• By Kevin E. Noonan

    The new Director of the Patent and Trademark Office, Undersecretary of Commerce for Intellectual Property John A. Squires has spent the last few weeks making serious policy changes in the Office (seeNew Director Overturns PTAB Procedural Precedents: Part I“; “USPTO Proposed New Rules Limiting the Availability of Inter Partes Review, But Are They Legal?“).  Towards the end of last month, the Assistant Commissioner for Patents Brian E. Hanlon made his contribution, issuing a Memorandum to the Patent Examining Corps entitled “Advance notice of change to the MPEP with respect to false assertions or certifications of entity status.”

    The Memorandum references an Official Gazette Notice on June 12, 2025 on “Statutory Penalties for False Assertions or Certifications of Small and Micro Entity Status,” later published at 1536 OG 204 (July 8, 2025).  Substantively that Notice informed the public that the Office could “institute a review of pending patent applications or patents to determine whether there is a false entity status claim that resulted in the payment of at least one fee in an unentitled reduced amount”; in a footnote the Assistant Commissioner was careful to reassure that this Notice does not suggest any lack of previous authority to review small entity status or had “previously refrained from doing so.”

    The most recent Notice identified the changes to the M.P.E.P. that will effectuate the desired effects of the Memorandum, in particular M.P.E.P. § 410 (ante- and penultimate paragraphs), giving “employees reporting to the Assistant Commissioner for Patents that oversees the Office of Petitions” the authority to review a claim for small entity status entitlement “as well as [assessing] the reasonableness of their conduct” in doing so.  This portion of the Memorandum cites 37 C.F.R. § 11.18(b) for determining violation of an applicant’s or practitioner’s duties of disclosure and 37 C.F.R. § 11.18(c) for sanctions to be imposed in the event such violations are determined.

    Further changes in M.P.E.P. § 509.03(b) are set forth with regard to “any attempt to fraudulently establish status as a small entity or pay fees as a small entity,” which will be considered to be fraud on the Office, and that an applicant cannot rely on any verbal advice “inadvertently” given regarding entitlement to small entity status.  The same “employees reporting to the Assistant Commissioner for Patents that oversees the Office of Petitions” referenced above are given the authority (“may review”) whether the applicant or patent owner is entitled to small entity status.  Similar provisions apply under M.P.E.P. § 509.04 for micro entity status under 37 C.F.R. § 1.29(j).

    Finally, the Memorandum discloses provisions under M.P.E.P. § 1001.02(b) for reconsideration requests under circumstances that a claim for small entity status was determined to be “falsely made and not in good faith.”

    These changes came into effect upon issuance of the Memorandum on October 24, 2025.

    What the Memorandum does not do is provide any rationale or basis for or any evidence that claims to small or micro entity status are being improperly made.

  • By Kevin E. Noonan

    In a seemingly otherwise run-of-the-mill, albeit precedential, decision, the Federal Circuit affirmed a stipulated judgment of non-infringement in Aortic Innovations LLC v. Edwards Lifesciences Corp.

    The case arose in litigation over the claims of Aortic’s U.S. Patent Nos. 10,881,538, 10,966,846, 10,987,236, and 11,129,735 directed towards devices for transcatheter aortic valve replacement; two alternatives of such devices are illustrated in the opinion as comprising a “balloon-expandable frame” and a “self-expanding frame”:

    Claim 1 of the ‘735 patent is set forth in the opinion as representative:

    1. An endovascular transcatheter valve assembly comprising:
    an outer frame,
    wherein the outer frame is formed from a metallic material and defines an open cell configuration
    wherein the outer frame includes an inflow end at a proximal portion thereof and an outflow end at a distal portion thereof,
    wherein the outer frame is formed by a plurality of struts that adjoin each other at the inflow end to form apices:
    an inner frame that engages a prosthetic heart valve having prosthetic leaflets, wherein the inner frame includes a cylindrically extending inner graft covering extending at least partially radially outwardly of the prosthetic heart valve and radially inwardly of the outer frame for providing sealing to the prosthetic heart valve,
    wherein the outer frame is secured to the inner graft covering by stitching a proximal portion of the outer frame;
    an outer seal for preventing paravalvular leaks that at least partially extends over at least two most proximal rows of cells formed in the outer frame,
    wherein the outer seal is formed of outwardly extending fibers positioned externally to the outer frame,
    wherein the valve assembly has a radially com-pressed orientation and a radially expanded orientation,
    wherein the valve assembly is configured to press some of the fibers against native leaflets of the aorta of the patient
    wherein an end of the apices of the outer frame that are most proximal are covered by the outer seal and the graft covering,
    wherein the end of the most proximal apices of the outer frame extends more proximally than a proximal end of the outer seal.

    (wherein outer frame is italicized for being the claim element at issue in the case).

    The District Court construed the term “outer frame” to be consistent with disclosure in the specification, particularly structure 416 identified in a dual-frame transcatheter valve illustrated by this Figure 20:

    and structure 216 identified in a dual-frame endo-graft device illustrated by this Figure 9:

    In this construction the District Court held that the term “outer frame” be interpreted as being interchangeable with “a self-expanding frame” as asserted by Edwards (rather than by its plain and ordinary meaning as Aortic argued) because Aortic had acted as its own lexicographer by using the terms “outer frame,” “self-expanding frame,” and “self-expanding outer frame” interchangeably.  The parties stipulated that under this construction Edwards’ accused SAPIEN 3 Ultra valve, a single, balloon-expandable frame did not infringe the asserted claims.

    In the meantime, and relevant to this appeal, Edwards filed inter partes review petitions against the asserted patents and instituted IPRs for all but the ‘735 patent.  The District Court entered judgment based on the stipulation of non-infringement and this appeal followed.

