The In re Motorola CAFC Ruling Reaffirms Discretionary, Nonappealable Nature of PTAB IPR Institution Decisions

The Federal Circuit’s latest ruling in In re Motorola Solutions, Inc. solidifies the discretionary authority of the USPTO director over inter partes review institution decisions, underscores the limited scope of judicial review, and clarifies the boundaries of due process and Administrative Procedure Act claims in the context of shifting USPTO guidance.

The case arises from a series of inter partes review (IPR) proceedings initiated by Motorola Solutions, Inc. against patents owned by Stellar, LLC, which were also at issue in a parallel district court litigation. [1]

Following the Patent Trial and Appeal Board’s initial decision to institute review on several patents, the acting director of the United States Patent and Trademark Office exercised discretionary authority to deinstitute Motorola’s IPRs, citing the application of the Fintiv factors in light of evolving agency guidance. [2] Motorola sought a writ of mandamus from the US Court of Appeals for the Federal Circuit, challenging both the procedural and substantive grounds of the USPTO’s actions.

FINTIV FACTORS AND VIDAL MEMORANDUM

Central to this dispute are the Fintiv factors, developed in Apple Inc. v. Fintiv, Inc., which allow the USPTO to discretionarily deny IPR institution where parallel district court proceedings exist. [3] The factors include the existence of a stay, proximity of trial dates, investment in the parallel proceeding, overlap of issues, identity of parties, and other circumstances impacting the PTAB’s discretion to deny petitions.

The June 2022 Vidal Memorandum provided interim guidance instructing the PTAB not to discretionarily deny institution where the petitioner provided a Sotera stipulation, that is, a binding commitment not to pursue in district court any ground that could have been raised in the IPR. [4] However, this guidance was rescinded in February 2025, and the importance of a Sotera stipulation was reduced to a “highly relevant” but not dispositive consideration. [5]

MANDAMUS STANDARD AND THE FINALITY OF IPR INSTITUTION DECISIONS

The Federal Circuit began its analysis by emphasizing the extraordinary nature of mandamus relief, stating that such a writ requires a “clear and indisputable” right to relief, a lack of adequate alternative remedies, and a finding that the writ is appropriate under the circumstances, as articulated in Cheney v. US District Court for the District of Columbia, 542 U.S. 367, 380-81 (2004). [6]

Critically, Congress committed the decision to institute IPRs to the USPTO director’s discretion and rendered such determinations “final and nonappealable” under 35 USC § 314(d), substantially limiting the scope of judicial review, including by mandamus, except for colorable constitutional or certain statutory claims. [7]

DUE PROCESS CLAIMS AND THE ABSENCE OF A PROTECTED PROPERTY INTEREST

Motorola argued that the rescission of the Vidal Memorandum and the subsequent denial of IPR institution violated its due process rights, contending that the memorandum created a constitutionally protected property interest in having its petitions considered without regard to the Fintiv factors.

The Federal Circuit rejected this argument, holding that “when a statute leaves a benefit to the discretion of a government official, no protected property interest in that benefit can arise.” [8] The Vidal Memorandum was characterized as interim guidance, subject to change, and did not mandate any particular outcome. Furthermore, the court held that reliance on interim guidance is insufficient to establish a constitutional violation (citing United States v. Carlton, 512 U.S. 26, 33 (1994)). [9]

ADMINISTRATIVE PROCEDURE ACT CLAIMS AND ALTERNATIVE REMEDIES

Motorola’s APA-based challenge asserted that rescission of the Vidal Memorandum should have undergone notice-and-comment rulemaking and that its retroactive application was arbitrary and capricious. The Federal Circuit concluded that an APA action in federal district court was available to Motorola as an alternative remedy, and that mandamus was not appropriate for challenging the process by which the acting director rescinded the guidance.

Precedent in cases including Apple Inc. v. Vidal, 63 F.4th 1 (Fed. Cir. 2023), supported the court’s decision to foreclose mandamus relief for such challenges.[10]

USPTO DIRECTOR DISCRETION AND THE ROLE OF INTERIM GUIDANCE

The Federal Circuit reaffirmed the USPTO director’s broad discretion in instituting IPR proceedings, with the authority to weigh and apply various factors, including those outlined in Fintiv and any interim guidance such as the Vidal Memorandum. The court made clear that such guidance does not create substantive entitlements and is subject to change at the agency’s discretion. [11] The decision also highlighted the fluidity of USPTO internal policy in this area, with the director having authority to rescind or amend guidance without formal rulemaking.

IMPLICATIONS FOR PRACTITIONERS AND FUTURE CHALLENGES

The Federal Circuit’s order in In re Motorola reinforces the limited avenues for judicial review of IPR institution decisions, especially when based on the director’s exercise of discretion under statutory authority. Practitioners seeking to challenge such decisions on due process or APA grounds face significant hurdles as neither reliance on interim guidance nor arguments regarding arbitrary and capricious action are likely to succeed in the mandamus context.

While APA challenges may proceed in district court, the prospects for success remain uncertain, particularly in the absence of a clear statutory or constitutional violation.

FORWARD-LOOKING CONSIDERATIONS

The Federal Circuit’s denial of Motorola’s mandamus petition underscores the finality and discretionary nature of PTAB institution decisions and clarifies that neither interim guidance nor shifting administrative policy creates substantive rights for petitioners.

The order serves as a reminder that the USPTO retains significant authority to adapt its procedures in response to evolving legal and policy considerations, and that judicial review of such adaptations is tightly circumscribed. Going forward, parties involved in parallel litigation and IPR proceedings should closely monitor USPTO policy developments and be prepared for continued evolution in the application of discretionary denial factors.