USPTO Substantially Revises PTAB Standard Operating Procedures

By Gene Quinn
September 20, 2018

Director Iancu, and his successors, now have the power to truly create uniform, all-Office policy that will not only need to be followed by patent examiners, but must also be followed by the PTAB.

USPTO Director Andrei Iancu. August 27, 2018.

USPTO Director Andrei Iancu. August 27, 2018.

The issue of uniformity within the United States Patent and Trademark Office (USPTO), and having the Patent Trial and Appeal Board (PTAB) follow Office guidance, was raised by Bernie Knight, former General Counsel at the USPTO and current PPAC member, at the last Patent Public Advisory Committee meeting in August. Director Iancu answered Knight with a smile: “Let me just state the obvious: We are one agency.” At that time I wrote: “[I]f Director Iancu can truly get the USPTO to operate as one agency on the same page that would be a tremendous legacy.” It would appear that USPTO Director Iancu has come up with a process to deliver on his often stated desire for uniformity, predictability, and for the Office to be united — including the PTAB.

Earlier today the USPTO announced the substantial revision of Standard Operating Procedures (“SOPs”) for the paneling of matters before the PTAB (SOP1) and precedential and informative decisions (SOP2). The revisions deliver upon the repeated promises of USPTO Director Andrei Iancu to increase transparency, predictability, and reliability across the USPTO. These new SOPs update the procedures based upon feedback the Office received from stakeholders, courts, legislators, and six years of experience with AIA trial proceedings.

These new SOPs are a major change to how PTAB panels will be comprised, and how precedential opinions will be designated. Given Director Iancu’s speeches, actions and apparent desire to have a more patent owner and innovator friendly Patent Office, these revisions will likely be game changing.

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SOP1: Assigning PTAB Panels

Revised SOP1 explains the new procedures for panel assignment and for informing parties regarding panel changes. It also explains the process for designating panels with more than three judges, and notes that such panels should be rare and will only occur with the approval of the Director. “An expanded panel is not favored and ordinarily will not be used.” SOP1(III)(M).

SOP1 also puts an end to the practice of expanding PTAB panels without notice to the parties or the public, what we have referred to as phantom expanded panels.  SOP1(III)(M)(7)(a) reads:

If an expanded panel is approved, Designee(s) will instruct a trial paralegal to enter an order (“Panel Change Order”) of the Chief Judge or the Deputy Chief Judge into the record notifying the parties of the panel change. The Order will identify the expanded panel. Appendix 2 to this SOP provides the form of the Panel Change Order for expanded panels.

Further, SOP1 also addresses the random changing of panels after the entry of a decision. SOP1(III)(M)(8) reads:

When an expanded panel is designated (1) after entry of a decision by a panel and (2) to consider a request for rehearing of the decision of the panel, the judges on the initial panel shall, if available, be designated as part of the expanded panel. The expanded panel shall decide the rehearing on its merits.

SOP1(III)(B) also addresses the important issue of conflicts of interest. Over the last six years there have been instances when Administrative Patent Judges (APJs) of the PTAB have decided cases dealing with former litigation clients, which for a lawyer would present an unimaginable conflict of interest that would lead to disciplinary sanctions. The PTAB does not, however, have any specific Code of Conduct that applies to APJs that is akin to the Judicial Code of Conduct that applies to federal judges. Of course, APJs on the PTAB are lawyers and as such are not absolved of their ethical obligations as lawyers. Unfortunately, that did not prevent one APJ from hearing and deciding 25 post grant challenges where his former litigation client was the petitioner.

SOP1(III)(B) instructs APJs on the PTAB to avoid conflict of interest. This is accomplished by requiring each APJ to provide a full list of conflicts, requiring that conflicts list to be updated as necessary, and preventing the paneling of an APJ “on any case having a conflict.” Of course, the ultimate responsibility is with the APJ. “Each judge is responsible ultimately for avoiding a conflict, and informing the designee(s) that re-paneling may be needed upon becoming aware of a conflict in a particular case.” SOP1(III)(B)(4).

