USPTO Issues New Guidance on PTAB Discretionary Institution: Focus on U.S. Manufacturing and Small Businesses
On March 11, 2026, USPTO Director John A. Squires issued a memorandum introducing additional discretionary considerations for instituting inter partes review (IPR) and post grant review (PGR) proceedings before the Patent Trial and Appeal Board (PTAB). The guidance highlights the role that U.S. manufacturing and small businesses may play in the Director’s discretionary institution decisions.
The America Invents Act requires the USPTO to consider how institution standards affect the economy, the integrity of the patent system, the efficient administration of the Office, and the ability to timely complete proceedings. The memorandum connects these statutory considerations to broader concerns about the long term decline of domestic manufacturing capacity, particularly in industries such as electronics and computing. Government reports cited in the memo note that offshoring has weakened parts of the U.S. industrial base and may threaten the nation’s innovation leadership.
The memorandum alleges that many of the most frequent users of PTAB proceedings are large companies that report little or no current U.S. manufacturing presence. In response, the Office encourages parties to include information in discretionary briefing that helps the USPTO understand the relationship between PTAB proceedings and domestic manufacturing investment.
When evaluating whether to institute an IPR or PGR, the Director may now consider whether products accused of infringement in related litigation are manufactured in the United States or tied to domestic manufacturing investments, whether the patent owner’s competing products are manufactured in the United States, and whether the petitioner is a small business that has been sued for infringement.
The USPTO also encourages parties to address the extent of U.S. based production when presenting these facts. This includes not only final assembly but also whether key components are produced domestically and whether products made in the United States are sent abroad for further processing. For method claims, the relevant product is the device used to perform the claimed method.
The memorandum applies to all IPR and PGR proceedings in which the deadline for a patent owner’s discretionary brief has not yet passed. The guidance signals that the USPTO may place greater weight on domestic manufacturing activity and the role of small businesses when exercising discretion over whether to institute PTAB proceedings.
About Perilla Knox & Hildebrandt LLP. PKH is a boutique law firm specializing in intellectual property law. With a team of dedicated attorneys, the firm provides comprehensive legal services in patent, trademark, copyright, and trade secret matters, including frequest representation in inter partes review and post grant review proceedings before the Patent Trial and Appeal Board. PKH is committed to delivering innovative and strategic solutions to protect and enforce its clients' intellectual property rights.