    The Federal Circuit affirmed, in an opinion by Judge Reyna and joined by Judges Prost and Chen.  (The Court dismissed the appeal for lack of jurisdiction regarding the ‘538 patent, in which the Patent Trial and Appeal Board held in a Final Written Decision that all claims were invalid, relying on Fresenius USA, Inc. v. Baxter Int’l, Inc., 721 F.3d 1330, 1340 (Fed. Cir. 2013)).  Turning to the merits, the panel agreed with the District Court’s construction that the term “outer frame” comprised embodiments that were also “self-expanding” and that the terms are interchangeable, and affirmed the District Court’s claim construction accordingly.  The basis for the Court’s conclusion on this construction was that a patentee is permitted to be its own lexicographer, provided that a definition of a claim term “other than its plain and ordinary meaning” must be set forth clearly and when this written description is satisfied the term should be construed in that way, citing Thorner v. Sony Comput. Ent. Am. LLC, 669 F.3d 1362, 1367 (Fed. Cir. 2012).  This definition does not need to be disclosed as an explicit redefinition of a term otherwise having a plain and ordinary meaning, however, but may define terms by implication, under Bell Atl. Network Servs., Inc. v. Covad Commc’ns Grp., Inc., 262 F.3d 1258, 1268 (Fed. Cir. 2001).  This burden is greater than “[s]imply referring to two terms as alternatives or disclosing embodiments that all use the term[s] the same way[, which] is not sufficient to redefine a claim term” according to the opinion.  But should the patent disclose a “consistent and clear interchangeable use of two terms [this] can result in a definition equating the two terms” according to the Court, citing Edwards Lifesciences LLC v. Cook Inc., 582 F.3d 1322, 1329 (Fed. Cir. 2009); Wasica Fin. GmbH v. Cont’l Auto. Sys., Inc., 853 F.3d 1272, 1282 n.6 (Fed. Cir. 2017); Bid for Position, LLC v. AOL, LLC, 601 F.3d 1311, 1317–18 (Fed. Cir. 2010); Tate Access Floors, Inc. v. Maxcess Techs., Inc., 222 F.3d 958, 968 (Fed. Cir. 2000); and Bell Atl., 262 F.3d at 1274–75 (and setting forth the bases in this precedent for the Court to arrive at a determination of redefinition).

    The panel agreed with the District Court that “[h]ere, a skilled artisan would understand that the claimed term ‘outer frame’ is a ‘self-expanding frame,’” citing the portions of the specification relied upon by the District Court (structure 416 in Figure 20 and structure 216 in Figure 9).  According to the opinion, “this disclosure clearly indicates that structures 216 and 416 are outer frames that must self-expand.”  In addition, the panel cited the consistent disclosure in the specification that “claim 1’s ‘outer frame’ is a ‘self-expanding frame,’” citing multiple examples of such disclosure in the summary section.  Citing GPNE Corp. v. Apple Inc., 830 F.3d 1365, 1370 (Fed. Cir. 2016), for the rubric that “when a patent repeatedly and consistently characterizes a claim term in a particular way, it is proper to construe the claim term in accordance with that characterization,” the opinion asserts that “the specification clearly and consistently conveys that the self-expanding nature of structures 216 and 416 is present in all embodiments of those devices.”  In view of this understanding, the Court held that the District Court was correct that the skilled artisan would understand the disclosure to be consistent with this construction.

    The opinion also somewhat summarily rejected Aortic’s additional argument that the Court should judicially estop Edwards from arguing that the term “outer frame” should be construed as anything other than its plain and ordinary meaning due to putative inconsistencies between their argument before the District Court and before the Patent Trial and Appeal Board during inter partes review proceedings, finding that Aortic had forfeited this argument by not raising it before the District Court.

    Aortic Innovations LLC v. Edwards Lifesciences Corp. (Fed. Cir. 2025)
    Panel: Circuit Judges Prost, Reyna, and Chen
    Opinion by Circuit Judge Reyna

  • By Michael S. Borella

    From a technical standpoint, everything a computer does involves reading, manipulating, and storing information through microcode instructions that move around 0’s and 1’s. Each operation performed by a processor, such as addition, comparison, and data transfer, can be manually simulated as a series of these instructions. Undergraduate students in computer architecture courses routinely perform such exercises with a pencil and paper to understand how a processor works. In principle, one could simulate any software algorithm this way (albeit with the parallel portions serialized). But completing even modest tasks might take years.

    U.S. patent law fails to appreciate these facts, and the consequences are absurd.

    The law deems certain categories of inventions as ineligible for patenting, among them those drawn to so-called abstract ideas. Mental processes are a sub-category of abstract ideas. The reasoning behind this exclusion seems straightforward and even reasonable at first blush – if something can be performed purely in the human mind, like adding two small numbers or making a basic decision, it should not be patentable. However, the doctrine has expanded far beyond that.

    Under decisions such as CyberSource Corp. v. Retail Decisions, Inc., courts have ruled that a mental process also includes tasks that could be performed by a human using pen and paper. The U.S. Patent and Trademark Office (USPTO) adopted the same stance in its Manual of Patent Examining Procedure (M.P.E.P.) § 2106, asserting that there is no distinction between processes performed entirely in the mind and those that require physical aids. Courts have gone even further, declaring that claims performed by a computer can still be considered mental processes. Cases like Mortgage Grader v. First Choice Loan Services and Intellectual Ventures I v. Symantec treat computer-implemented methods as mental acts simply because they can be theoretically replicated by the human mind.[1]

    This principle is a legal fiction. A process that requires a machine executing billions of instructions per second is treated as if it were a mere mental exercise even though it is not and never could be. No amount of coffee will help a person think their way through these complex calculations, much less at a rate that would provide a useful result in a reasonable period of time. And the consequences can be dire for patentees, with claims to legitimately innovative technical inventions being rejected by the USPTO or invalidated by courts because their steps could be simplified to appear analogous to human thoughts.

    In In re Killian, the Federal Circuit wrote a small treatise defending this nonsense.  The USPTO’s Patent Trial and Appeal Board (PTAB) continues to wield the mental steps doctrine like a sledgehammer against software applicants, affirming examiners’ patent eligibility rejections at a very high rate.

