[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 400 Reported in Senate (RS)]





                                                        Calendar No. 33

105th CONGRESS

  2d Session

                               H. R. 400

_______________________________________________________________________

                                 AN ACT

To amend title 35, United States Code, with respect to patents, and for 
                            other purposes.

_______________________________________________________________________

                             March 23, 1998

        Reported with an amendment in the nature of a substitute
                                                        Calendar No. 33
105th CONGRESS
  2d Session
                                H. R. 400


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 24, 1997

  Received; read twice and referred to the Committee on the Judiciary

                             March 23, 1998

 Reported by Mr. Hatch, with an amendment in the nature of a substitute
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]

_______________________________________________________________________

                                 AN ACT


 
To amend title 35, United States Code, with respect to patents, and for 
                            other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

<DELETED>SECTION 1. SHORT TITLE.</DELETED>

<DELETED>    This Act may be cited as the ``21st Century Patent System 
Improvement Act''.</DELETED>

<DELETED>SEC. 2. TABLE OF CONTENTS.</DELETED>

<DELETED>Sec. 1. Short title.
<DELETED>Sec. 2. Table of contents.
      <DELETED>TITLE I--PATENT AND TRADEMARK OFFICE MODERNIZATION

<DELETED>Sec. 101. Short title.
     <DELETED>Subtitle A--United States Patent and Trademark Office

<DELETED>Sec. 111. Establishment of Patent and Trademark Office as a 
                            Government corporation.
<DELETED>Sec. 112. Powers and duties.
<DELETED>Sec. 113. Organization and management.
<DELETED>Sec. 114. Management Advisory Board.
<DELETED>Sec. 115. Conforming amendments.
<DELETED>Sec. 116. Trademark Trial and Appeal Board.
<DELETED>Sec. 117. Board of Patent Appeals and Interferences.
<DELETED>Sec. 118. Suits by and against the Office.
<DELETED>Sec. 119. Annual report of Director.
<DELETED>Sec. 120. Suspension or exclusion from practice.
<DELETED>Sec. 121. Funding.
<DELETED>Sec. 122. Extension of surcharges on patent fees.
<DELETED>Sec. 123. Transfers.
<DELETED>Sec. 124. GAO study and report.
       <DELETED>Subtitle B--Effective Date; Technical Amendments

<DELETED>Sec. 131. Effective date.
<DELETED>Sec. 132. Technical and conforming amendments.
             <DELETED>Subtitle C--Miscellaneous Provisions

<DELETED>Sec. 141. References.
<DELETED>Sec. 142. Exercise of authorities.
<DELETED>Sec. 143. Savings provisions.
<DELETED>Sec. 144. Transfer of assets.
<DELETED>Sec. 145. Delegation and assignment.
<DELETED>Sec. 146. Authority of Director of the Office of Management 
                            and Budget with respect to functions 
                            transferred.
<DELETED>Sec. 147. Certain vesting of functions considered transfers.
<DELETED>Sec. 148. Availability of existing funds.
<DELETED>Sec. 149. Definitions.
   <DELETED>Subtitle D--Under Secretary of Commerce for Intellectual 
                            Property Policy

<DELETED>Sec. 151. Under Secretary of Commerce for Intellectual 
                            Property Policy.
<DELETED>Sec. 152. Relationship with existing authorities.
 <DELETED>TITLE II--EXAMINING PROCEDURE IMPROVEMENTS: PUBLICATION WITH 
      PROVISIONAL ROYALTIES; TERM EXTENSIONS; FURTHER EXAMINATION

<DELETED>Sec. 201. Short title.
<DELETED>Sec. 202. Publication.
<DELETED>Sec. 203. Time for claiming benefit of earlier filing date.
<DELETED>Sec. 204. Provisional rights.
<DELETED>Sec. 205. Prior art effect of published applications.
<DELETED>Sec. 206. Cost recovery for publication.
<DELETED>Sec. 207. Conforming changes.
<DELETED>Sec. 208. Patent term extension authority.
<DELETED>Sec. 209. Further examination of patent applications.
<DELETED>Sec. 210. Last day of pendency of provisional application.
<DELETED>Sec. 211. Reporting requirement.
<DELETED>Sec. 212. Effective date.
  <DELETED>TITLE III--PROTECTION FOR PRIOR DOMESTIC USERS OF PATENTED 
                              TECHNOLOGIES

<DELETED>Sec. 301. Short title.
<DELETED>Sec. 302. Defense to patent infringement based on prior 
                            domestic commercial or research use.
<DELETED>Sec. 303. Effective date and applicability.
      <DELETED>TITLE IV--ENHANCED PROTECTION OF INVENTORS' RIGHTS

<DELETED>Sec. 401. Short title.
<DELETED>Sec. 402. Invention promotion services.
<DELETED>Sec. 403. Technical and conforming amendment.
<DELETED>Sec. 404. Effective date.
              <DELETED>TITLE V--MISCELLANEOUS IMPROVEMENTS

<DELETED>Sec. 501. Provisional applications.
<DELETED>Sec. 502. International applications.
<DELETED>Sec. 503. Plant patents.
<DELETED>Sec. 504. Electronic filing.
<DELETED>Sec. 505. Divisional applications.
<DELETED>Sec. 506. Publications.

 <DELETED>TITLE I--PATENT AND TRADEMARK OFFICE MODERNIZATION</DELETED>

<DELETED>SEC. 101. SHORT TITLE.</DELETED>

<DELETED>    This title may be cited as the ``Patent and Trademark 
Office Modernization Act''.</DELETED>

        <DELETED>Subtitle A--United States Patent and Trademark 
                            Office</DELETED>

<DELETED>SEC. 111. ESTABLISHMENT OF PATENT AND TRADEMARK OFFICE AS A 
              GOVERNMENT CORPORATION.</DELETED>

<DELETED>    Section 1 of title 35, United States Code, is amended to 
read as follows:</DELETED>
<DELETED>``Sec. 1. Establishment</DELETED>
<DELETED>    ``(a) Establishment.--The United States Patent and 
Trademark Office is established as a wholly owned Government 
corporation subject to chapter 91 of title 31, separate from any 
department of the United States, and shall be an agency of the United 
States under the policy direction of the Secretary of Commerce. For 
purposes of internal management, the United States Patent and Trademark 
Office shall be a corporate body not subject to direction or 
supervision by any department of the United States, except as otherwise 
provided in this title.</DELETED>
<DELETED>    ``(b) Offices.--The United States Patent and Trademark 
Office shall maintain its principal office in the metropolitan 
Washington, D.C. area, for the service of process and papers and for 
the purpose of carrying out its functions. The United States Patent and 
Trademark Office shall be deemed, for purposes of venue in civil 
actions, to be a resident of the district in which its principal office 
is located, except where jurisdiction is otherwise provided by law. The 
United States Patent and Trademark Office may establish satellite 
offices in such other places as it considers necessary and appropriate 
in the conduct of its business.</DELETED>
<DELETED>    ``(c) Reference.--(1) For purposes of this title, the 
United States Patent and Trademark Office shall also be referred to as 
the `Office' and the `Patent and Trademark Office'.</DELETED>
<DELETED>    ``(2) As used in this title, the term `Under Secretary' 
means the Under Secretary of Commerce for Intellectual Property 
Policy.''.</DELETED>

<DELETED>SEC. 112. POWERS AND DUTIES.</DELETED>

<DELETED>    Section 2 of title 35, United States Code, is amended to 
read as follows:</DELETED>
<DELETED>``Sec. 2. Powers and duties</DELETED>
<DELETED>    ``(a) In General.--The United States Patent and Trademark 
Office, subject to the policy direction of the Secretary of Commerce--
</DELETED>
        <DELETED>    ``(1) shall be responsible for the granting and 
        issuing of patents and the registration of 
        trademarks;</DELETED>
        <DELETED>    ``(2) may, in support of the Under Secretary, 
        assist with studies, programs, or exchanges of items or 
        services regarding domestic and international law of patents, 
        trademarks, and other matters;</DELETED>
        <DELETED>    ``(3)(A) may, in support of the Under Secretary, 
        assist with studies and programs conducted cooperatively with 
        foreign patent and trademark offices and international 
        organizations, in connection with patents, trademarks, and 
        other matters; and</DELETED>
        <DELETED>    ``(B) with the concurrence of the Secretary of 
        State, may authorize the transfer of not to exceed $100,000 in 
        any year to the Department of State for the purpose of making 
        special payments to international intergovernmental 
        organizations for studies and programs for advancing 
        international cooperation concerning patents, trademarks, and 
        other matters; and</DELETED>
        <DELETED>    ``(4) shall be responsible for disseminating to 
        the public information with respect to patents and 
        trademarks.</DELETED>
<DELETED>The special payments under paragraph (3)(B) shall be in 
addition to any other payments or contributions to international 
organizations described in paragraph (3)(B) and shall not be subject to 
any limitations imposed by law on the amounts of such other payments or 
contributions by the United States Government.</DELETED>
<DELETED>    ``(b) Specific Powers.--The Office--</DELETED>
        <DELETED>    ``(1) shall have perpetual succession;</DELETED>
        <DELETED>    ``(2) shall adopt and use a corporate seal, which 
        shall be judicially noticed and with which letters patent, 
        certificates of trademark registrations, and papers issued by 
        the Office shall be authenticated;</DELETED>
        <DELETED>    ``(3) may sue and be sued in its corporate name 
        and be represented by its own attorneys in all judicial and 
        administrative proceedings, subject to the provisions of 
        section 7;</DELETED>
        <DELETED>    ``(4) may indemnify the Director, and other 
        officers, attorneys, agents, and employees (including members 
        of the Management Advisory Board established in section 5) of 
        the Office for liabilities and expenses incurred within the 
        scope of their employment;</DELETED>
        <DELETED>    ``(5) may establish regulations, not inconsistent 
        with law, which--</DELETED>
                <DELETED>    ``(A) shall govern the conduct of 
                proceedings in the Office;</DELETED>
                <DELETED>    ``(B) shall be made after notice and 
                opportunity for full participation by interested public 
                and private parties;</DELETED>
                <DELETED>    ``(C) shall facilitate and expedite the 
                processing of patent applications, particularly those 
                which can be filed, stored, processed, searched, and 
                retrieved electronically, subject to the provisions of 
                section 122 relating to the confidential status of 
                applications;</DELETED>
                <DELETED>    ``(D) may govern the recognition and 
                conduct of agents, attorneys, or other persons 
                representing applicants or other parties before the 
                Office, and may require them, before being recognized 
                as representatives of applicants or other persons, to 
                show that they are of good moral character and 
                reputation and are possessed of the necessary 
                qualifications to render to applicants or other persons 
                valuable service, advice, and assistance in the 
                presentation or prosecution of their applications or 
                other business before the Office; and</DELETED>
                <DELETED>    ``(E) shall recognize the public interest 
                in continuing to safeguard broad access to the United 
                States patent system through the reduced fee structure 
                for small entities under section 41(h)(1) of this 
                title;</DELETED>
                <DELETED>    ``(F) provide for the development of a 
                performance-based process that includes quantitative 
                and qualitative measures and standards for evaluating 
                cost-effectiveness and is consistent with the 
                principles of impartiality and 
                competitiveness;</DELETED>
        <DELETED>    ``(6) may acquire, construct, purchase, lease, 
        hold, manage, operate, improve, alter, and renovate any real, 
        personal, or mixed property, or any interest therein, as it 
        considers necessary to carry out its functions;</DELETED>
        <DELETED>    ``(7)(A) may make such purchases, contracts for 
        the construction, maintenance, or management and operation of 
        facilities, and contracts for supplies or services, without 
        regard to the provisions of the Federal Property and 
        Administrative Services Act of 1949 (40 U.S.C. 471 and 
        following), the Public Buildings Act (40 U.S.C. 601 and 
        following), and the Stewart B. McKinney Homeless Assistance Act 
        (42 U.S.C. 11301 and following); and</DELETED>
        <DELETED>    ``(B) may enter into and perform such purchases 
        and contracts for printing services, including the process of 
        composition, platemaking, presswork, silk screen processes, 
        binding, microform, and the products of such processes, as it 
        considers necessary to carry out the functions of the Office, 
        without regard to sections 501 through 517 and 1101 through 
        1123 of title 44;</DELETED>
        <DELETED>    ``(8) may use, with their consent, services, 
        equipment, personnel, and facilities of other departments, 
        agencies, and instrumentalities of the Federal Government, on a 
        reimbursable basis, and cooperate with such other departments, 
        agencies, and instrumentalities in the establishment and use of 
        services, equipment, and facilities of the Office;</DELETED>
        <DELETED>    ``(9) may obtain from the Administrator of General 
        Services such services as the Administrator is authorized to 
        provide to other agencies of the United States, on the same 
        basis as those services are provided to other agencies of the 
        United States;</DELETED>
        <DELETED>    ``(10) may, when the Director determines that it 
        is practicable, efficient, and cost-effective to do so, use, 
        with the consent of the United States and the agency, 
        government, or international organization concerned, the 
        services, records, facilities, or personnel of any State or 
        local government agency or instrumentality or foreign 
        government or international organization to perform functions 
        on its behalf;</DELETED>
        <DELETED>    ``(11) may determine the character of and the 
        necessity for its obligations and expenditures and the manner 
        in which they shall be incurred, allowed, and paid, subject to 
        the provisions of this title and the Act of July 5, 1946 
        (commonly referred to as the `Trademark Act of 
        1946');</DELETED>
        <DELETED>    ``(12) may retain and use all of its revenues and 
        receipts, including revenues from the sale, lease, or disposal 
        of any real, personal, or mixed property, or any interest 
        therein, of the Office, including for research and development 
        and capital investment, subject to the provisions of section 
        10101 of the Omnibus Budget Reconciliation Act of 1990 (35 
        U.S.C. 41 note);</DELETED>
        <DELETED>    ``(13) shall have the priority of the United 
        States with respect to the payment of debts from bankrupt, 
        insolvent, and decedents' estates;</DELETED>
        <DELETED>    ``(14) may execute, in accordance with its bylaws, 
        rules, and regulations, all instruments necessary and 
        appropriate in the exercise of any of its powers; and</DELETED>
        <DELETED>    ``(15) may provide for liability insurance and 
        insurance against any loss in connection with its property, 
        other assets, or operations either by contract or by self-
        insurance.</DELETED>
<DELETED>In exercising the Director's powers under paragraphs (6) and 
(7)(A), the Director shall consult with the Administrator of General 
Services when the Director determines that it is practicable, 
efficient, and cost-effective to do so.</DELETED>
<DELETED>    ``(c) Construction.--Nothing in this section shall be 
construed to nullify, void, cancel, or interrupt any pending request-
for-proposal let or contract issued by the General Services 
Administration for the specific purpose of relocating or leasing space 
to the United States Patent and Trademark Office.''.</DELETED>

