage of petitioners to an IPR proceeding
that were small entities. But, using the average overall percentage of
patent applicants that file as a small (or micro) entity, which is
approximately 25%, the USPTO estimates that the percentage of small
entities filing petitions is lower than the percentage of small
entities whose patents are currently subject to challenge in an IPR.
Accordingly, this proposed rule would likely benefit a greater
percentage of small entities in the IPR framework. The changes made by
this rulemaking are largely procedural as they address the
circumstances when the Board will institute an IPR proceeding, and the
only new requirement being imposed on impacted entities is the
submission of a stipulation by IPR petitioners, which results in only
minimal additional cost burden. The USPTO estimates that the overall
impact to all impacted small entities would be a net reduction in their
overall litigation costs as a result of limiting the avenues for serial
and parallel patentability challenges. For the foregoing reasons, the
changes in this proposed rule will not have a significant economic
impact on a substantial number of small entities.
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\1\ U.S. Pat. and Trademark Off., Patent Litigation and USPTO
Trials: Implications for Patent Examination and Quality 36 (January
2015).
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C. Executive Order 12866 (Regulatory Planning and Review): This
rulemaking been determined to be not significant under Executive Order
12866 (Sept. 30, 1993).
D. Executive Order 13563 (Improving Regulation and Regulatory
Review): The Office has complied with Executive Order 13563 (Jan. 18,
2011). Specifically, and as discussed above, the Office has, to the
extent feasible and applicable: (1) made a reasoned determination that
the benefits justify the costs of the rule; (2) tailored the rule to
impose the least burden on society consistent with obtaining the
regulatory objectives; (3) selected a regulatory approach that
maximizes net benefits; (4) specified performance objectives; (5)
identified and assessed available alternatives; (6) involved the public
in an open exchange of information and perspectives among experts in
relevant disciplines, affected stakeholders in the private sector, and
the public as a whole, and provided online access to the rulemaking
docket; (7) attempted to promote coordination, simplification, and
harmonization across Government agencies and identified goals designed
to promote innovation; (8) considered approaches that reduce burdens
and maintain flexibility and freedom of choice for the public; and (9)
ensured the objectivity of scientific and technological information and
processes.
E. Executive Order 14192 (Deregulation): This regulation is not an
Executive Order 14192 regulatory action because it has been determined
to be not significant under Executive Order 12866.
E. Executive Order 13132 (Federalism): This rulemaking pertains
strictly to federal agency procedures and does not contain policies
with federalism implications sufficient to warrant preparation of a
Federalism Assessment under Executive Order 13132 (Aug. 4, 1999).
F. Executive Order 13175 (Tribal Consultation): This rulemaking
will not: (1) have substantial direct effects on one or more Indian
tribes, (2) impose substantial direct compliance costs on Indian tribal
governments, or (3) preempt tribal law. Therefore, a tribal summary
impact statement is not required under Executive Order 13175 (Nov. 6,
2000).
G. Executive Order 13211 (Energy Effects): This rulemaking is not a
significant energy action under Executive Order 13211 because this
rulemaking is not likely to have a significant adverse effect on the
supply, distribution, or use of energy. Therefore, a Statement of
Energy Effects is not required under Executive Order 13211 (May 18,
2001).
H. Executive Order 12988 (Civil Justice Reform): This rulemaking
meets applicable standards to minimize litigation, eliminate ambiguity,
and reduce burden as set forth in sections 3(a) and 3(b)(2) of
Executive Order 12988 (Feb. 5, 1996).
I. Executive Order 13045 (Protection of Children): This rulemaking
does not concern an environmental risk to health or safety that may
disproportionately affect children under Executive Order 13045 (Apr.
21, 1997).
J. Executive Order 12630 (Taking of Private Property): This
rulemaking will not affect a taking of private property or otherwise
have taking implications under Executive Order 12630 (Mar. 15, 1988).
