John Squires, the director of the US Patent and Trademark Office (USPTO) has vacated a decision by the Patent Trial and Appeal Board (PTAB or Board) that was inconsistent with a determination by the International Trade Commission (ITC) involving the same patent, the same claims, the same prior art and substantially the same evidence.
The PTAB held in IPR2024-01312 that certain claims of Sun Pharmaceuticals’ US Patent No. 11,697,028 were unpatentable as obvious in light of prior art.
The ITC is the agency that adjudicates unfair import cases under Section 337 of the Tariff Act. An ITV administrative law judge found the claims of the patent at issue had not been shown invalid on the same obviousness grounds.
The Board had said that this didn’t bind it because the ITC’s decision wasn’t final at the time that the Board made its own decision, because new evidence (including expert testimony) was before the PTAB that was not before the ITC, and because of the different burdens of proof in the two forums.
Sun Pharmaceuticals then requested Director Review due to these inconsistent results.
Director Review is a relatively new procedure that grew out of the 2021 US Supreme Court decision in United States v. Arthrex requiring executive oversight of Board decisions. It’s a process where the head of the USPTO re-examines decisions made by the PTAB and allows parties to challenge unfavorable rulings.
As the USPTO notes,
Requests for Director Review of a Board’s decision on institution under 35 U.S.C. §§ 135, 314, or 324, or decisions granting rehearing of such a decision, shall be limited to decisions presenting (a) an abuse of discretion, (b) important issues of law or policy, (c) erroneous findings of material fact, or (d) erroneous conclusions of law. Both discretionary and merits-based issues may be raised, subject to limitations (a)–(d) above.
In response to the request, Squires vacated the Board’s ruling, concluding that there was no justifiable reason for the Board to have reached a different patentability determination than the ITC.
According to the Director,
The Board must consider prior findings of fact and conclusions of law when patent claims being challenged before the Board have already been adjudicated at the Office or in another forum, including the ITC. See IPR2024-01312 Patent 11,697,028 B2 3 Memorandum, “PTAB Consideration of Prior Findings of Fact and Conclusions of Law” (Sept. 16, 2025). As instructed in that Memorandum, a “more detailed explanation is required from the Board when the same or substantially the same evidence and/or arguments that were previously presented to the Office, the district court, or the ITC are being relied upon in the subsequent AIA trial proceeding.” Id. Whether the Board has provided such an explanation or whether an explanation is sufficient is a matter committed to the Director’s discretion and will determine whether a proceeding should be instituted and/or maintained or otherwise dismissed and terminated.
Also, said the Director,
The Board’s and the ITC’s determinations are also at odds on several technical findings, with inadequate explanation from the Board for the inconsistencies. For example, as part of a detailed analysis, the ITC determined that Petitioners had failed to show that the combination of Lundahl and Larsen teaches the “uniformly illuminate” limitation of the claims, finding further that Petitioners’ “analysis fails to sufficiently show that it is free of improper hindsight.”
He noted that
The difference in the ITC’s and Board’s standards of proof does not, without more, explain this discrepancy in the findings between the two forums.
Here, he said,
the Board failed to adequately explain why it was reaching a different outcome than the ITC. Under these circumstances and in view of the ITC’s decision, which is now final, the appropriate course is to grant Director Review, vacate the Board’s Final Written Decision, and dismiss the Petition.
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