<DELETED>SEC. 113. ORGANIZATION AND MANAGEMENT.</DELETED>

<DELETED>    Section 3 of title 35, United States Code, is amended to 
read as follows:</DELETED>
<DELETED>``Sec. 3. Officers and employees</DELETED>
<DELETED>    ``(a) Director.--</DELETED>
        <DELETED>    ``(1) In general.--The management of the United 
        States Patent and Trademark Office shall be vested in a 
        Director of the United States Patent and Trademark Office (in 
        this title referred to as the `Director'), who shall be a 
        citizen of the United States and who shall be appointed by the 
        President, by and with the advice and consent of the Senate. 
        The Director shall be a person who, by reason of professional 
        background and experience in patent or trademark law, is 
        especially qualified to manage the Office.</DELETED>
        <DELETED>    ``(2) Duties.--</DELETED>
                <DELETED>    ``(A) In general.--The Director shall be 
                responsible for the management and direction of the 
                Office, including the issuance of patents and the 
                registration of trademarks, and shall perform these 
                duties in a fair, impartial, and equitable 
                manner.</DELETED>
                <DELETED>    ``(B) Consulting with the management 
                advisory board.--The Director shall consult with the 
                Management Advisory Board established in section 5 on a 
                regular basis on matters relating to the operation of 
                the Office, and shall consult with the Advisory Board 
                before submitting budgetary proposals to the Office of 
                Management and Budget or changing or proposing to 
                change patent or trademark user fees or patent or 
                trademark regulations.</DELETED>
                <DELETED>    ``(C) Security clearances.--The Director, 
                in consultation with the Director of the Office of 
                Personnel Management, shall maintain a program for 
                identifying national security positions and providing 
                for appropriate security clearances.</DELETED>
        <DELETED>    ``(3) Term.--The Director shall serve a term of 5 
        years, and may continue to serve after the expiration of the 
        Director's term until a successor is appointed and assumes 
        office. The Director may be reappointed to subsequent 
        terms.</DELETED>
        <DELETED>    ``(4) Oath.--The Director shall, before taking 
        office, take an oath to discharge faithfully the duties of the 
        Office.</DELETED>
        <DELETED>    ``(5) Compensation.--The Director shall be paid an 
        annual rate of basic pay not to exceed the maximum rate of 
        basic pay of the Senior Executive Service established under 
        section 5382 of title 5, including any applicable locality-
        based comparability payment that may be authorized under 
        section 5304(h)(2)(C) of title 5. In addition, the Director may 
        receive a bonus in an amount up to, but not in excess of, 50 
        percent of such annual rate of basic pay, based upon an 
        evaluation by the Secretary of Commerce of the Director's 
        performance as defined in an annual performance agreement 
        between the Director and the Secretary. The annual performance 
        agreement shall incorporate measurable organization and 
        individual goals in key operational areas as delineated in an 
        annual performance plan agreed to by the Director and the 
        Secretary. Payment of a bonus under this paragraph may be made 
        to the Director only to the extent that such payment does not 
        cause the Director's total aggregate compensation in a calendar 
        year to equal or exceed the amount of the salary of the 
        President under section 102 of title 3.</DELETED>
        <DELETED>    ``(6) Removal.--The Director may be removed from 
        office by the President. The President shall provide 
        notification of any such removal to both Houses of 
        Congress.</DELETED>
        <DELETED>    ``(7) Designee of director.--The Director shall 
        designate an officer of the Office who shall be vested with the 
        authority to act in the capacity of the Director in the event 
        of the absence or incapacity of the Director.</DELETED>
<DELETED>    ``(b) Officers and Employees of the Office.--</DELETED>
        <DELETED>    ``(1) Commissioners.--The Director shall appoint a 
        Commissioner for Patents and a Commissioner for Trademarks for 
        terms that shall expire on the date on which the Director's 
        term expires. The Commissioner for Patents shall be a person 
        with demonstrated experience in patent law and the Commissioner 
        for Trademarks shall be a person with demonstrated experience 
        in trademark law. The Commissioner for Patents and the 
        Commissioner for Trademarks shall be the principal management 
        advisers to the Director on all aspects of the activities of 
        the Office that affect the administration of patent and 
        trademark operations, respectively.</DELETED>
        <DELETED>    ``(2) Other officers and employees.--The Director 
        shall--</DELETED>
                <DELETED>    ``(A) appoint such officers, employees 
                (including attorneys), and agents of the Office as the 
                Director considers necessary to carry out the functions 
                of the Office; and</DELETED>
                <DELETED>    ``(B) define the authority and duties of 
                such officers and employees and delegate to them such 
                of the powers vested in the Office as the Director may 
                determine.</DELETED>
        <DELETED>The Office shall not be subject to any 
        administratively or statutorily imposed limitation on positions 
        or personnel, and no positions or personnel of the Office shall 
        be taken into account for purposes of applying any such 
        limitation.</DELETED>
        <DELETED>    ``(3) Training of examiners.--The Patent and 
        Trademark Office shall develop an incentive program to retain 
        as employees patent and trademark examiners of the primary 
        examiner grade or higher who are eligible for retirement, for 
        the sole purpose of training patent and trademark 
        examiners.</DELETED>
<DELETED>    ``(c) Continued Applicability of Title 5.--Officers and 
employees of the Office shall be subject to the provisions of title 5 
relating to Federal employees. Section 2302 of title 5 applies to the 
Office, notwithstanding subsection (a)(2)(C) of such section.</DELETED>
<DELETED>    ``(d) Adoption of Existing Labor Agreements.--The Office 
shall adopt all labor agreements which are in effect, as of the day 
before the effective date of the Patent and Trademark Office 
Modernization Act, with respect to such Office (as then in 
effect).</DELETED>
<DELETED>    ``(e) Carryover of Personnel.--</DELETED>
        <DELETED>    ``(1) From pto.--Effective as of the effective 
        date of the Patent and Trademark Office Modernization Act, all 
        officers and employees of the Patent and Trademark Office on 
        the day before such effective date shall become officers and 
        employees of the Office, without a break in service.</DELETED>
        <DELETED>    ``(2) Other personnel.--Any individual who, on the 
        day before the effective date of the Patent and Trademark 
        Office Modernization Act, is an officer or employee of the 
        Department of Commerce (other than an officer or employee under 
        paragraph (1)) shall be transferred to the Office if--
        </DELETED>
                <DELETED>    ``(A) such individual serves in a position 
                for which a major function is the performance of work 
                reimbursed by the Patent and Trademark Office, as 
                determined by the Secretary of Commerce;</DELETED>
                <DELETED>    ``(B) such individual serves in a position 
                that performed work in support of the Patent and 
                Trademark Office during at least half of the 
                incumbent's work time, as determined by the Secretary 
                of Commerce; or</DELETED>
                <DELETED>    ``(C) such transfer would be in the 
                interest of the Office, as determined by the Secretary 
                of Commerce in consultation with the 
                Director.</DELETED>
        <DELETED>Any transfer under this paragraph shall be effective 
        as of the same effective date as referred to in paragraph (1), 
        and shall be made without a break in service.</DELETED>
        <DELETED>    ``(3) Accumulated leave.--The amount of sick and 
        annual leave and compensatory time accumulated under title 5 
        before the effective date described in paragraph (1), by those 
        becoming officers or employees of the Office pursuant to this 
        subsection, are obligations of the Office.</DELETED>
<DELETED>    ``(f) Transition Provisions.--</DELETED>
        <DELETED>    ``(1) Interim appointment of director.--On or 
        after the effective date of the Patent and Trademark Office 
        Modernization Act, the President shall appoint an individual to 
        serve as the Director until the date on which a Director 
        qualifies under subsection (a). The President shall not make 
        more than one such appointment under this subsection.</DELETED>
        <DELETED>    ``(2) Continuation in office of certain 
        officers.--(A) The individual serving as the Assistant 
        Commissioner for Patents on the day before the effective date 
        of the Patent and Trademark Office Modernization Act may serve 
        as the Commissioner for Patents until the date on which a 
        Commissioner for Patents is appointed under subsection 
        (b).</DELETED>
        <DELETED>    ``(B) The individual serving as the Assistant 
        Commissioner for Trademarks on the day before the effective 
        date of the Patent and Trademark Office Modernization Act may 
        serve as the Commissioner for Trademarks until the date on 
        which a Commissioner for Trademarks is appointed under 
        subsection (b).''.</DELETED>

<DELETED> SEC. 114. MANAGEMENT ADVISORY BOARD.</DELETED>

<DELETED>    Chapter 1 of part I of title 35, United States Code, is 
amended by inserting after section 4 the following:</DELETED>
<DELETED>``Sec. 5. Patent and Trademark Office Management Advisory 
              Board</DELETED>
<DELETED>    ``(a) Establishment of Management Advisory Board.--
</DELETED>
        <DELETED>    ``(1) Appointment.--The United States Patent and 
        Trademark Office shall have a Management Advisory Board 
        (hereafter in this title referred to as the `Advisory Board') 
        of 12 members, 4 of whom shall be appointed by the President, 4 
        of whom shall be appointed by the Speaker of the House of 
        Representatives, and 4 of whom shall be appointed by the 
        majority leader of the Senate. Not more than 3 of the 4 members 
        appointed by each appointing authority shall be members of the 
        same political party.</DELETED>
        <DELETED>    ``(2) Terms.--Members of the Advisory Board shall 
        be appointed for a term of 4 years each, except that of the 
        members first appointed by each appointing authority, 1 shall 
        be for a term of 1 year, 1 shall be for a term of 2 years, and 
        1 shall be for a term of 3 years. No member may serve more than 
        1 term.</DELETED>
        <DELETED>    ``(3) Chair.--The President shall designate the 
        chair of the Advisory Board, whose term as chair shall be for 3 
        years.</DELETED>
        <DELETED>    ``(4) Timing of appointments.--Initial 
        appointments to the Advisory Board shall be made within 3 
        months after the effective date of the Patent and Trademark 
        Office Modernization Act, and vacancies shall be filled within 
        3 months after they occur.</DELETED>
        <DELETED>    ``(5) Vacancies.--Vacancies shall be filled in the 
        manner in which the original appointment was made under this 
        subsection. Members appointed to fill a vacancy occurring 
        before the expiration of the term for which the member's 
        predecessor was appointed shall be appointed only for the 
        remainder of that term. A member may serve after the expiration 
        of that member's term until a successor is appointed.</DELETED>
        <DELETED>    ``(6) Committees.--The Chair shall designate 
        members of the Advisory Board to serve on a committee on patent 
        operations and on a committee on trademark operations to 
        perform the duties set forth in subsection (e) as they relate 
        specifically to the Office's patent operations, and the 
        Office's trademark operations, respectively.</DELETED>
<DELETED>    ``(b) Basis for Appointments.--Members of the Advisory 
Board shall be citizens of the United States who shall be chosen so as 
to represent the interests of diverse users of the United States Patent 
and Trademark Office, including inventors, and shall include 
individuals with substantial background and achievement in corporate 
finance and management.</DELETED>
<DELETED>    ``(c) Applicability of Certain Ethics Laws.--Members of 
the Advisory Board shall be special Government employees within the 
meaning of section 202 of title 18.</DELETED>
<DELETED>    ``(d) Meetings.--The Advisory Board shall meet at the call 
of the chair, not less than every 6 months, to consider an agenda set 
by the chair.</DELETED>
<DELETED>    ``(e) Duties.--The Advisory Board shall--</DELETED>
        <DELETED>    ``(1) review the policies, goals, performance, 
        budget, and user fees of the United States Patent and Trademark 
        Office, and advise the Director on these matters; and</DELETED>
        <DELETED>    ``(2) within 60 days after the end of each fiscal 
        year, prepare an annual report on the matters referred to in 
        paragraph (1), transmit the report to the President and the 
        Committees on the Judiciary of the Senate and the House of 
        Representatives, and publish the report in the Patent and 
        Trademark Office Official Gazette.</DELETED>
<DELETED>    ``(f) Compensation.--Members of the Advisory Board shall 
be compensated for each day (including travel time) during which they 
are attending meetings or conferences of the Advisory Board or 
otherwise engaged in the business of the Advisory Board, at the rate 
which is the daily equivalent of the annual rate of basic pay in effect 
for level III of the Executive Schedule under section 5314 of title 5, 
and while away from their homes or regular places of business they may 
be allowed travel expenses, including per diem in lieu of subsistence, 
as authorized by section 5703 of title 5.</DELETED>
<DELETED>    ``(g) Access to Information.--Members of the Advisory 
Board shall be provided access to records and information in the United 
States Patent and Trademark Office, except for personnel or other 
privileged information and information concerning patent applications 
required to be kept in confidence by section 122.''.</DELETED>

<DELETED>SEC. 115. CONFORMING AMENDMENTS.</DELETED>

<DELETED>    (a) Duties.--Chapter 1 of title 35, United States Code, is 
amended by striking section 6.</DELETED>
<DELETED>    (b) Regulations for Agents and Attorneys.--Section 31 of 
title 35, United States Code, and the item relating to such section in 
the table of sections for chapter 3 of title 35, United States Code, 
are repealed.</DELETED>

<DELETED>SEC. 116. TRADEMARK TRIAL AND APPEAL BOARD.</DELETED>

<DELETED>    Section 17 of the Act of July 5, 1946 (commonly referred 
to as the ``Trademark Act of 1946'') (15 U.S.C. 1067) is amended to 
read as follows:</DELETED>
<DELETED>    ``Sec. 17. (a) In every case of interference, opposition 
to registration, application to register as a lawful concurrent user, 
or application to cancel the registration of a mark, the Director shall 
give notice to all parties and shall direct a Trademark Trial and 
Appeal Board to determine and decide the respective rights of 
registration.</DELETED>
<DELETED>    ``(b) The Trademark Trial and Appeal Board shall include 
the Director, the Commissioner for Patents, the Commissioner for 
Trademarks, and administrative trademark judges who are appointed by 
the Director.''.</DELETED>

<DELETED>SEC. 117. BOARD OF PATENT APPEALS AND INTERFERENCES.</DELETED>

<DELETED>    Chapter 1 of title 35, United States Code, is amended by 
striking section 7 and inserting after section 5 the 
following:</DELETED>
<DELETED>``Sec. 6. Board of Patent Appeals and Interferences</DELETED>
<DELETED>    ``(a) Establishment and Composition.--There shall be in 
the United States Patent and Trademark Office a Board of Patent Appeals 
and Interferences. The Director, the Commissioner for Patents, the 
Commissioner for Trademarks, and the administrative patent judges shall 
constitute the Board. The administrative patent judges shall be persons 
of competent legal knowledge and scientific ability who are appointed 
by the Director.</DELETED>
<DELETED>    ``(b) Duties.--The Board of Patent Appeals and 
Interferences shall, on written appeal of an applicant, review adverse 
decisions of examiners upon applications for patents and shall 
determine priority and patentability of invention in interferences 
declared under section 135(a). Each appeal and interference shall be 
heard by at least 3 members of the Board, who shall be designated by 
the Director. Only the Board of Patent Appeals and Interferences may 
grant rehearings.''.</DELETED>

<DELETED>SEC. 118. SUITS BY AND AGAINST THE OFFICE.</DELETED>

<DELETED>    Chapter 1 of part I of title 35, United States Code, is 
amended by inserting after section 6 the following new 
section:</DELETED>
<DELETED>``Sec. 7. Suits by and against the Office</DELETED>
<DELETED>    ``(a) Actions Under United States Law.--Any civil action 
or proceeding to which the United States Patent and Trademark Office is 
a party is deemed to arise under the laws of the United States. The 
Federal courts shall have exclusive jurisdiction over all civil actions 
by or against the Office.</DELETED>
<DELETED>    ``(b) Representation by the Department of Justice.--The 
United States Patent and Trademark Office shall be deemed an agency of 
the United States for purposes of section 516 of title 28.</DELETED>
<DELETED>    ``(c) Prohibition on Attachment, Liens, Etc.--No 
attachment, garnishment, lien, or similar process, intermediate or 
final, in law or equity, may be issued against property of the 
Office.''.</DELETED>

<DELETED>SEC. 119. ANNUAL REPORT OF DIRECTOR.</DELETED>

<DELETED>    Section 14 of title 35, United States Code, is amended to 
read as follows:</DELETED>
<DELETED>``Sec. 14. Annual report to Congress</DELETED>
<DELETED>    ``The Director shall report to the Congress, not later 
than 180 days after the end of each fiscal year, the moneys received 
and expended by the Office, the purposes for which the moneys were 
spent, the quality and quantity of the work of the Office, and other 
information relating to the Office. The report under this section shall 
also meet the requirements of section 9106 of title 31, to the extent 
that such requirements are not inconsistent with the preceding 
sentence. The report required under this section shall not be deemed to 
be the report of the United States Patent and Trademark Office under 
section 9106 of title 31, and the Director shall file a separate report 
under such section.''.</DELETED>