K. Congressional Review Act: Under the Congressional Review Act
provisions of the Small Business Regulatory Enforcement Fairness Act of
1996 (5 U.S.C. 801 et seq.), prior to issuing any final rule, the USPTO
will submit a report containing the final rule and other required
information to the United States Senate, the United States House of
Representatives, and the Comptroller General of the Government
Accountability Office. The changes in this NPRM are not expected to
result in an annual effect on the economy of $100 million or more; a
major increase in costs or prices; or significant adverse effects on
competition, employment, investment, productivity, innovation, or the
ability of United States-based enterprises to compete with foreign-
based enterprises in domestic and export markets. Therefore, this
[[Page 48340]]
rulemaking is not a ``major rule'' as defined in 5 U.S.C. 804(2).
L. Unfunded Mandates Reform Act of 1995: The changes set forth in
this NPRM do not involve a Federal intergovernmental mandate that will
result in the expenditure by State, local, and tribal governments, in
the aggregate, of $100 million (as adjusted) or more in any one year,
or a Federal private sector mandate that will result in the expenditure
by the private sector of $100 million (as adjusted) or more in any one
year, and will not significantly or uniquely affect small governments.
Therefore, no actions are necessary under the provisions of the
Unfunded Mandates Reform Act of 1995. See 2 U.S.C. 1501 et seq.
M. National Environmental Policy Act of 1969: This rulemaking will
not have any effect on the quality of the environment and is thus
categorically excluded from review under the National Environmental
Policy Act of 1969. See 42 U.S.C. 4321 et seq.
N. National Technology Transfer and Advancement Act of 1995: The
requirements of section 12(d) of the National Technology Transfer and
Advancement Act of 1995 (15 U.S.C. 272 note) are not applicable because
this rulemaking does not contain provisions that involve the use of
technical standards.
O. Paperwork Reduction Act of 1995: The Paperwork Reduction Act of
1995 (44 U.S.C. 3501 et seq.) (PRA) requires that the USPTO consider
the impact of paperwork and other information collection burdens
imposed on the public. This rulemaking proposes changes to the PTAB
rules of practice for Inter Partes Review (IPR) which would result in
new information collection requirements that are subject to review and
approval by OMB. The provisions pertaining to IPRs have been reviewed
and previously approved by OMB under control number 0651-0069 (Patent
Review and Derivation Proceedings). This proposed rule modifies the
rule of practice for IPR to provide that an inter partes review would
not be instituted or maintained unless each petitioner files a
stipulation with the Board stating that if a trial is instituted, the
petitioner and any real party in interest or privy of the petitioner
will not raise grounds of invalidity or unpatentability with respect to
the challenged patent under 35 U.S.C. 102 or 103 in any other
proceeding.
This proposed rule would impact the burden estimates provided in
the information collection for the item ``Petitions for Inter Partes
Review.'' The USPTO currently estimates that 1,300 petitions are
submitted annually and 120 hours are needed to file each petition. The
USPTO is proposing to add one hour to the estimated time to file to
account for the preparation and submission of the stipulation proposed
in this rule, thus increasing the time estimate for this petition to
121 hours. Therefore, the USPTO calculates that this information
collection's estimated annual burden will increase by 1,300 hours and
$581,100 in hourly cost. This rulemaking does not change any fees
associated with filing an IPR, and therefore there is no change to the
estimated annual non-hourly cost burden in this information collection.
A summary of the proposed revisions to the information collection
follows.
As required by the PRA, the USPTO has submitted this proposed
revision to the information collection to OMB for its review.
Burden Data for the Petition for Inter Partes Review
Provided below is a summary of the current estimates and proposed
revisions to the burden data for Petition for Inter Partes Review.
Current Estimates
Estimated Number of Annual Responses: 1,300.
Estimated Time for Response: 120 hours.
Estimated Annual Respondent Burden Hours: 156,000.
Estimated Hourly Cost Burden Rate: \2\ $447.
---------------------------------------------------------------------------
\2\ 2023 Report of the Economic Survey, published by the
Committee on Economics of Legal Practice of the American
Intellectual Property Law Association; pg. F-41. The USPTO uses the
average billing rate for intellectual property work in all firms
which is $447 per hour (https://www.aipla.org/home/news-publications/economic-survey).
---------------------------------------------------------------------------
Estimated Annual Respondent Hourly Cost Burden: $69,732,000.
Proposed Revisions
Estimated Number of Annual Responses: 1,300.
