Apple Inc., Cisco Systems, Inc., Google LLC, Intel Corporation v. John A. Squires, Under Secretary of Commerce for Intellectual Property

United States Court of Appeals
for the Federal Circuit
______________________
APPLE INC., CISCO SYSTEMS, INC., GOOGLE LLC,
INTEL CORPORATION,
Plaintiffs-Appellants
EDWARDS LIFESCIENCES CORPORATION,
EDWARDS LIFESCIENCES LLC,
Plaintiffs
v.
JOHN A. SQUIRES, UNDER SECRETARY OF
COMMERCE FOR INTELLECTUAL PROPERTY
AND DIRECTOR OF THE UNITED STATES
PATENT AND TRADEMARK OFFICE,
Defendant-Appellee
______________________
2024-1864
______________________
Appeal from the United States District Court for the
Northern District of California in No. 5:20-cv-06128-EJD,
Judge Edward J. Davila.
______________________
Decided: February 13, 2026
______________________
MARK CHRISTOPHER FLEMING, Wilmer Cutler Pickering
Hale and Dorr LLP, Boston, MA, argued for all plaintiffs-
appellants. Plaintiffs-appellants Apple Inc., Cisco Sys-
tems, Inc., Intel Corporation also represented by GARY M.
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APPLE INC. v. SQUIRES 2
FOX, ALYSON ZUREICK, New York, NY; MARK D. SELWYN,
Palo Alto, CA. Plaintiff-appellant Google LLC also repre-
sented by NATHAN K. KELLEY, Perkins Coie LLP, Washing-
ton, DC; ANDREW DUFRESNE, Madison, WI.
WEILI J. SHAW, Appellate Staff, Civil Division, United
States Department of Justice, Washington, DC, argued for
defendant-appellee. Also represented by BRIAN M.
BOYNTON; MICHAEL S. FORMAN, Office of the Solicitor,
United States Patent and Trademark Office, Alexandria,
VA.
______________________
Before LOURIE, TARANTO, and CHEN, Circuit Judges.
TARANTO, Circuit Judge.
This case returns to us after a decision by the district
court rendered on remand from our decision in Apple Inc.
v. Vidal, 63 F.4th 1 (Fed. Cir. 2023) (2023 CAFC Decision).
The subject of the case, brought in 2020, was a challenge
by Apple Inc. and four other companies (collectively, Apple)
to certain instructions that the Director of the Patent and
Trademark Office (PTO or Office) had given to the Patent
Trial and Appeal Board (Board) to govern how the Board,
as the Director’s delegatee, would exercise the Director’s
statutory, discretionary authority to decline to institute in-
ter partes review (IPR) proceedings under 35 U.S.C. ch. 31
(§§ 311–19), added to the Patent Act by the America In-
vents Act (AIA), Pub. L. No. 112-29, 125 Stat. 284 (2011).
Seeking relief under the Administrative Procedure Act
(APA), 5 U.S.C. § 706, Apple asserted that the instructions
led to too many non-institution decisions (denying too
many IPR opportunities to challenge patents asserted
against it in court) and were legally defective in three re-
spects: they were contrary to 35 U.S.C. ch. 31, arbitrary
and capricious, and issued without formal notice-and-com-
ment rulemaking as defined by the APA, 5 U.S.C. § 553.
After the district court held all of Apple’s challenges to be
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APPLE INC. v. SQUIRES 3
judicially unreviewable, we held in 2023 that the first two
challenges were unreviewable but the third was not, and
we therefore remanded for consideration of the rulemak-
ing-process (§ 553) challenge. 2023 CAFC Decision, at 11–
18. On remand, the district court rejected the challenge,
holding that the instructions did not have to be issued
through notice-and-comment rulemaking. Apple Inc. v. Vi-
dal, No. 20-CV-06128, 2024 WL 1382465 (N.D. Cal. Mar.
31, 2024) (2024 District Court Decision). Apple appeals.
We hold, in agreement with the district court, that the
Director’s instructions are a “general statement of policy”
exempted from notice-and-comment rulemaking proce-
dures by the express terms of § 553(b). Congress provided
no legal right to institution of an IPR, which is just one of
several mechanisms for adjudicating challenges to patents.
The challenged pronouncements at issue are simply in-
structions to the Board for how, as the Director’s delegatee,
it should exercise in the first instance the Director’s statu-
tory discretionary authority not to institute an IPR. The
non-institution authority of the Director is statutorily in-
sulated from judicial review, at least when, as relevant
here, no constitutional claim is presented. And the instruc-
tions do not even purport to bind the Director, who has al-
ways retained the authority to make the non-institution
decision even after an initial Board decision as delegatee.
Based on those characteristics taken together, we affirm
the district court’s decision that notice-and-comment rule-
making was not required for the challenged instructions.
I
We rehearse pertinent legal and factual background
set forth more fully in 2023 CAFC Decision, at 6–11.