<DELETED>SEC. 120. SUSPENSION OR EXCLUSION FROM PRACTICE.</DELETED>

<DELETED>    Section 32 of title 35, United States Code, is amended by 
inserting before the last sentence the following: ``The Director shall 
have the discretion to designate any attorney who is an officer or 
employee of the United States Patent and Trademark Office to conduct 
the hearing required by this section.''.</DELETED>

<DELETED>SEC. 121. FUNDING.</DELETED>

<DELETED>    Section 42 of title 35, United States Code, is amended to 
read as follows:</DELETED>
<DELETED>``Sec. 42. Patent and Trademark Office funding</DELETED>
<DELETED>    ``(a) Fees Payable to the Office.--All fees for services 
performed by or materials furnished by the United States Patent and 
Trademark Office shall be payable to the Office.</DELETED>
<DELETED>    ``(b) Use of Moneys.--Moneys from fees shall be available 
to the United States Patent and Trademark Office to carry out, to the 
extent provided in appropriations Acts, the functions of the Office. 
Moneys of the Office not otherwise used to carry out the functions of 
the Office shall be kept in cash on hand or on deposit, or invested in 
obligations of the United States or guaranteed by the United States, or 
in obligations or other instruments which are lawful investments for 
fiduciary, trust, or public funds. Fees available to the Office under 
this title shall be used for the processing of patent applications and 
for other services and materials relating to patents. Fees available to 
the Office under section 31 of the Act of July 5, 1946 (commonly 
referred to as the `Trademark Act of 1946'; 15 U.S.C. 1113), shall be 
used only for the processing of trademark registrations and for other 
services and materials relating to trademarks.''.</DELETED>

<DELETED>SEC. 122. EXTENSION OF SURCHARGES ON PATENT FEES.</DELETED>

<DELETED>    (a) In General.--Section 10101 of the Omnibus Budget 
Reconciliation Act of 1990 (35 U.S.C. 41 note) is amended to read as 
follows:</DELETED>

<DELETED>``SEC. 10101. PATENT AND TRADEMARK OFFICE USER FEES.</DELETED>

<DELETED>    ``(a) Surcharges.--There shall be a surcharge on all fees 
authorized by subsections (a) and (b) of section 41 of title 35, United 
States Code, in order to ensure that the amounts specified in 
subsection (c) are collected.</DELETED>
<DELETED>    ``(b) Use of Surcharges.--Notwithstanding section 3302 of 
title 31, United States Code, all surcharges collected by the Patent 
and Trademark Office--</DELETED>
        <DELETED>    ``(1) shall be credited to a separate account 
        established in the Treasury and ascribed to the activities of 
        the United States Patent and Trademark Office as offsetting 
        collections,</DELETED>
        <DELETED>    ``(2) shall be collected by and available to the 
        United States Patent and Trademark Office for all authorized 
        activities and operations of the Office, including all direct 
        and indirect costs of services provided by the office, 
        and</DELETED>
        <DELETED>    ``(3) shall remain available until 
        expended.</DELETED>
<DELETED>    ``(c) Establishment of Surcharges.--The Director of the 
United States Patent and Trademark Office shall establish surcharges 
under subsection (a), subject to the provisions of section 553 of title 
5, United States Code, in order to ensure that $119,000,000, but not 
more than $119,000,000, are collected in fiscal year 1999 and each 
fiscal year thereafter.</DELETED>
<DELETED>    ``(d) Appropriations Act Required.--Notwithstanding 
subsections (a) through (c), no fee established by subsection (a) shall 
be collected nor shall be available for spending without prior 
authorization in appropriations Acts.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by subsection (a) 
shall take effect on October 1, 1998.</DELETED>

<DELETED>SEC. 123. TRANSFERS.</DELETED>

<DELETED>    (a) Transfer of Functions.--Except to the extent that such 
functions, powers, and duties relate to the direction of patent or 
trademark policy, there are transferred to, and vested in, the United 
States Patent and Trademark Office all functions, powers, and duties 
vested by law in the Secretary of Commerce or the Department of 
Commerce or in the officers or components in the Department of Commerce 
with respect to the authority to grant patents and register trademarks, 
and in the Patent and Trademark Office, as in effect on the day before 
the effective date of this title, and in the officers and components of 
such Office.</DELETED>
<DELETED>    (b) Transfer of Funds and Property.--The Secretary of 
Commerce shall transfer to the United States Patent and Trademark 
Office, on the effective date of this title, so much of the assets, 
liabilities, contracts, property, records, and unexpended and 
unobligated balances of appropriations, authorizations, allocations, 
and other funds employed, held, used, arising from, available to, or to 
be made available to the Department of Commerce, including funds set 
aside for accounts receivable, which are related to functions, powers, 
and duties which are vested in the Patent and Trademark Office by this 
title.</DELETED>

<DELETED>SEC. 124. GAO STUDY AND REPORT.</DELETED>

<DELETED>    The Comptroller General shall conduct a study of and, not 
later than the date that is 2 years after the effective date of this 
title, submit to the Committee on the Judiciary of the House of 
Representatives and the Committee on the Judiciary of the Senate a 
report on--</DELETED>
        <DELETED>    (1) the operations of the Patent and Trademark 
        Office as a Government corporation; and</DELETED>
        <DELETED>    (2) the feasibility and desirability of making the 
        trademark operations of the Patent and Trademark Office a 
        separate Government corporation or agency.</DELETED>

  <DELETED>Subtitle B--Effective Date; Technical Amendments</DELETED>

<DELETED>SEC. 131. EFFECTIVE DATE.</DELETED>

<DELETED>    This title and the amendments made by this title shall 
take effect 4 months after the date of the enactment of this 
Act.</DELETED>

<DELETED>SEC. 132. TECHNICAL AND CONFORMING AMENDMENTS.</DELETED>

<DELETED>    (a) Amendments to Title 35.--</DELETED>
        <DELETED>    (1) The item relating to part I in the table of 
        parts for chapter 35, United States Code, is amended to read as 
        follows:</DELETED>

        <DELETED>``I. United States Patent and Trademark Office    1''.
        <DELETED>    (2) The heading for part I of title 35, United 
        States Code, is amended to read as follows:</DELETED>

         <DELETED>``PART I--UNITED STATES PATENT AND TRADEMARK 
                          OFFICE''.</DELETED>

        <DELETED>    (3) The table of chapters for part I of title 35, 
        United States Code, is amended by amending the item relating to 
        chapter 1 to read as follows:</DELETED>

<DELETED>``1. Establishment, Officers and Employees,               1''.
                            Functions.
        <DELETED>    (4) The table of sections for chapter 1 of title 
        35, United States Code, is amended to read as 
        follows:</DELETED>

     <DELETED>``CHAPTER 1--ESTABLISHMENT, OFFICERS AND EMPLOYEES, 
                          FUNCTIONS</DELETED>

<DELETED>``Sec.
<DELETED>``1.  Establishment.
<DELETED>``2.  Powers and duties.
<DELETED>``3.  Officers and employees.
<DELETED>``4.  Restrictions on officers and employees as to interest in 
                            patents.
<DELETED>``5.  Patent and Trademark Office Management Advisory Board.
<DELETED>``6.  Board of Patent Appeals and Interferences.
<DELETED>``7.  Suits by and against the Office.
<DELETED>``8.  Library.
<DELETED>``9.  Classification of patents.
<DELETED>``10. Certified copies of records.
<DELETED>``11. Publications.
<DELETED>``12. Exchange of copies of patents with foreign countries.
<DELETED>``13. Copies of patents for public libraries.
<DELETED>``14. Annual report to Congress.''.
<DELETED>    (5) Section 41(h) of title 35, United States Code, is 
amended by striking ``Commissioner of Patents and Trademarks'' and 
inserting ``Director''.</DELETED>
        <DELETED>    (6) Section 155 of title 35, United States Code, 
        is amended by striking ``Commissioner of Patents and 
        Trademarks'' and inserting ``Director''.</DELETED>
        <DELETED>    (7) Section 155A(c) of title 35, United States 
        Code, is amended by striking ``Commissioner of Patents and 
        Trademarks'' and inserting ``Director''.</DELETED>
        <DELETED>    (8) Section 302 of title 35, United States Code, 
        is amended by striking ``Commissioner of Patents'' and 
        inserting ``Director''.</DELETED>
        <DELETED>    (9) Section 303(b) of title 35, United States 
        Code, is amended by striking ``Commissioner's'' and inserting 
        ``Director's''.</DELETED>
        <DELETED>    (10)(A) Except as provided in subparagraph (B), 
        title 35, United States Code, is amended by striking 
        ``Commissioner'' each place it appears and inserting 
        ``Director''.</DELETED>
        <DELETED>    (B) Chapter 17 of title 35, United States Code, is 
        amended by striking ``Commissioner'' each place it appears and 
        inserting ``Commissioner of Patents''.</DELETED>
        <DELETED>    (11) Section 41(a)(8)(A) of title 35, United 
        States Code, is amended by striking ``On'' and inserting 
        ``on''.</DELETED>
        <DELETED>    (12) Section 157(d) of title 35, United States 
        Code, is amended by striking ``Secretary of Commerce'' and 
        inserting ``Director''.</DELETED>
        <DELETED>    (13) Section 181 of title 35, United States Code, 
        is amended in the third paragraph by striking ``Secretary of 
        Commerce under rules prescribed by him'' and inserting 
        ``Director under rules prescribed by the Patent and Trademark 
        Office''.</DELETED>
        <DELETED>    (14) Section 188 of title 35, United States Code, 
        is amended by striking ``Secretary of Commerce'' and inserting 
        ``Patent and Trademark Office''.</DELETED>
        <DELETED>    (15) Section 202(a) of title 35, United States 
        Code, is amended by striking ``iv)'' and inserting 
        ``(iv)''.</DELETED>
<DELETED>    (b) Other Provisions of Law.--</DELETED>
        <DELETED>    (1)(A) Section 45 of the Act of July 5, 1946 
        (commonly referred to as the ``Trademark Act of 1946''; 15 
        U.S.C. 1127), is amended by striking ``The term `Commissioner' 
        means the Commissioner of Patents and Trademarks.'' and 
        inserting ``The term `Director' means the Director of the 
        United States Patent and Trademark Office.''.</DELETED>
        <DELETED>    (B) The Act of July 5, 1946 (commonly referred to 
        as the ``Trademark Act of 1946''; 15 U.S.C. 1051 and 
        following), except for section 17, as amended by section 116 of 
        this Act, is amended by striking ``Commissioner'' each place it 
        appears and inserting ``Director''.</DELETED>
        <DELETED>    (2) Section 9101(3) of title 31, United States 
        Code, is amended by adding at the end the following:</DELETED>
                <DELETED>    ``(R) the United States Patent and 
                Trademark Office.''.</DELETED>
        <DELETED>    (3) Section 500(e) of title 5, United States Code, 
        is amended by striking ``Patent Office'' and inserting ``United 
        States Patent and Trademark Office''.</DELETED>
        <DELETED>    (4) Section 5102(c)(23) of title 5, United States 
        Code, is amended to read as follows:</DELETED>
        <DELETED>    ``(23) administrative patent judges and designated 
        administrative patent judges in the United States Patent and 
        Trademark Office;''.</DELETED>
        <DELETED>    (5) Section 5316 of title 5, United States Code (5 
        U.S.C. 5316) is amended by striking ``Commissioner of Patents, 
        Department of Commerce.'', ``Deputy Commissioner of Patents and 
        Trademarks.'', ``Assistant Commissioner for Patents.'', and 
        ``Assistant Commissioner for Trademarks.''.</DELETED>
        <DELETED>    (6) Section 9(p)(1)(B) of the Small Business Act 
        (15 U.S.C. 638(p)(1)(B)) is amended to read as 
        follows:</DELETED>
                <DELETED>    ``(B) the Director of the United States 
                Patent and Trademark Office; and''.</DELETED>
        <DELETED>    (7) Section 12 of the Act of February 14, 1903 (15 
        U.S.C. 1511) is amended by striking ``(d) Patent and Trademark 
        Office;'' and redesignating subsections (a) through (g) as 
        paragraphs (1) through (6), respectively.</DELETED>
        <DELETED>    (8) Section 19 of the Tennessee Valley Authority 
        Act of 1933 (16 U.S.C. 831r) is amended--</DELETED>
                <DELETED>    (A) by striking ``Patent Office of the 
                United States'' and inserting ``United States Patent 
                and Trademark Office''; and</DELETED>
                <DELETED>    (B) by striking ``Commissioner of 
                Patents'' and inserting ``Director of the United States 
                Patent and Trademark Office''.</DELETED>
        <DELETED>    (9) Section 182(b)(2)(A) of the Trade Act of 1974 
        (19 U.S.C. 2242(b)(2)(A)) is amended by striking ``Commissioner 
        of Patents and Trademarks'' and inserting ``Director of the 
        United States Patent and Trademark Office''.</DELETED>
        <DELETED>    (10) Section 302(b)(2)(D) of the Trade Act of 1974 
        (19 U.S.C. 2412(b)(2)(D)) is amended by striking ``Commissioner 
        of Patents and Trademarks'' and inserting ``Director of the 
        United States Patent and Trademark Office''.</DELETED>
        <DELETED>    (11) The Act of April 12, 1892 (27 Stat. 395; 20 
        U.S.C. 91) is amended by striking ``Patent Office'' and 
        inserting ``United States Patent and Trademark 
        Office''.</DELETED>
        <DELETED>    (12) Sections 505(m) and 512(o) of the Federal 
        Food, Drug, and Cosmetic Act (21 U.S.C. 355(m) and 360b(o)) are 
        each amended by striking ``Patent and Trademark Office of the 
        Department of Commerce'' and inserting ``United States Patent 
        and Trademark Office''.</DELETED>
        <DELETED>    (13) Section 702(d) of the Federal Food, Drug, and 
        Cosmetic Act (21 U.S.C. 372(d)) is amended by striking 
        ``Commissioner of Patents'' and inserting ``Director of the 
        United States Patent and Trademark Office''.</DELETED>
        <DELETED>    (14) Section 105(e) of the Federal Alcohol 
        Administration Act (27 U.S.C. 205(e)) is amended by striking 
        ``United States Patent Office'' and inserting ``United States 
        Patent and Trademark Office''.</DELETED>
        <DELETED>    (15) Section 1295(a)(4) of title 28, United States 
        Code, is amended--</DELETED>
                <DELETED>    (A) in subparagraph (A) by inserting 
                ``United States'' before ``Patent and Trademark''; 
                and</DELETED>
                <DELETED>    (B) in subparagraph (B) by striking 
                ``Commissioner of Patents and Trademarks'' and 
                inserting ``Director of the United States Patent and 
                Trademark Office''.</DELETED>
        <DELETED>    (16) Section 1744 of title 28, United States Code 
        is amended--</DELETED>
                <DELETED>    (A) by striking ``Patent Office'' each 
                place it appears in the text and section heading and 
                inserting ``United States Patent and Trademark 
                Office'';</DELETED>
                <DELETED>    (B) by striking ``Commissioner of 
                Patents'' and inserting ``Director of the United States 
                Patent and Trademark Office''; and</DELETED>
                <DELETED>    (C) by striking ``Commissioner'' and 
                inserting ``Director''.</DELETED>
        <DELETED>    (17) Section 1745 of title 28, United States Code, 
        is amended by striking ``United States Patent Office'' and 
        inserting ``United States Patent and Trademark 
        Office''.</DELETED>
        <DELETED>    (18) Section 1928 of title 28, United States Code, 
        is amended by striking ``Patent Office'' and inserting ``United 
        States Patent and Trademark Office''.</DELETED>
        <DELETED>    (19) Section 151 of the Atomic Energy Act of 1954 
        (42 U.S.C. 2181) is amended in subsections c. and d. by 
        striking ``Commissioner of Patents'' and inserting ``Director 
        of the United States Patent and Trademark Office''.</DELETED>
        <DELETED>    (20) Section 152 of the Atomic Energy Act of 1954 
        (42 U.S.C. 2182) is amended by striking ``Commissioner of 
        Patents'' each place it appears and inserting ``Director of the 
        United States Patent and Trademark Office''.</DELETED>
        <DELETED>    (21) Section 305 of the National Aeronautics and 
        Space Act of 1958 (42 U.S.C. 2457) is amended--</DELETED>
                <DELETED>    (A) in subsection (c) by striking 
                ``Commissioner of Patents'' and inserting ``Director of 
                the United States Patent and Trademark Office 
                (hereafter in this section referred to as the 
                `Director')''; and</DELETED>
                <DELETED>    (B) by striking ``Commissioner'' each 
                subsequent place it appears and inserting 
                ``Director''.</DELETED>
        <DELETED>    (22) Section 12(a) of the Solar Heating and 
        Cooling Demonstration Act of 1974 (42 U.S.C. 5510(a)) is 
        amended by striking ``Commissioner of the Patent Office'' and 
        inserting ``Director of the United States Patent and Trademark 
        Office''.</DELETED>
        <DELETED>    (23) Section 1111 of title 44, United States Code, 
        is amended by striking ``the Commissioner of 
        Patents,''.</DELETED>
        <DELETED>    (24) Section 1114 of title 44, United States Code, 
        is amended by striking ``the Commissioner of 
        Patents,''.</DELETED>
        <DELETED>    (25) Section 1123 of title 44, United States Code, 
        is amended by striking ``the Patent Office,''.</DELETED>
        <DELETED>    (26) Sections 1337 and 1338 of title 44, United 
        States Code, and the items relating to those sections in the 
        table of contents for chapter 13 of such title, are 
        repealed.</DELETED>
        <DELETED>    (27) Section 10(i) of the Trading With the Enemy 
        Act (50 U.S.C. App. 10(i)) is amended by striking 
        ``Commissioner of Patents'' and inserting ``Director of the 
        United States Patent and Trademark Office''.</DELETED>
        <DELETED>    (28) Section 11 of the Inspector General Act of 
        1978 (5 U.S.C. App.) is amended--</DELETED>
                <DELETED>    (A) in paragraph (1)--</DELETED>
                        <DELETED>    (i) by striking ``and'' before 
                        ``the chief executive officer of the Resolution 
                        Trust Corporation;'';</DELETED>
                        <DELETED>    (ii) by striking ``and'' before 
                        ``the Chairperson of the Federal Deposit 
                        Insurance Corporation;'';</DELETED>
                        <DELETED>    (iii) by striking ``or'' before 
                        ``the Commissioner of Social Security,''; 
                        and</DELETED>
                        <DELETED>    (iv) by inserting ``or the 
                        Director of the United States Patent and 
                        Trademark Office;'' after ``Social Security 
                        Administration;''; and</DELETED>
                <DELETED>    (B) in paragraph (2)--</DELETED>
                        <DELETED>    (i) by striking ``or'' before 
                        ``the Veterans' Administration,''; 
                        and</DELETED>
                        <DELETED>    (ii) by striking ``or the Social 
                        Security Administration'' and inserting ``the 
                        Social Security Administration, or the United 
                        States Patent and Trademark Office''.</DELETED>