Estimated Time for Response: 121 hours.
Estimated Annual Respondent Burden Hours: 157,300.
Estimated Hourly Cost Burden Rate: \3\ $447.
---------------------------------------------------------------------------
\3\ Ibid.
---------------------------------------------------------------------------
Estimated Annual Respondent Hourly Cost Burden: $70,313,100.
As a result of this proposed rule, the annual respondent burden
hours for the Petition for Inter Partes Review will increase by 1,300
hours from 156,000 hours to 157,300 hours. Likewise, the non-hourly
cost burden will also increase by $581,100 from $69,732,000 to
$70,313,100.
Proposed Total Burden Data for the Information Collection
OMB Control Number: 0651-0069.
Title of Collection: Patent Review and Derivation Proceedings.
Type of Review: Revision of a currently approved information
collection.
Summary: This collection covers information submitted by the public
to petition the Board to initiate an inter partes review, post-grant
review, derivation proceeding, and the transitional program for covered
business method patents, as well as any responses to such petitions,
and the filing of any motions, replies, oppositions, and other actions,
after a review/proceeding has been instituted.
Method of Collection: Applicants must submit the information
electronically using Patent Trial and Appeal Case Tracking System
filing system. Parties may seek authorization to submit a filing by
means other than electronic filing pursuant to 42 CFR 42.6(b)(2).
Forms: None.
Affected Public: Private sector.
Respondent's Obligation: Required to obtain or retain benefits.
Frequency: On occasion.
Estimated Number of Annual Respondents: 7,897 respondents.
Estimated Number of Annual Responses: 11,947 responses.
Estimated Time per Response: The USPTO estimates that the responses
in this information collection will take the public approximately 18
minutes (0.3 hours) to 170 hours to complete. This includes the time to
gather the necessary information, create the document, and submit the
completed item to the USPTO.
Estimated Total Annual Respondent Burden Hours: 591,930 hours.
Estimated Total Annual Respondent Hourly Cost Burden: $264,592,710.
Estimated Total Annual Respondent Non-Hourly Cost Burden:
$76,099,956. There are no capital start-up costs, maintenance costs,
recordkeeping costs, or postage costs associated with this information
collection. However, the USPTO estimates that the total annual non-
hourly cost burden for this information collection, in the form of
filing fees, is $76,099,956.
The USPTO is soliciting public comments to:
(a) Evaluate whether the collection of information is necessary for
the proper performance of the functions of the agency, including
whether the information will have practical utility;
[[Page 48341]]
(b) Evaluate the accuracy of the agency's estimate of the burden of
the collection of information, including the validity of the
methodology and assumptions used;
(c) Enhance the quality, utility, and clarity of the information to
be collected; and
(d) Minimize the burden of the collection of information on those
who are to respond, including through the use of appropriate automated,
electronic, mechanical, or other technological collection techniques or
other forms of information technology (e.g., permitting electronic
submission of responses).
Please submit comments on the new collection of information
requirements at: www.reginfo.gov/public/do/PRAMain. Find this
particular information collection by selecting ``Currently under
Review'' or by using the search function and entering the title of the
collection. Please send a copy of your comments to the USPTO using the
method described under ADDRESSES at the beginning of this document. All
comments submitted in response to this proposed rule are a matter of
public record. The USPTO will include or summarize the comments
received in the request to the OMB to approve the new information
collection requirements.
Notwithstanding any other provision of law, no person is required
to respond to, nor shall any person be subject to a penalty for failure
to comply with a collection of information subject to the requirements
of the PRA unless that collection of information displays a currently
valid OMB control number.
P. E-Government Act Compliance: The USPTO is committed to
compliance with the E-Government Act to promote the use of the internet
and other information technologies, to provide increased opportunities
for citizen access to Government information and services, and for
other purposes.
List of Subjects in 37 CFR Part 42
Administrative practice and procedure, Inventions and patents,
Lawyers.
