By Bill Devitt, Ashvi Patel, and Maddy Hemphill* –
In Magnolia Medical Technologies, Inc. v. Kurin, Inc., IPR2026-00097 (“Decision”), Director Squires issued a precedential decision denying institution of inter partes review (“IPR”)—and in doing so, also provided significant insights into his views of the original purpose of AIA review. In the Decision, Director Squires emphasized that that the foundational purpose of AIA review is to serve as a litigation alternative, not a vehicle for duplicative patent challenges.
The Parties and Background
The dispute between Magnolia (“Petitioner”) and Kurin (“Patent Owner”) originated in district court litigation. Patent Owner asserted U.S. Patent No. 12,138,052 (“the ’052 patent”) via counterclaim after Petitioner initiated a patent infringement suit in 2024. In the district court proceeding, Petitioner challenged the validity of the ’052 patent, on anticipation and obviousness grounds, among others. The district court, however, precluded the testimony of Petitioner’s invalidity expert due to the expert’s failure to disclose the claim construction upon which he based his anticipation and obviousness opinions—a failure the Director characterized as “within Petitioner’s control.” Decision at 10. A jury subsequently found the ’052 patent not invalid on the remaining grounds presented at trial.
Following the preclusion order, Petitioner filed its petition seeking IPR. Petitioner argued that because its expert was precluded, no forum had actually adjudicated whether the challenged claims were anticipated or obvious, which weighed in favor of institution to allow those issues to be heard. The Director rejected this argument. In so doing, the Director noted that Petitioner “had the opportunity to fully and fairly litigate these issues before the district court, did so, and lost,” and characterized Petitioner’s petition as an attempt to “use the Office as a repeat challenge or second bite at the apple to undo its litigation loss.” Decision at 10.
The Director’s Stance on Discretionary Denial
Notably, the Decision extends well beyond the specific facts of this particular case. Indeed, Director Squires uses this Decision to articulate his broader vision for the role of AIA review (including IPRs and post-grant reviews) in the patent system.
Director Squires began by recounting Congress’s intent that IPRs were intended to serve as expedient, cost-effective alternatives to litigation, not as mechanisms for harassment or repeated attacks designed to prevent market entry. He observed, however, that many petitioners do not use AIA review as an “alternative” at all—noting that over 80% of PTAB proceedings have parallel litigation in district court or the ITC, and that overlapping prior art between forums signals the petition is functioning as a litigation supplement rather than a substitute.
The Director identified several categories of what he characterized as system misuse: (1) filing multiple petitions challenging the same patent without sound reason, (2) filing petitions after patents have already been challenged unsuccessfully in court, the ITC, or the Office, and (3) taking inconsistent positions before different tribunals, which the Director views as evidence that parties may be misleading one tribunal or pursuing alternative theories to gain a tactical advantage.
Director Squires also challenged the narrative that AIA review primarily serves small, U.S.-based manufacturers by pointing to data showing that the top ten petitioners—nearly all market-dominant companies—filed roughly 1,900 petitions. The next 70 petitioners combined filed approximately the same number. He further noted that companies associated with foreign governments have been among the top ten AIA review petitioners, even as the U.S. government itself is not permitted to file AIA petitions.
Underpinning the Decision is the Director’s framing of AIA review as serving the public interest. He emphasized that the Office institutes review to correct possible errors in the original patent grant, not to resolve disputes between private parties. Drawing a sharp line between the two systems, the Director stated: “Our AIA review under Article I is ultimately regulatory; proceedings under Article III are adjudicatory.” Decision at 7.
Takeaway
This Decision is a must-read for every PTAB practitioner and patent litigator. Although the unique procedural posture of the specific case—a petition filed after certain invalidity arguments were excluded from trial—may limit the decision’s broad applicability, the Director’s articulation of factors governing discretional denial carries significant weight. Petitioners filing IPRs in parallel with district court litigation should be prepared to explain why the IPR serves as a genuine alternative to litigation rather than a backstop or second forum. They should also maintain consistency between positions taken before the district court and the PTAB, absent sound reasoning for divergence. Patent owners, meanwhile, should emphasize any overlap between the petitioner’s district court invalidity arguments and its IPR grounds, any adverse rulings that appear to have triggered the IPR filing, and any facts suggesting the petition is a tactical maneuver rather than a good-faith challenge to the patent’s validity.
* Maddy is a Summer Associate in Jones Day’s Dallas Office.