SOP1(III)(L) also addresses the issue of panel changes after a panel has appeared and taken jurisdiction of a case, which has become a concerning issue in several cases. “For all proceedings in which the panel has appeared (e.g., in a decision or hearing), panel changes are disfavored.” SOP1(III)(L)(3). The rules do, however, take into account the necessity for recusal should a conflict become apparent, gives the PTAB the authority to reassign APJs to meet deadlines, and recognizes that judges may be unavailable for a variety of reasons including maternity leave, paternity leave, sick leave, or retirement. SOP1(III)(L)(1).

SOP1 also requires the panel assigned  to explain why one judge has been changed in the event a change must be made. SOP1 (L)(4)(a). This simple procedure is customary in virtually every court in the country, but has not previously been the practice of the PTAB. Explaining the absence or change with a footnote only increases transparency and is in keeping with legal norms. It will also prevent conspiracy theories and questions, and is a substantial but easy step toward greater transparency.

SOP2: Bringing Uniformity to the USPTO

Revised SOP2 creates a Precedential Opinion Panel (POP), typically comprising the Director, the Commissioner for Patents, and the Chief Judge of the PTAB. The POP will serve two primary functions: (1) it may be convened to rehear matters in pending trials and appeals, for example on issues of exceptional importance; and (2) it may assist the Director in determining whether a decision previously issued by the PTAB should be designated as precedential or informative. It is expected that the POP and the procedures described in revised SOP2 will, in most cases, replace the prior practice of expanded paneling under SOP1, with a process that is more transparent and predictable. It is also expected that revised SOP2 will result in more decisions being designated as precedential.

While SOP2 envisions parties requesting rehearing and consideration from the POP (see SOP2(II)(C)(1), or the Commissioner for Patents, Chief Judge or any APJs recommending consideration by the POP (see SOP2(II)(C)(2), by its express terms SOP2 does not limit the Director’s power to sua sponte order consideration by the POP, or sua sponte designating “any decision by any panel, including the Precedential Opinion Panel, as precedential…” SOP2(II)(E).

SOP2 also directly and in no ambiguous terms says: “No decision will be designated or de-designated as precedential or informative without the approval of the Director.”

SOP2(II)(B) addresses the composition of the Precedential Opinion Panel:

The Precedential Opinion Panel members are selected by the Director, and by default shall consist of the Director, the Commissioner for Patents, and the Chief Judge. The Director (or the Director’s delegate) may determine that a panel of more than three members is appropriate in certain circumstances. The Director may also, in his or her discretion, replace the default members of the Panel with the Deputy Director, the Deputy Chief Judge, or an Operational Vice Chief Judge, in any case. The three primary members of the Precedential Opinion Panel may each decide to delegate their authority under certain circumstances. Decisions on delegation of authority will be made in the following order: (1) first the Director will decide whether to delegate his or her authority; (2) next, the Commissioner for Patents; and (3) finally, the Chief Judge. The authority of each of these three members of the Precedential Opinion Panel may be delegated to one of the following individuals, in the following order and based on availability: the Deputy Director; the Deputy Chief Judge; or an Operational Vice Chief Judge in order of seniority. No individual may receive the delegated authority of more than one member of the Precedential Opinion Panel. A Precedential Opinion Panel member’s authority may be delegated for reasons including conflicts of interest and availability or when the issues to be decided are directed to procedural aspects of practice before the Board.

SOP2 also includes procedures for making routine panel decisions precedential. An Executive Judges Committee consisting of five members will make recommendations to the Director with respect to which decisions should become precedential (i.e., binding on all APJs and panels) or informative (i.e., decisions that set forth norms that should be followed in most cases absent justification). This Executive Judges Committee will include the Chief Judge, the Deputy Chief Judge and the Operational Vice Chief Judge, in order of seniority and based on availability. “If the Director determines that the decision or portion thereof should be designated as precedential or informative, the Director will notify the Chief Judge.” SOP2(II)(C).

Impressions

The buck will now stop with the Director insofar as matters of the PTAB are concerned. Director Iancu, and his successors, now have the power to truly create uniform, all-Office policy that will not only need to be followed by patent examiners, but must also be followed by the PTAB. The Director has the power to pick which decisions are precedential and will have binding effect on the PTAB. This will force the PTAB to follow Office rules, regulations, and perhaps most importantly Office interpretations of the law, rules and regulations.