A
In the AIA, Congress authorized the Director to insti-
tute an IPR, upon petition by a challenger, of claims of an
already-issued patent to determine whether they actually
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APPLE INC. v. SQUIRES 4
failed to meet certain patentability requirements (based on
specified kinds of prior art) and should be cancelled. 35
U.S.C. §§ 311, 316–318. Importantly for present purposes,
it is the Director that Congress gave the authority to decide
whether to institute an IPR. 35 U.S.C. § 314(a). Even if
certain statutory preconditions for institution are met,
non-institution remains within the Director’s discretion:
No law compels institution. 2023 CAFC Decision, at 6–7;
see id. at 6 (“‘The Director is permitted, but never com-
pelled, to institute an IPR[, a]nd no petitioner has a right
to such institution.’ Mylan Laboratories Ltd. v. Janssen
Pharmaceutica, N.V., 989 F.3d 1375, 1382 (Fed. Cir.
2021).”); id. at 7 (quoting the Supreme Court’s statement,
based on § 314(a), that there is “no mandate to institute
review,” Cuozzo Speed Technologies, LLC v. Lee, 579 U.S.
261, 273 (2016)). Congress reinforced the Director’s discre-
tion by broadly precluding review of its exercise at least
where no constitutional ground is asserted. 2023 CAFC
Decision, at 7; see United States v. Arthrex, Inc., 594 U.S.
1, 8–9 (2021) (stating that “Congress [ ] committed the de-
cision to institute inter partes review to the Director’s un-
reviewable discretion”) (emphasis added); Thryv, Inc.
v. Click-To-Call Technologies, LP, 590 U.S. 45, 60 (2020);
Cuozzo, 579 U.S. at 271–76.
“From the outset of the IPR program,” the Director au-
thorized the Board to institute an IPR as the Director’s del-
egatee. 2023 CAFC Decision, at 7; 37 C.F.R. § 42.4(a). The
Director, as the possessor of the statutory authority, al-
ways retained full power to reverse an initial Board deci-
sion on institution or to make the decision personally in the
first instance. 2023 CAFC Decision, at 7, 13.
At issue in the present case is a trio of related instruc-
tions the Director issued to the Board for its exercise of del-
egated non-institution authority (where the threshold
statutory preconditions are present), addressing the com-
mon situation where the IPR petitioner and patentee are
already involved in district-court litigation over the patent
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APPLE INC. v. SQUIRES 5
at issue. Two of the instructions were in the form of prec-
edential Board decisions to govern later Board decisions,
exercising the Director’s authority under Patent Trial and
Appeal Board, Standard Operating Procedure 2 (now Revi-
sion 11) at 1 (2023) (SOP 2). NHK Spring Co. v. Intri-Plex
Technologies, Inc., IPR2018-00752, 2018 WL 4373643
(P.T.A.B. Sept. 12, 2018) (made precedential on May 7,
2019) (NHK); Apple Inc. v. Fintiv, Inc., IPR2020-00019,
2020 WL 2126495 (P.T.A.B. Mar. 20, 2020) (modifying
NHK, made precedential on May 5, 2020) (Fintiv). The
NHK-Fintiv instructions identified six nonexclusive factors
that the Board must assess, with the factors weighing in
favor of or against institution. See 2023 CAFC Decision, at
8–10 (quoting and describing the instructions). The NHK-
Fintiv instructions, as Board precedent, bind only the
Board, not the Director or, therefore, the PTO.
After this case began (and was decided the first time by
the district court), the Director issued a third instruction,
citing the Director’s authority to “provid[e] policy direction
and management supervision for the Office” under 35
U.S.C. § 3(a)(2)(A) as well as SOP 2. See Memorandum
from Katherine K. Vidal, Under Secretary of Commerce for
Intellectual Property and Director of the PTO, to Members
of the Board, Interim Procedure for Discretionary Denials
in AIA Post-Grant Proceedings with Parallel District Court
Litigation at 2–3 (June 21, 2022) (June 2022 Memo). This
instruction somewhat modified the first two instructions
and likewise applied only to the Board, not purporting to
bind the Director. No party has suggested that the June
2022 Memo changes the analysis of the issue before us, so,
like the parties and the district court, we address the NHK-
Fintiv instructions generally without separate mention of
the June 2022 instruction.
B
In our 2023 decision, we ruled that “at least Apple has
standing to press the challenge to the Director’s
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APPLE INC. v. SQUIRES 6
instructions as invalid for want of notice-and-comment
rulemaking.” 2023 CAFC Decision, at 15. We also ruled
that the rulemaking-process challenge was reviewable. Id.
at 14–15. On remand, the district court conducted the re-
view, addressing the basic legal distinction that is at issue
here.
It is undisputed that the instructions come within the
capacious notion of “rule” under the APA, 5 U.S.C. § 551(4).
But, as is also undisputed, not all rules require notice-and-
comment procedures under § 553, which states such a re-
quirement, § 553(b)–(d), while taking pains to identify ex-
clusions. Thus, in two provisions not at issue here, § 553(a)
excludes rules addressing certain topics, and § 553(b) per-
mits agencies to make exceptions based on, e.g., findings of
impracticability. What is at issue here, and in most of the
relevant case law, is § 553(b)’s additional express exclusion
of “interpretative rules, general statements of policy, or
rules of agency organization, procedure, or practice,” un-
less another statute requires notice-and-comment proce-
dures. 5 U.S.C. § 553(b).
