Patent Appeals Strategy

What is Required

• Amendment that does not broaden any claim
• A request for consideration under AFCP 2.0
• A showing of how the amendment addresses the final rejection

What the Examiner Does

• Examiner has 3 additional hours to consider the amendment
• May conduct an interview (this is one of the biggest values — AFCP 2.0 greatly increases the chance of an examiner interview)
• If amendment places application in condition for allowance = allowed
• If not = examiner explains
• You have NOT changed your appeal rights

Best Use Case

• When you can add a small limiting amendment that clearly distinguishes the prior art AND you want to have an interview with the examiner to understand why your claims were rejected
• Can be combined with a pre-appeal brief if AFCP 2.0 fails

Cost

• No USPTO fee
• Filing brief: $3,000-$8,000 attorney fees

What it Does

• A panel of three examiners (the primary examiner + two others) reviews the brief
• Options: enter appeal
• Reopen prosecution
• Allow the application
• Resolves ~40% of cases without reaching PTAB

Cost

• $860 (small entity; Notice of Appeal) + $1,000 (small entity; appeal brief)
• + attorney fees for brief preparation $10,000-$25,000

Outcome

• Reversal of rejection
• Affirmance
• New ground of rejection

Cost

• $900 (small entity; first RCE)
• $900 (second RCE small entity)
• + filing fee
• Attorney fees

Effect

• Prosecution reopens
• Application is back before examiner with new prosecution cycle

Can Proceed with

• New amendments
• New arguments
• New evidence (§ 1.132 declarations)

Option 5 — Continuation Application

• File a continuation with different claim scope before the parent issues
• Preserves priority date
• Allows fresh examination with different claim language

Who Decides PTAB Ex Parte Appeals

• A panel of typically three APJs (Administrative Patent Judges)
• APJs are typically patent attorneys with technical backgrounds in the relevant art
• The original examining corps is not part of the PTAB panel

What PTAB Reviews

• PTAB reviews whether the examiner's rejections were correct
• De novo review of legal issues
• Deferential review of fact findings
• PTAB can review: anticipation (§ 102)
• Obviousness (§ 103)
• § 101 patent eligibility
• § 112 written description
• § 112 enablement
• § 112 indefiniteness
• Double patenting

Ex Parte Appeal Brief Requirements

• Statement of facts (correct description of prosecution history)
• Claim groupings (groups claims together for argument efficiency)
• Argument section (one argument per distinct rejection; grouped claims)
• 37 C.F.R. § 41.37 technical requirements
• 25-page limit (or request waiver)

After the Appeal Brief

• Examiner's Answer: examiner files an Answer responding to the appeal brief
• Can contain new grounds of rejection
• If new grounds → applicant has 2 months to respond or maintain the appeal
• Reply Brief: optional
• Applicant responds to examiner's Answer
• Strict time limit

Oral Hearing

• Applicant may request oral argument before PTAB panel
• 30-minute presentation
• Allows direct questioning by APJs
• Useful for complex claim construction disputes

Reversal of All Rejections

• All rejected claims found allowable
• Application returns to examiner for allowance

New Ground of Rejection

• PTAB finds a rejection that the examiner did not make
• Applicant has two options: (a) reopen prosecution (respond to new ground before examiner)
• Or (b) request rehearing by PTAB panel

Affirmance

• PTAB agrees with examiner
• All rejections confirmed
• Applicant must then: appeal to Federal Circuit OR file RCE + amend

Reversal Statistics

• Overall PTAB ex parte appeal reversal rates: approximately 30-40% of claims receive some reversal
• Technology-specific variation: § 101 software rejections reversed more often since Alice guidance
• § 102/103 reversals depend heavily on claim construction precision

Strategic Value of PTAB Appeal

• Beyond the reversal rate, filing a PTAB appeal demonstrates seriousness
• Many cases settle at the examiner's answer stage or immediately after oral argument
• PTAB decisions create a written record that may be useful if the patent is later litigated.

