USPTO prepares to restore PTAB authority over patent challenges

The US Patent and Trademark Office (USPTO) is set to return responsibility for merits-based decisions on patent challenges to the Patent Trial and Appeal Board (PTAB), reversing a policy that centralized institution decisions under Director John Squires.

The USPTO is preparing to restore the PTAB’s authority to determine whether patent challenges should proceed to trial based on their merits, in a significant change to the administration of post-grant patent proceedings in the United States.

Under a new policy announced on November 10, the PTAB will once again decide whether to institute inter partes review (IPR) and post-grant review (PGR) proceedings based on merits-based considerations, following an initial review by the USPTO Director’s office. The change, effective November 16, 2026, partially reverses an approach introduced by Director John Squires in October 2025, when he centralized institution decisions in his office.

Under the revised arrangement, Squires will retain responsibility for non-merits considerations, including discretionary factors that could justify refusing to institute proceedings. Petitions that pass this initial review will be referred to a three-member PTAB panel, which will determine whether institution is justified based on the merits of the challenge.

Although the Director retains statutory authority to grant or deny institution, the PTAB will make the merits-based determination on his behalf. The new process will apply to IPR and PGR proceedings for which a notice referring the petition for merits-based consideration has not yet been entered.

New guidelines for assessing patent challenges

The November 10 memorandum, issued by Squires and USPTO General Counsel and Supervisory Solicitor John F. Duffy, also establishes specific guidelines for PTAB judges assessing the merits of patent challenges.

Under the revised framework, petitioners must explain how the cited prior art discloses or renders obvious each limitation of every challenged patent claim. They must provide an understandable, element-by-element explanation identifying the specific portions of prior art supporting their arguments. Simply relying on an examiner’s previous findings will not be sufficient.

The memorandum also sets out circumstances in which the PTAB must refuse institution. These include situations where a petitioner fails to make the required showing for a substantial majority of the challenged claims.

Similarly, the Board must deny institution where a patent owner’s preliminary response presents a reasonable argument, supported by reliable and credible evidence, demonstrating that the petitioner has failed to meet the applicable institution standard for a substantial majority of the claims.

The PTAB may also identify such deficiencies independently. Another important provision concerns the treatment of conflicting evidence. Where arguments for and against the unpatentability of an individual challenged claim are both reasonably supported by the evidence, the Board must not consider the petitioner to have satisfied the applicable institution threshold for that claim.

The memorandum distinguishes between the two statutory thresholds: an IPR petitioner must demonstrate a reasonable likelihood of prevailing with respect to at least one challenged claim, while a PGR petitioner must demonstrate that it is more likely than not that at least one challenged claim is unpatentable.

The guidelines are illustrative rather than exhaustive, giving the PTAB direction on how to assess petitions while leaving room for other circumstances that may demonstrate a failure to meet the institution requirements.

Separate panels to handle institution and trial

The revised process also introduces an important procedural safeguard concerning the composition of PTAB panels. Judges who determine whether an IPR or PGR proceeding should be instituted will not subsequently conduct the resulting trial. If a petition is granted, a different panel will be assigned to hear the case, with no overlap between the judges responsible for the institution decision and those conducting the trial.

The arrangement is intended to separate the preliminary assessment of a patent challenge from the subsequent adjudication of its merits. The Director will continue to determine whether petitions should be refused on non-merits discretionary grounds and will retain his statutory authority over institution decisions.

Reversal of last year’s centralization

The policy marks a shift from the approach introduced in October 2025, when Squires centralized institution decisions in his office. The earlier arrangement followed an interim process introduced in March 2025, which separated discretionary considerations from merits-based assessments. The October policy subsequently brought both categories of decision-making under the Director’s control.

In explaining the latest change, Squires highlighted the contribution of PTAB judges over the past year, noting that they had assisted with more than 325 decisions involving merits-based considerations. He also pointed to the USPTO’s LOOP (Learning from Outcomes to Optimize Patents) training program, which connects lessons from post-grant proceedings with patent examination, and its PTAB STRONG (Support, Training, Resources, Opportunities, Networking, and Guidance) initiative, which provides training and professional development for administrative patent judges.

The Director said these developments had strengthened the Board’s ability to assess patentability challenges and supported the decision to return merits-based institution determinations to its judges. For patent owners and challengers, the changes could have significant practical implications for how IPR and PGR petitions are prepared, assessed, and contested.

Petitioners will need to provide detailed, claim-by-claim explanations of their prior-art arguments, while patent owners will have clear opportunities to challenge the evidential strength of petitions at the institution stage. The revised framework is therefore not a complete return to the previous institution model. Instead, it represents a redistribution of responsibilities within the USPTO, restoring a greater role for specialist administrative patent judges while preserving centralized oversight of discretionary decisions.

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