Federal Circuit Affirms PTAB’s Analysis Finding Product-by-Process Claim Narrowed During Prosecution Valid Over Prior Art

In a precedential opinion issued on March 4, 2025, in Restem, LLC v. Jadi Cell, LLC, No, 23-2054, the U.S. Court of Appeals for the Federal Circuit affirmed the PTAB’s claim construction and ruling that product-by-process claims directed to making a specific type of stem cell were not invalid as inherently anticipated after the claim scope had been narrowed during prosecution.  The court further affirmed the PTAB’s determination that the prior art process did not inherently teach the claimed product, despite allegedly teaching all of the claimed process steps.

Takeaways for Practitioners

• Acquiescence to an examiner’s clear statements made during patent prosecution regarding claim scope may effectively narrow the scope of a claim term, even if the patent specification provides an express and broader definition of that term. 
• A validity analysis for a product-by-process claims focuses on the end product, and not the process of making it, because old products are not patentable even when made by new processes. Infringement determinations, on the other hand, require satisfaction of both the claimed process and resulting product.

The Stem Cell Patent and PTAB Proceeding

Restem appealed from an unsuccessful inter partes review final written decision finding that the challenged claims of Jadi Cell’s U.S. Patent No. 9,803,176 (“’176 patent”) were not unpatentable. Representative claim 1 of that patent is directed to stem cells with specific cell markers obtained from the subepithelial layer (“SL”) of mammalian umbilical cord tissue.  The claimed “cell” is made by a two-step process and must express at least three cell markers selected from a claimed list and it must also not express at least six specified cell markers selected from a second claimed list. Restem challenged the ’176 patent claims under the theory that they are inherently anticipated or alternatively rendered obvious by the prior art.

Narrowed Claim Scope Due to Applicant’s Acquiescence to the Examiner 

Restem’s first argument was that the PTAB incorrectly construed the claimed “placing” step recited in the limitation “placing a subepithelial layer of a mammalian umbilical cord tissue in direct contact with a growth substrate” by importing additional process steps from the specification. The court disagreed, holding that the PTAB had only discussed additional process steps, not to incorporate them into its claim construction, but as part of the factual findings distinguishing the prior art from the claimed process while assessing Restem’s inherent anticipation position. 

Similarly, the court affirmed the PTAB’s implicit construction of the claim term “isolated cell” as “a cell population.” Relying on the specification’s express lexicography, Restem argued that “an isolated cell” need not be “a cell population” where the specification states, “[a]s used herein, the term ‘isolated cell’ refers to a cell that has been isolated from the subepithelial layer of a mammalian umbilical cord.” Despite this definition, the court found the “isolated cell” term was narrowed during prosecution. The specification and examiner repeatedly described the invention as a “cell population,” including in the Notice of Allowance. The “applicant’s acquiescence to the examiner’s clear statements regarding claim scope,” here in the form of references to “cell population,” narrowed the claim scope despite the specification’s broader and express definition of that claim term.

Affirming No Inherent Anticipation of Product-by-Process Claim Based on the Product, Not Process 

The court then affirmed the PTAB’s finding of no inherent anticipation of the ’176 patent’s product-by-process claim. Product-by-process claims are those where the product is defined, at least in part, in terms of the process by which it is made. In this case, claim 1 specifies a two-step process of “placing a subepithelial layer of a mammalian umbilical cord tissue in direct contact with a growth substrate; and culturing the subepithelial layer . . .” When determining the validity of a product-by-process claim, “the focus is on the product and not on the process of making it, because an old product is not patentable even if it is made by a new process.” Restem was faulted for improperly trying to shift the analysis away from whether the prior art discloses the claimed product to whether the prior art discloses the claimed process. In contrast, determining infringement of a product-by-process claim requires focus on both the claimed process and the product itself. Thus, where the record did not establish that the final product made by the allegedly anticipating prior art process would have “inevitably” possessed the claimed cell marker expression profiles of claim 1, Restem failed to prove inherent anticipation. 

In addition to clarifying the validity analysis for product-by-process claims, this case serves as a useful reminder that acquiescence to the Examiner’s stated understandings of scope during prosecution can limit the issued claims, for better or worse.

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