November Highlights: The Upcoming Review of the USMCA
This fall marked the beginning of the first scheduled Joint Review process for the United States-Mexico-Canada Agreement (USMCA), the 2020 trade pact that governs trade across North America. The joint review is a built-in mechanism requiring the three countries to assess whether the agreement is functioning as intended and whether its provisions should be renewed, amended, or renegotiated. In September, the Office of the U.S. Trade Representative opened a public docket for input on the agreement’s operation in advance of the official Joint Review, which will take place in July 2026. In November, the agency prepared for a public hearing on the Joint Review, taking place December 3-5.
Because the USMCA governs trade rules across life sciences, advanced manufacturing, clean energy, digital commerce, creative industries, and other IP-intensive sectors, the outcome of this review will have far-reaching consequences for U.S. prosperity and competitiveness. It also presents an unprecedented opportunity. For the first time since the agreement took effect in 2020, U.S. negotiators will have the opportunity to directly confront Canada’s and Mexico’s violations of certain IP provisions, strengthen enforcement mechanisms, and restore important IP protections — such as robust regulatory data protection — that were originally negotiated into the agreement but ultimately removed before ratification.
However, if negotiators allow the USMCA’s IP provisions to erode or go unenforced, the consequences could be particularly harmful to the United States. U.S. innovators will face much greater difficulty competing in two of America’s largest export markets — and rivals like China will be well-positioned to fill the gap.
For these reasons, urging USTR to renew and strengthen the USMCA, securing comprehensive, enforceable IP protections, was a priority for C4IP throughout the month of November:
- C4IP Executive Director Frank Cullen submitted a comment letter urging USTR to use the upcoming joint review to press Mexico and Canada to fully implement their IP commitments, crack down on currently widespread violations of the USMCA’s counterfeiting and piracy provisions, and strengthen regulatory data protection for medicines to better support U.S. innovation.
- Read It Now: C4IP Comments RE: Operation of the Agreement between the United States of America, the United Mexican States, and Canada
- C4IP’s comment was highlighted in IPWatchdog’s weekly “Barks & Bites” news roundup, which also highlighted the specific IP problems in copyright, piracy, and industrial policy facing Mexico and Canada that were identified by C4IP.
Additional Coalition Updates
- On November 19, C4IP Chief Policy Officer and Counsel Jamie Simpson gave a presentation on the shifting balance between patents and trade secrets in the United States after the passage of the Defend Trade Secrets Act of 2016 at the Presidential Council on Intellectual Property and the Supreme Court of Korea’s 2025 International Forum on Intellectual Property in Seoul, South Korea.
- On November 17, C4IP published a fact sheet comparing the PREVAIL Act of 2025’s proposed PTAB framework with prior and current USPTO approaches, highlighting how the bill would end the cycle of policy shifts between administrations by eliminating duplicative and repetitive proceedings as well as harmonizing standards for challenging patents between PTAB, district courts, and the International Trade Commission (ITC).
- On November 17, C4IP Executive Director Frank Cullen was interviewed by KTNV Las Vegas in a news segment about the danger posed by counterfeit holiday gifts, which not only violate the IP rights of legitimate creators and sellers but can cause physical harm to unsuspecting recipients.
- On November 14, C4IP published a blog post detailing the economic and consumer harms posed by counterfeit goods, which are particularly prevalent during the holiday season, and urging Congress to pass the SHOP SAFE Act to incentivize e-commerce platforms to better police counterfeit products being sold by third parties through their sites.
- On November 13, C4IP’s support for the Patent Eligibility Restoration Act (PERA) was cited in a Mondaq article on the bill, which concluded that there is a broad consensus between “[j]udges, industry leaders, investors, USPTO personnel and many others” on the need for patent subject matter eligibility reform.
- On November 10, C4IP Executive Director Frank Cullen issued a statement commending six members of Congress for introducing the Restoring America’s Leadership in Innovation Act of 2025 and four members for introducing the Balancing Incentives Act of 2025, both of which recognize the problems that have faced innovators by the operations of the PTAB’s post grant review proceedings.
- On November 6, C4IP Executive Director Frank Cullen submitted a comment letter to India’s Central Drugs Standard Control Organization, responding to its recent invitation to comment on India’s drug approval regime and recommending that India adopt robust regulatory data protection and data exclusivity to reward first movers, attract investment, and expand patient access to innovative medicines.
