Sterne Kessler’s U.S. IP Update is a newsletter delivering the latest developments in U.S. intellectual property law, tailored for companies and legal counsel in Korea. Stay informed on key court decisions, policy changes, and trends impacting patents, trademarks, and other IP rights in the United States.
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In This Issue:
U.S. Legislative Update on Patent Law
Joseph Kim
Two significant patent owner friendly pieces of legislation moving through Congress have the potential to change U.S. patent law. These bills are still in committee and far from moving to the floor for full votes of the U.S. House and Senate, but we will continue to track their progress, so stay tuned for updates.
The PREVAIL Act
The PREVAIL Act (Promoting and Respecting Economically Vital American Innovation Leadership Act) (S. 1553; H.R. 3160) would limit those who can file an inter partes review (IPR) or post-grant review (PGR) petition and restrict parallel actions in the district court or the U.S. International Trade Commission (ITC). This bill was first introduced in the 118th Congress: the House in June 2023 and the Senate in July 2023. But failing to make it out of committee for a full vote of either chamber, the bill did not pass in the 118th Congress. The sponsors of the bill reintroduced it in both houses of the 119th Congress substantially unchanged.
The most notable provisions in the PREVAIL Act introduced the following changes to the PTAB process:
- Standing Required. Petitioners would be required to have been sued or threatened with a patent infringement suit before filing an IPR petition. The bill would also limit financial contributors of PTAB challenges from filing multiple IPR or PGR petitions on the same patent, as financial contributors would be considered real-parties-in-interest.
- Limits Joinders. The bill introduces a rebuttable presumption against joinder for a time-barred party.
- Attaches Estoppel at the Time of Petition. Estoppel would apply at the time the IPR petition is filed, instead of after a PTAB final written decision.
- Raises the Burden of Proof. The invalidity burden of proof and claim construction standards at the PTAB would be harmonized with those used in federal district courts. Invalidity would be found by “clear and convincing” evidence and patent claims would be construed by their “plain and ordinary meaning.”
- Limits Multiple Forums. If an IPR or PGR has been instituted, a party would not be able to raise the same invalidity arguments in district court or the ITC. Likewise, an IPR or PGR would not be instituted on the same grounds that a district court or the ITC has already entered a final judgment on.
The PERA Act
The PERA Act (Patent Eligibility Restoration Act) (S. 1546; H.R. 3152) would specify patent ineligible subject matter and eliminate judicially-created exceptions to patent eligibility. This bill was also introduced in the Senate during the 118th Congress in June 2023 and, like the PREVAIL Act, it never made it out of committee. So the sponsors reintroduced it in both houses of this Congress in May 2025.
The PERA Act suggests that the following would be patent ineligible:
- A mathematical formula that is not part of a claimed invention that is a useful process, machine, manufacture, or composition of matter, or any useful improvement thereof, unless the invention cannot be performed without the use of a machine or manufacture;
- A process that is substantially economic, financial, business, social, cultural, or artistic, even though at least one step in the process refers to a machine or manufacture, unless the invention cannot be performed without the use of a machine or manufacture;
- A process that is a mental process performed solely in the human mind or occurs in nature wholly independent of, and prior to, any human activity;
- An unmodified human gene as it exists in the human body, unless the human gene is purified, enriched, or otherwise altered by human activity, or otherwise employed in a useful invention or discovery; and
- An unmodified natural material as it exists in nature, unless the natural material is isolated, purified, enriched, or otherwise altered by human activity, or otherwise employed in a useful invention or discovery.
While these bills have bipartisan support, it is unclear if the bills will move out of committee. They are still moving through their respective judiciary committees of both the U.S. House and Senate, and so the scope and contents of the bills may change before moving on to the floor for full votes.
Sterne Kessler’s Offerings on Artificial Intelligence and Intellectual Property
Anna Phillips
Check out 2024 AI Intellectual Property Year in Review discussing the U.S. Patent Office’s guidance on using AI tools, perspectives on inventorship for AI-assisted inventions, and the U.S. Copyright Office’s position on copyrightability of works created using AI.
U.S. Federal Circuit Narrows the Scope of IPR Estoppel
Josephine Kim
The Federal Circuit in Ingenico Inc. v. IOENGINE, LLC has resolved a long-standing district court split regarding the type of prior art and invalidity grounds that fall within the scope of the inter partes reviews (IPR) estoppel provision. As background, in IPRs brought before the U.S. Patent Trial and Appeal Board (PTAB), petitioners may challenge the validity of a patent claim based on patent or printed publication prior art only and, if the petition results in a final written decision, the petitioner is not permitted to raise in district court or at the U.S. International Trade Commission (ITC) any invalidity grounds that the petitioner “raised or reasonably could have raised” during that IPR.
The question at issue here was whether a petitioner may bring invalidity grounds in a district court action or at the ITC based on product art or a prior art system that is “materially identical” to printed publications that could have been raised in an IPR. The Federal Circuit determined that the petitioner may do so because the petitioner is raising invalidity grounds that could not be raised during the IPR, for example, that the claimed invention was known or used by others, on sale, or in public use.
The takeaway for Korean companies is that IPR estoppel does not prevent a party from pursuing product art invalidity grounds in district court or at the ITC, even though the product art is materially identical to art that was raised or could have been raised in an earlier-filed IPR filed by that party (or a real party in interest) that has proceeded to a final written decision.
The full client alert can be viewed here.