        <DELETED>Subtitle C--Miscellaneous Provisions</DELETED>

<DELETED>SEC. 141. REFERENCES.</DELETED>

<DELETED>    (a) In General.--Any reference in any other Federal law, 
Executive order, rule, regulation, or delegation of authority, or any 
document of or pertaining to a department or office from which a 
function is transferred by this title--</DELETED>
        <DELETED>    (1) to the head of such department or office is 
        deemed to refer to the head of the department or office to 
        which such function is transferred; or</DELETED>
        <DELETED>    (2) to such department or office is deemed to 
        refer to the department or office to which such function is 
        transferred.</DELETED>
<DELETED>    (b) Specific References.--Any reference in any other 
Federal law, Executive order, rule, regulation, or delegation of 
authority, or any document of or pertaining to the Patent and Trademark 
Office--</DELETED>
        <DELETED>    (1) to the Commissioner of Patents and Trademarks 
        is deemed to refer to the Director of the United States Patent 
        and Trademark Office;</DELETED>
        <DELETED>    (2) to the Assistant Commissioner for Patents is 
        deemed to refer to the Commissioner for Patents; or</DELETED>
        <DELETED>    (3) to the Assistant Commissioner for Trademarks 
        is deemed to refer to the Commissioner for 
        Trademarks.</DELETED>

<DELETED>SEC. 142. EXERCISE OF AUTHORITIES.</DELETED>

<DELETED>    Except as otherwise provided by law, a Federal official to 
whom a function is transferred by this title may, for purposes of 
performing the function, exercise all authorities under any other 
provision of law that were available with respect to the performance of 
that function to the official responsible for the performance of the 
function immediately before the effective date of the transfer of the 
function under this title.</DELETED>

<DELETED>SEC. 143. SAVINGS PROVISIONS.</DELETED>

<DELETED>    (a) Legal Documents.--All orders, determinations, rules, 
regulations, permits, grants, loans, contracts, agreements, 
certificates, licenses, and privileges--</DELETED>
        <DELETED>    (1) that have been issued, made, granted, or 
        allowed to become effective by the President, the Secretary of 
        Commerce, any officer or employee of any office transferred by 
        this title, or any other Government official, or by a court of 
        competent jurisdiction, in the performance of any function that 
        is transferred by this title, and</DELETED>
        <DELETED>    (2) that are in effect on the effective date of 
        such transfer (or become effective after such date pursuant to 
        their terms as in effect on such effective date),</DELETED>
<DELETED>shall continue in effect according to their terms until 
modified, terminated, superseded, set aside, or revoked in accordance 
with law by the President, any other authorized official, a court of 
competent jurisdiction, or operation of law.</DELETED>
<DELETED>    (b) Proceedings.--This title shall not affect any 
proceedings or any application for any benefits, service, license, 
permit, certificate, or financial assistance pending on the effective 
date of this title before an office transferred by this title, but such 
proceedings and applications shall be continued. Orders shall be issued 
in such proceedings, appeals shall be taken therefrom, and payments 
shall be made pursuant to such orders, as if this title had not been 
enacted, and orders issued in any such proceeding shall continue in 
effect until modified, terminated, superseded, or revoked by a duly 
authorized official, by a court of competent jurisdiction, or by 
operation of law. Nothing in this subsection shall be considered to 
prohibit the discontinuance or modification of any such proceeding 
under the same terms and conditions and to the same extent that such 
proceeding could have been discontinued or modified if this title had 
not been enacted.</DELETED>
<DELETED>    (c) Suits.--This title shall not affect suits commenced 
before the effective date of this title, and in all such suits, 
proceedings shall be had, appeals taken, and judgments rendered in the 
same manner and with the same effect as if this title had not been 
enacted.</DELETED>
<DELETED>    (d) Nonabatement of Actions.--No suit, action, or other 
proceeding commenced by or against the Department of Commerce or the 
Secretary of Commerce, or by or against any individual in the official 
capacity of such individual as an officer or employee of an office 
transferred by this title, shall abate by reason of the enactment of 
this title.</DELETED>
<DELETED>    (e) Continuance of Suits.--If any Government officer in 
the official capacity of such officer is party to a suit with respect 
to a function of the officer, and under this title such function is 
transferred to any other officer or office, then such suit shall be 
continued with the other officer or the head of such other office, as 
applicable, substituted or added as a party.</DELETED>
<DELETED>    (f) Administrative Procedure and Judicial Review.--Except 
as otherwise provided by this title, any statutory requirements 
relating to notice, hearings, action upon the record, or administrative 
or judicial review that apply to any function transferred by this title 
shall apply to the exercise of such function by the head of the Federal 
agency, and other officers of the agency, to which such function is 
transferred by this title.</DELETED>

<DELETED>SEC. 144. TRANSFER OF ASSETS.</DELETED>

<DELETED>    Except as otherwise provided in this title, so much of the 
personnel, property, records, and unexpended balances of 
appropriations, allocations, and other funds employed, used, held, 
available, or to be made available in connection with a function 
transferred to an official or agency by this title shall be available 
to the official or the head of that agency, respectively, at such time 
or times as the Director of the Office of Management and Budget directs 
for use in connection with the functions transferred.</DELETED>

<DELETED>SEC. 145. DELEGATION AND ASSIGNMENT.</DELETED>

<DELETED>    Except as otherwise expressly prohibited by law or 
otherwise provided in this title, an official to whom functions are 
transferred under this title (including the head of any office to which 
functions are transferred under this title) may delegate any of the 
functions so transferred to such officers and employees of the office 
of the official as the official may designate, and may authorize 
successive redelegations of such functions as may be necessary or 
appropriate. No delegation of functions under this section or under any 
other provision of this title shall relieve the official to whom a 
function is transferred under this title of responsibility for the 
administration of the function.</DELETED>

<DELETED>SEC. 146. AUTHORITY OF DIRECTOR OF THE OFFICE OF MANAGEMENT 
              AND BUDGET WITH RESPECT TO FUNCTIONS 
              TRANSFERRED.</DELETED>

<DELETED>    (a) Determinations.--If necessary, the Director of the 
Office of Management and Budget shall make any determination of the 
functions that are transferred under this title.</DELETED>
<DELETED>    (b) Incidental Transfers.--The Director of the Office of 
Management and Budget, at such time or times as the Director shall 
provide, may make such determinations as may be necessary with regard 
to the functions transferred by this title, and to make such additional 
incidental dispositions of personnel, assets, liabilities, grants, 
contracts, property, records, and unexpended balances of 
appropriations, authorizations, allocations, and other funds held, 
used, arising from, available to, or to be made available in connection 
with such functions, as may be necessary to carry out the provisions of 
this title. The Director shall provide for the termination of the 
affairs of all entities terminated by this title and for such further 
measures and dispositions as may be necessary to effectuate the 
purposes of this title.</DELETED>

<DELETED>SEC. 147. CERTAIN VESTING OF FUNCTIONS CONSIDERED 
              TRANSFERS.</DELETED>

<DELETED>    For purposes of this title, the vesting of a function in a 
department or office pursuant to reestablishment of an office shall be 
considered to be the transfer of the function.</DELETED>

<DELETED>SEC. 148. AVAILABILITY OF EXISTING FUNDS.</DELETED>

<DELETED>    Existing appropriations and funds available for the 
performance of functions, programs, and activities terminated pursuant 
to this title shall remain available, for the duration of their period 
of availability, for necessary expenses in connection with the 
termination and resolution of such functions, programs, and activities, 
subject to the submission of a plan to the Committees on Appropriations 
of the House and Senate in accordance with the procedures set forth in 
section 605 of the Departments of Commerce, Justice, and State, the 
Judiciary, and Related Agencies Appropriations Act 1997.</DELETED>

<DELETED>SEC. 149. DEFINITIONS.</DELETED>

<DELETED>    For purposes of this title--</DELETED>
        <DELETED>    (1) the term ``function'' includes any duty, 
        obligation, power, authority, responsibility, right, privilege, 
        activity, or program; and</DELETED>
        <DELETED>    (2) the term ``office'' includes any office, 
        administration, agency, bureau, institute, council, unit, 
        organizational entity, or component thereof.</DELETED>

   <DELETED>Subtitle D--Under Secretary of Commerce for Intellectual 
                       Property Policy</DELETED>

<DELETED>SEC. 151. UNDER SECRETARY OF COMMERCE FOR INTELLECTUAL 
              PROPERTY POLICY.</DELETED>

<DELETED>    (a) Appointment.--There shall be within the Department of 
Commerce an Under Secretary of Commerce for Intellectual Property 
Policy, who shall be appointed by the President, by and with the advice 
and consent of the Senate. On or after the effective date of this 
title, the President may appoint an individual to serve as the Under 
Secretary until the date on which an Under Secretary qualifies under 
this subsection. The President shall not make more than 1 appointment 
under the preceding sentence.</DELETED>
<DELETED>    (b) Duties.--The Under Secretary of Commerce for 
Intellectual Property Policy, under the direction of the Secretary of 
Commerce, shall perform the following functions with respect to 
intellectual property policy:</DELETED>
        <DELETED>    (1) In coordination with the Under Secretary of 
        Commerce for International Trade, promote exports of goods and 
        services of the United States industries that rely on 
        intellectual property.</DELETED>
        <DELETED>    (2) Advise the President, through the Secretary of 
        Commerce, on national and international intellectual property 
        policy issues.</DELETED>
        <DELETED>    (3) Advise Federal departments and agencies on 
        matters of intellectual property protection in other 
        countries.</DELETED>
        <DELETED>    (4) Provide guidance, as appropriate, with respect 
        to proposals by agencies to assist foreign governments and 
        international intergovernmental organizations on matters of 
        intellectual property protection.</DELETED>
        <DELETED>    (5) Conduct programs and studies related to the 
        effectiveness of intellectual property protection throughout 
        the world.</DELETED>
        <DELETED>    (6) Advise the Secretary of Commerce on programs 
        and studies relating to intellectual property policy that are 
        conducted, or authorized to be conducted, cooperatively with 
        foreign patent and trademark offices and international 
        intergovernmental organizations.</DELETED>
        <DELETED>    (7) In coordination with the Department of State, 
        conduct programs and studies cooperatively with foreign 
        intellectual property offices and international 
        intergovernmental organizations.</DELETED>
<DELETED>    (c) Deputy Under Secretaries.--To assist the Under 
Secretary of Commerce for Intellectual Property Policy, the Secretary 
of Commerce shall appoint a Deputy Under Secretary for Patent Policy 
and a Deputy Under Secretary for Trademark Policy as members of the 
Senior Executive Service in accordance with the provisions of title 5, 
United States Code. The Deputy Under Secretaries shall perform such 
duties and functions as the Under Secretary for Intellectual Property 
Policy shall prescribe.</DELETED>
<DELETED>    (d) Compensation.--Section 5314 of title 5, United States 
Code, is amended by adding at the end the following:</DELETED>
        <DELETED>    ``Under Secretary of Commerce for Intellectual 
        Property Policy.''.</DELETED>
<DELETED>    (e) Funding.--Funds available to the United States Patent 
and Trademark Office shall be made available for all expenses of the 
office of the Under Secretary for Intellectual Property Policy, subject 
to prior approval in appropriations Acts. Amounts made available under 
this subsection shall not exceed 2 percent of the projected annual 
revenues of the Patent and Trademark Office from fees for services and 
goods of that Office. The Secretary of Commerce shall determine the 
budget requirements of the office of the Under Secretary for 
Intellectual Property Policy.</DELETED>

<DELETED>SEC. 152. RELATIONSHIP WITH EXISTING AUTHORITIES.</DELETED>

<DELETED>    Nothing in section 151 shall derogate from the duties of 
the United States Trade Representative as set forth in section 141 of 
the Trade Act of 1974 (19 U.S.C. 2171).</DELETED>

 <DELETED>TITLE II--EXAMINING PROCEDURE IMPROVEMENTS: PUBLICATION WITH 
 PROVISIONAL ROYALTIES; TERM EXTENSIONS; FURTHER EXAMINATION</DELETED>

<DELETED>SEC. 201. SHORT TITLE.</DELETED>

<DELETED>    This title may be cited as the ``Examining Procedure 
Improvements Act''.</DELETED>