Who can Appeal

• Both the petitioner (if patent was NOT cancelled) and the patent owner (if patent WAS cancelled or claims amended) can appeal a final written decision (FWD)
• Parties must have participated in the IPR

Legal Issues

• De novo review (PTAB's legal conclusions reviewed without deference)
• Includes: claim construction (now under Phillips standard)
• § 101 patent eligibility
• § 112 requirements

Factual Findings

• Clear error review (PTAB's factual findings reversed only if clearly erroneous)
• Includes: obviousness motivation to combine
• Scope and content of prior art
• Secondary considerations

Institution Decision

• Cuozzo Speed Technologies v. Lee (S.Ct. 2016): PTAB's decision to institute IPR is not reviewable on appeal
• But PTAB's authority to decide a case can be challenged
• Thryv v. Click-to-Call (S.Ct. 2020): § 315(b) time bar determinations = not reviewable
• ARTHREX v. SMITH & NEPHEW (S.Ct. 2021): APJ appointments were unconstitutional as APJs wielded significant executive power without proper presidential appointment

Remedy

• Director can now review any PTAB decision
• Parties can seek Director review as a new procedural step before Federal Circuit

Claim Construction

• Petitioner may appeal arguing PTAB construed claims too narrowly
• Patent owner may appeal arguing claims construed too broadly
• Federal Circuit decides claim construction de novo
• Claim construction changes on appeal can flip the outcome

Motivation to Combine

• Federal Circuit reviews underlying factual findings for clear error
• But may review de novo the legal conclusion of obviousness
• Belden v. Berk-Tek LLC (key case on motivation to combine)

Secondary Considerations

• Objective indicia of non-obviousness must be weighed
• Failure to consider secondary considerations = reversible error

Federal Circuit Reversal Rates from PTAB IPR

• Approximately 15-25% of appealed FWDs are reversed in whole or part
• Approximately 60-70% are affirmed
• The rest are remanded

Certiorari to Supreme Court

• Patent cases from Federal Circuit can petition for cert
• Granted rarely (Oil States Energy Services v. Greene's Energy — SCOTUS 2018 upheld IPR constitutionality; Arthrex APJ appointments; Samsung v. Apple design patent; Amgen v. Sanofi enablement)

Strategic Use of Federal Circuit Appeal

• Patent owner: if PTAB cancels claims, appeal buys 12-18 months of continued patent protection while on appeal
• Petitioner: if PTAB maintains patent and district court infringement case was stayed, Federal Circuit appeal forces patent owner to continue defending validity on two fronts.

The Arthrex Problem

• APJs are appointed by the Secretary of Commerce (a department official) rather than the President with Senate confirmation
• The Supreme Court held this was unconstitutional because APJs exercise significant executive power (they can cancel patents, which is a significant final agency action)

The Remedy — Director Review

• Rather than invalidating all IPR decisions, the Court held that the remedy is to give the USPTO Director power to review and correct any PTAB APJ decision
• Result: any party can now request Director Review of a PTAB decision

How Director Review Works

• After a PTAB final written decision (or institution decision), any party can request Director Review
• The Director (or delegated designee) reviews the PTAB decision
• The Director can: affirm
• Reverse
• Modify
• Or remand to the PTAB
• No fixed timeline for Director Review (adds some uncertainty)

PTAB Precedential Opinion Panel (POP)

• Separately from Arthrex, the POP is a mechanism for the Director to convene a special panel to address legal issues across multiple PTAB proceedings
• POP decisions become binding on future PTAB panels
• Significantly more important now that Director has explicit review authority

Institution Denial Review

• If PTAB denies institution (particularly on Fintiv grounds), petitioner can request Director Review
• Director has signaled willingness to review Fintiv denials
• Important tool for petitioners denied institution near start of trial

Patent Owner Review Requests

• If PTAB cancels claims, patent owner should consider Director Review before Federal Circuit appeal
• Director Review does not require briefing in Federal Circuit (preserves Federal Circuit option)

Fintiv Factor Changes

• Director has issued guidance modifying the Fintiv analysis
• Director Review provides a mechanism to challenge Fintiv denials
• DUDAS v.

Iancu Lineage

• The political appointee Director (confirmed by Senate) changes with administrations
• Director Review practice may vary based on Director's patent policy priorities

Current Director Review Status

• As of 2024, Director Review is actively used
• Several high-profile Director reversals of PTAB decisions have occurred
• Petition statistics: hundreds filed per year
• Director grants review in a small fraction

Interaction with Federal Circuit

• Director Review does not replace Federal Circuit appeal
• Federal Circuit appeal is available AFTER Director Review if Director affirms PTAB
• Some uncertainty about timing of Federal Circuit jurisdiction when Director Review is pending
• Best practice: file notice of appeal within statutory deadline while requesting Director Review to preserve both options.