The Supreme Court long ago recognized: “The central
distinction among agency regulations found in the APA is
that between ‘substantive rules’ on the one hand and ‘in-
terpretative rules, general statements of policy, or rules of
agency organization, procedure, or practice’ on the other.”
Chrysler Corp. v. Brown, 441 U.S. 281, 301 (1979). The
Court also summarized: “The notice-and-comment require-
ments apply . . . only to so-called ‘legislative’ or ‘substan-
tive’ rules.” Lincoln v. Vigil, 508 U.S. 182, 196 (1993). In
the present case, the particular dispute is whether the in-
structions are a substantive/legislative rule or, instead, a
“general statement[ ] of policy.” 2024 District Court Deci-
sion, at *5 n.3 (internal quotation marks omitted). The Su-
preme Court has explained that a general statement of
policy is a pronouncement “issued by an agency to advise
the public prospectively of the manner in which the agency
proposes to exercise a discretionary power.” Chrysler, 441
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APPLE INC. v. SQUIRES 7
U.S. at 302 n.31 (internal citation and quotation marks
omitted); Lincoln, 508 U.S. at 197.
The district court in this case held that the instructions
are “a general statement of policy, rather than a substan-
tive or legislative rule, [and] the Director was not required
to conduct notice-and-comment rulemaking prior to desig-
nating the NHK and Fintiv decisions as precedential, and
the lack of such rulemaking does not render the NHK-
Fintiv standard unlawful.” 2024 District Court Decision, at
*13 (cleaned up). Apple timely filed an appeal that is
within our jurisdiction under 28 U.S.C. § 1295(a)(1).
C
The PTO announced several changes of relevance after
the briefs on appeal were filed. In February 2025, the Act-
ing Director rescinded the June 2022 Memo.1 On October
17, 2025, the Director took two additional actions of note.
First, the Director announced that, for now, the Board
would not be making initial institution decisions and, in-
stead, he (with advice) would directly be making institution
decisions: “[T]he Director, in consultation with at least
three [Board] judges, will determine whether to institute
trials in all IPR[s] . . . . [W]here the Director determines
[that] detailed treatment of issues raised in a petition is
appropriate . . . , the Director may refer the decision on
1 USPTO rescinds memorandum addressing discre-
tionary denial procedures, USPTO.GOV (Feb. 28, 2025),
https://www.uspto.gov/about-us/news-updates/uspto-resci
nds-memorandum-addressing-discretionary-denial-proced
ures; see also Chief Admin. Patent Judge, Guidance on
PTO’s recission of “Interim Procedure for Discretionary De-
nials in AIA Post-Grant Proceedings with Parallel District
Court Litigation” (Mar. 24, 2025), https://www.uspto.gov/
sites/default/files/documents/guidance_memo_on_interim_
procedure_recission_20250324.pdf.
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APPLE INC. v. SQUIRES 8
institution to one or more members of the [Board].” Mem-
orandum from John A. Squires, Under Secretary of Com-
merce for Intellectual Property and Director of the PTO, to
All Board Judges at 1–2 (Oct. 17, 2025),
https://www.uspto.gov/sites/default/files/documents/Direct
or_Institution_of_AIA_Trial_Proceedings.pdf.
Second, the PTO published a notice of proposed rule-
making, the proposals consisting of “modifications to the
rules of practice for [IPR] before the [Board] that the [Di-
rector] and, by delegation, the [Board] will use in institut-
ing IPR.” Revision to Rules of Practice Before the Patent
Trial and Appeal Board, 90 Fed. Reg. 48335, 48335 (Oct.
17, 2025) (to be codified at 37 C.F.R. pt. 42). If finally
adopted as proposed, the institution standard would bind
the PTO itself, not merely the Board. Id. Specifically, the
PTO proposed to modify 37 C.F.R. § 42.108 by adding the
following provision to address parallel pending proceed-
ings:
(f) Parallel Litigation — Inter partes review shall
not be instituted or maintained if, more likely than
not, any of the following will occur, with respect to
a challenged claim or an independent claim from
which a challenged claim depends, before the due
date for the final written decision pursuant to 35
U.S.C. [§] 316(a)(11):
(1) U.S. District Court —A district court trial in
which a party challenges the patent under 35
U.S.C. [§§] 102 or 103 . . . .
90 Fed. Reg at 48341 (emphasis added). The proposal does
not expressly revoke the precedential status of the NHK
and Fintiv decisions. See 90 Fed. Reg at 48336.
II
It is undisputed that whether the Director was obli-
gated to use notice-and-comment procedures when issuing
the challenged instructions presents an issue of law that
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APPLE INC. v. SQUIRES 9
we resolve de novo. Moreover, neither side has suggested
that there is any material difference on this issue between
our circuit’s own law and the law of the regional circuit of
the district court (the Ninth Circuit), and both sides, in ad-
dressing the issue, also draw on other circuits’ decisions,
including but not only those of the D.C. Circuit. We follow
suit.