    The USPTO’s own guidance attempts to draw a line between processes that “can practically be performed in the human mind” and those that cannot. Examples deemed mental include generic data analysis and DNA sequence comparison, while examples deemed non-mental include GPS position calculations, network packet inspection, and certain encryption methods. Yet the logic behind these distinctions is paper-thin.

    For example, comparing BRCA1 and BRCA2 gene sequences – which the USPTO believes to be mental tasks – involves analyzing tens of thousands of DNA base pairs, an undertaking as unsuited for human performance as inspecting hundreds of network packets, which the USPTO classifies as non-mental. The supposed boundary between these categories has no technical coherence.

    The doctrine collapses because it confuses what is theoretically imaginable with what is physically possible. While a human could, given enough time and paper, emulate any computer program, that does not make machine-based computation a mental act. Software execution is a physical process of manipulating electrical states in silicon, not a series of thoughts.

    By treating computer-implemented algorithms as abstract mental activities, courts ignore the physical nature of software execution and the integral relationship between code and hardware. Software causes a machine to change states and behaviors when its instructions are performed. Separating the idea of the algorithm from the computer that carries it out distorts both technology and law. This is like confusing a mere recipe with the act of cooking using kitchen utensils and appliances.

    This confusion has especially damaging effects on emerging fields like machine learning. Despite the USPTO’s own examples showing that certain machine learning claims are not drawn to mental processes, examiners frequently reject similar claims as ineligible. The reasoning is circular: because a neural network follows mathematical logic, it can be performed mentally, even though no human could realistically simulate millions of weighted matrix operations by hand.

    The current application of the mental steps doctrine, coupled with the Supreme Court’s overly-broad abstract idea exclusion, has made software patent eligibility unpredictable and irrational. Courts invoke metaphysical distinctions between “thinking” and “computing” while ignoring the physical, technical character of modern digital systems. As a result, patent examiners are left to apply vague rules that depend more on inconsistent precedent and personal interpretation than on consistent reasoning.

    A rational approach would confine the doctrine to its original intent – excluding only those inventions truly meant to be performed mentally by humans. A claim to a method that requires a computer should not be treated as a mental process simply because it can be described in terms of steps that have an attenuated relationship to human thought.

    If anyone still insists that computers and human minds are analogous for patent eligibility purposes, I invite them to prove it. Go ahead and train a large language model in your head. Memorize billions of parameters, calculate trillions of matrix multiplications, backpropagate the gradients, and fine-tune it across terabytes of text. You have to do it all mentally, of course, or maybe with a handy pen and paper if you need a physical aid. But you can’t do it because no human can. If you disagree, then go ahead and try and show me the results. I’ll wait but probably not long enough, because by the time you finish the sun will have boiled the oceans and swallowed the Earth.

    * This article has been adapted from the author’s earlier article, “The Mental Process Exception to Patent Eligibility is Remarkably Brainless,” Patent Docs, Jan. 9, 2023.


    [1] To be fair, a claim deemed abstract can still be eligible if it also recites an “inventive concept.” But in practice, this can be quite difficult because once a claim is characterized as directed to an abstract idea, courts often view most or all of its features as part of that abstraction. Further, generic hardware or using routine functions cannot provide an inventive concept. The courts have set a high bar for a claim surviving once it has been damned to the Hell of abstraction.

  • By Michael S. Borella

    It has been over a decade since the Supreme Court blessed us with the two-step framework for patent eligibility under 35 U.S.C. § 101 in Alice Corp. v. CLS Bank. First, one must determine whether the claim at issue is “directed to” a judicial exception, and if so, one must then decide whether the claim adds “significantly more” than the alleged exception itself.

    The ambiguities of this test are legion. But beyond its shortcomings, the Federal Circuit and the U.S. Patent and Trademark Office (USPTO) have both modified it in substantive fashions. So now we have three “Alice tests” that share a name but can be applied differently in practice.

    At surface level, the original Alice decision was about abstract ideas implemented in software, and whether reciting generic computer hardware in a claim made the overall claims any less abstract. But the Court’s language in the opinion made it clear that their actual concern was one of preemption.

    We have described the concern that drives this exclusionary principle as one of pre-emption. Laws of nature, natural phenomena, and abstract ideas are the basic tools of scientific and technological work. Monopolization of those tools through the grant of a patent might tend to impede innovation more than it would tend to promote it, thereby thwarting the primary object of the patent laws. We have repeatedly emphasized this concern that patent law not inhibit further discovery by improperly tying up the future use of these building blocks of human ingenuity.

    The Court’s stated rationale was straightforward – to not allow monopolization of the “building blocks of human ingenuity.”[1] In this light, the Alice test was supposed to ask whether a claim effectively preempted use of such a building block in the form of an abstract idea (whatever that means this month), law of nature, or natural phenomenon.

    Further, this preemption-centric logic at least ties § 101 to a policy rationale. If a claim does not preempt others from using the “basic tools of scientific and technological work” it is eligible. Unfortunately, the Court left out the small matter of how one is supposed to measure preemption. Is it claim breadth? Use of functional language? Market impact? Who knows. How much and what does one need to add to an abstract idea in order to make it “significantly more?” Again, who knows? The Court shrugged and walked away, leaving the Federal Circuit to fill in the blanks. This was a mistake.

    The Federal Circuit looked at Alice, nodded politely, and proceeded to ignore its core premise. Instead, the appellate court has stripped preemption from the test. In Ariosa Diagnostics, Inc. v. Sequenom, Inc., the Federal Circuit wrote:

    The Supreme Court has made clear that the principle of preemption is the basis for the judicial exceptions to patentability. For this reason, questions on preemption are inherent in and resolved by the § 101 analysis . . . . While preemption may signal patent ineligible subject matter, the absence of complete preemption does not demonstrate patent eligibility . . . . Where a patent’s claims are deemed only to disclose patent ineligible subject matter under the [Alice] framework, as they are in this case, preemption concerns are fully addressed and made moot.

