PTAB Precedential Decision Clarifies When a Wire Transfer “Payment Is Received” by the Board

16 March 2022 PTAB Trial Insights Blog
Author(s): Matthew Horton Michael R. Houston

The Patent Trial and Appeal Board (PTAB) Precedential Opinion Panel (POP) recently issued a precedential decision clarifying when a wire transfer “payment is received” via the Federal Reserve Fedwire System (Fedwire). Oftentimes, wired funds are not “settled” in a recipient’s bank account until several days after a payer initiated the wire transfer. This delay between initiation and settlement was raised in Toshiba Am. Elec. Components, Inc., v. Monument Peak Ventures, LLC.1 The Petitioner submitted an inter partes review (IPR) petition and the accompanying petition fee by wire to Treasury NYC (the USPTO’s bank) two days before the one-year statutory bar date, but the funds did not settle in the USPTO’s account until after the bar date. The POP addressed the question of the appropriate date, holding that payment was received when the funds were wired to Treasury NYC, not when the funds eventually settled in the USPTO’s account. 

On December 16, 2020, the Petitioner filed an IPR petition trying to invalidate claims of U.S. 7,583,294 (the ’294 patent). That same day, the Petitioner wired the petition fees to Treasury NYC according to the Board’s published guidelines. The Petitioner received a payment confirmation receipt from the bank and counsel forwarded the documentation to the USPTO accounting office. The funds eventually settled in the USPTO’s account on December 18, 2020, and the Board ultimately docketed the petition filing date for the next business day, December 21, 2020. This filing date was after the one-year bar date and would doom the petition.

The Petitioner filed a motion to correct the filing date to December 16, arguing that it had complied with the payment obligations on that date and had the payment confirmation to prove it. The Patent Owner disagreed, arguing the Fedwire payment confirmation did not show either that Treasury NYC accepted the funds or that the funds settled and were available to the USPTO. According to the Patent Owner, the documents showed that the USPTO received payment when the funds settled on December 18.

In a split decision, the Board denied the motion to correct the filing date. The majority was unpersuaded that the Fedwire payment confirmation could establish the date on which the fees were paid. The bank (Treasury NYC) and the USPTO are different entities and the Fedwire payment confirmation showed when the bank received the wire, but it did not show when the USPTO received the funds.

The dissent attributed the lag time in the funds arriving at the USPTO to the government. The dissent believed the majority’s view improperly penalized the Petitioner for the government’s delay. The dissent also noted that the Petitioner sent the funds, and the USPTO received payment, in accordance with the USPTO’s express instructions, furthering the point that the Petitioner was being improperly and unfairly penalized.

The POP disagreed with the majority and held that a Fedwire payment confirmation receipt can establish the date when the USPTO receives payment. The POP was persuaded by the Petitioner’s adherence to the USPTO’s guidance on wire payments. Citing the guidance, the POP explained that the Board “permits fees to be paid by wire transfer through Fedwire, and provides instructions for sending a wire payment.” The Petitioner’s Fedwire payment confirmation demonstrated that the Petitioner met the wire requirements as of December 16.

Effectively, under the decision, “payment is received” when a wire transfer is initiated, since a petitioner will usually receive a Fedwire confirmation receipt very shortly after the funds are wired. Notably, even though the POP said a Fedwire payment confirmation can demonstrate the date of payment, there are still additional requirements that must be met for wire transfers. The Fedwire payment confirmation establishes the date of payment, provided that a petitioner includes certain transaction details on the Fedwire paperwork.



1 IPR2021-00330, Paper 20 (January 14, 2022)

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