<DELETED>SEC. 202. PUBLICATION.</DELETED>

<DELETED>    Section 122 of title 35, United States Code, is amended to 
read as follows:</DELETED>
<DELETED>``Sec. 122. Confidential status of applications; publication 
              of patent applications</DELETED>
<DELETED>    ``(a) Confidentiality.--Except as provided in subsection 
(b), applications for patents shall be kept in confidence by the Patent 
and Trademark Office and no information concerning applications for 
patents shall be given without authority of the applicant or owner 
unless necessary to carry out the provisions of an Act of Congress or 
in such special circumstances as may be determined by the 
Director.</DELETED>
<DELETED>    ``(b) Publication.--</DELETED>
        <DELETED>    ``(1) In general.--(A) Subject to paragraph (2), 
        each application for patent, except applications for design 
        patents filed under chapter 16 of this title and provisional 
        applications filed under section 111(b) of this title, shall be 
        published, in accordance with procedures determined by the 
        Director, promptly after the expiration of a period of 18 
        months from the earliest filing date for which a benefit is 
        sought under this title. At the request of the applicant, an 
        application may be published earlier than the end of such 18-
        month period.</DELETED>
        <DELETED>    ``(B) No information concerning published patent 
        applications shall be made available to the public except as 
        the Director determines.</DELETED>
        <DELETED>    ``(C) Notwithstanding any other provision of law, 
        a determination by the Director to release or not to release 
        information concerning a published patent application shall be 
        final and nonreviewable.</DELETED>
        <DELETED>    ``(2) Exceptions.--(A) An application that is no 
        longer pending shall not be published.</DELETED>
        <DELETED>    ``(B) An application that is in the process of 
        being reviewed by the Atomic Energy Commission, the Department 
        of Defense, or a defense agency pursuant to section 181 of this 
        title shall not be published until the Director has been 
        notified by the Atomic Energy Commission, the Secretary of 
        Defense, or the chief officer of the defense agency, as the 
        case may be, that in the opinion of the Atomic Energy 
        Commission, the Secretary of Defense, or such chief officer, as 
        the case may be, publication or disclosure of the invention by 
        the granting of a patent would not be detrimental to the 
        national security of the United States.</DELETED>
        <DELETED>    ``(C) An application that is subject to a secrecy 
        order pursuant to section 181 of this title shall not be 
        published.</DELETED>
        <DELETED>    ``(D) An application filed by a small business 
        concern entitled to reduced fees under section 41(h)(1) of this 
        title, by an individual who is an independent inventor entitled 
        to reduced fees under such section, or by an institution of 
        higher education (as defined in section 1202 of the Higher 
        Education Act of 1965) entitled to reduced fees under such 
        section 41(h)(1) shall not be published until a patent is 
        issued thereon, except upon the request of the applicant, or in 
        any of the following circumstances:</DELETED>
                <DELETED>    ``(i) In the case of an application under 
                section 111(a) for a patent for an invention for which 
                the applicant intends to file or has filed an 
                application for a patent in a foreign country, the 
                Commissioner may publish, at the discretion of the 
                Commissioner and by means determined suitable for the 
                purpose, no more than that data from such application 
                under section 111(a) which will be made or has been 
                made public in such foreign country. Such a publication 
                shall be made only after the date of the publication in 
                such foreign country and shall be made only if the data 
                is not available, or cannot be made readily available, 
                in the English language through commercial 
                services.</DELETED>
                <DELETED>    ``(ii) If the Commissioner determines that 
                a patent application which is filed after the date of 
                the enactment of this paragraph--</DELETED>
                        <DELETED>    ``(I) has been pending more than 5 
                        years from the effective filing date of the 
                        application,</DELETED>
                        <DELETED>    ``(II) has not been previously 
                        published by the Patent and Trademark 
                        Office,</DELETED>
                        <DELETED>    ``(III) is not under any appellate 
                        review by the Board of Patent Appeals and 
                        Interferences,</DELETED>
                        <DELETED>    ``(IV) is not under interference 
                        proceedings in accordance with section 
                        135(a),</DELETED>
                        <DELETED>    ``(V) is not under any secrecy 
                        order pursuant to section 181,</DELETED>
                        <DELETED>    ``(VI) is not being diligently 
                        pursued by the applicant in accordance with 
                        this title, and</DELETED>
                        <DELETED>    ``(VII) is not in 
                        abandonment,</DELETED>
                <DELETED>the Commissioner shall notify the applicant of 
                such determination.</DELETED>
                <DELETED>    ``(iii) An applicant which received notice 
                of a determination described in clause (ii) may, within 
                30 days of receiving such notice, petition the 
                Commissioner to review the determination to verify that 
                subclauses (I) through (VII) are all applicable to the 
                applicant's application. If the applicant makes such a 
                petition, the Commissioner shall not publish the 
                applicant's application before the Commissioner's 
                review of the petition is completed. If the applicant 
                does not submit a petition, the Commissioner may 
                publish the applicant's application no earlier than 90 
                days after giving such a notice.</DELETED>
                <DELETED>    ``(iv) If after the date of the enactment 
                of this paragraph a continuing application has been 
                filed more than 6 months after the date of the initial 
                filing of an application, the Commissioner shall notify 
                the applicant under such application. The Commissioner 
                shall establish a procedure for an applicant which 
                receives such a notice to demonstrate that the purpose 
                of the continuing application was for reasons other 
                than to achieve a delay in the time of publication of 
                the application. If the Commissioner agrees with such a 
                demonstration by the applicant, the Commissioner shall 
                not publish the applicant's application. If the 
                Commissioner does not agree with such a demonstration 
                by the applicant or if the applicant does not make an 
                attempt at such a demonstration within a reasonable 
                period of time as determined by the Commissioner, the 
                Commissioner shall publish the applicant's 
                application.</DELETED>
        <DELETED>    ``(E)(i) Upon the request at the time of filing by 
        an applicant that is a small business concern or an independent 
        inventor entitled to reduced fees under section 41(h)(1) of 
        this title, the application shall not be published in 
        accordance with paragraph (1) until 3 months after the Director 
        makes a second notification to such applicant on the merits of 
        the application under section 132 of this title. The Director 
        may require applicants that no longer have the status of a 
        small business concern or an independent inventor to so notify 
        the Director not later than 15 months after the earliest filing 
        date for which a benefit is sought under this title.</DELETED>
        <DELETED>    ``(ii) Applications filed pursuant to section 363 
        of this title, applications asserting priority under section 
        119 or 365(a) of this title, and applications asserting the 
        benefit of an earlier application under section 120 or 365(c) 
        of this title shall not be eligible for a request pursuant to 
        this subparagraph.</DELETED>
        <DELETED>    ``(iii) Applications asserting the benefit of an 
        earlier application under section 121 shall not be eligible for 
        a request pursuant to this subparagraph unless filed within 2 
        months after the date on which the Director required the 
        earlier application to be restricted to 1 of 2 or more 
        inventions in the earlier application.</DELETED>
        <DELETED>    ``(iv) In a request under this subparagraph, the 
        applicant shall certify that the invention disclosed in the 
        application was not and will not be the subject of an 
        application filed in a foreign country.</DELETED>
        <DELETED>    ``(v) The Director may establish appropriate 
        procedures and nominal fees for making a request under this 
        subparagraph.</DELETED>
        <DELETED>    ``(F)(i) In a case in which an applicant, after 
        making a request under subparagraph (E)(i), determines to file 
        an application in a foreign country, the applicant shall notify 
        the Director promptly. The application shall then be published 
        in accordance with the provisions of paragraph (1).</DELETED>
        <DELETED>    ``(ii) The Director may establish appropriate fees 
        to cover the costs of processing notifications under clause 
        (i), including the costs of any special handling of 
        applications resulting from the initial request under 
        subparagraph (E)(i).</DELETED>
        <DELETED>    ``(F) No fee established under this section shall 
        be collected nor shall be available for spending without prior 
        authorization in appropriations Acts.</DELETED>
<DELETED>    ``(c) Pre-Issuance Opposition.--The provisions of this 
section shall not operate to create any new opportunity for pre-
issuance opposition. The Director may establish appropriate procedures 
to ensure that this section does not create any new opportunity for 
pre-issuance opposition.''.</DELETED>

<DELETED>SEC. 203. TIME FOR CLAIMING BENEFIT OF EARLIER FILING 
              DATE.</DELETED>

<DELETED>    (a) In a Foreign Country.--Section 119(b) of title 35, 
United States Code, is amended to read as follows:</DELETED>
<DELETED>    ``(b)(1) No application for patent shall be entitled to 
this right of priority unless a claim is filed in the Patent and 
Trademark Office, at such time during the pendency of the application 
as is required by the Director, that identifies the foreign application 
by specifying its application number, the country in or for which the 
application was filed, and the date of its filing.</DELETED>
<DELETED>    ``(2) The Director may consider the failure of the 
applicant to file a timely claim for priority as a waiver of any such 
claim, and may require the payment of a surcharge as a condition of 
accepting an untimely claim during the pendency of the 
application.</DELETED>
<DELETED>    ``(3) The Director may require a certified copy of the 
original foreign application, specification, and drawings upon which it 
is based, a translation if not in the English language, and such other 
information as the Director considers necessary. Any such certification 
shall be made by the intellectual property authority in the foreign 
country in which the foreign application was filed and show the date of 
the application and of the filing of the specification and other 
papers.''.</DELETED>
<DELETED>    (b) In the United States.--Section 120 of title 35, United 
States Code, is amended by adding at the end the following: ``No 
application shall be entitled to the benefit of an earlier filed 
application under this section unless an amendment containing the 
specific reference to the earlier filed application is submitted at 
such time during the pendency of the application as is required by the 
Commissioner. The Director may consider the failure to submit such an 
amendment within that time period as a waiver of any benefit under this 
section. The Director may establish procedures, including the payment 
of a surcharge, to accept unavoidably late submissions of amendments 
under this section.''.</DELETED>

<DELETED>SEC. 204. PROVISIONAL RIGHTS.</DELETED>

<DELETED>    Section 154 of title 35, United States Code, is amended--
</DELETED>
        <DELETED>    (1) in the section caption by inserting ``; 
        provisional rights'' after ``patent''; and</DELETED>
        <DELETED>    (2) by adding at the end the following new 
        subsection:</DELETED>
<DELETED>    ``(d) Provisional Rights.--</DELETED>
        <DELETED>    ``(1) In general.--In addition to other rights 
        provided by this section, a patent shall include the right to 
        obtain a reasonable royalty from any person who, during the 
        period beginning on the date of publication of the application 
        for such patent pursuant to section 122(b) of this title, or in 
        the case of an international application filed under the treaty 
        defined in section 351(a) of this title designating the United 
        States under Article 21(2)(a) of such treaty, the date of 
        publication of the application, and ending on the date the 
        patent is issued--</DELETED>
                <DELETED>    ``(A)(i) makes, uses, offers for sale, or 
                sells in the United States the invention as claimed in 
                the published patent application or imports such an 
                invention into the United States; or</DELETED>
                <DELETED>    ``(ii) if the invention as claimed in the 
                published patent application is a process, uses, offers 
                for sale, or sells in the United States or imports into 
                the United States products made by that process as 
                claimed in the published patent application; 
                and</DELETED>
                <DELETED>    ``(B) had actual notice of the published 
                patent application and, where the right arising under 
                this paragraph is based upon an international 
                application designating the United States that is 
                published in a language other than English, a 
                translation of the international application into the 
                English language.</DELETED>
        <DELETED>    ``(2) Right based on substantially identical 
        inventions.--The right under paragraph (1) to obtain a 
        reasonable royalty shall not be available under this subsection 
        unless the invention as claimed in the patent is substantially 
        identical to the invention as claimed in the published patent 
        application.</DELETED>
        <DELETED>    ``(3) Time limitation on obtaining a reasonable 
        royalty.--The right under paragraph (1) to obtain a reasonable 
        royalty shall be available only in an action brought not later 
        than 6 years after the patent is issued. The right under 
        paragraph (1) to obtain a reasonable royalty shall not be 
        affected by the duration of the period described in paragraph 
        (1).</DELETED>
        <DELETED>    ``(4) Requirements for international 
        applications.--The right under paragraph (1) to obtain a 
        reasonable royalty based upon the publication under the treaty 
        defined in section 351(a) of this title of an international 
        application designating the United States shall commence from 
        the date that the Patent and Trademark Office receives a copy 
        of the publication under such treaty of the international 
        application, or, if the publication under the treaty of the 
        international application is in a language other than English, 
        from the date that the Patent and Trademark Office receives a 
        translation of the international application in the English 
        language. The Director may require the applicant to provide a 
        copy of the international publication of the international 
        application and a translation thereof.''.</DELETED>

<DELETED>SEC. 205. PRIOR ART EFFECT OF PUBLISHED 
              APPLICATIONS.</DELETED>

<DELETED>    Section 102(e) of title 35, United States Code, is amended 
to read as follows:</DELETED>
<DELETED>    ``(e) the invention was described in--</DELETED>
        <DELETED>    ``(1) an application for patent, published 
        pursuant to section 122(b) of this title, by another filed in 
        the United States before the invention by the applicant for 
        patent, except that an international application filed under 
        the treaty defined in section 351(a) of this title shall have 
        the effect under this subsection of a national application 
        published under section 122(b) of this title only if the 
        international application designating the United States was 
        published under Article 21(2)(a) of such treaty in the English 
        language, or</DELETED>
        <DELETED>    ``(2) a patent granted on an application for 
        patent by another filed in the United States before the 
        invention by the applicant for patent, or''.</DELETED>

<DELETED>SEC. 206. COST RECOVERY FOR PUBLICATION.</DELETED>

<DELETED>    The Director of the United States Patent and Trademark 
Office shall recover the cost of early publication required by the 
amendment made by section 202 by adjusting the filing, issue, and 
maintenance fees under title 35, United States Code, by charging a 
separate publication fee, or by any combination of these 
methods.</DELETED>