    In the span of three sentences, the Federal Circuit both acknowledged that preemption is the basis of the Alice test and then declared that preemption is irrelevant when one applies the Alice test. This is the jurisprudential equivalent of agreeing that a solid foundation is essential, then building a house on sand anyway. The Supreme Court’s § 101 decisions do not treat preemption as an incidental consequence of the analysis; they treat it as the reason the analysis exists. By declaring that preemption concerns are “moot” once the claim fails the Alice test, the Federal Circuit inverted the structure of the doctrine. Ariosa instead treats the test as self-justifying, in that preemption begins and ends with whatever conclusion the court reaches. Through this doctrinal sleight of hand, the Alice test as applied by the Federal Circuit does not ask whether a patent blocks others from using one of the basic tools of scientific and technological work.

    This has resulted in many remarkably narrow claims that recite far more than basic building blocks to be ruled too abstract for patenting in a highly conclusory manner. This shift also means that § 101 is doing the job of § 102, § 103, and § 112 all at once, but without the pesky constraints of evidence or claim construction.

    So, preemption has gone from the cornerstone of the analysis to an irrelevant footnote. Which brings us to the third version of the test – the USPTO’s bureaucratic remix.

    Never one to miss a chance to turn doctrine into paperwork, the USPTO took Alice and did what federal agencies do best: they added complexity. The 2019 Revised Patent Subject Matter Eligibility Guidance broke the first step of the Federal Circuit test into two parts, each with its own long list of relevant considerations.

    Particularly, the two substeps of the judicial exception inquiry are: does the claim recite a judicial exception,[2] and if so does it integrate that exception into a practical application? Examiners must then run through a list of factors, such as improvements to technology, meaningful limitations, specific machine use, etc., each of which can support eligibility. Only then do we reach Step 2B, where the “inventive concept” analysis lives, chained to the unhelpful “well-understood, routine, and conventional” mantra.

    The USPTO’s 2019 guidance was supposed to improve consistency, but it mainly made § 101 rejections and rebuttals longer and more convoluted. Worse, none of this is binding on the courts, so an applicant who finally navigates the Office’s Alice labyrinth may find their patent declared ineligible on the pleadings by a district court judge.

    The USPTO’s Alice test is thus a triumph of administrative structure over substance. It replaces two vague steps with three vague steps, aimed at creating the illusion of objectivity. Kafka would be proud.

    So we have three distinct versions of the same test. The Supreme Court’s Alice test is fundamentally based on preemption, the Federal Circuit’s Alice test ignores preemption, and the USPTO is too busy drawing flowcharts to care either way. Each of these tests speaks its own language, none of which is intelligible. A claim that passes the USPTO may fail in court. A claim that would survive under the Supreme Court’s stated rationale might never make it past an examiner or the Federal Circuit. The only common thread is uncertainty.

    If Congress or the Supreme Court ever decides to clean this up, here is a two-step process they could use that is actually workable in practice. Step one: admit the obvious – the Alice test is an incomprehensible mess. Step two: go back to a pre-Alice regime and focus on § 102, § 103, and § 112.


    [1] Some would argue that, ironically, Alice has strengthened the monopoly power of large companies by weakening patent law so that these companies can “efficiently infringe” competitors’ patents given that invalidating such patents was made dramatically easier.

    [2] The USPTO goes to pains when trying to explain the difference between the language “directed to” and “recites.” One of the more bizarre outcomes of the USPTO’s version of the test is that an eligible independent claim that does not recite a judicial exception can have an ineligible dependent claim that does.

  • By Kevin E. Noonan

    It is fair to say (no matter what else can be said) that the current administration is outcome- rather than process-driven. This general inclination is true of the Department of Health and Human Services and the agencies contained thereinunder, and the Food and Drug Administration exhibited this tendency in a recent Draft Guidance regarding the requirements for a biosimilar-producing applicant to obtain approval for an abbreviated Biologic License Application (aBLA).

    Here the outcome is lower drug prices, as expressly stated by Secretary Kennedy in a press release. Characterizing the change as an illustration of “bold action,” the press release attributes the lower number of approved biosimilar drugs (76) compared to conventional small molecule generic drugs (over 30,000) as the result of “a burdensome approval process” (ignoring the difference between the over forty years that have elapsed since passage of the Hatch-Waxman Act and fifteen years since the BPCIA was passed as part of the Affordable Care Act, as well as the recognized differences in technology and costs/efforts for bringing a biosimilar drug to market (seeNo One Seems Happy with Follow-on Biologics According to the FTC” and “Emerging Health Care Issues: Follow-on Biologic Drug Competition“). FDA Commissioner Marty Makary M.D., M.P.H. echoes his boss’s theme, stating that “[b]y streamlining the biosimilar development process and helping advance interchangeability, we can achieve massive cost reductions for advanced treatments for cancer, autoimmune diseases, and rare disorders affecting millions of Americans” (Dr. Makary’s philosophy can be found in his book, Blind Spots: When Medicine Gets It Wrong, and What It Means for Our Health). Now-former Director, FDA Center for Drug Evaluation and Research, George Tidmarsh, M.D., Ph.D. in more measured tones characterized the changes as being due to the FDA’s commitment “to advancing common-sense policies that further promote efficient and effective biosimilar and interchangeable biosimilar development, without compromising safety and effectiveness,” a worthy aspiration but perhaps being less than expected or hoped-for. The economic and political impetus is also set forth in the press release, which notes that “[e]xpensive biologic medications make up only 5% of prescriptions in the U.S. but account for 51% of total drug spending as of 2024. FDA-approved biosimilars are as safe and effective as the branded drugs, yet their market share remains below 20%.” There is little to no recognition that perhaps the reason approved biosimilar drugs are “as safe and effective as the branded drugs” is because of the “burdensome approval process” (a blind spot shared by many; seeInterchangeable Biosimilars: In a Battle of Safety vs. Cost, Where Does Sen. Lee Stand?“).

