Patent Office Director Defends Frequent Discretionary Denial of IPR Petitions

The America Invents Act (AIA) of 2011 created several post-issuance patent review proceedings including inter partes review (IPR). These proceedings allow the Patent Office to take a second look at an issued patent where a petitioner identifies prior art that creates a ”reasonable likelihood” that at least one issued claim of a patent would be found invalid.

On Thursday, May 14, 2026, Patent Office Director John Squires issued a precedential decision denying institution of Inter Partes Review in Magnolia Medical Technologies v. Kurin, Inc., IPR 2026-00097 (Paper 17). The Director determined that “The purpose of AIA reviews was, and is, to provide a quick and cost-effective alternative to district court patent litigation for resolving disputes over patent validity.” Id. at 2. He further found that “many petitioners seek AIA review in parallel with litigation to gain litigation leverage.” Id. at 3.

Not Used as an Alternative

The Director acknowledged that the mere existence of parallel litigation may not be cause for concern but found that “all too often the co-pending litigation involves either the same arguments as the AIA review, or a petitioner asserts system art in the litigation that overlaps with the patents or printed publications asserted in the AIA review—a tell-tale sign that the AIA review is not functioning as a litigation alternative.” Id. The Director stated that if the AIA review “simply serves as a means by which the petitioner presents additional invalidity arguments . . . [then] the parties spend more time and resources litigating patent validity than they would have in the absence of AIA reviews.” Id.

Misuse of AIA Review

The Director further stated that 1) the filing of multiple petitions, 2) petitions for review after district court or ITC proceedings, and 3) petitions taking inconsistent positions in the district court and PTAB without adequate explanation suggest misuse of AIA proceedings. Id. at 4.

Big Companies and Foreign Governments

The Director found that most AIA petitions are filed by “market dominant companies” rather than by small, U.S.-based manufacturers. Id. at 4-5. He further found that “companies associated with foreign governments have been among the top ten AIA review petitioners (when considered collectively).” Id. at 5. The Director referenced his recent Tianma decision which provides that a petition will not be instituted where the petitioner or any of its real parties in interest are foreign sovereigns. Id. at 6.

Public Interest is Paramount

The Director determined that AIA reviews are intended to serve the public interest rather than focusing “narrowly on the interests of private litigants.” Unlike the Patent Office, the Courts are intended to adjudicate private disputes. The Director stated that “Our AIA review under Article I is ultimately regulatory; proceedings under Article III are adjudicatory.” Id. at 7.

Help for Small Businesses

The Director refers to his March 11, 2026 Memo (“Additional Discretion my Institution Considerations - U.S. Manufacturing and Small Business Use of AIA Proceedings”) which he says “encourages petitioners and patent owners to discuss American manufacturing and/or small business considerations in their discretionary briefing.” Id. at 7.

Conclusion

Taken as a whole, the Magnolia Medical decision amounts to a defense of the Director’s practice of frequent discretionary (non-merits based) denial of institution and a strong indication that he will not be changing course anytime soon. The number of AIA petitions has recently declined and is expected to remain below the historical average.