USPTO Director Issues Informative Decision Upholding Institution in Tesla v. Bulletproof IPR Despite Discretionary Considerations

The United States Patent and Trademark Office (USPTO) Director issued an informative decision on June 15, 2026, in the inter partes review proceeding Tesla, Inc. v. Bulletproof Property Management, LLC, IPR2026-00204. This decision applies the Office’s memorandum on Additional Discretionary Institution Considerations, which guides the exercise of discretion in deciding whether to institute AIA trials.

In this case, the Director declined to deny institution on discretionary grounds. The decision highlights three key factors influencing this outcome. First, the trial date in the co-pending parallel district court litigation had been vacated. Additionally, the petitioner submitted a broad stipulation, effectively allowing the AIA review to serve as an alternative forum to the ongoing litigation.

Second, the petitioner demonstrated what the Director characterized as an apparent Office error. This factor weighed in favor of proceeding with the inter partes review.

Third, the petitioner brought an early challenge to the patents at issue, which the Director recognized as a positive consideration supporting institution.

Moreover, the petitioner provided evidence of U.S. manufacturing specifically related to the accused products. This evidence further counseled against discretionary denial, reflecting the USPTO’s interest in supporting U.S. manufacturing and small business use of AIA proceedings.

The decision, designated as Paper 14 in the proceeding, serves as a reference point for how the USPTO applies its memorandum on Additional Discretionary Institution Considerations. It underscores the Office’s willingness to institute review when the petitioner’s actions and circumstances align with the policy goals of the America Invents Act (AIA).

The USPTO encourages stakeholders to review such informative decisions to better understand the factors influencing institution determinations in AIA trials. This transparency supports predictability and fairness in the patent review process.

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