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4 “Petitioner’s awareness of Patent Owner’s applications and failure to seek early review of the patents favors denial and outweighs the above-discussed considerations.”- Director’s Discretionary Denial Decision
U.S. Patent and Trademark Office (USPTO) Acting Director, Coke Morgan Stewart, issued a Director’s Discretionary Denial Decision on Friday denying institution of five inter partes reviews (IPR) in which several factors weighed against denial but the failure of the petitioner to challenge the patent sooner and the “settled expectations” of the patent owner superseded those factors.
The IPRs were brought by iRhythm Technologies, Inc. against Welch Allyn challenging claims of five patents: IPR2025-00363 (Patent 10,159,422 B2); IPR2025-00374 (Patent 8,965,492 B2); IPR2025-00376 (Patent 9,155,484 B2); IPR2025-00377 (Patent 8,214,007 B2); and IPR2025-00378 (Patent 8,214,007 B2).
Welch Allyn filed a request for discretionary denial of institution under the “Interim Processes for PTAB Workload Management” guidance. Stewart sent a memorandum to all PTAB Administrative Patent Judges (APJs) in March detailing the process. According to the memo, to ensure the PTAB can continue to meet its statutory obligations relating to ex parte appeals, the Director will exercise her discretion under 35 U.S.C. 314(a) and 324(a) to determine whether discretionary denial is appropriate for any petition for IPR or post-grant review (PGR).
In May, Stewart issued the first four decisions under the new process, granting two of the requests for discretionary denial and rejecting the other two. Those four decisions were all based on the timing of the expected date of district court trial versus the expected date of a Final Written Decision. But in this latest decision, Stewart found that, although a number of factors weighed against granting denial, discretionary denial was still warranted.
The projected final written decision due date in the PTAB proceedings in this case was August 12, 2026, while the district court’s trial date is not scheduled until March 22, 2027. “There also appears to be little investment by the parties in the district court proceeding and a high likelihood of a stay if an inter partes review is instituted,” wrote Stewart. Welch Allyn also argued that iRhythm was over-reliant on expert testimony but failed to properly identify how. All of this weighed against granting discretionary denial, said the decision.
However, Welch Allyn also argued that “because one of the patents has been in force since as early as 2012 and Petitioner was aware of it as early as 2013—having cited the then-pending application that issued as the challenged patent in an Information Disclosure Statement Petitioner filed in its own patent application—settled expectations favor denial of institution.” Stewart found this argument persuasive and afforded more weight to it than all of the other factors. “Petitioner’s awareness of Patent Owner’s applications and failure to seek early review of the patents favors denial and outweighs the above-discussed considerations,” she wrote.
It is expected that numerous additional Director decisions on discretionary denial will be handed down in the coming weeks and months.
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4 comments so far.
Pro Say
June 10, 2025 09:24 pmBravo Acting Director Stewart!
With China breathing down our necks (though the complete elimination of the innovation-killing Death Squad is and will always be the best way forward for our country), these and your other directives to reform and reshape the PTAB into what Congress had in mind is exactly what American innovation so desperately needs.
Please keep up the great work!
Ron Katznelson
June 9, 2025 03:31 pmThere is substantial legislative support to Annon’s important conclusion above.
First, in 35 U.S.C. § 321, Congress set a de-facto presumption that users of technology are sufficiently diligent to monitor issued patents by others, early enough to challenge them under all patentability statutes in a PGR within 9 months of the patent issue date. That sets 9 months as a default presumptive expectation for third-party diligence.
Second, today about 99% of patents that issue are post-AIA patents eligible for a challenge in PGRs. Yet, it appears that PGR proceedings are infrequently utilized compared to IPRs. It seems that users of inventions patented by others prefer to wait out the patentee and refrain from challenging the patent until sued for infringement.
Fairness to patentees, who over time develop investment-backed expectations, and to applicants whose ex parte appeals are delayed at the PTAB, dictates that PTAB resources must be prioritized for PGRs and for reducing pendency of ex parte appeals. This should be done by denying IPRs and their increased workload on the PTAB, except for the following circumstances:
The presumption should be against granting IPR petitions unless the petitioner can establish with substantial evidence that its failure to timely challenge the patent under PGR was due to unavoidable circumstances. The Director of the PTO has rulemaking authority to promulgate and exercise discretion in this way to ensure “the efficient administration of the Office, and the ability of the Office to timely complete proceedings.” 35 U.S.C. § 316(b). Filing for reexamination of the patent and waiting one’s turn at the examining corps is always available to the patent challenger.
Josh Malone
June 9, 2025 01:45 pmThis is great news for inventors. If we can begin to trust that the USPTO isn’t going to take back our patents, U.S. innovation can flourish again.
Anon
June 9, 2025 11:28 amI would go further than this:
“However, Welch Allyn also argued that ‘because one of the patents has been in force since as early as 2012 and Petitioner was aware of it as early as 2013—having cited the then-pending application that issued as the challenged patent in an Information Disclosure Statement Petitioner filed in its own patent application—settled expectations favor denial of institution.’ Stewart found this argument persuasive and afforded more weight to it than all of the other factors.”
I would make actual patent publication to be de facto notice.
Interested parties – especially those willing to spend the money to challenge patents – should already be paying attention to publication of patents (at least, and probably patent application publications as well).
This would also serve to reinforce the stated objective in promoting progress (in the use of the advertising notion of the word promote) that serves as the Quid Pro Quo exchange.