A
We begin with several preliminaries to our discussion
of the main issue.
1
We agree with the parties that the new announcements
of the PTO do not render the dispute before us moot. To
begin with, as already noted, the issues before us are not
altered by the inclusion of the June 2022 Memo in the case.
The February 2025 rescission of that memorandum does
not moot the case. And the October 2025 announcements
likewise leave the dispute here a live one.
As to the Director’s announcement that he will for now
be making the institution decisions himself (with advice),
the Director has explained to this court why that action
does not moot the case. The Director has not repealed the
regulation, 37 C.F.R. § 42.4(a), that allows “[t]he Board [to]
institute[ ] the [proceeding] on behalf of the Director,” see
Arthrex, 594 U.S. at 9, and while “[Board] panels do not
now exercise the Director’s discretion to institute,” he “has
left those decisions as precedential” and “if [Board] panels
were to again exercise the Director’s discretion to institute,
NHK and Fintiv would remain precedent.” Letter from
Weili J. Shaw, Attorney for the United States, to Jarrett B.
Perlow, Clerk of Court (Jan. 2, 2026), ECF No. 104 at 1–2.
In these circumstances, the high standard for finding moot-
ness based on “voluntary cessation” is not met, West Vir-
ginia v. Environmental Protection Agency, 597 U.S. 697,
720 (2022) (“[V]oluntary cessation does not moot a case
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APPLE INC. v. SQUIRES 10
unless it is absolutely clear that the allegedly wrongful be-
havior could not reasonably be expected to recur.”) (inter-
nal citation and quotation marks omitted), and we see no
other basis for a determination of mootness.
As to the notice of proposed rulemaking, the agency ac-
tion is just a proposal. It has no current effect, and it can-
not be reliably predicted what, if any, effect it will come to
have. That is enough to avoid mootness based on the pro-
posal. See Chafin v. Chafin, 568 U.S. 165, 172 (2013); see
also Vanscoter v. Sullivan, 920 F.2d 1441, 1448 (9th Cir.
1990) (reasoning that “[t]he protracted nature of agency
proceedings and the uncertainty as to whether and when
the proposed regulation may be adopted preclude a finding
of mootness”).
2
Apple suggests that our 2023 holding that Apple had
standing to press its rulemaking-process claim must be un-
derstood to have decided that the challenged instructions
constitute substantive/legislative rules. Apple Opening Br.
at 25, 35–36. We reject Apple’s contention that our stand-
ing holding establishes that the challenged instructions
meet that standard. We did not purport to do so, and our
standing result did not necessarily do so.
In 2023, in reversing the grant of a motion to dismiss
regarding the rulemaking-process claim, we held that, for
standing purposes, the injury was concrete and particular-
ized and not unduly speculative and was to a “legally pro-
tected interest” based on a one-step-removed effect on
Apple’s interest as a defendant in infringement suits. 2023
CAFC Decision, at 16–17. That conclusion logically does
not answer the question whether an agency pronounce-
ment about its own enforcement policies meets the core
standard for a measure being substantive/legislative under
§ 553, which, in one judicial statement (similar to others,
capturing essentially the same idea), requires that the
measure “alter the landscape of individual rights and
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APPLE INC. v. SQUIRES 11
obligations, binding parties with the force and effect of
law.” Stupp Corp. v. United States, 5 F.4th 1341, 1352
(Fed. Cir. 2021). Indeed, to equate the Article III notion of
legally protected interest, see Charles A. Wright, et al., Fed-
eral Practice and Procedure § 3531.4 & nn.15–16 (3rd ed.
2025) (discussing the uncertain scope of that notion), with
the binding-law standard for triggering a notice-and-com-
ment duty under § 553 would run counter to the many de-
cisions that reject § 553 challenges on the merits, i.e., on
the ground that the statutory duty did not apply in the
case, not for want of Article III standing. In any event, our
standing conclusion in 2023 involved a motion to dismiss,
and “where the plaintiff presents a nonfrivolous legal chal-
lenge, alleging an injury to a protected right . . . , the fed-
eral courts may not dismiss for lack of standing on the
theory that the underlying interest is not legally pro-
tected.” Initiative & Referendum Inst. v. Walker, 450 F.3d
1082, 1093 (10th Cir. 2006). Thus, our standing ruling in
2023 does not control the resolution of the merits issues
now before us.
3
We also reject Apple’s contention that the statutory
provision contemplating the Director’s issuance of IPR reg-
ulations, 35 U.S.C. § 316, compels notice-and-comment
rulemaking, Apple Opening Br. at 53–55. Section 316 pro-
vides that, as to various topics, “[t]he Director shall pre-
scribe regulations,” including ones “establishing and
governing inter partes review under [chapter 31] and the
relationship of such review to other proceedings under [ti-
tle 35].” 35 U.S.C. § 316(a)(4). That provision does not im-
pose a notice-and-comment rulemaking requirement for
the contemplated “regulations.” Any requirement of no-
tice-and-comment procedures is not implicit in the word
“regulations,” and so must come from another source of
law, such as 5 U.S.C. § 553, which depends on the particu-
lar type of regulation.
