I have a key that firmly states on the back: Duplication Prohibited by Federal Utility Patent Law. What is the penalty for copying the key? Is it a cash fine or time behind bars?

Such a prohibition is for the locksmith. It tells the smith not to make a copy. So are you a locksmith who made a copy or are you in possession of the key and want to make a copy?

I have a key that firmly states on the back: Duplication Prohibited by Federal Utility Patent Law. What is the penalty for copying the key? Is it a cash fine or time behind bars?

The inscription quoted is intended to scare you. U.S. patent laws have nothing to do with it.

You have not stated where you are, but I am not familiar with any U.S. state law which makes it a crime to copying a "do not copy" key. Ethical locksmiths will probably ask questions about it, but there is normally not criminal to ignore such an inscription.