New USPTO Paneling Guidance for TTAB and PTAB Requires Disclosure of Financial Interests Regardless of Dollar Value

“Nothing in this memorandum is intended to suggest that Board judges, in any past or pending cases, have not been impartial, have created an appearance of impropriety….” – USPTO guidance memo

GuidanceThe U.S. Patent and Trademark Office (USPTO) today announced new guidance on empaneling procedures for the Patent Trial and Appeal Board (PTAB) and Trademark Trial and Appeal Board (TTAB). Under the guidance, PTAB and TTAB management will “avoid empaneling cases to judges who hold stock or bonds (publicly traded or privately held) in any of the disclosed parties or real parties in interest, regardless of the dollar value.”

The guidance does not require PTAB and TTAB judges to divest any financial interests like stocks or bonds, and it does not prohibit them from holding any financial interests. It asks all judges to “voluntarily inform their management of any companies in which they know that the judge, the judge’s spouse, or their minor children own stocks or bonds, regardless of the dollar value.” Even if they choose not to provide this information to management up front, however, they must “promptly notify” the paneling staff once they receive notice of empaneling on a particular case whether repaneling is necessary in light of the guidance.

If judges become aware of their financial interest after paneling, they should either request repaneling or confer with the USPTO’s Office of General Counsel.

The memo comes on the heels of a case involving Centripetal Networks in which the Federal Circuit reversed a $2.75 billion damages award to Centripetal Networks after ruling that the district court judge should have disqualified himself over his wife’s financial interest in Cisco, the defendant in the infringement action. The interest, which was only discovered after the bench trial on infringement was conducted and the judge had already drafted the final ruling, totaled roughly $4,500 in Cisco stock.

In parallel IPR proceedings at the PTAB challenging the validity of patent claims supporting the multibillion-dollar damages verdict against Cisco, Centripetal learned after the trial institution phase that APJ Brian McNamara, who voted to institute the challenge to Centripetal’s patent claims, owns up to $15,000 in Cisco stock and receives an annual profit share from law firm Foley & Lardner, which represents Cisco in lobbying efforts. In response, Centripetal filed a motion for recusal and vacatur, but APJ McNamara continued to stay in the IPR proceedings and even sat on the panel when it granted a motion to join Cisco, who was otherwise time-barred from challenging Centripetal’s patent claims through its own IPR petition.

The guidance specifically notes:

“Nothing in this memorandum is intended to suggest that Board judges, in any past or pending cases, have not been impartial, have created an appearance of impropriety, or have otherwise violated any obligations under existing federal ethics regulations and laws, or that they might do so going forward even if their actions comply with such regulations and laws.”

It also states that the Office “will not revisit any prior decisions-or any future decisions-in which our judges complied with the applicable ethics rules” and the USPTO Director said she does “not envision that this interim guidance will give rise to the repaneling of a large number of cases.”

the guidance takes effect 60 days from today.

Image rights acquired by


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

Join the Discussion

3 comments so far.

  • [Avatar for Anon]
    September 25, 2023 11:11 am

    The gulf between impropriety and appearance of impropriety is a stark one.

  • [Avatar for Julie Burke]
    Julie Burke
    September 24, 2023 01:21 pm

    That is an excellent suggestion, Herb, that should be extended not just to patent examiners but to employees across the entire agency.

    Many types and levels of USPTO employees, including those fake SPE contractors, have input into, power over and/or access to upcoming USPTO decisions.

    To be consistent, fair and effective, the Supervisory Patent Examiners who assign applications and review examiners’ work, the TC and OPQA Quality Reviewers who can impact the outcome of examination, TC Group Directors who can withdraw a notice of allowance, the PTAB GS-15 ghost writers who review appeals and IPRs to craft draft decisions, among others, must all be held to the same new ethics standards as the PTAB and TTAB managers who assign matters to the APJs.

    This requirement should not be limited to the applicant and real parties of interest. Extend this requirement to owning stock/bonds in competing companies that work in the same technological sector as the patent application or IPR under review, since their value can be impacted by the resulting USPTO decision.

    As recently as 2015, when I retired from the office, patent examiners had to disclose stock above a certain value in the technology sector that they examine, whether or not the they recluse themselves from a particular matter. This is because a favorable or negative decision for one company could cause a competitor company’s stock to go down or up, respectively.

    Importantly, because the USPTO Director is required to provide “significant oversight, direction and control” to the PTAB APJs, aka, the inferior officers, this new requirement must be extended to Director Kathi Vidal, as she is the ultimate decision maker on of the PTAB IPR matters, regardless of the dollar amounts of stock or bonds she or her family members may own.

    Lastly, as linked in the USPTO memo, the US Office of Government Ethics sets the cap at a whopping $30,000 of stock or bonds.

    “If you or your spouse or minor child owned $30,000 of stock in a company that would be affected by your job duties, you would not be able to perform those duties until certain measures are taken to resolve the conflict.”

    Contrast that with 18 USC 208, as summarized by OGE as “You are prohibited from working on Government matter in which you, your spouse or minor child or certain others have a financial interest.”

    A financial interest.

    As a patent examiner, I was told US government employees should not just avoid improprieties, but also avoid the appearance of any impropriety.

  • [Avatar for Herb Wamsley]
    Herb Wamsley
    September 23, 2023 04:31 pm

    I commend Director Vidal for issuing this memo. I suggest extending it to patent examiners. Experienced examiners are the foremost experts in the USPTO in their arts. An examiner could be assigned an application disclosing a breakthrough invention that might afferct stock price if patented. Examiners are in a good position torecognize such applications. They should recuse themselves if they own stock in the applicant.