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APPLE INC. v. SQUIRES 12
Apple cannot properly read more into § 316’s use of the
word “regulation.” For one thing, “by 1987 courts had com-
monly referred to both substantive and interpretative rules
as ‘regulations,’” Azar v. Allina Health Services, 587 U.S.
566, 578 (2019) (emphasis in original), and, as already
noted, “interpretative rules” are expressly exempt from no-
tice-and-comment requirements under 5 U.S.C. § 553(b).
Relatedly, as the D.C. Circuit long ago explained, “[c]ourts
and Congress treat the terms ‘regulation’ and ‘rule’ as in-
terchangeable and synonymous,” National Treasury Em-
ployees Union v. Weise, 100 F.3d 157, 160 (D.C. Cir. 1996),
and, as already noted, the term “rule,” 5 U.S.C. § 551(4),
extends to statements of general policy as well as interpre-
tative pronouncements that are expressly exempt from no-
tice-and-comment requirements under 5 U.S.C. § 553(b).
Moreover, the Patent Act itself provides that the PTO may
“establish regulations . . . in accordance with section 553 of
title 5,” 35 U.S.C. § 2(b)(2)(B) (emphasis added), and that
reference covers both regulations for which § 553 requires
notice-and-comment procedures and regulations for which
§ 553 says there is no notice-and-comment requirement,
see In re Chestek PLLC, 92 F.4th 1105, 1110 (Fed. Cir.
2024).
Accordingly, Apple’s challenge depends on whether the
instructions are a substantive/legislative rule or, instead,
are a general statement of policy under 5 U.S.C. § 553(b).
B
Although courts’ formulations vary in their precise
wording, we have summarized the governing standard for
a substantive/legislative rule as follows: “Legislative rules
alter the landscape of individual rights and obligations,
binding parties with the force and effect of law[.]” Stupp,
5 F.4th at 1352 (quoted and applied in Xi’an Metals & Min-
erals Import & Export Co. v. United States, 50 F.4th 98,
105–06 (Fed. Cir. 2022)); see also Chrysler, 441 U.S. at 295–
96, 301–02 (stressing force and effect of law); Disabled
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APPLE INC. v. SQUIRES 13
American Veterans v. Secretary of Veterans Affairs, 859
F.3d 1072, 1077 (Fed. Cir. 2017) (stressing binding effect
and force of law), overruled regarding a § 552 issue by Na-
tional Organization of Veterans’ Advocates, Inc. v. Secre-
tary of Veterans Affairs, 981 F.3d 1360 (Fed. Cir. 2020) (en
banc); National Mining Association v. McCarthy, 758 F.3d
243, 251 (D.C. Cir. 2014). In contrast, general statements
of policy are pronouncements that “do not have the force
and effect of law,” Chrysler, 441 U.S. at 302 n.31, and are
merely “‘statements issued by an agency to advise the pub-
lic prospectively of the manner in which the agency pro-
poses to exercise a discretionary power,’” id. (quoting Tom
C. Clark, United States Attorney General, Attorney Gen-
eral’s Manual on the Administrative Procedure Act 30 n.3
(1947)). See also Sacora v. Thomas, 628 F.3d 1059, 1069
(9th Cir. 2010); Mada-Luna v. Fitzpatrick, 813 F.2d 1006,
1014 (9th Cir. 1987); National Mining Association, 758
F.3d at 251; Syncor International Corp. v. Shalala, 127
F.3d 90, 94 (D.C. Cir. 1997); Brock v. Cathedral Bluffs
Shale Oil Co., 796 F.2d 533, 537 (D.C. Cir. 1986) (Scalia,
J.); Batterton v. Marshall, 648 F.2d 694, 706 (D.C. Cir.
1980); Guardian Federal Savings & Loan Association
v. Federal Savings & Loan Insurance Corp., 589 F.2d 658,
666 (D.C. Cir. 1978); Pacific Gas & Electric Co. v. Federal
Power Commission, 506 F.2d 33, 38–39 (D.C. Cir. 1974).
We apply that distinction to the NHK-Fintiv instruc-
tions at issue here. We conclude that they are on the state-
ment-of-general-policy side of the line.2
2 There is no contention, or basis for a contention,
that the NHK-Fintiv instructions are made substan-
tive/legislative by virtue of modifying a pre-existing rule
that was itself separately conceded or established to be
substantive/legislative. Compare United States Telecom
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APPLE INC. v. SQUIRES 14
To begin with, whether an agency pronouncement has
binding effect on the agency is central to the § 553 inquiry.
See Xi’an Metals, 50 F.4th at 105–06; Stupp, 5 F.4th at
1352; Disabled American Veterans, 859 F.3d at 1077; see
also Syncor, 127 F.3d at 94; Professionals & Patients for
Customized Care v. Shalala, 56 F.3d 592, 595 (5th Cir.
