With U.S. Patent and Trademark Office (USPTO) Director Kathi Vidal’s return to private practice in December 2024 and the future permanent Director yet to be tapped for nomination, it is a good time to reflect on one of the most impactful processes that grew during Vidal’s tenure — Director Review.  It was not until shortly before the end of Director Vidal’s term, on October 31, 2024, that the USPTO implemented 37 CFR § 42.75 and effectively codified the Interim Director Review Process. The following provides an overview of the origin of Director Review, the process as it has been codified, and a recap of the statistics under Director Vidal’s purview.

Background

Director Review was born from the Supreme Court’s decision in United States v. Arthrex, Inc., where the Court explained that “constitutional principles chart a clear course: Decisions by [administrative patent judges (APJs)] must be subject to review by the Director.” 594 U.S. 1, 24 (2021). The Court further held that “the Director has the authority to provide for a means of reviewing PTAB decisions” and “may review final PTAB decisions and, upon review, may issue decisions [themself] on behalf of the Board.” Id. at 25.

Process

Availability and Filings

A party to a Patent Trial and Appeal Board (PTAB) decision may request Director Review of any decision including Derivation Proceedings (35 U.S.C. §§ 135), inter partes review (35 U.S.C. §§ 314, 318), and post-grant review (35 U.S.C. §§ 324, 328).  The request must be filed either: (1) within 14 days of the entry of a non-final decision or a decision to institute a trial, or (2) within 30 days of the entry of a final decision or a decision not to institute a trial.  37 C.F.R. § 42.71(d).

Generally, the appellee is not permitted to respond to a request for Director Review; however, the Director may authorize such a response as well as the submission of new evidence or arguments if warranted (e.g., in cases addressing issues of first impression or issues involving intervening changes in the law or USPTO procedures, guidance, or decisions).

Determination of Whether to Grant Director Review

A request for Director Review is evaluated by the Advisory Committee, which is established by the Director and comprises at least 11 members from various USPTO business units (e.g., Office of the Under Secretary, Patent Trial and Appeal Board, Office of the General Counsel, etc.).  The Advisory Committee then provides a recommendation to the Director, who may take it into consideration along with the underlying decision and the associated arguments and evidence.

The Director may also grant review sua sponte (on the Director’s own initiative)—although it is typically reserved for issues of “exceptional importance,” which are flagged by the PTAB’s internal post-issuance review team.

 Process Following Determination

Should the Director determine to deny review, an order denying the request will be entered into the record. The Director is not required to (and generally opts not to) provide any reasons for denial.

Should the Director determine to grant review, the Director may issue an initial order granting review and identifying the issue(s) to be addressed by a later order.  Alternatively, the Director may issue a single decision that simultaneously grants Director Review and resolves the identified issue(s).

In cases where the Director remands a decision to the Board, the Board is expected to issue a new decision either by: (1) the due date specified in the Director’s remand order, or (2) absent a due date set by the Director, six months from the date of remand.

Challenging Director Review Decisions

Depending on the underlying decision subject to the Director Review order, parties may seek an appeal to the Federal Circuit.  Specifically, a party may appeal a Director Review decision of a final, rehearing, or other appealable decision under 35 U.S.C. §§ 135 (derivation proceeding), 316 (IPR), or 328 (PGR). Conversely, Director Review decisions of Board decisions on institution are not appealable. See 35 U.S.C. § 314(d).

In the alternative, a party may file one request for rehearing a Director Review Decision.  However, such a request must specifically identify what matter the Director Review decision overlooked and may not serve as an opportunity to raise new issues or arguments.

Director Review under Director Vidal

The following chart provides a breakdown of Director Review under Director Vidal (as of Dec. 15, 2024, available at https://www.uspto.gov/patents/patent-trial-and-appeal-board/status-director-review-requests):

In sum, Director Vidal faced 332 requests for Director Review during her two-and-a-half-year tenure. At a high-level, it is evident that Petitioners have had greater success in receiving grants to requests for Director Review– as opposed to their counterpart Patent Owners — 21.2% grant rate compared to a 1.48% grant rate (dismissed, withdrawn, and pending not considered).  Additionally, Director Vidal notably took the initiative to conduct Director Review sua sponte in 36 cases, begging the question of whether the future Director will similarly take the onus to review without a party’s invitation. 

With the number of requests growing year by year and the recent codification of Director Review, Patent Owners and Petitioners alike may feel encouraged to continue to request Director Review—even in the face of limited success rates as shown above.  But, with Director Vidal’s stepping down, one may only guess how the future Director will wield the power of Director Review. 

See generally 37 CFR § 42.75; see also https://www.uspto.gov/patents/ptab/decisions/director-review-process.