The patent statute 35 U.S.C. § 325(d) allows the USPTO Director to deny institution of an IPR when “the same or substantially the same prior art or arguments previously were presented to the Office.” In IPR practice, relying on prior art that already had been before the PTO is perfectly acceptable. Under the 2020 decision in Advanced Bionics, LLC v. MED-EL Elektromedizinische Geräte GmbH, however, a petitioner must justify the reliance by demonstrating that the PTO made a mistake that is material to the patentability of claims being challenged.

The recent case of Ecto World, LLC and SV3, LLC v RAI Strategic Holdings, Inc. presented a situation in which there were questions of whether a PTO Examiner had considered the prior art on which the petitioner was relying in its IPR petition, and whether the Examiner had made a material mistake. The USPTO Director’s May 19, 2025 decision, reconciling different decisions from different PTAB Boards, sheds interesting light on both questions.

Was the Prior Art Really Before the Office?

In Ecto World, the petitioner relied exclusively on four prior art references that were submitted to the PTO in an Information Disclosure Statement (IDS) while the challenged patent was pending. The IDS listed over 1,000 references, all of which the Examiner initialed, indicating consideration of all of the references. Normally, a petitioner would have to justify reliance on previously-considered prior art by providing analysis under § 325(d) and the Advanced Bionics factors as elaborated in Becton, Dickinson & Co. v. B. Braun Melsungen AG. The petitioner spent very little time addressing this issue, however, relying solely on the size of the IDS and the practical time limits that Examiners have in which to examine a patent application. The petitioner basically took the position that § 325(d) and Advanced Bionics did not apply because the Examiner could not have considered the references. (The petition used 13,998 of the 14,000 words allowed. Presumably the petitioner did not want to devote additional words to provide the otherwise-required analysis.)

The PTAB denied institution, holding that the prior art was in front of the Office because the Examiner indicated consideration of the references, and that the petitioner had not demonstrated any material error in the Examiner’s consideration, thus failing to provide the required analysis under § 325(d) and Advanced Bionics.

The petitioner requested Director Review of the institution denial, arguing that the Board misapplied Advanced Bionics, and noting that while the patent was pending, the applicant/patent owner did not comply with the Examiner’s request to identify references to which the Examiner should pay particular attention. In opposing the petitioner’s Director Review Request, the patent owner pointed out that the same Examiner had examined all the patents in this patent family (the patent here was the ninth patent in a series of continuations) since 2006, and that three of the four references were of record as early as 2015, and the fourth as early as 2018. (Actually, two of the references were presented as early as 2014, in an IDS listing 60 references. A third reference was first presented in 2015 as part of a larger IDS that included IDS from earlier patents in the family. The fourth reference was first presented in 2019, again as part of a larger IDS.) The IDS grew larger as the family continued, but the IDS first listing each of the four references was smaller, in some cases much smaller than the one filed in the patent that was the subject of the IPR. Thus, despite the size of the final IPR, it would not have been unreasonable to infer that the Examiner did in fact have the opportunity to consider references as presented incrementally over the life of the patent family.

The Director granted the petitioner’s Director Review request, and sent the case back to the Board so that the parties could provide further briefing. The Director agreed with the Board that the Examiner’s initialing of the IDS references constituted a certification that the Examiner had reviewed all of the references, meeting the requirement under the first prong of the Advanced Bionics analysis, but left open the possibility that the petitioner could rely on the size of the IDS as possibly contributing to a material error in considering the references..

Did the Petitioner Point Out the Examiner’s Mistake?

The Board held that the petitioner did not point out any mistake the Examiner may have made in not relying on any of the four references to reject the claims. In requesting Director Review, the petitioner said that the arguments throughout the petition provided sufficient identification of Examiner error.

Here again, the Director agreed with the Board, finding that the petitioner did not satisfy the second prong of Advanced Bionics. The Director stated that a petitioner must explain, with reference to Becton, Dickinson factors (c), (e), and (f), “how the Examiner erred in overlooking the prior art”. The Director went further, and stated that the petitioner’s pointing generally to arguments throughout the petition effectively called on the Board to have “scoured the Petition to cobble together an argument,” shifting the petitioner’s burden to make this argument onto the Board.

Back to the Board With More Briefing

The Director found it appropriate to grant the Director Review request and send the case back to the Board because the Director’s discussion “clarifies how to apply Advanced Bionics and Becton, Dickinson.”

In looking further at Becton, Dickinson factor (f), the Director indicated that the size of the IDS in the patent file, and the applicant’s not having complied with the Examiner’s request to identify references to which the Examiner should pay particular attention, could enable the petitioner to demonstrate that discretionary denial would be inappropriate.

Under the new procedure allowing separate briefing on discretionary denials, patent owners and petitioners have 14,000 words each to argue for or against. The Director may well have had in mind to apply some form of the new procedure in the Ecto World IPR, even though the parties’ papers before the Board’s Decision on Institution were filed well before the March 26, 2025 date set forth under the new procedure. The Director limited the briefing to 15 pages, and so did not accord the parties the full benefit of the new procedure.

Takeaways

Under the new discretionary denial briefing procedure, which was intended to relieve workload at the Board, the Board no longer has responsibility for deciding whether to discretionarily deny a petition and can focus solely on the merits. Petitioners have a separate and expansive opportunity to discuss all of the Advanced Bionics and Becton, Dickinson factors, as well as § 325(d) andother discretionary denial issues. As a result, the petitioner’s situation in the Ecto World case is unlikely to occur again.

Besides the Director’s clarification on how to apply Advanced Bionics and Becton, Dickinson, it is difficult to ascribe any other motive to the Director’s willingness to allow additional discretionary denial briefing in a situation in which the petitioner clearly and deliberately had failed to address § 325(d) in its petition under the prior procedure. In view of the stated desire to reduce workload at the Board, perhaps the Director should have ordered the discretionary denial briefing to go to the Director rather than to the Board, with the Board taking up the case again only if the Director deems discretionary denial not to be appropriate.