1995); Pacific Gas, 506 F.2d at 38. “The critical factor to
determine whether a directive announcing a new policy
constitutes a rule or a general statement of policy is the
extent to which the challenged directive leaves the agency,
or its implementing official, free to exercise discretion to
follow, or not to follow, the announced policy in an individ-
ual case.” Mada-Luna, 813 F.2d 1013 (internal citation
omitted and cleaned up); Guardian, 589 F.2d at 666 (same).
But the NHK-Fintiv instructions are not binding on the
agency, i.e., on the statutory decisionmaker—the Director.
The instructions challenged by Apple do not even pur-
port to bind the Director. The Director, who is the statu-
tory decisionmaker on the matter, always could make the
non-institution (or institution) decision personally,
whether or not the Board has made an initial decision. See
2023 CAFC Decision, at 7, 13. The Director’s “flexibility
and [his] opportunity to make individualized determina-
tions” when “exercising [his] discretionary power” to insti-
tute is fully preserved. Sacora, 628 F.3d at 1070 (cleaned
up).
The challenged instructions, besides leaving much ini-
tial discretion to the Board, simply inform the Board how,
Association v. Federal Communications Commission, 400
F.3d 29, 34–35 (D.C. Cir. 2005), with Hemp Industries As-
sociation v. Drug Enforcement Administration, 333 F.3d
1082, 1088 (9th Cir. 2003). No such substantive/legislative
pre-existing rule has been identified.
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APPLE INC. v. SQUIRES 15
as delegatee, it should “exercise [the Director’s] discretion-
ary power in specific cases.” Mada-Luna, 813 F.2d at 1013
(internal citations removed). But “they are only binding
[on] the initial adjudicat[ory]” decisionmaker. Erringer
v. Thompson, 371 F.3d 625, 630–31 & n.10 (9th Cir. 2004).
These instructions are best understood as merely “ad-
vis[ing] the public prospectively of the manner in which the
agency proposes to exercise a discretionary power,” Chrys-
ler, 441 U.S. at 302 n.31; Lincoln, 508 U.S. at 197—here,
through a delegatee’s initial decision that the Director is
free to displace.
As Apple observes, the Director has (in the past) gen-
erally not displaced the initial decisions of the Board as del-
egatee. Apple Opening Br. at 27, 34. But that fact does not
mean that the Director has effectively treated those in-
structions as binding on the Director, who is the statutory
grantee of institution authority–although the Director
could do so in the future. See 90 Fed. Reg. 48335, 48335
(proposing institution standards applicable to the PTO). It
means only that the Board’s implementation of existing in-
structions in a particular case has reflected the Director’s
judgment at the time, which could have been altered in any
given case as a matter of unreviewable discretion. Syncor,
127 F.3d at 94 (“[A general policy statement] merely repre-
sents an agency position with respect to how it will treat
. . . the governing legal norm . . . . The agency retains the
discretion and the authority to change its position—even
abruptly—in any specific case because a change in its pol-
icy does not affect the legal norm.”); see also Guardian, 589
F.2d at 666 (observing that a binding norm did not exist
when the agency decisionmaker possessed the “discretion
to accept a non-conforming [ ] report” under the challenged
regulation).
In this important respect, the present case differs crit-
ically from a variety of cases in which the challenged pro-
nouncement did have a binding effect on the agency itself.
See, e.g., Coalition for Common Sense in Government
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APPLE INC. v. SQUIRES 16
Procurement v. Secretary of Veterans Affairs, 464 F.3d
1306, 1318 (Fed. Cir. 2006) (determining that the Secretary
“intended” its changes to its refund system “to be binding
. . . on itself”); W.C. v. Bowen, 807 F.2d 1502, 1505 (9th
Cir.), opinion amended on denial of rehearing, 819 F.2d 237
(9th Cir. 1987) (holding that the administrative law judges’
“final [Social Security disability benefit] decisions bind[ ]
both the Secretary [of Health and Human Services] and
claimant[s]” because the challenged agency “program lim-
its the Secretary’s discretion not to review an [administra-
tive law judge’s] decision”); Mendoza v. Perez, 754 F.3d
1002, 1024 (D.C. Cir. 2014) (determining that the chal-
lenged guidance letters established procedures for how the
“Department [of Labor] will evaluate H–2A applications,
[and] . . . what employers must do to obtain approval,”
binding both the ultimate decisionmaker and “substan-
tively affect[ing] the regulated public”); General Electric
Co. v. Environmental Protection Agency, 290 F.3d 377, 384
(D.C. Cir. 2002) (determining that EPA guidance facially
purported to apply to both regulated entities as well as the
agency itself).
The nature and statutory treatment of the decision
that is the subject of the challenged instructions, insofar as
the instructions allegedly harm Apple, further confirm that
the instructions are not on the notice-and-comment side of
the § 553 line at issue. Apple complains of “an institution
standard that reduces the likelihood that IPR will be insti-
tuted.” Apple Opening Br. at 36 (emphasis added); see id.
at 25, 34–36. That is, it challenges pronouncements con-
cerning the Director’s decision not to initiate an agency ad-
judicatory proceeding.
