On September 4, 2025, the USPTO's Acting Director declined H2 Intellect LLC's request for discretionary denial of an IPR petition filed by Home Depot U.S.A., Inc. Central to the decision was the PTAB's analysis of "settled expectations"—the idea that a patent owner's long-standing rights may weigh against institution of review.
While acknowledging that the timing of the underlying district court trial, low chances of a district court stay, and H2 Intellect's strong settled expectations based on the challenged patent's age supported discretionary denial, the Director ultimately referred the petition to the Patent Trial and Appeal Board (PTAB) for a decision on the merits. Home Depot persuaded the Director by arguing that H2 Intellect's patent (which relates to the delivery of content to mobile device applications based on device location), had not been commercialized, asserted, marked, licensed, or otherwise applied in its technology space. Specifically, H2 Intellect's previous enforcement efforts had targeted products like smartphones, tablets, and watches, which are unrelated to Home Depot's hardware business and gave it no reason to anticipate assertion of the patent.
As a result, the Director denied H2 Intellect's request for discretionary denial and ordered that the petition proceed to the PTAB for further review. (The panel later denied institution for substantive reasons.)
Takeaway: The case underscores that while factors like parallel litigation and patent age are relevant, the PTAB will closely scrutinize the actual use and enforcement history of a patent before finding that settled expectations justify discretionary denial.
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