<DELETED>SEC. 207. CONFORMING CHANGES.</DELETED>

<DELETED>    The following provisions of title 35, United States Code, 
are amended:</DELETED>
        <DELETED>    (1) Section 11 is amended in paragraph 1 of 
        subsection (a) by inserting ``and published applications for 
        patents'' after ``Patents''.</DELETED>
        <DELETED>    (2) Section 12 is amended--</DELETED>
                <DELETED>    (A) in the section caption by inserting 
                ``and applications'' after ``patents''; and</DELETED>
                <DELETED>    (B) by inserting ``and published 
                applications for patents'' after ``patents''.</DELETED>
        <DELETED>    (3) Section 13 is amended--</DELETED>
                <DELETED>    (A) in the section caption by inserting 
                ``and applications'' after ``patents''; and</DELETED>
                <DELETED>    (B) by inserting ``and published 
                applications for patents'' after ``patents''.</DELETED>
        <DELETED>    (4) The items relating to sections 12 and 13 in 
        the table of sections for chapter 1, as amended by section 
        132(a)(4) of this Act, are each amended by inserting ``and 
        applications'' after ``patents''.</DELETED>
        <DELETED>    (5) The item relating to section 122 in the table 
        of sections for chapter 11 is amended by inserting ``; 
        publication of patent applications'' after 
        ``applications''.</DELETED>
        <DELETED>    (6) The item relating to section 154 in the table 
        of sections for chapter 14 is amended by inserting ``; 
        provisional rights'' after ``patent''.</DELETED>
        <DELETED>    (7) Section 181 is amended--</DELETED>
                <DELETED>    (A) in the first paragraph--</DELETED>
                        <DELETED>    (i) by inserting ``by the 
                        publication of an application or'' after 
                        ``disclosure''; and</DELETED>
                        <DELETED>    (ii) by inserting ``the 
                        publication of the application or'' after 
                        ``withhold'';</DELETED>
                <DELETED>    (B) in the second paragraph by inserting 
                ``by the publication of an application or'' after 
                ``disclosure of an invention'';</DELETED>
                <DELETED>    (C) in the third paragraph--</DELETED>
                        <DELETED>    (i) by inserting ``by the 
                        publication of the application or'' after 
                        ``disclosure of the invention''; and</DELETED>
                        <DELETED>    (ii) by inserting ``the 
                        publication of the application or'' after 
                        ``withhold''; and</DELETED>
                <DELETED>    (D) in the fourth paragraph by inserting 
                ``the publication of an application or'' after ``and'' 
                in the first sentence.</DELETED>
        <DELETED>    (8) Section 252 is amended in the first paragraph 
        by inserting ``substantially'' before ``identical'' each place 
        it appears.</DELETED>
        <DELETED>    (9) Section 284 is amended by adding at the end of 
        the second paragraph the following: ``Increased damages under 
        this paragraph shall not apply to provisional rights under 
        section 154(d) of this title.''.</DELETED>
        <DELETED>    (10) Section 374 is amended to read as 
        follows:</DELETED>
<DELETED>``Sec. 374. Publication of international application: 
              Effect</DELETED>
<DELETED>    ``The publication under the treaty defined in section 
351(a) of this title of an international application designating the 
United States shall confer the same rights and shall have the same 
effect under this title as an application for patent published under 
section 122(b), except as provided in sections 102(e) and 154(d) of 
this title.''.</DELETED>
        <DELETED>    (11) Section 135(b) of title 35, United States 
        Code, is amended to read as follows:</DELETED>
<DELETED>    ``(b)(1) A claim which is the same as, or for the same or 
substantially the same subject matter as, a claim of an issued patent 
may only be made in an application if--</DELETED>
        <DELETED>    ``(A) such a claim is made prior to 1 year after 
        the date on which the patent was granted; and</DELETED>
        <DELETED>    ``(B) the applicant files evidence which 
        demonstrates that the applicant is prima facie entitled to a 
        judgment relative to the patent.</DELETED>
<DELETED>    ``(2)(A) A claim which is the same as, or for the same or 
substantially the same subject matter as, a claim of a published 
application may only be made in an application filed after the date of 
publication of the published application if, except in a case to which 
subparagraph (B) applies--</DELETED>
        <DELETED>    ``(i) such a claim is made prior to 1 year after 
        the date of publication of the published application; 
        and</DELETED>
        <DELETED>    ``(ii) the applicant of the application filed 
        after the date of publication of the published application 
        files evidence that demonstrates that the applicant is prima 
        facie entitled to a judgment relative to the published 
        application.</DELETED>
<DELETED>    ``(B) If the applicant of the application filed after the 
date of publication of the published application alleges that the 
invention claimed in the published application was derived from that 
applicant, such a claim may only be made if that applicant files 
evidence which demonstrates that the applicant is prima facie entitled 
to a judgment relative to the published application.''.</DELETED>

<DELETED>SEC. 208. PATENT TERM EXTENSION AUTHORITY.</DELETED>

<DELETED>    Section 154(b) of title 35, United States Code, is amended 
to read as follows:</DELETED>
<DELETED>    ``(b) Term Extension.--</DELETED>
        <DELETED>    ``(1) Basis for patent term extension.--</DELETED>
                <DELETED>    ``(A) Delay.--Subject to the limitations 
                set forth in paragraph (2), if the issue of an original 
                patent is delayed due to--</DELETED>
                        <DELETED>    ``(i) a proceeding under section 
                        135(a) of this title, including any appeal 
                        under section 141, or any civil action under 
                        section 146, of this title,</DELETED>
                        <DELETED>    ``(ii) the imposition of an order 
                        pursuant to section 181 of this 
                        title,</DELETED>
                        <DELETED>    ``(iii) review by the Board of 
                        Patent Appeals and Interferences or by a 
                        Federal court in a case in which the patent was 
                        issued pursuant to a decision in the review 
                        reversing an adverse determination of 
                        patentability, or</DELETED>
                        <DELETED>    ``(iv) an unusual administrative 
                        delay by the Patent and Trademark Office in 
                        issuing the patent,</DELETED>
                <DELETED>the term of the patent shall be extended for 
                the period of delay.</DELETED>
                <DELETED>    ``(B) Administrative delay.--For purposes 
                of subparagraph (A)(iv), an unusual administrative 
                delay by the Patent and Trademark Office is the failure 
                to--</DELETED>
                        <DELETED>    ``(i) make a notification of the 
                        rejection of any claim for a patent or any 
                        objection or argument under section 132 of this 
                        title or give or mail a written notice of 
                        allowance under section 151 of this title not 
                        later than 14 months after the date on which 
                        the application was filed;</DELETED>
                        <DELETED>    ``(ii) respond to a reply under 
                        section 132 of this title or to an appeal taken 
                        under section 134 of this title not later than 
                        4 months after the date on which the reply was 
                        filed or the appeal was taken;</DELETED>
                        <DELETED>    ``(iii) act on an application not 
                        later than 4 months after the date of a 
                        decision by the Board of Patent Appeals and 
                        Interferences under section 134 or 135 of this 
                        title or a decision by a Federal court under 
                        section 141, 145, or 146 of this title in a 
                        case in which allowable claims remain in an 
                        application;</DELETED>
                        <DELETED>    ``(iv) issue a patent not later 
                        than 4 months after the date on which the issue 
                        fee was paid under section 151 of this title 
                        and all outstanding requirements were 
                        satisfied; or</DELETED>
                        <DELETED>    ``(v) issue a patent within 3 
                        years after the filing date of the application 
                        in the United States, if the applicant--
                        </DELETED>
                                <DELETED>    ``(I) has not obtained 
                                further limited examination of the 
                                application under section 209 of the 
                                Examining Procedure Improvements 
                                Act;</DELETED>
                                <DELETED>    ``(II) has not benefitted 
                                from an extension of patent term under 
                                clause (i), (ii), or (iii) of paragraph 
                                (1)(A);</DELETED>
                                <DELETED>    ``(III) has not sought or 
                                obtained appellate review by the Board 
                                of Patent Appeals and Interferences or 
                                by a Federal Court other than in a case 
                                in which the patent was issued pursuant 
                                to a decision in the review reversing 
                                an adverse determination of 
                                patentability; and</DELETED>
                                <DELETED>    ``(IV) has not requested 
                                any delay in the processing of the 
                                application by the Patent and Trademark 
                                Office.</DELETED>
        <DELETED>    ``(2) Limitations.--(A) The total duration of any 
        extensions granted pursuant to either clause (iii) or (iv) of 
        paragraph (1)(A) or both such clauses shall not exceed 10 
        years. To the extent that periods of delay attributable to 
        grounds specified in paragraph (1) overlap, the period of any 
        extension granted under this subsection shall not exceed the 
        actual number of days the issuance of the patent was 
        delayed.</DELETED>
        <DELETED>    ``(B) The period of extension of the term of a 
        patent under clause (iv) of paragraph (1)(A), which is based on 
        the failure of the Patent and Trademark Office to meet the 
        criteria set forth in clause (v) of paragraph (1)(B), shall be 
        reduced by the cumulative total of any periods of time that an 
        applicant takes to respond in excess of 3 months after the date 
        on which the Patent and Trademark Office makes any rejection, 
        objection, argument, or other request.</DELETED>
        <DELETED>    ``(C) The period of extension of the term of a 
        patent under this subsection shall be reduced by a period equal 
        to the time in which the applicant failed to engage in 
        reasonable efforts to conclude prosecution of the application. 
        The Director shall prescribe regulations establishing the 
        circumstances that constitute a failure of an applicant to 
        engage in reasonable efforts to conclude processing or 
        examination of an application in order to ensure that 
        applicants are appropriately compensated for any delays by the 
        Patent and Trademark Office in excess of the time periods 
        specified in paragraph (1)(B).</DELETED>
        <DELETED>    ``(D) No patent the term of which has been 
        disclaimed beyond a specified date may be extended under this 
        section beyond the expiration date specified in the 
        disclaimer.</DELETED>
        <DELETED>    ``(3) Procedures.--The Director shall prescribe 
        regulations establishing procedures for the notification of 
        patent term extensions under this subsection and procedures for 
        contesting patent term extensions under this 
        subsection.''.</DELETED>

<DELETED>SEC. 209. FURTHER EXAMINATION OF PATENT 
              APPLICATIONS.</DELETED>

<DELETED>    Section 132 of title 35, United States Code, is amended--
</DELETED>
        <DELETED>    (1) in the first sentence by striking ``Whenever'' 
        and inserting ``(a) Whenever''; and</DELETED>
        <DELETED>    (2) by adding at the end the following:</DELETED>
<DELETED>    ``(b) The Director shall prescribe regulations to provide 
for the further limited examination of applications for patent at the 
request of the applicant. The Director may establish appropriate fees 
for such further limited examination and shall be authorized to provide 
a 50 percent reduction on such fees for small entities that qualify for 
reduced fees under section 41(h)(1) of this title.</DELETED>

<DELETED>SEC. 210. LAST DAY OF PENDENCY OF PROVISIONAL 
              APPLICATION.</DELETED>

<DELETED>    Section 119(e) of title 35, United States Code, is amended 
by adding at the end the following:</DELETED>
<DELETED>    ``(3) If the day that is 12 months after the filing date 
of a provisional application falls on a Saturday, Sunday, or Federal 
holiday within the District of Columbia, the period of pendency of the 
provisional application shall be extended to the next succeeding 
secular or business day.''.</DELETED>

<DELETED>SEC. 211. REPORTING REQUIREMENT.</DELETED>

<DELETED>    The Director of the United States Patent and Trademark 
Office shall report to the Congress not later than April 1, 2001, and 
not later than April 1 of each year thereafter, regarding the impact of 
publication on the patent applications filed by applicants who are 
independent inventors entitled to reduced fees under section 41(h)(1) 
of title 35, United States Code. The report shall include information 
concerning the frequency and number of initial and continuing patent 
applications, pendency, interferences, reexaminations, rejection, 
abandonment rates, fees, other expenses, and other relevant information 
related to the prosecution of patent applications.</DELETED>

<DELETED>SEC. 212. EFFECTIVE DATE.</DELETED>

<DELETED>    (a) Sections 202 Through 207.--Sections 202 through 207, 
and the amendments made by such sections, shall take effect on April 1, 
1998, and shall apply to all applications filed under section 111 of 
title 35, United States Code, on or after that date, and all 
international applications designating the United States that are filed 
on or after that date.</DELETED>
<DELETED>    (b) Sections 208 Through 210.--The amendments made by 
sections 208 through 210 shall take effect on the date of the enactment 
of this Act and, except for a design patent application filed under 
chapter 16 of title 35, United States Code, shall apply to any 
application filed on or after June 8, 1995.</DELETED>

  <DELETED>TITLE III--PROTECTION FOR PRIOR DOMESTIC USERS OF PATENTED 
                         TECHNOLOGIES</DELETED>

<DELETED>SEC. 301. SHORT TITLE.</DELETED>

<DELETED>    This title may be cited as the ``Protection for Prior 
Domestic Commercial and Research Users of Patented Technologies 
Act''.</DELETED>

<DELETED>SEC. 302. DEFENSE TO PATENT INFRINGEMENT BASED ON PRIOR 
              DOMESTIC COMMERCIAL OR RESEARCH USE.</DELETED>

<DELETED>    (a) Defense.--Chapter 28 of title 35, United States Code, 
is amended by adding at the end the following new section:</DELETED>
<DELETED>``Sec. 273. Prior domestic commercial or research use; defense 
              to infringement</DELETED>
<DELETED>    ``(a) Definitions.--For purposes of this section--
</DELETED>
        <DELETED>    ``(1) the terms `commercially used', `commercially 
        use', and `commercial use' mean the use in the United States in 
        commerce or the use in the design, testing, or production in 
        the United States of a product or service which is used in 
        commerce, whether or not the subject matter at issue is 
        accessible to or otherwise known to the public;</DELETED>
        <DELETED>    ``(2) in the case of activities performed by a 
        nonprofit research laboratory, or nonprofit entity such as a 
        university, research center, or hospital, a use for which the 
        public is the intended beneficiary shall be considered to be a 
        use described in paragraph (1) if the use is limited to 
        activity that occurred within the laboratory or nonprofit 
        entity or by persons in privity with that laboratory or 
        nonprofit entity before the effective filing date of the 
        application for patent at issue, except that the use--
        </DELETED>
                <DELETED>    ``(A) may be asserted as a defense under 
                this section only by the laboratory or nonprofit 
                entity; and</DELETED>
                <DELETED>    ``(B) may not be asserted as a defense 
                with respect to any subsequent use by any entity other 
                than such laboratory, nonprofit entity, or persons in 
                privity;</DELETED>
        <DELETED>    ``(3) the terms `used in commerce', and `use in 
        commerce' mean that there has been an actual sale or other 
        arm's-length commercial transfer of the subject matter at issue 
        or that there has been an actual sale or other arm's-length 
        commercial transfer of a product or service resulting from the 
        use of the subject matter at issue; and</DELETED>
        <DELETED>    ``(4) the `effective filing date' of a patent is 
        the earlier of the actual filing date of the application for 
        the patent or the filing date of any earlier United States, 
        foreign, or international application to which the subject 
        matter at issue is entitled under section 119, 120, or 365 of 
        this title.</DELETED>
<DELETED>    ``(b) Defense to Infringement.--(1) A person shall not be 
liable as an infringer under section 271 of this title with respect to 
any subject matter that would otherwise infringe one or more claims in 
the patent being asserted against such person, if such person had, 
acting in good faith, commercially used the subject matter before the 
effective filing date of such patent.</DELETED>
<DELETED>    ``(2) The sale or other disposition of the subject matter 
of a patent by a person entitled to assert a defense under this section 
with respect to that subject matter shall exhaust the patent owner's 
rights under the patent to the extent such rights would have been 
exhausted had such sale or other disposition been made by the patent 
owner.</DELETED>
<DELETED>    ``(c) Limitations and Qualifications of Defense.--The 
defense to infringement under this section is subject to the 
following:</DELETED>
        <DELETED>    ``(1) Derivation.--A person may not assert the 
        defense under this section if the subject matter on which the 
        defense is based was derived from the patentee or persons in 
        privity with the patentee.</DELETED>
        <DELETED>    ``(2) Not a general license.--The defense asserted 
        by a person under this section is not a general license under 
        all claims of the patent at issue, but extends only to the 
        subject matter claimed in the patent with respect to which the 
        person can assert a defense under this chapter, except that the 
        defense shall also extend to variations in the quantity or 
        volume of use of the claimed subject matter, and to 
        improvements in the claimed subject matter that do not infringe 
        additional specifically claimed subject matter of the 
        patent.</DELETED>
        <DELETED>    ``(3) Effective and serious preparation.--With 
        respect to subject matter that cannot be commercialized without 
        a significant investment of time, money, and effort, a person 
        shall be deemed to have commercially used the subject matter 
        if--</DELETED>
                <DELETED>    ``(A) before the effective filing date of 
                the patent, the person actually reduced the subject 
                matter to practice in the United States, completed a 
                significant portion of the total investment necessary 
                to commercially use the subject matter, and made an 
                arm's-length commercial transaction in the United 
                States in connection with the preparation to use the 
                subject matter; and</DELETED>
                <DELETED>    ``(B) thereafter the person diligently 
                completed the remainder of the activities and 
                investments necessary to commercially use the subject 
                matter, and promptly began commercial use of the 
                subject matter, even if such activities were conducted 
                after the effective filing date of the 
                patent.</DELETED>
        <DELETED>    ``(4) Burden of proof.--A person asserting the 
        defense under this section shall have the burden of 
        establishing the defense.</DELETED>
        <DELETED>    ``(5) Abandonment of use.--A person who has 
        abandoned commercial use of subject matter may not rely on 
        activities performed before the date of such abandonment in 
        establishing a defense under subsection (b) with respect to 
        actions taken after the date of such abandonment.</DELETED>
        <DELETED>    ``(6) Personal defense.--The defense under this 
        section may only be asserted by the person who performed the 
        acts necessary to establish the defense and, except for any 
        transfer to the patent owner, the right to assert the defense 
        shall not be licensed or assigned or transferred to another 
        person except in connection with the good faith assignment or 
        transfer of the entire enterprise or line of business to which 
        the defense relates.</DELETED>
        <DELETED>    ``(7) One-year limitation.--A person may not 
        assert a defense under this section unless the subject matter 
        on which the defense is based had been commercially used or 
        actually reduced to practice more than one year prior to the 
        effective filing date of the patent by the person asserting the 
        defense or someone in privity with that person.</DELETED>
<DELETED>    ``(d) Unsuccessful Assertion of Defense.--If the defense 
under this section is pleaded by a person who is found to infringe the 
patent and who subsequently fails to demonstrate a reasonable basis for 
asserting the defense, the court shall find the case exceptional for 
the purpose of awarding attorney's fees under section 285 of this 
title.</DELETED>
<DELETED>    ``(e) Invalidity.--A patent shall not be deemed to be 
invalid under section 102 or 103 of this title solely because a defense 
is established under this section.''.</DELETED>
<DELETED>    (b) Conforming Amendment.--The table of sections at the 
beginning of chapter 28 of title 35, United States Code, is amended by 
adding at the end the following new item:</DELETED>

<DELETED>``273. Prior domestic commercial or research use; defense to 
                            infringement.''.