The PTAB, and the Board of Patent Appeals and Interferences before it, have historically not followed Office interpretations of the law, rules and regulations. That should change, and it will be for the better to have a Patent Office that follows the same law, rules and regulations interpreted in the same way.

These changes are extremely positive and should bring much needed sanity and structure to the PTAB.

Updated: September 20, 2018 at 2:37 PM (The last paragraph under the heading SOP1: Assigning PTAB Panels was mistaken and has since been replaced with the paragraph beginning with SOP1 also requires…)

The Author

Gene Quinn

Gene Quinn is a Patent Attorney and Editor and founder of IPWatchdog.com. Gene is also a principal lecturer in the PLI Patent Bar Review Course and an attorney with Widerman Malek. Gene’s specialty is in the area of strategic patent consulting, patent application drafting and patent prosecution. He consults with attorneys facing peculiar procedural issues at the Patent Office, advises investors and executives on patent law changes and pending litigation matters, and works with start-up businesses throughout the United States and around the world, primarily dealing with software and computer related innovations. is admitted to practice law in New Hampshire, is a Registered Patent Attorney and is also admitted to practice before the United States Court of Appeals for the Federal Circuit. CLICK HERE to send Gene a message.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 13 Comments comments. Join the discussion.

  1. Pro Say September 20, 2018 12:09 pm

    Bravo!

    Thank you Mr. Iancu and staff!

    Now please require that the entire PTO follow Alice as SCOTUS actually intended it … including ONE and ONLY ONE alleged abstract idea / concept applied to ALL the claims at issue.

  2. Concerned September 20, 2018 12:59 pm

    Will Bahr’s memos be followed by the PTAB upon submission of my appeal? The USPTO tossed them. Maybe it will be a new day?

    Thank you Mr. Quinn et al

  3. Pro Say September 20, 2018 2:45 pm

    Concerned — how can I contact you? I have something that may help with your appeal.

  4. Jason Lee September 20, 2018 2:57 pm

    Gene great post thanks for writing this piece. Look like the New director at USPTO means whats he has been saying. Patent holders need a life line, looks like they are moving in the right direction. This is great news. Thanks Again!

  5. Concerned September 20, 2018 3:13 pm

    Pro Say @ 3

    jkillian8202@wowway.com

  6. Glen Duff September 21, 2018 5:49 am

    So excited to see a positive change of the system to make it easier for innovators to get a fair shake in the system.

  7. Holly Daley September 21, 2018 8:24 am

    I am a stockholder of a Company that is presently dealing with an issue for a while. This is wonderful news and a step in the right direction for transparency. Thank you for your efforts.

  8. Patent Investor September 21, 2018 12:53 pm

    Is there any chance they review prior decisions and change the (quite obvious) decisions currently labeled non-precedential to the proper precedential?

  9. Pro Say September 21, 2018 1:04 pm

    Concerned @ 5: message sent.

  10. Concerned September 21, 2018 3:08 pm

    Pro Say.

    Confirmed receipt via returned email. Awaiting further info.

    Thank you for your interest and assistance!

  11. Pro Say September 21, 2018 9:04 pm

    Concerned — please check e-mail (address/es) and resend. Nothing’s come in (yet) today (6pm CA time).

    Maybe send from your ISP?

    Maybe someone could invent and patent a better e-mail system … 🙂

  12. concerned September 22, 2018 1:01 am

    Pro Say:

    “B” had the same trouble with my e-mail when providing his assistance from another post. I just resent the email as a new email vs. hitting the reply button. Sure, some can invent a better email system. Getting the patent…well? Lol.

    I have been through your file wrapper. Wow, what a battle. And congratulations for standing up for your beliefs! Looking forward to your info!

    I appreciate everyone’s generosity.

  13. Jeff Lindsay September 24, 2018 11:28 pm

    Such great news! Still many battles to be fought to restore respect for IP and innovation, but this is a welcome start.

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