PTAB Precedential: Two Decisions Against Exercising Discretion to Deny Institution Made Precedential

By Rebecca Tapscott
December 21, 2020

Entertainment law and media justice or TV and movie contract negotiation as a film industry slateboard or film slate shaped as a justice scale as a 3D render.On December 17, the U.S. Patent and Trademark Office (USPTO) designated two opinions as precedential, both decisions where the PTAB considered the so-called Fintiv factors and decided against exercising its discretion to deny institution of the inter partes review (IPR) challenges. In Sotera Wireless, Inc. v. Masimo Corporation, the PTAB addressed the Fintiv factors and noted that a petitioner’s broad stipulation not to pursue in district court proceedings any ground that it raised, or could have raised, in the inter partes review weighs strongly in favor of institution. In Snap, Inc. v. SRK Technology LLC, also analyzing the Fintiv factors, the PTAB explains that a district court stay that would remain in place until an inter partes review final written decision weighs strongly in favor of institution.

Sotera Wireless, Inc. v. Masimo Corporation

In June 2019, Sotera Wireless, Inc. (Sotera) filed a complaint against Masimo Corporation (Masimo) in the U.S. District Court for the Southern District of California, alleging infringement of the claims of U.S. Patent No. RE47,353 (the RE353 patent). In May 2020, Sotera filed a Petition requesting inter partes review of the claims and Masimo Corporation (Masimo) filed a Preliminary Response. Subsequently, the USPTO’s Patent Trial and Appeals Board (PTAB) authorized additional briefing for the parties to address the factors laid out in the PTAB’s informative decision in Apple, Inc. v. Fintiv, Inc. regarding the PTAB’s exercise of its statutory discretion to refuse to institute IPR challenges under 35 U.S.C. § 314(a). Masimo filed a stipulation in the District Court, stating that “if the PTAB institutes inter partes review, Petitioner ‘will not pursue in [the District Court] the specific grounds [asserted in the inter partes review], or on any other ground . . . that was raised or could have been reasonably raised in an IPR.”

Masimo, relying on the PTAB’s precedential decisions in NHK Spring Co., Ltd. v. Intri-Plex Techs., Inc. and Fintiv, argued that the PTAB should exercise its discretion to deny institution based on the status of the parallel district court litigation. The PTAB analyzed each of the six Fintiv factors, finding that four of the six factors did not weigh for or against denying institution. However, the PTAB found that the factors relating to “investment in the parallel proceeding by the court and parties” and the “overlap between issues raised in the petition and in the parallel proceeding” weighed in favor of not exercising discretion to deny institution under 35 U.S.C. § 314(a).

With respect to “investment in the parallel proceeding by the court and parties”, the PTAB noted that there is still a lot of work to be done in the parallel proceeding with respect to invalidity, because there has been a “relatively limited investment” in the parallel proceeding. With respect to the factor concerning “overlap between issues raised in the petition and in the parallel proceeding”, the PTAB explained that Masimo’s stipulation provided to the district court “unequivocally” stated that it would not pursue “any ground raised or that could have been reasonably raised in an IPR” in the district court proceeding. Therefore, the PTAB found the stipulation mitigated concerns of duplicative efforts or potentially conflicting decisions. As a result, the PTAB explained that Masimo’s “broad stipulation ensures that an inter partes review is a ‘true alternative’ to the district court proceeding.”

Ultimately, as the PTAB explained, in taking a “holistic view of whether efficiency and integrity of the system are best served by denying or instituting review”, the Fintiv factors weighed in favor of instituting inter partes review.


Snap, Inc. v. SRK Technology LLC

Snap Inc. (Snap) filed a Petition requesting an inter partes review of several claims of U.S. Patent No. 9,930,159, which was owned by SRK Technology LLC (SRK). SRK argued that the PTAB should have exercised its discretion and denied institution based on a parallel proceeding that was pending in the Central District of California. The PTAB addressed each of the six Fintiv factors and determined that each of the factors weighed in favor of institution or were neutral and declined to exercise its discretion to institute the IPR challenge.