But, as we have explained, Apple has “no right to an
IPR.” Mylan Laboratories, 989 F.3d at 1383; see supra p.4.
To the contrary, the Director has broad and protected dis-
cretion not to launch an IPR, even when the statutory pre-
conditions are present. For one thing, decisions not to
launch enforcement actions are a category of agency
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APPLE INC. v. SQUIRES 17
decisions that the courts “traditionally have regarded as
‘committed to agency discretion’” and are “presumptively
unreviewable under [the APA, 5 U.S.C.] § 701(a)(2).” Lin-
coln, 508 U.S. at 191 (internal citations omitted). The Su-
preme Court invoked that recognition when stating that
“the agency’s decision to deny a petition is a matter com-
mitted to the Patent Office’s discretion.” Cuozzo, 579 U.S.
at 273; see Thryv, 590 U.S. at 60. And in any event, the
exercise of such discretion is statutorily protected from ju-
dicial review by 35 U.S.C. § 314. See supra p.4. These con-
firmations of unreviewable discretion strongly indicate
that the instructions concerning such non-institution are
properly considered “‘statements issued by [the PTO] to ad-
vise the public prospectively of the manner in which the
agency proposes to exercise a discretionary power.’” Lin-
coln, 508 U.S. at 197 (quoting Chrysler, 441 U.S. at 302
n.31 (internal citation omitted)).
Finally, as previously discussed, the “touchstone for
distinguishing” substantive rules from general statements
of policy is that the former must have the “force and effect
of law” and do so with respect to “individual rights and ob-
ligations.” Chrysler, 441 U.S. at 301–02 (internal citation
and quotation marks omitted); Stupp, 5 F.4th at 1352.
That is how we understand what it must mean to “affect”
“individual rights and obligations” in this area. See Chrys-
ler, 441 U.S. at 301–02. That understanding follows from
the requirement that a substantive/legislative rule have
the force and effect of law binding the agency and from the
§ 553(b) exclusion of statements of policy about the ex-
pected exercise of discretion—which, if exercised one way,
could often end up modifying an individual’s legal posi-
tion.3
3 Apple quotes a portion of a sentence from Batterton
v. Marshall, 648 F.2d 694 (D.C. Cir. 1980), in support of a
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APPLE INC. v. SQUIRES 18
A non-institution decision, which is protected as a mat-
ter of unreviewable discretion (constitutional issues aside),
leaves a patent challenger’s actual legal rights and obliga-
tions unchanged—what they would be if Congress had not
enacted the IPR regime (which it enacted only with pro-
tected Director discretion about institution). A non-insti-
tution decision has no legal effect on the underlying patent
suggested standard that would allow for a looser connec-
tion to legal rights or obligations—loose enough to encom-
pass the present challenged instructions, which are not
binding on the agency. See Apple Opening Br. at 32. But
Apple’s suggestion relies on an overreading of the cited
Batterton phrase even on its own terms and is inconsistent
with Chrysler (which Batterton does not cite) and all the
case law we have discussed. In Batterton, after stating that
notice-and-comment rulemaking is “required for those ac-
tions that carry the force of law,” taken pursuant to power
to “promulgate binding regulations,” the D.C. Circuit ob-
served that such rules “thus implement congressional in-
tent” and “effectuate statutory purposes,” and it then
added: “In so doing, they grant rights, impose obligations,
or produce other significant effects on private interests.”
648 F.2d at 701–02 (footnotes omitted) (emphasis added).
Apple points to the italicized phrase and treats it as if it
stood alone and stated an independently sufficient basis for
an agency action to qualify as a substantive/legislative
rule. Apple Opening Br. at 32, 33, 41. It should not be so
understood. The “[i]n so doing” sentence does not purport
to be declaring independently sufficient conditions; rather,
it is identifying effects that a substantive/legislative rule,
so qualifying under the just-described force-of-law and
binding-effect criteria, has. And Batterton, which involved
a change in existing rights (to certain federal money), does
not rely for its result on the broad notion Apple suggests;
Apple itself relies on Batterton only for its phrase, not for
its result (on facts far different from those present here).
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APPLE INC. v. SQUIRES 19
rights and obligations. Challengers are “free to litigate [a
challenged patent’s] claims’ validity in [their] own district
court case.” Mylan Laboratories, 989 F.3d at 1383. And
they may seek reexamination in the PTO under 35 U.S.C.
ch. 30, §§ 301–07.
C
The § 553 distinction at issue here involves terms and
concepts having a good deal of imprecision to them, so the
case-specific facts involved in cited judicial opinions, not
just the language used in those opinions, matter in analyz-
ing the present case against the background of pertinent
case law. Apple has placed particular reliance on several
decisions in which the D.C. Circuit held that an agency vi-
olated § 553 by not using notice-and-comment procedures.
But those decisions involved issues or circumstances that
differed materially from those present in this case. They
therefore do not alter our conclusion here.