    The press release states simply the point of the new Guidance: based on “the agency’s accrued data and experience since the first biosimilar was approved in 2015” (the same evidence excoriated as being “unduly burdensome” earlier in the press release), “comparative efficacy studies generally have low sensitivity compared to many other analytical assessments,” and touts that the new Guidance “reduces this unnecessary resource-intensive requirement for developers to conduct comparative human clinical studies” in favor of such analytical studies. Also denigrated are testing requirements for interchangeability, which has been the subject of earlier Guidance changes.

    The Guidance is remarkably brief in view of the purported sea change it is promised to produce in biosimilar approval requirements. The Guidance itself reiterates some of these policy-based (as opposed to science-based) rationales for the changes set forth therein. The Introduction section of the Guidance sets forth an earlier Guidance (Scientific Considerations in 37 Demonstrating Biosimilarity to a Reference Product) from 2015 providing information related to satisfaction of the statutory requirements under Section 351 of the PHS Act for biosimilarity and FDA’s interpretation thereof (including “comparative analytical studies, an assessment of toxicity, comparative human PK and PD studies (if there is a relevant PD measure(s)), and a clinical immunogenicity assessment.” The devil being in the details, the Guidance announces that the substantive changes are a consequence of the “significant experience in evaluating analytical differences between proposed biosimilar products and their reference products and understanding the impact of those analytical differences on clinical performance.” According to the Guidance, “currently available analytical technologies can structurally characterize highly purified therapeutic proteins and model in vivo functional effects with a high degree of specificity and sensitivity using in vitro biological and biochemical assays” and “comparative analytical assessment (CAA) is generally more sensitive than a [comparative efficacy study,] CES to detect differences between two products” relevant to biosimilarity.  Under circumstances where a CAA indicates biosimilarity as defined in the statute, “FDA recommends that sponsors consider a streamlined approach where a CES may not be necessary to support a demonstration of biosimilarity,” which may include “an appropriately designed human pharmacokinetic similarity study and an assessment of immunogenicity.” In a specific recommendation the Guidance provides that:

    A streamlined approach should be considered when:

    • The reference product and proposed biosimilar product are manufactured from clonal cell lines, are highly purified, and can be well-characterized analytically;

    • The relationship between quality attributes and clinical efficacy is generally understood for the reference product, and these attributes can be evaluated by assays included in the CAA; and

    • A human pharmacokinetic similarity study is feasible and clinically relevant.

    The Guidance also recognizes “there may remain” instances and circumstances where a CES may be appropriate, and sponsors are “encouraged” to discuss such instances and circumstances with the Agency.

    As with all draft Guidances, this one sets forth immediately before the Introduction the caveat that:

    Whether the requirements in this Guidance improvidently expose the public to inadequately tested/screened/examined biosimilar drugs will depend on how the Guidance is implemented and (with even more uncertainly) the particular biologic drug for which the biosimilar is approved. And it remains questionable whether any such changes will significantly impact the number, time to market, or cost savings of new biosimilar drugs.

  • By Joshua R. Rich

    Usually, when an issue is actually considered and resolved after a full and fair opportunity to litigate, the doctrine of issue preclusion can bar the losing party from relitigating the issue in another case.  That is, judicial economy is best served by not allowing a losing party a second bite at the apple on questions it had every reason to fight over, but failed.  But as Inland Diamond Products shows, there can be an exception:  in certain circumstances when the earlier decision was made based on a lower standard of proof, courts will not honor that earlier decision by applying issue preclusion and will make later parties prove their case from whole cloth.

    The Inland Diamond Products case was the second round of fighting over the two patents-in-suit (U.S. Patent Nos. 8,636,360 and 9,405,130).  In 2017, Inland brought a patent infringement lawsuit against Hoya Optical Labs of America in the U.S. District Court for the Eastern District of Texas alleging infringement of claims of the two patents.  Hoya responded by filing petitions for inter partes review against the two patents in late 2017 and early 2018.  The district court litigation and IPRs continued in parallel until August 2018, when the parties settled the litigation.  Importantly, however, the settlement expressly did not moot the IPRs.  Instead, they carried forward to resolution, with some of the claims (including the independent claims) being found invalid for obviousness in mid-2019.  But some of the claims survived.

    With those surviving claims in hand, Inland sued Cherry Optical for patent infringement in the U.S. District Court for the Eastern District of Wisconsin.  After almost three years of hard-fought litigation, Cherry Optical moved for summary judgment of invalidity due to obviousness.  It based its motion in part on the earlier IPR decisions, reasoning that Inland should be bound to the earlier finding that the independent claims of the asserted patents were obvious and Inland should only be permitted to argue that the additional elements of the dependent claims rendered them nonobvious.  The District Court agreed, applying issue preclusion to narrow Inland’s possible arguments to only those additional elements.  But those differences were not enough to overcome the prior art references and arguments that Cherry Optical asserted and the District Court granted summary judgment of invalidity.

    While the appeal from the District Court’s decision in the Inland Diamond Products case was pending, the Federal Circuit decided two cases that dictated its decision here.  In ParkerVision, Inc. v. Qualcomm Inc., 116 F.4th 1345 (Fed. Cir. 2024), the PTAB found apparatus claims invalid in an IPR; the patentee then asserted the method claims of the same patent in district court litigation.  The accused infringer cited the same invalidating art in the litigation and the District Court barred the patentee from providing expert witness testimony on the same factual issues that were resolved in the IPR.  Because the PTAB’s decision was made under the preponderance of the evidence standard, not clear and convincing evidence (the standard for invalidation in litigation), the Federal Circuit ruled that estoppel could not apply.  Similarly, in Kray IP Holdings, LLC v. Groupon, Inc., 127 F.4th 1376 (Fed. Cir. 2025), the Board held claims of the relevant patent invalid in an IPR.  When Kray sought to assert immaterially different claims in litigation, the District Court dismissed its complaint due to issue preclusion.  Again, the Federal Circuit refused to apply issue preclusion and reversed the dismissal based on the different burdens of proof on invalidity in the Patent Office and district court.