For the reasons set forth in the preamble, the Office proposes to
amend 37 CFR part 42 as follows:
PART 42--TRIAL PRACTICE BEFORE THE PATENT TRIAL AND APPEAL BOARD
0
1. The authority citation for 37 CFR part 42 continues to read as
follows:
Authority: 35 U.S.C. 2(b)(2), 3, 6, 21, 23, 41, 134, 135, 143,
153, 311, 312, 314, 316, 318, 321-326, 328; Pub. L. 112-29, 125
Stat. 284; and Pub. L. 112-274, 126 Stat. 2456.
* * * * *
0
2. Amend Sec. 42.108 by adding paragraphs (d) through (e) to read as
follows:
Sec. 42.108 Institution of inter partes review.
* * * * *
(d) Required stipulation for efficiency. Inter partes review shall
not be instituted or maintained unless each petitioner files a
stipulation with the Board and any other tribunal where it is
litigating or later litigates regarding the challenged patent, stating
that if a trial is instituted, the petitioner and any real party in
interest or privy of the petitioner will not raise grounds of
invalidity or unpatentability with respect to the challenged patent
under 35 U.S.C. 102 or 103 in any other proceeding.
(e) Claims found valid in prior proceedings. Inter partes review
shall not be instituted or maintained if a challenged claim or an
independent claim from which a challenged claim depends:
(1) U.S. District Court Trial--Was found not invalid under 35
U.S.C. 102 or 103 by a district court or jury following a bench trial
or jury trial in a decision or verdict that has not been vacated or
reversed in relevant part;
(2) U.S. District Court Summary Judgment--Was found not invalid by
a district court in a summary judgement decision finding no dispute of
material fact under 35 U.S.C. 102 or 103 that has not been vacated or
reversed in relevant part;
(3) U.S. International Trade Commission--Was found not invalid
under 35 U.S.C. 102 or 103 in initial or final determination of the
U.S. International Trade Commission that has not been vacated or
reversed in relevant part;
(4) PTAB Final Written Decision--Was found not unpatentable in a
final written decision of the Board under 35 U.S.C. 318(a) or 328(a)
that has not been vacated or reversed;
(5) Ex Parte Reexamination--Was found patentable in an office
action or decision by the Board following a reexamination request filed
under Chapter 30 of Title 35 United States Code by someone other than
the patent owner, the patent owner's real party in interest or privy;
or
(6) Federal Circuit--Was found unpatentable or invalid under 35
U.S.C. 102 or 103 in a decision, but that decision was reversed in
relevant part by the U.S. Court of Appeals for the Federal Circuit.
(f) Parallel Litigation--Inter partes review shall not be
instituted or maintained if, more likely than not, any of the following
will occur, with respect to a challenged claim or an independent claim
from which a challenged claim depends, before the due date for the
final written decision pursuant to 35 U.S.C. 316(a)(11):
(1) U.S. District Court--A district court trial in which a party
challenges the patent under 35 U.S.C. 102 or 103;
(2) U.S. International Trade Commission--an initial or final
determination of the U.S. International Trade Commission with respect
to 35 U.S.C. 102 or 103; or
(3) PTAB Final Written Decision--issuance of a final written
decision by the Board under 35 U.S.C. 318(a) or 328(a).
(g) Institution in extraordinary circumstances. If a panel of the
Board determines that extraordinary circumstances warrant institution
notwithstanding paragraphs (d), (e), or (f) the Panel shall refer to
matter to the Director who may personally institute inter partes
review. Extraordinary circumstances may include a determination by the
Director that the prior challenge barring institution was initiated in
bad faith, e.g., for the purpose of preventing future challenges, or
that the prior challenge is rendered irrelevant in view of a
substantial change in a statute or precedent of the Supreme Court of
the United States. Unusual and extraordinary circumstances shall not
include new or additional prior art, new expert testimony, new caselaw
(except as provided above) or new legal argument, or a prior
challenger's failure to appeal. Neither the Director nor the Board
shall waive the requirements of paragraphs (d), (e), or (f) of this
section except as provided in this paragraph. Frivolous or abusive
petitions under this paragraph may be appropriately sanctioned,
including with an award of attorneys' fees.
John A. Squires,
Under Secretary of Commerce for Intellectual Property and Director of
the United States Patent and Trademark Office.
[FR Doc. 2025-19580 Filed 10-16-25; 8:45 am]
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