<DELETED>SEC. 303. EFFECTIVE DATE AND APPLICABILITY.</DELETED>

<DELETED>    This title and the amendments made by this title shall 
take effect on the date of the enactment of this Act, but shall not 
apply to any action for infringement that is pending on such date of 
enactment or with respect to any subject matter for which an 
adjudication of infringement, including a consent judgment, has been 
made before such date of enactment.</DELETED>

 <DELETED>TITLE IV--ENHANCED PROTECTION OF INVENTORS' RIGHTS</DELETED>

<DELETED>SEC. 401. SHORT TITLE.</DELETED>

<DELETED>    This title may be cited as the ``Enhanced Protection of 
Inventors' Rights Act''.</DELETED>

<DELETED>SEC. 402. INVENTION PROMOTION SERVICES.</DELETED>

<DELETED>    Part I of title 35, United States Code, is amended by 
adding after chapter 4 the following new chapter:</DELETED>

      <DELETED>``CHAPTER 5--INVENTION PROMOTION SERVICES</DELETED>

<DELETED>``Sec.
<DELETED>``51. Definitions.
<DELETED>``52. Contracting requirements.
<DELETED>``53. Standard provisions for cover notice.
<DELETED>``54. Reports to customer required.
<DELETED>``55. Mandatory contract terms.
<DELETED>``56. Remedies.
<DELETED>``57. Records of complaints.
<DELETED>``58. Fraudulent representation by an invention promoter.
<DELETED>``59. Rule of construction.
<DELETED>``Sec. 51. Definitions</DELETED>
<DELETED>    ``For purposes of this chapter--</DELETED>
        <DELETED>    ``(1) the term `contract for invention promotion 
        services' means a contract by which an invention promoter 
        undertakes invention promotion services for a 
        customer;</DELETED>
        <DELETED>    ``(2) the term `customer' means any person, firm, 
        partnership, corporation, or other entity who enters into a 
        financial relationship or a contract with an invention promoter 
        for invention promotion services;</DELETED>
        <DELETED>    ``(3) the term `invention promoter' means any 
        person, firm, partnership, corporation, or other entity who 
        offers to perform or performs for, or on behalf of, a customer 
        any act described under paragraph (4), but does not include--
        </DELETED>
                <DELETED>    ``(A) any department or agency of the 
                Federal Government or of a State or local 
                government;</DELETED>
                <DELETED>    ``(B) any nonprofit, charitable, 
                scientific, or educational organization, qualified 
                under applicable State law or described under section 
                170(b)(1)(A) of the Internal Revenue Code of 1986; 
                or</DELETED>
                <DELETED>    ``(C) any person duly registered with, and 
                in good standing before, the United States Patent and 
                Trademark Office acting within the scope of that 
                person's registration to practice before the Patent and 
                Trademark Office; and</DELETED>
        <DELETED>    ``(4) the term `invention promotion services' 
        means, with respect to an invention by a customer, any act 
        involved in--</DELETED>
                <DELETED>    ``(A) evaluating the invention to 
                determine its protectability as some form of 
                intellectual property, other than evaluation by a 
                person licensed by a State to practice law who is 
                acting solely within the scope of that person's 
                professional license;</DELETED>
                <DELETED>    ``(B) evaluating the invention to 
                determine its commercial potential by any person for 
                purposes other than providing venture capital; 
                or</DELETED>
                <DELETED>    ``(C) marketing, brokering, licensing, 
                selling, or promoting the invention or a product or 
                service in which the invention is incorporated or used, 
                except that the display only of an invention at a trade 
                show or exhibit shall not be considered to be invention 
                promotion services.</DELETED>
<DELETED>``Sec. 52. Contracting requirements</DELETED>
<DELETED>    ``(a) In General.--(1) Every contract for invention 
promotion services shall be in writing and shall be subject to the 
provisions of this chapter. A copy of the signed written contract shall 
be given to the customer at the time the customer enters into the 
contract.</DELETED>
<DELETED>    ``(2) If a contract is entered into for the benefit of a 
third party, such party shall be considered a customer for purposes of 
this chapter.</DELETED>
<DELETED>    ``(b) Requirements of Invention Promoter.--The invention 
promoter shall--</DELETED>
        <DELETED>    ``(1) state in a written document, at the time a 
        customer enters into a contract for invention promotion 
        services, whether the usual business practice of the invention 
        promoter is to--</DELETED>
                <DELETED>    ``(A) seek more than 1 contract in 
                connection with an invention; or</DELETED>
                <DELETED>    ``(B) seek to perform services in 
                connection with an invention in 1 or more phases, with 
                the performance of each phase covered in 1 or more 
                subsequent contracts; and</DELETED>
        <DELETED>    ``(2) supply to the customer a copy of the written 
        document together with a written summary of the usual business 
        practices of the invention promoter, including--</DELETED>
                <DELETED>    ``(A) the usual business terms of 
                contracts; and</DELETED>
                <DELETED>    ``(B) the approximate amount of the usual 
                fees or other consideration that may be required from 
                the customer for each of the services provided by the 
                invention promoter.</DELETED>
<DELETED>    ``(c) Right of Customer To Cancel Contract.--(1) 
Notwithstanding any contractual provision to the contrary, a customer 
shall have the right to terminate a contract for invention promotion 
services by sending a written letter to the invention promoter stating 
the customer's intent to cancel the contract. The letter of termination 
must be deposited with the United States Postal Service on or before 5 
business days after the date upon which the customer or the invention 
promoter executes the contract, whichever is later.</DELETED>
<DELETED>    ``(2) Delivery of a promissory note, check, bill of 
exchange, or negotiable instrument of any kind to the invention 
promoter or to a third party for the benefit of the invention promoter, 
without regard to the date or dates appearing in such instrument, shall 
be deemed payment received by the invention promoter on the date 
received for purposes of this section.</DELETED>
<DELETED>``Sec. 53. Standard provisions for cover notice</DELETED>
<DELETED>    ``(a) Contents.--Every contract for invention promotion 
services shall have a conspicuous and legible cover sheet attached with 
the following notice imprinted in boldface type of not less than 12-
point size:</DELETED>
        <DELETED>    ```YOU HAVE THE RIGHT TO TERMINATE THIS CONTRACT. 
        TO TERMINATE THIS CONTRACT, YOU MUST SEND A WRITTEN LETTER TO 
        THE COMPANY STATING YOUR INTENT TO CANCEL THIS CONTRACT. THE 
        LETTER OF TERMINATION MUST BE DEPOSITED WITH THE UNITED STATES 
        POSTAL SERVICE ON OR BEFORE FIVE (5) BUSINESS DAYS AFTER THE 
        DATE ON WHICH YOU OR THE COMPANY EXECUTE THE CONTRACT, 
        WHICHEVER IS LATER.</DELETED>
        <DELETED>    ```THE TOTAL NUMBER OF INVENTIONS EVALUATED BY THE 
        INVENTION PROMOTER FOR COMMERCIAL POTENTIAL IN THE PAST FIVE 
        (5) YEARS IS </DELETED>__________<DELETED>. OF THAT NUMBER, 
        </DELETED>__________ <DELETED>RECEIVED POSITIVE EVALUATIONS AND 
        </DELETED>__________ <DELETED>RECEIVED NEGATIVE 
        EVALUATIONS.</DELETED>
        <DELETED>    ```IF YOU ASSIGN EVEN A PARTIAL INTEREST IN THE 
        INVENTION TO THE INVENTION PROMOTER, THE INVENTION PROMOTER MAY 
        HAVE THE RIGHT TO SELL OR DISPOSE OF THE INVENTION WITHOUT YOUR 
        CONSENT AND MAY NOT HAVE TO SHARE THE PROFITS WITH 
        YOU.</DELETED>
        <DELETED>    ```THE TOTAL NUMBER OF CUSTOMERS WHO HAVE 
        CONTRACTED WITH THE INVENTION PROMOTER IN THE PAST FIVE (5) 
        YEARS IS </DELETED>__________<DELETED>. THE TOTAL NUMBER OF 
        CUSTOMERS KNOWN BY THIS INVENTION PROMOTER TO HAVE RECEIVED, BY 
        VIRTUE OF THIS INVENTION PROMOTER'S PERFORMANCE, AN AMOUNT OF 
        MONEY IN EXCESS OF THE AMOUNT PAID BY THE CUSTOMER TO THIS 
        INVENTION PROMOTER IS 
        </DELETED>______________<DELETED>.</DELETED>
        <DELETED>    ```THE OFFICERS OF THIS INVENTION PROMOTER HAVE 
        COLLECTIVELY OR INDIVIDUALLY BEEN AFFILIATED IN THE LAST TEN 
        (10) YEARS WITH THE FOLLOWING INVENTION PROMOTION COMPANIES: 
        (LIST THE NAMES AND ADDRESSES OF ALL PREVIOUS INVENTION 
        PROMOTION COMPANIES WITH WHICH THE PRINCIPAL OFFICERS HAVE BEEN 
        AFFILIATED AS OWNERS, AGENTS, OR EMPLOYEES). YOU ARE ENCOURAGED 
        TO CHECK WITH THE UNITED STATES PATENT AND TRADEMARK OFFICE, 
        THE FEDERAL TRADE COMMISSION, YOUR STATE ATTORNEY GENERAL'S 
        OFFICE, AND THE BETTER BUSINESS BUREAU FOR ANY COMPLAINTS FILED 
        AGAINST ANY OF THESE COMPANIES.</DELETED>
        <DELETED>    ```YOU ARE ENCOURAGED TO CONSULT WITH AN ATTORNEY 
        OF YOUR OWN CHOOSING BEFORE SIGNING THIS CONTRACT. BY 
        PROCEEDING WITHOUT THE ADVICE OF AN ATTORNEY REGISTERED TO 
        PRACTICE BEFORE THE UNITED STATES PATENT AND TRADEMARK OFFICE, 
        YOU COULD LOSE ANY RIGHTS YOU MIGHT HAVE IN YOUR IDEA OR 
        INVENTION.'.</DELETED>
<DELETED>    ``(b) Other Requirements for Cover Notice.--The cover 
notice shall contain the items required under subsection (a) and the 
name, primary office address, and local office address of the invention 
promoter, and may contain no other matter.</DELETED>
<DELETED>    ``(c) Disclosure of Certain Customers Not Required.--The 
requirement in the notice set forth in subsection (a) to include the 
`TOTAL NUMBER OF CUSTOMERS WHO HAVE CONTRACTED WITH THE INVENTION 
PROMOTER IN THE PAST FIVE (5) YEARS' need not include information with 
respect to customers who have purchased trade show services, research, 
advertising, or other nonmarketing services from the invention 
promoter, nor with respect to customers who have defaulted in their 
payments to the invention promoter.</DELETED>
<DELETED>``Sec. 54. Reports to customer required</DELETED>
<DELETED>    ``With respect to every contract for invention promotion 
services, the invention promoter shall deliver to the customer at the 
address specified in the contract, at least once every 3 months 
throughout the term of the contract, a written report that identifies 
the contract and includes--</DELETED>
        <DELETED>    ``(1) a full, clear, and concise description of 
        the services performed to the date of the report and of the 
        services yet to be performed and names of all persons who it is 
        known will perform the services; and</DELETED>
        <DELETED>    ``(2) the name and address of each person, firm, 
        corporation, or other entity to whom the subject matter of the 
        contract has been disclosed, the reason for each such 
        disclosure, the nature of the disclosure, and complete and 
        accurate summaries of all responses received as a result of 
        those disclosures.</DELETED>
<DELETED>``Sec. 55. Mandatory contract terms</DELETED>
<DELETED>    ``(a) Mandatory Terms.--Each contract for invention 
promotion services shall include in boldface type of not less than 12-
point size--</DELETED>
        <DELETED>    ``(1) the terms and conditions of payment and 
        contract termination rights required under section 
        52;</DELETED>
        <DELETED>    ``(2) a statement that the customer may avoid 
        entering into the contract by not making a payment to the 
        invention promoter;</DELETED>
        <DELETED>    ``(3) a full, clear, and concise description of 
        the specific acts or services that the invention promoter 
        undertakes to perform for the customer;</DELETED>
        <DELETED>    ``(4) a statement as to whether the invention 
        promoter undertakes to construct, sell, or distribute one or 
        more prototypes, models, or devices embodying the invention of 
        the customer;</DELETED>
        <DELETED>    ``(5) the full name and principal place of 
        business of the invention promoter and the name and principal 
        place of business of any parent, subsidiary, agent, independent 
        contractor, and any affiliated company or person who it is 
        known will perform any of the services or acts that the 
        invention promoter undertakes to perform for the 
        customer;</DELETED>
        <DELETED>    ``(6) if any oral or written representation of 
        estimated or projected customer earnings is given by the 
        invention promoter (or any agent, employee, officer, director, 
        partner, or independent contractor of such invention promoter), 
        a statement of that estimation or projection and a description 
        of the data upon which such representation is based;</DELETED>
        <DELETED>    ``(7) the name and address of the custodian of all 
        records and correspondence relating to the contracted for 
        invention promotion services, and a statement that the 
        invention promoter is required to maintain all records and 
        correspondence relating to performance of the invention 
        promotion services for such customer for a period of not less 
        than 2 years after expiration of the term of such contract; 
        and</DELETED>
        <DELETED>    ``(8) a statement setting forth a time schedule 
        for performance of the invention promotion services, including 
        an estimated date in which such performance is expected to be 
        completed.</DELETED>
<DELETED>    ``(b) Invention Promoter as Fiduciary.--To the extent that 
the description of the specific acts or services affords discretion to 
the invention promoter with respect to what specific acts or services 
shall be performed, the invention promoter shall be deemed a 
fiduciary.</DELETED>
<DELETED>    ``(c) Availability of Information.--Records and 
correspondence described under subsection (a)(7) shall be made 
available after 7 days written notice to the customer or the 
representative of the customer to review and copy at a reasonable cost 
on the invention promoter's premises during normal business 
hours.</DELETED>
<DELETED>``Sec. 56. Remedies</DELETED>
<DELETED>    ``(a) In General.--(1) Any contract for invention 
promotion services that does not comply with the applicable provisions 
of this chapter shall be voidable at the option of the 
customer.</DELETED>
<DELETED>    ``(2) Any contract for invention promotion services 
entered into in reliance upon any material false, fraudulent, or 
misleading information, representation, notice, or advertisement of the 
invention promoter (or any agent, employee, officer, director, partner, 
or independent contractor of such invention promoter) shall be voidable 
at the option of the customer.</DELETED>
<DELETED>    ``(3) Any waiver by the customer of any provision of this 
chapter shall be deemed contrary to public policy and shall be void and 
unenforceable.</DELETED>
<DELETED>    ``(4) Any contract for invention promotion services which 
provides for filing for and obtaining utility, design, or plant patent 
protection shall be voidable at the option of the customer unless the 
invention promoter offers to perform or performs such act through a 
person duly registered to practice before, and in good standing with, 
the Patent and Trademark Office.</DELETED>
<DELETED>    ``(b) Civil Action.--(1) Any customer who is injured by a 
violation of this chapter by an invention promoter or by any material 
false or fraudulent statement or representation, or any omission of 
material fact, by an invention promoter (or any agent, employee, 
director, officer, partner, or independent contractor of such invention 
promoter) or by failure of an invention promoter to make all the 
disclosures required under this chapter, may recover in a civil action 
against the invention promoter (or the officers, directors, or partners 
of such invention promoter) in addition to reasonable costs and 
attorneys' fees, the greater of--</DELETED>
        <DELETED>    ``(A) $5,000; or</DELETED>
        <DELETED>    ``(B) the amount of actual damages sustained by 
        the customer.</DELETED>
<DELETED>    ``(2) Notwithstanding paragraph (1), the court may 
increase damages to not more than 3 times the amount awarded.</DELETED>
<DELETED>    ``(c) Rebuttable Presumption of Injury.--For purposes of 
this section, substantial violation of any provision of this chapter by 
an invention promoter or execution by the customer of a contract for 
invention promotion services in reliance on any material false or 
fraudulent statements or representations or omissions of material fact 
shall establish a rebuttable presumption of injury.</DELETED>
<DELETED>``Sec. 57. Records of complaints</DELETED>
<DELETED>    ``(a) Release of Complaints.--The Director shall make all 
complaints received by the United States Patent and Trademark Office 
involving invention promoters publicly available, together with any 
response of the invention promoters.</DELETED>
<DELETED>    ``(b) Request for Complaints.--The Director may request 
complaints relating to invention promotion services from any Federal or 
State agency and include such complaints in the records maintained 
under subsection (a), together with any response of the invention 
promoters.</DELETED>
<DELETED>``Sec. 58. Fraudulent representation by an invention 
              promoter</DELETED>
<DELETED>    ``Whoever, in providing invention promotion services, 
knowingly provides any false or misleading statement, representation, 
or omission of material fact to a customer or fails to make all the 
disclosures required under this chapter, shall be guilty of a 
misdemeanor and fined not more than $10,000 for each offense.</DELETED>
<DELETED>``Sec. 59. Rule of construction</DELETED>
<DELETED>    ``Except as expressly provided in this chapter, no 
provision of this chapter shall be construed to affect any obligation, 
right, or remedy provided under any other Federal or State 
law.''.</DELETED>