    Given the precedent of the ParkerVision and Kray decisions, the Federal Circuit’s reversal of summary judgment in the Inland Diamond Products case was preordained.  But as the court noted, the earlier cases had to distinguish the decision in XY, LLC v. Trans Ova Genetics, L.C., 890 F.3d 1282 (Fed. Cir. 2018).  In that case, the Federal Circuit applied issue preclusion to bar relitigation of the validity of a claim that had been invalidated in an IPR when the appellate court concurrently decided the two appeals.  It held the appellate decision means “the claim no longer exists and cannot be asserted as a basis for infringement.”  But given the later precedent of ParkerVision and Kray, it seems to be a thin reed to distinguish between the two situations:  only if the Federal Circuit decides the two appeals on the same day (or invalidates the patent claims earlier) does the reasoning even apply?[1]

    The Federal Circuit did provide some guidance for the District Court – and future litigants – after reaching its conclusion.  First, in a footnote, it indicated that there would be another reason to ignore issue preclusion in early IPRs.  Specifically, it said claim constructions rendered based on the “broadest reasonable interpretation” cannot preclude relitigation because the claim construction standards are different.  In this case, that would be another reason that applying issue preclusion was erroneous, beyond the distinction in standard of proof of invalidity and the asserted claims themselves not having been invalidated.  Furthermore, even if the same prior art was asserted as invalidating closely related claims, the District Court could not rely on the PTAB’s decision to shorten its analysis; the patent challenger would carry the burden of proof and the patentee must be allowed to mount a full challenge to the invalidity arguments.

    The Inland Diamond Products case limits the value of a successful IPR.  Coming at almost exactly the same time as proposed rules that limit the availability of IPRs[2] and the Director’s decision to resolve all institution issues himself,[3] it is another blow to IPRs as an option for resolving validity issues.  The intent in creating IPRs was to avoid the need for fulsome litigation of validity issues if the Patent Office could resolve them more quickly and inexpensively.  The Inland Diamond Products case eliminates all of those efficiencies.

    Inland Diamond Products v. Cherry Optical (Fed. Cir. 2025)
    Panel: Circuit Judges Prost, Reyna, and Chen
    Opinion by Circuit Judge Prost


    [1] Given the reasoning of these cases, it isn’t clear if the Federal Circuit would apply issue preclusion to allow a PTAB finding of invalidity to prevent assertion of infringement of the same claim in a district court or if the IPR appeal were still pending when an infringement appeal were decided.

    [2] https://patentdocs.org/2025/10/19/uspto-proposed-new-rules-limiting-the-availability-of-inter-partes-review-but-are-they-legal/

    [3] https://patentdocs.org/2025/10/19/new-director-overturns-ptab-procedural-precedents-part-i/

  • By Michael S. Borella

    The U.S. Patent and Trademark Office (USPTO) is trapped in a perpetual battle on two fronts.  First, there is their application backlog, which can extend patent pendency by months or years.  Second is the systemic challenge of patent quality.  These two problems are not independent of one another. Low-quality examination is characterized by incomplete searches and rushed analysis, which can lead to rounds of Requests for Continued Examination (RCEs), appeals, and even costly post-grant litigation.  Conversely, under pressure to reduce pendency, examiners may conduct less-thorough examinations, thereby harming quality.

    For decades, the solutions have been incremental, bureaucratic, or both.  Examiner interviews, accelerated examination programs, and various pilot programs have nibbled at the edges of the problem.  The most recent, the “Streamlined Claim Set Pilot Program,” continues this tradition by offering a simple, but flawed bargain: trade your claims for a spot at the front of the examination queue.

    These solutions misdiagnose the illness.  The problem is not the number of claims; instead, it is the profound inefficiency of the first substantive interaction between the applicant and the examiner.  A first non-final office action is often the output of many examiner hours being spent on cold-start prior art searches. In many cases, this office action contains prior art rejections that could have been avoided.  If the applicant had known of the closest prior art, they likely would have narrowed their claims to focus examination on more protectable aspects of the invention.

    With the rise of generative artificial intelligence (AI), there are new options on the table.  One that we’d like to propose for discussion is what we call AI-First Triage (AIFT).  This change would fundamentally restructure the examination front-end to accelerate prosecution, improve patent quality, and create a more collaborative, efficient process for applicants and examiners alike.  Particularly, AIFT is designed to front-load information sharing between the USPTO and the applicant and incentivize early, substantive amendments where appropriate.  The process would be simple, universal, and mandatory, updating the current examination procedure.  Further, it would be provided at no charge for all new applications.

    The main principles of AIFT would be as follows.

    • AI Search (The “Zeroeth” Office Action): Upon filing and completion of formalities, every new patent application would be processed by an in-house, private generative AI search engine. This tool would analyze the specification, drawings, and, most critically, the as-filed claims.
    • The AI Advisory Action: Within a few weeks of filing, the applicant would receive an initial AI advisory action.  This office action would not contain statutory rejections.  Instead, it would be an AI-generated search report.  The report would contain the results of the AI search, mapping the most relevant prior art references found by the AI search to specific claim elements.  For example, the report might include a claim chart mapping each claim element to a specific location in a prior art document where the AI search engine contends that it found disclosure of the element.  Notably, the AI search would only identify prior art and would not provide any legal reasoning.  In other words, the AI search would not provide a § 101 or § 112 analysis, nor would it provide a motivation to combine should it use multiple references against a claim.
    • The Applicant’s Choice: The applicant would then have a two-month, non-extendable window to respond to this AI advisory action.  There would be two simple options.  The first would be to file a preliminary amendment that makes a substantive narrowing amendment to at least one independent claim in view of the AI search.  The applicant would have the option of including remarks explaining why the narrowing amendment results in claims that the cited art does on read on.  The second would be to take no action and not file a response. In the latter case, the applicant can still file a preliminary amendment at any time before the first action on the merits.
    • The Examination Queue: If the applicant chooses the first option, the application is placed into a prioritized queue for examination by a human patent examiner.  If the applicant chooses the second option, the application is placed in the standard (slower) examination queue.
    • The Non-Final Action: Regardless of which option the applicant chooses, the next office action is issued by a human examiner and is a non-final office action.  The examiner is free to use or discard the AI search results, conduct their own search, and formulate their own rejections.  This preserves the applicant’s established right to respond to a complete, human-led examination on the merits.

