USIJ and Medical Device Group Urge Movement on PERA and PREVAIL

The Medical Device Manufacturers Association (MDMA) and the Alliance of U.S. Startups and Inventors for Jobs (USIJ) sent a letter today to the leadership of the Senate Judiciary Committee and the Judiciary Committee’s Subcommittee on Intellectual Property to express their support for both the Promoting and Respecting Economically Vital American Innovation Leadership Act (PREVAIL Act) and the Patent Eligibility Restoration Act (PERA).

Both PREVAIL and PERA were introduced on June 22, 2023. The PREVAIL Act aims to reform Patent Trial and Appeal Board (PTAB) practices while PERA would eliminate all judicially-created exceptions to U.S. patent eligibility law.

The joint letter from MDMA and USIJ said the two groups, which collectively represent over 300 startups, venture investors, research organizations and companies across a range of sectors, support many of the provisions of PREVAIL that would level the playing field for “innovative and disruptive inventors, startups, small companies and their investors,” who have suffered post-America Invents Act (AIA) from a lack of stability and predictability due to the leverage the current post-grant system gives large companies.

As to PERA, the letter noted that all of the active judges on the U.S. Court of Appeals for the Federal Circuit (CAFC) have cited confusion around patent eligibility and that the bill would effectively “strike a decade of judicial tinkering that has needlessly turned the question of patent eligibility into a confusing mess, and harmed the U.S. versus our economic competitors.” Notably, the letter added:

“China, in particular has leapt well ahead of the U.S. by extending patent protection for a broader range of inventions by focusing on the concrete features of the invention while we spin our wheels arguing about whether something is ‘abstract’ or not.”

USIJ Hits Back at High-Tech

The joint letter comes a few weeks after USIJ sent a separate letter to Judiciary Committee Leadership responding to a March 11 letter opposing the bill, authored by high-tech groups. The high-tech joint letter was signed by organizations including the High-Tech Inventors Alliance (HTIA), the Computer & Communications Industry Association, The App Association, United for Patent Reform and others and urged the Committee not to move forward on PERA because it “would turn the U.S. patent system upside down, severing patent rights from their historic mooring to improvements in technology.” The letter also presaged a “wave of crippling litigation against American manufacturers, innovative technology companies, and main street businesses.” To illustrate the harms, it listed a number of patents that have been killed under Section 101 but that the authors claimed would be allowed under PERA and that they said “would do serious harm to the American innovation economy.”

USIJ called the high-tech groups’ letter “rife with inaccuracies and misstatements as to how PERA would affect the acquisition and enforcement of U.S. patents” and specifically called out the letter’s conflation of the terms “patentable” and “patent eligible” throughout, “as if these words mean the same thing,” said USIJ.

“To use the two terms as if they are interchangeable is highly misleading and confusing,” the letter continued. It went on to point out other “hyperbole,” such as that PERA would effectively allow for “the patenting of much of daily life.”

The USIJ letter explained: “No ‘activity’ is eligible for patent coverage unless it is a machine, manufacture, composition of matter or process, or an improvement on one of the foregoing. And almost anything that occurs as ‘much of daily life’ is neither novel nor nonobvious.”

USIJ also countered specific arguments made by David Jones of HTIA during a January IP Subcommittee hearing in which Jones said that HTIA would accept an approach to eligibility reform that targeted only certain sectors or “a broader legislative solution that tethers patentability to its underlying policy purpose by explicitly limiting the availability of patent protection to only those inventions that embody an advance in technology.”

These solutions are untenable, said the USIJ letter, because 1) “any categorization of ‘inventions’ is likely to be impossible, particularly since even a field such as diagnostics may rely on chemical reactions, digital analysis of data, optical devices that read color, genetic discoveries, etc., any of which may be a separate invention with multiple uses,” and 2) Sections 102, 103 and 112 already address Jones’ second proposal. The letter characterized these approaches as mere attempts to delay change. It warned:

“Anyone familiar with the current state of global competition for technological supremacy knows that America does not have decades to sit around arguing about a new system. Our country right now is sacrificing its leadership in science and technology to other countries, most particularly China, by limiting the opportunities for small innovative companies and creative individuals to pursue breakthrough inventions.”

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