NHK-Fintiv is a general policy but not a substantive rule. Guidance by the new director of the USPTO limited it’s impact. There are plenty of ways around it

In January of this year, the Supreme Court denied a request for certiorari on the Federal Circuit’s decision regarding its first two challenges. And, on April 1, the Northern District of California again dismissed the remanded claims against the director, now Kathi Vidal. Judge Edward Davila stated that Fintiv was excluded from the APA’s notice-and-comment rulemaking requirements because Fintiv was a general statement of policy and not a substantive rule. Apple Inc. v. Vidal, No. 20-CV-06128-EJD, 2024 WL 1382465, at *13 (N.D. Cal. Mar. 31, 2024). A substantive rule requires notice-and-comment rulemaking under the APA. Davila found that a substantive rule affects individual rights and obligations and does not leave the PTAB free to exercise discretion and consider the individual facts before it in a given case, and that a general statement of policy must be only prospective and must not establish a binding norm or be finally determinative of the issues or rights. Davila ruled that because IPR institution is never required (referencing § 314(a)), the Fintiv factors do not affect individual rights or obligations, and because the Fintiv factors are referred to as “nonexclusive,” they are not determinative and leave the PTAB free to exercise discretion. On April 19, the PTAB finally followed up on the ANPR and issued a notice of proposed rulemaking (NPR). Notably absent from the NPR was any mention of the Fintiv factors. It appears that, considering Davila’s order in the Northern District of California, Vidal and the PTAB are content leaving the Fintiv factors in their current state. Moreover, the denial of institution under Fintiv has declined following the guidance issued by Vidal, and petitioners can now utilize Sotera stipulations to avoid denial. See Sotera Wireless, Inc. v. Masimo Corp., IPR2020-01019, Paper 12 (PTAB Dec. 1, 2020). As a result, the criticism that Fintiv discretionary denials frustrate the purpose of IPRs to provide a more efficient venue for patent issues no longer packs the same punch.