    AIFT addresses a bottleneck in the examination process by speeding up the prior art search.  This creates a virtuous incentive for applicants to engage with prior art and improve patent quality from the start.  This up-front sharing of information and incentive for early amendment is likely to more quickly to disposal of an application (i.e., allowance or abandonment) by identifying prior art before the examiner lifts a finger.  Additionally, we expect that such a procedure would reduce the rate of RCEs, which are one of the greatest contributors to pendency, making the entire examination process more efficient.

    AIFT can also improve patent quality.  First, it would augment examiners by providing an AI search across extensive databases.  Examiners could then spend less time looking for needles in haystacks and more time conducting an analysis of the prior art.  Second, by presenting applicants with relevant prior art early, applicants are encouraged to amend broad or vague claims early in the process.  Third, the initial AI advisory action could act as a filter, prompting applicants to abandon clearly anticipated or clearly obvious inventions early, freeing up examiner resources for other applications.

    Despite AIFT having advantages, there are several concerns that may hinder its deployment.  Applicants would face a significant dilemma if presented with low-quality or irrelevant AI-cited prior art, forcing them to either make an unnecessary amendment to gain docket priority or be penalized with a longer wait time for challenging the AI’s findings.  Thus, the quality of the AI search would be key and some degree of human oversight may be needed.  Further, filing a preliminary amendment in response to an AI advisory action would create prosecution history estoppel before the applicant ever interacts with a human examiner.  This may incentivize some applicants to ignore the AI search results.  Moreover, some applicants might strategically file overly broad initial claims specifically so they can concede a narrowing amendment in response to the AI search.  This gaming of the system would result in a faster examination without having to file a focused claim set up front, effectively turning the collaborative step into a mere procedural hurdle to be cleared for a docketing advantage.

    While potentially problematic, each of these issues could be mitigated.  AI is a learning technology and the USPTO’s AI search model could be updated with examples of when a human examiner successfully used the AI-cited prior art to motivate an applicant to amend their claims, as well as when the human examiner overrode the AI-cited prior art and used different art to reject the claims.  Applicants could mitigate the estopped issue by filing a response with minimal or no substantive remarks, relying on the claim amendments to speak for themselves.  Also, Applicants could make it clear on the record that the amendments were made without prejudice and merely to expedite prosecution.  Finally, if necessary, applicants can be disincentivized from gaming the system by modifying the procedure as follows.  The first human-produced office action can be final when the applicant does not amend the claims in response to the AI advisory action and the human examiner’s prior art rejections are based entirely and solely on the prior art references that were previously cited in the AI advisory action (if the human examiner adds any new prior art to the rejections, their action must be non-final).  It is recommended that the human examiner would need the head of their technical center to approve such a first-action final.

    The USPTO cannot solve its dual pendency and quality crisis by merely repackaging old ideas or coming up with another pay-to-play docket manipulation approach that fails to improve search quality, claim clarity, or examiner decision making.  The proposed AIFT, in contrast, is a re-imagining of the examination process that places a powerful information technology tool at the very beginning, creating a collaborative triage step to help applicants produce better claims for human examination, and to help examiners conduct better searches. USPTO should stop tinkering with the queue and instead innovate at the core of the examination process itself.

  • The Biotechnology Innovation Organization (BIO) will be holding its 2025 IP Conference on November 17-19, 2025 in Palm Springs, CA.

    The conference will offer presentations on the following topics:

    • Navigating the Road of Joint Inventorship
    • Public Disclosures and Patent Risks: US vs EP Perspectives
    • Antibody Inventions: The Life and Times of the Genus Claim
    • BPCIA Litigation Update: Key Cases, Trends, and Takeaways from 2024–2025
    • Using AI In Patent Practice: Practical and Ethical Issues
    • How to Talk to Policymakers about Biopharma Patent Portfolios: A Conversation Under Chatham House Rules

    Patent Docs author Dr. Donald Zuhn of McDonnell Boehnen Hulbert & Berghoff LLP and Patent Docs contributor Joshua Rich of Lippes Mathias LLP will be participating as panelists on the session on “Using AI In Patent Practice: Practical and Ethical Issues”.  If you are a patent practitioner who uses AI tools in your practice and would be interested in attending the BIO IP Conference and participating on the above panel, please contact Dr. Zuhn at zuhn@mbhb.com.

    In addition to the above sessions, there will be a welcome reception from 5:30 pm to 7:30 pm on November 17, and a dinner reception from 5:30 pm to 8:30 pm on November 18.  A program agenda for this conference can be found here.

    Registration information can be found here.

  • The Intellectual Property Owners Association (IPO) will offer a one-hour webinar entitled “Patent & Technology Law Developments: Personal Jurisdiction, Estoppel & Everything in Between” on October 30, 2025 from 2:00 pm to 3:00 pm (ET).  Aaron Chatterjee of Microsoft Corporation, Renée Fuller of Bristol Myers Squibb Company, and Paul McAndrews of McAndrews, Held & Malloy, Ltd. will explore recent intellectual property cases and examine their practical impact in light of key court decisions and proposed legislation.  Topics to be covered will include a discussion of recent prosecution laches decisions, the Federal Circuit’s resolution of a district court split on the scope of IPR estoppel, personal jurisdiction in certain patent cases, various aspects of patent invalidity, and the domestic industry requirement in ITC proceedings.  Panelists will also discuss the Patent Eligibility Restoration Act of 2025 and the RESTORE Patent Rights Act of 2025, outlining what these developments could mean for practitioners.

