PublishedJune 30, 2025

The USPTO Acting Director Uses “Settled Expectations” to Violate the Rule of Law

The America Invents Act (AIA) created a system of “inter partes review” (IPR), which was intended to make it easier for alleged patent infringers to challenge the validity of patents they’re accused of infringing, by requesting review from the Patent Trial and Appeal Board (PTAB). Section 315(b) of the AIA provides that “[a]n inter partes review may not be instituted if the petition requesting the proceeding is filed more than 1 year after the date on which the petitioner, real party in interest, or privy of the petitioner is served with a complaint alleging infringement of the patent.” With respect to § 315(b), the 2011 Committee Report on the AIA stated that “[i]nter partes review must be sought by a party within 12 months of the date when the party is served with a complaint for infringement.” 

In the absence of litigation, the AIA imposes no deadline whatsoever. During the September 2011 debates, Senator Jon Kyl discussed why the House and Senate bill managers had agreed to a longer deadline than had originally passed the Senate, stating “it is important that the section 315(b) deadline afford defendants a reasonable opportunity to identify and understand the patent claims that are relevant to the litigation. It is thus appropriate to extend the section 315(b) deadline to one year.”

Yet the Acting Director of the USPTO, in a June 6th Director Discretionary Decision, has claimed that her discretion allows her to deny IPR to a party under section 315(b) simply because a petitioner “was aware of” the patent at issue earlier, and didn’t seek IPR at some prior date, such that “settled expectations favor denial of institution” of review.

That reasoning turns the law on its head. First, it contradicts the clear terms of the AIA, which explicitly allows applying for IPR up to one year after litigation is filed. Courts use standards called “canons of construction” to guide them in properly interpreting statutes according to principles of logic. For example, the Plain Meaning Rule provides that if a statute clearly permits something, it should not be read to foreclose that same thing. So, for example, if the AIA allows applying for IPR up to a year after litigation is filed, a party must be allowed to do so. Also, the Canon Against Surplusage provides that interpreters of statutes should not make clear permissions in statutes meaningless by interpreting them in ways that prevent the permission from being acted on. You see where this is going? A single sentence from an Acting Director’s discretionary decision violates a whole host of common-sense rules for statutory interpretation.

Second, the Acting Director’s reasoning rests a decision to deny IPR on a petitioner’s having become aware of the patent at some time prior. But all patents are made public, putting everyone in the world on constructive notice that every patent ever granted exists, such that the Acting Director’s flawed reasoning would wholly negate section 315(b), even in the face of unambiguous statutory history stating the time for seeking IPR must “afford defendants a reasonable opportunity to identify and understand the patent claims that are relevant to the litigation.” That can’t happen if IPR is denied prior to any litigation being filed.

Third, and more fundamentally, the Acting Director’s reasoning runs afoul of a seminal statement of the Father of the Constitution, James Madison, who wrote in Federalist Paper No. 62 that “It will be of little avail to the people, that the laws are made by men of their own choice, if the laws … undergo such incessant changes that no man, who knows what the law is to-day, can guess what it will be to-morrow. Law is defined to be a rule of action; but how can that be a rule, which is little known, and less fixed?” That is, the clear terms of a statute are supposed to constitute the very “settled expectations” the Acting Director has overturned with a discretionary decision. That isn’t “settling expectations.” It’s creating chaos.

Patents aren’t fixed in time. Once a patent is granted, it can be amended, transferred, narrowed, or otherwise altered in a variety of ways. The AIA’s establishment of the PTAB rests on that very logic. Not only is the Acting Director’s “settled expectations” decision nonsensical, worse than that, the application of her flawed logic in the future will deny PTAB review of invalid patents, to the detriment of innocent, productive companies which were granted the right by Congress under the AIA to have the PTAB rescind bogus patents asserted against them in litigation.

The Acting Director’s flawed reasoning also means that, since anyone can face a lawsuit for infringing a patent that might be invalid, every company should file for IPR right now regarding every patent that could possibly be asserted against them in litigation, in order to preserve their right to PTAB review that’s supposed to be guaranteed to them by statute until one year following the litigation. But good luck filing a PTAB challenge against all such patents because the same Acting Director could just as well make up another reason to discretionarily deny the applications––perhaps by saying there’s no prospect of an infringement suit involving the patents any time soon.

The Acting Director appears not to have read the governing statute. Nor does she appear to have read the Government Accountability Office’s May report, which indicated USPTO personnel at the management and supervisor levels are more concerned with patent output than patent quality—making the availability of PTAB review of invalid patents more urgent than ever.

In any case, the Acting Director can’t legitimately claim to be using her discretion when doing so violates the clear terms of a congressional statute. No government official has the discretion to violate the law.

Paul Taylor

Paul Taylor was counsel and chief counsel of the House Subcommittee on the Constitution, Civil Rights, and Civil Liberties, for over 20 years, where he shepherded dozens of bills through committee to be signed into law by presidents of both political parties. He was also counsel to the House Oversight Committee, where he handled constitutional and civil rights issues. He is the author of over a dozen law review articles on legal reform, continuity in government, religious liberty, congressional powers, and civil rights. He is an elected member of the American Law Institute (the first active congressional staff person elected to that body in its 98-year history), a 1991 graduate of Yale University (BA, summa cum laude), and a 1994 graduate of Harvard Law School (JD, cum laude).

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