In Klein Tools v. Milwaukee, the Acting Director Moves Away from the ITC Fintiv Factor Balancing of POSCO

In Klein Tools, Inc. v. Milwaukee Electric Tool Corp., IPR2024-01400, -01401, Paper 22 (PTAB June 9, 2025), the Acting Director intervened on review and denied institution for “erroneous” weighing of the Fintiv factors. In doing so, she seemingly rejected the reasoning of POSCO for how to assess parallel ITC investigations under Fintiv.

Ever since the February rescission of the 2022 Fitniv memo, the PTAB has been grappling once again with how to apply Fintiv to ITC investigations. ITC investigations are different from most parallel litigations considered by the PTAB for two reasons. First, because they typically involve at least two parallel proceedings: a district court action, which is stayed, and an ITC investigation, which is not. And second, because the ITC lacks authority to invalidate a patent, eventually invalidity will be at issue in the stayed district court action. Because of this, how factor 1 (likelihood of a stay) and factor 4 (overlap) should be assessed is not as clear.

As we have previously discussed, one of the leading cases from the APJ merits panels addressing this question is POSCO Co., Ltd. v. Arcelormittal, IPR2024-01376, Paper 11 at 3 (P.T.A.B. March 18, 2025), which answered this question by shifting emphasis from factor 1 to factor 4. By its reasoning (which the panel in Klein Tools adopted), the “overlap” of “patentability disputes” in the ITC tells you whether the district court stay in truth “allays concerns about inefficiency.”

However, in Klein Tools, the Acting Director seemingly rejected this reasoning, finding “[t]he Board’s analysis of factors 1 and 4, and overall weighing of the Fintiv factors were erroneous.” She found that factor 1 weighed against institution because a stay of the ITC proceeding is unlikely, with no mention of the parallel district court proceeding. She also found factor 4 weighed against institution because “the Board [did not] sufficiently consider the extent of the overlap between the two proceedings,” because “the ITC investigation involves the same parties, the same challenged claims, and includes overlapping prior art references.” Additionally, the Acting Director found that the merits under factor 6 did not outweigh the concerns raised by factors 1 and 4.

This decision raises the question whether the holding in POSCO, which is still pending for director review, will be upheld. While the Acting Director’s reliance on error in “weighing” the factors would seem to indicate it may not, this case could also have been decided more narrowly on the error for factor 4, which is “elevated” in importance under POSCO. The POSCO case has been fully briefed for director review for almost two months, so the answer should be forthcoming.