    The webinar is free for IPO members.  Those interested in attending the webinar should register here.

  • By Joshua R. Rich

    Under President Trump, the U.S. Patent and Trademark Office has sought to encourage the issuance of more patents and limit the ability to challenge them in post-grant proceedings; since John Squires was sworn in as Director, that process has accelerated tremendously. On October 16, 2025, the Office issued proposed rules limiting the circumstances under which inter partes review can be instituted and conditioning institution upon a waiver of any other prior art challenge. There is no doubt that the proposed rules would limit the frequency and availability of IPR to challenge the validity of patents. But there is a real question whether the proposed rules are legal.

    Importantly, notice of proposed rulemaking was not identified as the beginning of notice-and-comment rulemaking (and all of the administrative requirements that such a process would entail). Rather, the notice indicates that “[t]he changes proposed by this rulemaking involve rules of agency practice and procedure, and/or interpretive rules, and do not require notice-and-comment rulemaking.” It is questionable whether that assertion is correct, as the proposed rules would have a significant impact on accused infringers’ (and other patent challengers’) substantive rights, but the USPTO is seeking to push the rules through quickly by allowing only thirty days for the submission of any comments. As a result, the rules may be in place sooner, but there is a very real threat that their enforcement will be blocked if the rulemaking process is challenged under the Administrative Procedure Act.

    There are four basic proposed changes in the IPR rules:

    • Unless every petitioner submits a stipulation to the USPTO and “any other tribunal where it is litigating or later litigates regarding the challenged patent” indicating that it (and any privy or real party in interest) will forego any anticipation or obviousness argument in any other proceeding, inter partes review cannot be instituted or maintained.
    • Inter partes review cannot be instituted or maintained if a challenged claim or an independent claim from which the claim depends has been found not anticipated or obvious in a district court (either upon trial or by summary judgment), the U.S. International Trade Commission (in either an initial or final determination), the Board itself (in an inter partes review or post-grant review), in ex parte reexamination, or in the Federal Circuit, even in proceedings not involving the petitioner.
    • Inter partes review cannot be instituted or maintained if there is a parallel proceeding in a district court, the ITC, or another Board proceeding where it is more likely than not that a decision will be reached before the final written decision in the inter partes review, even in proceedings not involving the petitioner.
    • If the Board finds there are extraordinary circumstances that would justify an exception to the rules above, they can refer a petition to the Director to decide whether to institute. But extraordinary circumstances are limited: they include a bad faith action to prevent review or a substantial change in the statute or Supreme Court precedent that renders the prior challenge irrelevant, but do not include new prior art or argument, Federal Circuit precedent, or a prior challenger’s failure to appeal. And sanctions can be imposed if a petition claiming extraordinary circumstances is found to be frivolous or abusive.

    The first of these provisions appears to be the most legally suspect. The America Invents Act that created inter partes review identified circumstances under which such an inter partes review could prevent anticipation or obviousness challenges in other proceedings. Under 35 U.S.C. § 315(e)(1):

    The petitioner in an inter partes review of a claim in a patent under this chapter that results in a final written decision under section 318(a), or the real party in interest or privy of the petitioner, may not request or maintain a proceeding before the Office with respect to that claim on any ground that the petitioner raised or reasonably could have raised during that inter partes review.

    That estoppel is narrower than the proposed rule in several ways. Most importantly, it limits estoppel to any ground that the petitioner raised or reasonably could have raised in the inter partes review, not all anticipation and obviousness arguments. But it also only takes effect if a final written decision results from a proceeding; the proposed stipulation is required for institution. So there is a gap between the two forms of estoppel for review that settles before a final written opinion.

    Given the carefully crafted scope of statutory estoppel, an administrative stipulation provision that would have the effect of creating a broader estoppel is likely to be held to exceed the USPTO’s discretion in implementing the statute. Under the statutory construction maxim “expressio unius est exclusion alterius,” Congress’s decision to provided only limited estoppel suggests it did not intend to bar all anticipation and obviousness challenges (and not in all instituted reviews). Any regulations on the same topic – like the stipulation requirement – of different scope would therefore likely be unlawful for the agency to implement.

    But the regulations that would bar inter partes review based on another party’s challenge are legally suspect as well. To be clear, these regulations would not prevent inter partes review of just the same arguments or art, or arguments by the same party. They would prevent any inter partes review if a prior challenger failed in its challenge as well, even if also based on unrelated art. Effectively, this would give some level of offensive res judicata effect to a patent owner’s win against a prior art challenge. That is not the law. To the contrary, res judicata in patent cases is not mutual: patent challengers are not barred by another challenger’s failure, but a single finding of invalidity prevents assertion of invalidated claims against another accused infringer. That question was squarely considered and determined by the Supreme Court in Blonder Tongue v. Univ. of Ill. Found., 402 U.S. 313 (1971). While the decision did not involve whether administrative proceedings could have different rules (especially administrative proceedings that did not exist until decades later), it is hard to believe that courts would view contrary regulations to be appropriate.

    While there appear to be substantial potential problems with the proposed rules, they may serve several beneficial purposes nonetheless. First, just as the bipartisan Patent Eligibility Restoration Act introduced by Senators Tillis and Coons has, they can provide a framework for discussion of potential changes to the Patent Act.  Second, they reinforce the seriousness that the USPTO has shown in trying to strengthen patent eligibility. Further, they may discourage (or sensitize courts) to some of the abusive use of inter partes review. And there is always the possibility that courts will not invalidate the proposed rules, if adopted. But most likely, they are most useful as pushing Congress into action to restore patent protections that have been narrowed over the years.