PREVAIL Act Proposes Major Patent Shake-Up: Tougher Challenges, New Judge Rules, and Dedicated USPTO Cash

The PREVAIL Act is on the table, and it’s aiming to give the U.S. patent system a serious tune-up. In a nutshell, this bill wants to make patents harder to challenge once they're granted, set new ethical rules for the judges who review those challenges, and make sure the fees paid to the U.S. Patent and Trademark Office (USPTO) actually stay with the USPTO to fund its work. It also includes provisions intended to help out universities and small businesses navigating the patent world.

Raising the Bar: Challenging Patents Could Get Trickier

One of the biggest shifts in the PREVAIL Act involves how patents are challenged after they're issued, especially in those inter partes review (IPR) and post-grant review (PGR) proceedings you hear about. If you want to argue an existing patent claim is invalid, the bill says you'd need to prove it by "clear and convincing evidence" (Sections 4 & 5, amending 35 U.S.C. 316 & 326). That’s a higher hurdle than the current "preponderance of the evidence" standard generally used at the Patent Trial and Appeal Board (PTAB) for these claims. For any new or substitute claims proposed by the patent owner during one of these reviews, the lower "preponderance of the evidence" standard would still apply for the challenger. Essentially, the bill wants to give issued patents the same presumption of validity they get in federal court.

This means if someone already holds a patent, you'll need a much stronger case to get its existing claims invalidated at the PTAB. This could be a relief for patent holders worried about what they see as harassing or repetitive challenges. On the flip side, it might make it tougher and more expensive for, say, a small tech company or an entrepreneur to fight off what they believe is a weak or overly broad patent held by a larger entity. The Act also aims to curb "repetitive petitions" (Sections 4 & 5, amending 35 U.S.C. 315 & 325). Generally, if you’ve had your shot at challenging a patent claim in one venue (like the PTAB, a district court, or the International Trade Commission), you might be barred from trying again with arguments you raised or could have reasonably raised the first time. To add transparency, the bill also wants to know who’s really bankrolling these challenges by requiring disclosure of any "real party in interest," which explicitly includes anyone financially contributing to the petition (Sections 4, 5, & 6).

A New Playbook for Patent Judges and USPTO Bucks

The bill isn't just focused on patent challengers; it's also looking at the referees. It mandates a new "code of conduct" for the administrative patent judges on the PTAB, the body that hears these challenges. This code would take cues from the Code of Conduct for United States Judges (Section 3). A significant proposed change here: a PTAB judge who was part of the initial panel that decided to institute a review (basically saying, "yes, this challenge has enough merit to proceed") wouldn't be allowed to be on the panel that hears the actual full review (Section 3). The idea seems to be to ensure impartiality and avoid any appearance that the judges have pre-judged the case.

And what about the money? For years, there's been significant concern about "fee diversion," where fees paid to the USPTO by inventors and businesses get siphoned off by Congress for other government spending. The PREVAIL Act wants to put a stop to that by creating a dedicated "United States Patent and Trademark Office Innovation Promotion Fund" (Section 7). The plan is straightforward: fees collected for patent work will fund patent operations, and trademark fees will fund trademark operations. No more, no less. This could mean a more consistently funded and potentially more efficient USPTO, which could impact everything from examination times to the quality of services.

A Nod to Innovators: Universities and Small Business Support

The PREVAIL Act also includes a couple of provisions aimed at helping out specific groups in the innovation ecosystem. For universities and certain non-profit research organizations, it clarifies and potentially expands their eligibility for "micro entity" status (Section 8). This status means significantly lower fees when they apply for patents, which could help stretch tight research budgets and encourage more patenting of academic discoveries.

For small businesses, the Small Business Administration (SBA) would be tasked with producing a report within one year of the Act's enactment. This report would analyze the impact of patent ownership by small businesses and the effect of patent infringement lawsuits filed against them (Section 9). This could provide valuable data for policymakers on how the patent system truly affects smaller players in the economy. Finally, there's a push for better access to information. The bill mandates that patent and trademark information available at the USPTO's Public Search Facility in Alexandria, Virginia, including search tools and databases, be made available online to the public, free of charge (Section 9). This sounds like a big win for inventors, researchers, and small businesses doing their homework. However, there's an important caveat: this is unless existing licensing agreements with third-party contractors make providing it for free "financially unviable." This loophole could limit how much information actually becomes freely accessible online, so it's one to watch.