SAN FRANCISCO -- Federal regulators said they're preparing to toss out three key patents related to human embryonic stem cells, an action that could ease concerns over commercial control of the work.

The Wisconsin Alumni Research Foundation from the University of Wisconsin-Madison owns the patents and has 60 days to respond and seek to change the ruling by the U.S. Patent and Trademark Office.

The ruling was made public on Monday by the Foundation for Taxpayer and Consumer Rights and the Public Patent Foundation, which challenged the validity of the patents.

Two nonprofit groups that got regulators to take a second look at the patents said they are thrilled. One group said that it believes WARF was trying to be the "Microsoft" of stem cells and that it just suffered a key defeat.

The university said it will fight the preliminary decision by the federal regulators.

"We have no intention of losing those three patents. We have every intention of moving forward and taking this to its conclusion," said Andy Cohn, public relations director for WARF.

WARF, the engine that drives UW research, found out about the patent ruling late Monday afternoon. Officials said they were "prepared" for the decision, which they said isn't unusual for such an initial review.

But groups criticizing the three WARF patents in question say they are "ecstatic" over the ruling because it agrees with their arguments and even outlines more.

The non-profit group Public Patent Foundation of New York petitioned the U.S. Patent office last July for a review, along with a California nonprofit consumer group.

"It couldn't have been better. If WARF wants to do the right thing, they will admit they got caught with their hand in the cookie jar and they will abandon these patents immediately," said PPF President and Executive Director Daniel Ravicher in a phone interview.

The U.S. Patent Office's preliminary ruling rejects all of WARF's claims for three patents, which require scientists and companies to pay licensing and / or fees to conduct embryonic stem cell research.

The patents are based on the work of UW-Madison researcher Jamie Thomson, who WARF said was the first person to find a way to grow human embryonic stem cells for research.

The initial ruling found the opposite, saying Thomson's claims are "the same as or obvious from (prior) products."

While critics said they feel vindicated, WARF is sticking to its claims.

"A number of scientists all over the world were scrambling to figure out how to make human embryonic stem cells not differentiate, and Dr. Thomson was the first one," Cohn said.

In 1998, Thompson made headlines with his research and made the cover of magazines for his work. But Ravicher said that doesn't mean his work meets patent criteria. He said patent rejection would fuel scientific research, but WARF disagrees.

"WARF's saying Jamie Thomson was the first person to develop human embryonic stem cells is a flat lie. It's like saying the world is flat and not round; just because everyone believes it doesn't make it true," Ravicher said.

WARF has two months to file a response to the ruling.