Apple cites American Federation of Labor and Congress
of Industrial Organizations v. National Labor Relations
Board, in which the D.C. Circuit determined that three (of
five) challenged provisions of a rule announced by the Na-
tional Labor Relations Board had to be promulgated
through notice-and-comment rulemaking. 57 F.4th 1023,
1036–43 (D.C. Cir. 2023) (AFL-CIO); see Apple Opening Br.
at 37. But there was no issue in AFL-CIO about a “state-
ment of general policy” or a pronouncement not binding on
the agency and concerning the agency’s unreviewable non-
enforcement discretion. Rather, the Board’s only argument
was that the three provisions were excused from notice-
and-comment rulemaking as “rules of agency organization,
procedure, or practice,” 5 U.S.C. § 553(b), and the D.C. Cir-
cuit rejected that argument. AFL-CIO, 57 F.4th at 1036.
It held that the three provisions (“those regarding employ-
ers’ production of voter lists, the delayed certification of
election results, and who may serve as election observers”)
altered employees’ statutory “right[s] to elect
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APPLE INC. v. SQUIRES 20
representatives of their choice” and to “bargain in good
faith,” 29 U.S.C. §§ 158, 159, because they “trench[ed] on
the union’s substantive interest in campaigning on equal
footing with the employer,” “delay[ed] certification [thus]
cut[ting] back on an employer’s legal duty to post-election
to bargain in good faith,” and “directly affect[ed] regulated
parties’ interests in fair elections.” AFL-CIO, 57 F.4th at
1027–29, 1035. The present case, involving no legal enti-
tlement to the desired institution, a pronouncement not
binding on the statutory decisionmaker, unreviewable dis-
cretion in the relevant authority, and the “statement of
general policy” (not the “agency organization, procedure, or
practice”) portion of § 553, is properly distinguished from
AFL-CIO.
Apple also points to General Electric Co. v. Environ-
mental Protection Agency, in which the D.C. Circuit held
that the Environmental Protection Agency (EPA) had to
use notice-and-comment procedures to promulgate a guid-
ance document defining legal obligations of private parties
concerning EPA-regulated disposal of a certain chemical
compound. 290 F.3d at 385; see Apple Opening Br. at 37.
The D.C. Circuit concluded that the guidance document on
its face purported “to bind the [EPA]” and “require[ ] [reg-
ulated entities] to conform” to cleanup plan criteria. Id. at
384–85. The court held that “the commands of the Guid-
ance Document indicate that it has the force of law.” Id. at
385. For reasons we have explained, the present case is far
different.
Apple points in addition to Reeder v. Federal Commu-
nications Commission, 865 F.2d 1298, 1305 (D.C. Cir.
1989). See Apple Opening Br. at 37. But in Reeder, the
D.C. Circuit noted that the government did not dispute on
appeal that the Federal Communications Commission’s or-
der at issue, which changed its “longstanding policy” for
commercial FM frequency channel substitutions, was sub-
ject to notice-and-comment procedures. 865 F.2d at 1304,
1305. Even aside from evident differences in facts, see also
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APPLE INC. v. SQUIRES 21
supra p.14 n.2, that is reason enough to conclude that
Reeder does not alter our conclusion here.
Finally, Apple relies on Pickus v. United States Board
of Parole, 507 F.2d 1107 (D.C. Cir. 1974), stating that “the
rule altering the [P]arole [B]oard’s standards was subject
to notice and comment not because inmates had an existing
right to parole—they did not—but because the rule was cal-
culated to have a substantial effect on ultimate parole de-
cisions.” Apple Opening Br. at 38 (internal citations and
quotation marks omitted); see also id. at 45–46. Apple’s
reliance on Pickus is misplaced. In Pickus, federal prison-
ers challenged the Parole Board’s adopted criteria for
granting parole, and the D.C. Circuit held that the criteria
should have been promulgated pursuant to notice-and-
comment because the criteria were “self imposed controls
over the manner and circumstances in which the agency
will exercise its plenary power. They have the effect of law
and are not reviewable except for arbitrariness.” 507 F.2d
at 1113 (emphases added). In contrast to the present case,
Pickus itself recognized that it involved pronouncements
found to bind the agency with the effect of law, and parole
decisions under the criteria that were reviewable, albeit
deferentially. Indeed, perhaps because a decision to deny
parole is rather different from a decision simply to stay out
of a requester’s way (it is a decision to keep detaining the
requester), a parole denial was not committed to the Parole
Board’s discretion by law, but was reviewable (deferen-
tially) in habeas. See Furnari v. Warden, Allenwood Fed-
eral Correctional Institution, 218 F.3d 250, 254 (3d Cir.
2000); Ruviwat v. Smith, 701 F.2d 844, 844–45 (9th Cir.
1983); Sutherland v. McCall, 709 F.2d 730, 732 (D.C. Cir.
1983); Izsak v. Sigler, 604 F.2d 1205, 1206 n.1 (9th Cir.
1979). The present case is materially different for purposes
of § 553.
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APPLE INC. v. SQUIRES 22
III
For the foregoing reasons, we affirm the district court’s
judgment rejecting Apple’s challenges to the Director’s in-
structions as having improperly been issued without no-
tice-and-comment rulemaking procedures.
AFFIRMED
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