Authored by: Jeremy J. Gustrowsky
In a recent decision, the Federal Circuit denied Motorola Solutions, Inc.’s attempt to overturn the Patent Office’s (USPTO) decision to end several inter partes review (IPR) proceedings involving patents challenged by Motorola. The case, In re Motorola Solutions, Inc., centered on whether the USPTO’s Acting Director acted improperly by rescinding a prior policy (the “Vidal Memorandum”) and applying the so-called “Fintiv factors” to deny institution of IPRs in light of ongoing parallel district court litigation.
Motorola argued that the abrupt policy change and its application violated both the Administrative Procedure Act (APA) and Motorola’s due process rights. Specifically, Motorola claimed it had a protected right to have its IPR petitions considered under the old policy, which discouraged discretionary denial when a party agreed to a “Sotera stipulation” (a promise not to raise certain patent challenges in court if the IPR was instituted). However, the court found that institution of IPR is a discretionary benefit, not a guaranteed right. Because Congress gave the USPTO Director broad, unreviewable discretion over whether to institute IPRs, Motorola could not claim a property interest or constitutional protection in having its petitions considered under any particular standard.
The court also addressed Motorola’s argument that the USPTO should have used formal rulemaking before changing its policy. While the court acknowledged that such APA challenges could be brought in district court, it made clear that the Federal Circuit cannot review specific institution decisions, even if the process by which they were made is challenged. The court distinguished this case from prior decisions where general APA compliance was at issue, not a specific IPR institution outcome.
Ultimately, the Federal Circuit concluded that the USPTO’s decision to rescind the Vidal Memorandum and apply the Fintiv factors—even retroactively to pending cases—was within its statutory discretion. Motorola’s petition for mandamus was denied, reaffirming that parties have no entitlement to IPR institution or to a particular process for such decisions.