With respect to the first factor, the PTAB noted that since a stay had been granted in the parallel district court proceeding, the first factor weighed strongly against exercising discretion to deny institution. The PTAB engaged in a lengthy analysis of the third factor, i.e., investment in the parallel proceeding by the court and the parties” and again concluded that the considerations of the third factor weighted against exercising discretion. The PTAB agreed with Snap that the District Court proceeding was in its early stages prior to the stay. For example, the District Court had not issued any claim construction orders and discovery was not complete. With respect to timeliness in filing the petition, the PTAB found that it was neutral because the petition was “filed neither expeditiously nor with delay because, although it was not filed promptly after Petitioner became aware of the claims being asserted in the invalidity contentions filed in the District Court …, it was not filed in close proximity to any response by Patent Owner to the invalidity contentions because Patent Owner did not file a response prior to the stay of the proceedings.”

The PTAB also thoroughly analyzed the factor concerning overlap between the issues raised in the petition and the parallel proceeding. Noting that the prior art applied in the district court proceeding is not the same as the prior art in the IPR petition, the PTAB explained that “if the petition includes materially different grounds, arguments, and/or evidence than those presented in the district court, this fact has tended to weigh against exercising discretion to deny institution.” However, the PTAB explained that, despite the material differences in the invalidity contentions, the PTAB will likely address patentability prior to the District Court due to the stay. Thus, the concerns of inefficiency and conflicting decisions will be obviated, and the issues may be simplified for the District Court. The PTAB concluded that the fourth factor weighed against exercising discretion to deny institution.

Based on its review and balancing of the Fintiv factors, the PTAB determined that the circumstanced weighed against exercising discretion to deny institution based on 35 U.S.C. § 314(a).


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The Author

Rebecca Tapscott

Rebecca Tapscott is an intellectual property attorney who has joined IPWatchdog as our Staff Writer. She received her Bachelor of Science degree in chemistry from the University of Central Florida and received her Juris Doctorate in 2002 from the George Mason School of Law in Arlington, VA.

Prior to joining IPWatchdog, Rebecca has worked as a senior associate attorney for the Bilicki Law Firm and Diederiks & Whitelaw, PLC. Her practice has involved intellectual property litigation, the preparation and prosecution of patent applications in the chemical, mechanical arts, and electrical arts, strategic alliance and development agreements, and trademark prosecution and opposition matters. In addition, she is admitted to the Virginia State Bar and is a registered patent attorney with the United States Patent and Trademark Office. She is also a member of the American Bar Association and the American Intellectual Property Law Association.

Warning & Disclaimer: The pages, articles and comments on 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 as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of Read more.

Discuss this

There are currently 6 Comments comments.

  1. Josh Malone December 22, 2020 9:41 am

    Inventors are ready to go to work. Just let us know how we can get an enforceable patent for our inventions. These precedential opinions provide no clarity whatsoever. It is no better than a crapshoot.

  2. Paul F Morgan December 22, 2020 11:24 am

    Question for the author. One of the parallel D.C. cases was in CDCA and the other in SDCA. What kind of trial date delays are typical in those districts? Neither has ever been called a “rocket docket,” I believe. Is not that a major “Fintiv factor” against the PTAB exercising its discretion to deny institution of the inter partes review (IPR) challenges?

  3. Jonathan R Stroud December 22, 2020 11:49 am

    Both decisions provide clarity and apply in specific situations. It’s what people have been talking about for years. It’s funny how people talk about certainty and stability, but really only want to be certain one side will win over another.

  4. Josh Malone December 22, 2020 2:44 pm

    Jonathan, would you pick a few of pending cases that cite Fintiv in the POPR and tell us how the PTAB will rule? I will wager you cannot guess 7 out of last 10 correctly.

  5. Pro Say December 22, 2020 6:01 pm

    These decisions are no more than (pick one or more of the 3):

    1. Mumbo-Jumbo

    2. Flim-Flam

    3. Hocus-Pocus

    4. Voodoo (bonus choice)

  6. Jonathan R Stroud December 23, 2020 9:57 am

    Josh I agree that policy-based discretion is neither predictably applied, nor good practice. These decisions do provide more (small) clarity than before, though.