- On November 5-7, C4IP Chief Policy Officer and Counsel Jamie Simpson spoke on a panel at the 12th Annual IP Dealmakers Forum in Austin, Texas, about trends and developments in the PTAB.
- On November 3, C4IP published a blog post on the FDA’s recent approval of a new, subcutaneous formulation of the cancer drug Keytruda, explaining how this exemplifies the value to patients of follow-on innovation and rebutting critics’ assertions that the new formulation constitutes an unnecessary “product hop.”
Government Rundown
Office of the United States Trade Representative Hearing: Public Hearing Relating to the Operation of the USMCA:
On December 3-5, the Office of the United States Trade Representative is holding a public hearing on the operation of the United States-Mexico-Canada Agreement (USMCA) in advance of the scheduled 2026 Joint Review of the USMCA, the first since the agreement entered into force in 2020. The review process will give negotiators an opportunity to review the USMCA’s key provisions, with significant implications for intellectual property enforcement, innovation incentives, and U.S. competitiveness writ large. (Office of the United States Trade Representative, 12/3-12/5)
USPTO Event: USPTO Hour: Updates on Subject Matter Eligibility Under 35 U.S.C. § 101:
On November 5, the USPTO’s Office of the Commissioner for Patents held a USPTO Hour webinar outlining the Office’s current guidance on patent subject matter eligibility. (USPTO, 11/5)
Fact Check
A coalition of anti-patent groups — including the R Street Institute, the Electronic Frontier Foundation, Public Knowledge, and others — recently sent a letter to Senate Judiciary Committee leaders urging them to oppose the Patent Eligibility Restoration Act (PERA). The letter recycles a familiar set of unfounded accusations against PERA, including that restoring clarity on patent eligibility would hurt small businesses and that stronger patent rights would dampen innovation in important sectors like artificial intelligence. The letter also took aim at recent attempts to reform the procedures of the Patent Trial and Appeal Board (PTAB). These critics inaccurately claim that reforming the PTAB so that its procedures are more balanced harms small innovators, when such reforms help small and large innovators alike from the abusive and repetitive patent validity challenges that have unfortunately characterized the Board’s operations.
In short, despite what the critics claim, both PERA and PTAB reform efforts are necessary to support inventors and entrepreneurs, promoting innovation in the United States.
The letter contains numerous misleading claims:
| Claim: Recent USPTO changes to Patent Trial and Appeal Board practice are “dismantling” a key safeguard for innovative small businesses. |
| In reality: The USPTO’s decision to rescind its 2022 discretionary-denial memorandum and adopt a new two-step review process is a necessary corrective measure to curb PTAB abuse by deep-pocketed patent infringers, which commonly file repeated and duplicative patent validity challenges against their opponents, including small companies, in order to escape accountability. The rescinded guidance had enabled this predatory infringement strategy by allowing Big Tech and other large firms to easily file PTAB petitions related to cases already being litigated in court. The new interim USPTO guidance empowers the Director and PTAB to deny institution when an issue is being litigated elsewhere or has already been under review at the agency, reducing wasteful duplication. The new guidance preserves the process of post-grant review for its intended purpose of checking the validity of patents rather than allowing large incumbents to weaponize the process against their competitors. Further, despite what the critics’ letter alleges, the USPTO’s interim changes are meaningful to small innovators, who often lack the legal and financial resources to fight against simultaneous challenges in court and at the PTAB. Put simply, the interim USPTO agency guidance is necessary to ensure that small innovators have a fair chance to defend their patents on the merits instead of being overwhelmed by their opponents’ resources. |
| Claim: Expanding patent subject matter eligibility through the Patent Eligibility Restoration Act (PERA) would entrench large incumbents and harm small businesses and startups. |
| In reality: Small businesses and startups depend on strong patent rights to compete with large incumbents and would therefore benefit from patent eligibility that is commensurate with the scope of technological innovation in the United States. By enabling inventors to protect their inventions against potential infringement, patents allow small companies to attract funding from outside investors and compete against market incumbents on the merits of their innovation. However, when patent eligibility is uncertain, it becomes difficult for innovative small companies to attract the outside financial backing needed to compete in the market. One study found that 74% of responding investors treat patent eligibility as an important consideration when deciding whether to invest in a company developing new