PTAB Rescinds Sotera: Why Ex Parte Reexam Just Got More Attractive

In recent weeks, the USPTO has rescinded its position that a Sotera Stipulation forecloses discretionary denial of an inter partes review petition. The change is procedurally narrow, a clarification that the stipulation will no longer be treated as dispositive under the Fintiv framework, but its substantive effect is large. For challengers building parallel invalidity strategies in district court litigation, the calculus has shifted. Many petitions that would have been IPRs through 2024 will now be ex parte reexaminations. (For the procedural mechanics that follow, see How an Ex Parte Reexamination Works, Step by Step.)

What changed

The Sotera Stipulation, named for the petitioner in Sotera Wireless, Inc. v. Masimo Corp., IPR2020-01019 (Paper 12, Dec. 1, 2020), is a petitioner's commitment not to raise in another forum the same grounds raised at the PTAB. For years after the Apple v. Fintiv decision, a properly worded Sotera Stipulation was effectively dispositive against discretionary denial: the PTAB would generally institute when the stipulation was filed.

The agency has now rescinded that position. On February 28, 2025, USPTO Acting Director Coke Morgan Stewart rescinded the June 2022 Vidal memorandum that had treated a Sotera Stipulation as foreclosing discretionary denial. Stewart issued follow-on interim Fintiv-evaluation guidance on March 26, 2025. Sotera Stipulations remain relevant. They continue to be a factor the PTAB considers. But they are no longer dispositive. After the change, even a Sotera-stipulated petition can be discretionarily denied. The downside risk of filing IPR is real again.

Why this matters for ex parte reexam

Three structural effects predict a substantial diversion of challenger filings from IPR to ex parte reexam through 2025.

First, cost asymmetry. IPR's value proposition rested in part on near-certain institution for Sotera-stipulated petitions. Removing that certainty raises the expected cost per petition, petitioners face a meaningful institution-denial risk, after which the investment in the petition is largely lost. Ex parte reexam's lower cost ($50K-$150K typical legal fees against IPR's $300K-$600K) becomes more competitive on an expected-value basis.

Second, no estoppel. 35 U.S.C. 315(e) IPR estoppel bars petitioners from raising the same grounds in subsequent district court litigation after a final written decision. Ex parte reexam has no analogous statutory bar. A challenger preserving optionality across forums can use reexam without locking in a downstream limitation. The optionality argument was always there. It becomes more compelling when the IPR alternative is itself uncertain.

Third, gate symmetry. Both procedures have a threshold gate: institution at the PTAB for IPR, SNQ determination at the USPTO for reexam. Historically, the SNQ gate has been the less restrictive (approximately 95% grant rate across closed cases, compared to IPR's approximately 68% institution rate by petition in FY2024). With Sotera rescinded, IPR institution becomes less predictable. Reexam becomes structurally easier to clear in expected-value terms.

What forecasters should watch

The first cohort of reexams filed in the post-rescission window will be visible by Q2 2025. Three signals to watch:

• Absolute filing volume. Pre-2025 utility-patent ex parte reexam filings have been running at 300-330 per year. A Q2 monthly rate materially above that baseline would confirm IPR-to-EPR diversion in real time.
• Third-party share. Reexam filings have historically been third-party-dominated, but the share has tracked specific IPR cost-benefit considerations. A higher third-party share in Q2 2025 filings would indicate displaced IPR petitioners.
• PTAB IPR filing rate. A symmetric drop in IPR filings, if observed, would confirm the diversion thesis. If both rise together, the change drives something other than substitution.

What patent owners should do

For patent owners facing a recent reexam request, the change does not alter the immediate procedural response. The patent owner statement under 37 CFR 1.530 remains the load-bearing engagement; the office action sequence remains where most outcomes are decided.

The forward-looking concern is volume. Patent owners with portfolios that have previously been targeted via IPR should expect to see more reexam requests filed against the same patents through 2025. The procedural posture is different, no inter partes participation, lower stakes per request, no estoppel, but the strategic problem is the same. The challenger is trying to invalidate the claims.

A new equilibrium

Whether the post-rescission equilibrium settles into a permanent IPR-EPR rebalancing depends on PTAB practice through the remainder of 2025. If discretionary denial practice tightens further, the diversion will accelerate. If the PTAB pulls back, IPR will likely recover some of the displaced filings. The Sotera rescission is a meaningful but not necessarily final shift. The market will reveal its size through filing data over the coming quarters.