technology. Another study found that after the Supreme Court reduced patent eligibility for medical diagnostic technology in Mayo v. Prometheus (2012), investment in U.S. disease-diagnostic technologies fell by nearly $9.3 billion compared to what it would have been without the decision. PERA solves these problems by clarifying the scope of patent subject matter eligibility and restoring the common-sense, historically grounded rules that existed prior to the Supreme Court’s misguided jurisprudence in the 2010s. In short, under PERA, small companies would once again be able to patent innovative technologies in fields where Supreme Court precedent has injected uncertainty, such as artificial intelligence and medical diagnostics, ensuring that there are the proper incentives for innovation in these economically important areas, especially for small businesses. |
| Claim: Expanding patent eligibility – such as through PERA – would harm artificial intelligence innovation. |
| In reality: Restoring patent eligibility to its historic scope is critical to robust AI innovation. Under current precedent, inventions in AI and other emerging industries are often deemed ineligible for patenting, which has deterred innovation in those areas. Most pertinent to the issue of AI is the Supreme Court’s decision in Alice Corp v. CLS Bank (2014), which ruled that a particular computer algorithm was simply an “abstract idea” and therefore ineligible for patenting. Over time, as the court’s decision in Alice has been applied by lower courts to weaken patent eligibility for computer algorithms more broadly, a growing share of AI technologies have been denied patents. C4IP Co-Chair and former USPTO Director David Kappos found that in 2018, the majority of AI patent applications were rejected on eligibility grounds. At a time when patenting of AI technologies is growing rapidly around the globe — and other countries, including China, allow more patenting of these technologies than the United States — needlessly limiting patent eligibility threatens to hold back domestic scientific progress in a crucial strategic sector. |
Celebrating American Innovation
Inventor Spotlight
This month, C4IP is recognizing Augustine Sackett (1841-1914), whose invention of gypsum wallboard, or drywall, transformed building construction across America and around the world.
- Sackett was born in Connecticut in 1841, attended Rensselaer Polytechnic Institute, and served as an assistant engineer in the Union Navy during the Civil War before settling in New York City as an inventor and entrepreneur.
- Sackett patented “Sackett Board,” the first paper-faced gypsum panel, in 1894, creating the precursor to modern drywall.
- Sackett also designed machinery to mass-produce the material and founded the Sackett Plaster Board Company to commercialize it.
- The U.S. Gypsum Company acquired Sackett’s company in 1909 and refined Sackett Board into the gypsum wallboard still used today.
- Sackett’s drywall presented notable advantages in construction speed — taking weeks off of traditional building schedules — and resource efficiency, which caused its popularity to skyrocket during World War II when companies were forced to ration lumber.
- It also provides advantages over traditional brick construction in fire resistance and energy efficiency.
- Today, drywall has become a ubiquitous feature of American buildings: The average new home in the United States contains more than 6,000 feet of drywall, according to the National Inventors Hall of Fame.
- The market for drywall continues to grow, with an estimated global value of nearly $50 billion and annual U.S. sales of over $3 billion.
[PHOTO: National Inventors Hall of Fame]
What’s Happening in Congress
With the 119th Congress underway, Democratic and Republican lawmakers are weighing legislation to prioritize strengthening IP protections, including the recent reintroduction of several significant bills from the previous Congress:
- The Patent Eligibility Restoration Act (PERA), which would revitalize innovation and investment in crucial high-tech sectors by reversing arbitrary, judicially created exceptions to patent eligibility.
- The Promoting and Respecting Economically Vital American Innovation Leadership (PREVAIL) Act, which would level the legal playing field for inventors and give them a fair chance to defend their patents from unauthorized infringement by larger competitors.
- The Realizing Engineering, Science, and Technology Opportunities by Restoring Exclusive (RESTORE) Patent Rights Act, which was reintroduced in both the House and Senate. This bipartisan, bicameral legislation would reestablish injunctive relief as the primary legal remedy for patent infringement, reaffirming innovators’ constitutional rights to the exclusive ownership of their inventions.
- The Nurture Originals, Foster Art, and Keep Entertainment Safe (NO FAKES) Act, which would protect all individuals from having their voice and visual likeness copied by generative AI without consent.
We will continue to track movement on these bills and provide updates on legislative developments in upcoming editions. In the interim, you can find resources on these key issues here.