<DELETED>SEC. 403. TECHNICAL AND CONFORMING AMENDMENT.</DELETED>

<DELETED>    The table of chapters for part I of title 35, United 
States Code, is amended by adding after the item relating to chapter 4 
the following:</DELETED>

<DELETED>``5. Invention Promotion Services..................      51''.

<DELETED>SEC. 404. EFFECTIVE DATE.</DELETED>

<DELETED>    This title and the amendments made by this title shall 
take effect 60 days after the date of the enactment of this 
Act.</DELETED>

         <DELETED>TITLE V--MISCELLANEOUS IMPROVEMENTS</DELETED>

<DELETED>SEC. 501. PROVISIONAL APPLICATIONS.</DELETED>

<DELETED>    (a) Abandonment.--Section 111(b)(5) of title 35, United 
States Code, is amended to read as follows:</DELETED>
        <DELETED>    ``(5) Abandonment.--Notwithstanding the absence of 
        a claim, upon timely request and as prescribed by the Director, 
        a provisional application may be treated as an application 
        filed under subsection (a). Subject to section 119(e)(3) of 
        this title, if no such request is made, the provisional 
        application shall be regarded as abandoned 12 months after the 
        filing date of such application and shall not be subject to 
        revival thereafter.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendment made by subsection (a) 
applies to any provisional application filed on or after June 8, 
1995.</DELETED>

<DELETED>SEC. 502. INTERNATIONAL APPLICATIONS.</DELETED>

<DELETED>    Section 119 of title 35, United States Code, is amended--
</DELETED>
        <DELETED>    (1) in subsection (a), by inserting ``or in a WTO 
        member country,'' after ``or to citizens of the United 
        States,''; and</DELETED>
        <DELETED>    (2) by adding at the end the following new 
        subsections:</DELETED>
<DELETED>    ``(f) Applications for Plant Breeder's Rights.--
Applications for plant breeder's rights filed in a WTO member country 
(or in a UPOV Contracting Party) shall have the same effect for the 
purpose of the right of priority under subsections (a) through (c) of 
this section as applications for patents, subject to the same 
conditions and requirements of this section as apply to applications 
for patents.</DELETED>
<DELETED>    ``(g) Definitions.--As used in this section--</DELETED>
        <DELETED>    ``(1) the term `WTO member country' has the same 
        meaning as the term is defined in section 104(b)(2) of this 
        title; and</DELETED>
        <DELETED>    ``(2) the term `UPOV Contracting Party' means a 
        member of the International Convention for the Protection of 
        New Varieties of Plants.''.</DELETED>

<DELETED>SEC. 503. PLANT PATENTS.</DELETED>

<DELETED>    (a) Tuber Propagated Plants.--Section 161 of title 35, 
United States Code, is amended by striking ``a tuber propagated plant 
or''.</DELETED>
<DELETED>    (b) Rights in Plant Patents.--The text of section 163 of 
title 35, United States Code, is amended to read as follows: ``In the 
case of a plant patent, the grant shall include the right to exclude 
others from asexually reproducing the plant, and from using, offering 
for sale, or selling the plant so reproduced, or any of its parts, 
throughout the United States, or from importing the plant so 
reproduced, or any parts thereof, into the United States.''.</DELETED>
<DELETED>    (c) Effective Date.--The amendment made by subsection (a) 
shall apply on the date of the enactment of this Act. The amendment 
made by subsection (b) shall apply to any plant patent issued on or 
after the date of the enactment of this Act.</DELETED>

<DELETED>SEC. 504. ELECTRONIC FILING.</DELETED>

<DELETED>    Section 22 of title 35, United States Code, is amended by 
striking ``printed or typewritten'' and inserting ``printed, 
typewritten, or on an electronic medium''.</DELETED>

<DELETED>SEC. 505. DIVISIONAL APPLICATIONS.</DELETED>

<DELETED>    (a) In General.--Section 121 of title 35, United States 
Code, is amended--</DELETED>
        <DELETED>    (1) in the first sentence by striking ``If'' and 
        inserting ``(a) If''; and</DELETED>
        <DELETED>    (2) by adding at the end the following new 
        subsections:</DELETED>
<DELETED>    ``(b) In a case in which restriction is required on the 
ground that two or more independent and distinct inventions are claimed 
in an application, the applicant shall be entitled to submit an 
examination fee and request examination for each independent and 
distinct invention in excess of one. The examination fee shall be equal 
to the filing fee, including excess claims fees, that would have 
applied had the claims corresponding to the asserted independent and 
distinct inventions been presented in a separate application for 
patent. For each of the independent and distinct inventions in excess 
of one for which the applicant pays an examination fee within two 
months after the requirement for restriction, the Director shall cause 
an examination to be made and a notification of rejection or written 
notice of allowance provided to the applicant within the time period 
specified in section 154(b)(1)(B)(i) of this title for the original 
application. Failure to meet this or any other time limit set forth in 
section 154(b)(1)(B) of this title shall be treated as an unusual 
administrative delay under section 154(b)(1)(A)(iv) of this 
title.</DELETED>
<DELETED>    ``(c) An applicant who requests reconsideration of a 
requirement for restriction under this section and submits examination 
fees pursuant to such requirement shall, if the requirement is 
determined to be improper, be entitled to a refund of any examination 
fees determined to have been paid pursuant to the 
requirement.''.</DELETED>
<DELETED>    (b) Effective Date.--The amendments made by subsection (a) 
shall take effect on the date that is 2 years after the date of the 
enactment of this Act and shall apply to applications for patent filed 
on or after such effective date.</DELETED>

<DELETED>SEC. 506. PUBLICATIONS.</DELETED>

<DELETED>    Section 11 of title 35, United States Code, is amended by 
adding at the end the following:</DELETED>
<DELETED>    ``(c) The Patent and Trademark Office shall make available 
for public inspection during regular business hours all solicitations 
issued by the Office for contracts for goods or services, and all 
contracts entered into by the Office for goods or 
services.''.</DELETED>

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Omnibus Patent Act of 1997''.

SEC. 2. TABLE OF CONTENTS.

Sec. 1. Short title.
Sec. 2. Table of contents.

        TITLE I--UNITED STATES PATENT AND TRADEMARK ORGANIZATION

Sec. 101. Short title.

  Subtitle A--Establishment of the United States Patent and Trademark 
                              Organization

Sec. 111. Establishment of the United States Patent and Trademark 
                            Organization as a Government corporation.
Sec. 112. Powers and duties.
Sec. 113. Organization and management.
Sec. 114. United States Patent Office.
Sec. 115. United States Trademark Office.
Sec. 116. Suits by and against the Organization.
Sec. 117. Funding.
Sec. 118. Transfers.
Sec. 119. Use of Organization name.

            Subtitle B--Effective Date; Technical Amendments

Sec. 131. Effective date.
Sec. 132. Technical and conforming amendments.

                  Subtitle C--Miscellaneous Provisions

Sec. 141. References.
Sec. 142. Exercise of authorities.
Sec. 143. Savings provisions.
Sec. 144. Transfer of assets.
Sec. 145. Delegation and assignment.
Sec. 146. Authority of Director of the Office of Management and Budget 
                            with respect to functions transferred.
Sec. 147. Certain vesting of functions considered transfers.
Sec. 148. Availability of existing funds.
Sec. 149. Definitions.

           TITLE II--EARLY PUBLICATION OF PATENT APPLICATIONS

Sec. 201. Short title.
Sec. 202. Early publication.
Sec. 203. Time for claiming benefit of earlier filing date.
Sec. 204. Provisional rights.
Sec. 205. Prior art effect of published applications.
Sec. 206. Cost recovery for publication.
Sec. 207. Conforming changes.
Sec. 208. Last day of pendency of provisional application.
Sec. 209. Effective date.

                   TITLE III--PATENT TERM RESTORATION

Sec. 301. Patent term restoration authority.
Sec. 302. Further examination of patent applications.
Sec. 303. Technical clarification.
Sec. 304. Effective date.

                TITLE IV--PRIOR DOMESTIC COMMERCIAL USE

Sec. 401. Short title.
Sec. 402. Defense to patent infringement based on prior domestic 
                            commercial use.
Sec. 403. Effective date and applicability.

                  TITLE V--PATENT REEXAMINATION REFORM

Sec. 501. Short title.
Sec. 502. Definitions.
Sec. 503. Reexamination procedures.
Sec. 504. Conforming amendments.
Sec. 505. Report to Congress.
Sec. 506. Effective date.

               TITLE VI--MISCELLANEOUS PATENT PROVISIONS

Sec. 601. Provisional applications.
Sec. 602. International applications.
Sec. 603. Access to electronic patent information.
Sec. 604. Certain limitations on damages for patent infringement not 
                            applicable.
Sec. 605. Plant patents.
Sec. 606. Electronic filing.
Sec. 607. Study and report on biological deposits in support of 
                            biotechnology patents.

        TITLE I--UNITED STATES PATENT AND TRADEMARK ORGANIZATION

SEC. 101. SHORT TITLE.

    This title may be cited as the ``United States Patent and Trademark 
Organization Act of 1997''.

  Subtitle A--Establishment of the United States Patent and Trademark 
                              Organization

SEC. 111. ESTABLISHMENT OF THE UNITED STATES PATENT AND TRADEMARK 
              ORGANIZATION AS A GOVERNMENT CORPORATION.

    (a) Establishment.--The United States Patent and Trademark 
Organization is established as a wholly owned Government corporation 
subject to chapter 91 of title 31, separate from any department, and 
shall be an agency of the United States under the policy direction of 
the Secretary of Commerce.
    (b) Offices.--The United States Patent and Trademark Organization 
shall maintain its principal office in the District of Columbia, or the 
metropolitan area thereof, for the service of process and papers and 
for the purpose of carrying out its powers, duties, and obligations 
under this title. The United States Patent and Trademark Organization 
shall be deemed, for purposes of venue in civil actions, to be a 
resident of the district in which its principal office is located 
except where jurisdiction is otherwise provided by law. The United 
States Patent and Trademark Organization may establish satellite 
offices in such places within the United States as it considers 
necessary and appropriate in the conduct of its business.
    (c) Reference.--For purposes of this title, a reference to the 
``Organization'' shall be a reference to the United States Patent and 
Trademark Organization, unless the context provides otherwise.

SEC. 112. POWERS AND DUTIES.

    (a) In General.--The United States Patent and Trademark 
Organization, under the policy direction of the Secretary of Commerce, 
shall be responsible for--
            (1) the granting and issuing of patents and the 
        registration of trademarks;
            (2) conducting studies, programs, or exchanges of items or 
        services regarding domestic and international patent and 
        trademark law, the administration of the Organization, or any 
        other function vested in the Organization by law, including 
        programs to recognize, identify, assess, and forecast the 
        technology of patented inventions and their utility to 
        industry;
            (3)(A) authorizing or conducting studies and programs 
        cooperatively with foreign patent and trademark offices and 
        international organizations, in connection with the granting 
        and issuing of patents and the registration of trademarks; and
            (B) with the concurrence of the Secretary of State, 
        authorizing the transfer of not to exceed $100,000 in any year 
        to the Department of State for the purpose of making special 
        payments to international intergovernmental organizations for 
        studies and programs for advancing international cooperation 
        concerning patents, trademarks, and related matters; and
            (4) disseminating to the public information with respect to 
        patents and trademarks.
    (b) Special Payments.--The special payments under subsection 
(a)(3)(B) may be in addition to any other payments or contributions to 
international organizations and shall not be subject to any limitations 
imposed by law on the amounts of such other payments or contributions 
by the United States Government.
    (c) Specific Powers.--The Organization--
            (1) shall have perpetual succession;
            (2) shall adopt and use a corporate seal, which shall be 
        judicially noticed and with which letters patent, certificates 
        of trademark registrations, and papers issued by the 
        Organization shall be authenticated;
            (3) may sue and be sued in its corporate name and be 
        represented by its own attorneys in all judicial and 
        administrative proceedings, subject to the provisions of 
        section 116;
            (4) may indemnify the Director of the United States Patent 
        and Trademark Organization, the Commissioner of Patents, the 
        Commissioner of Trademarks, and other officers, attorneys, 
        agents, and employees (including members of the Management 
        Advisory Boards of the Patent Office and the Trademark Office) 
        of the Organization for liabilities and expenses incurred 
        within the scope of their employment;
            (5) may adopt, amend, and repeal bylaws, rules, 
        regulations, and determinations, which--
                    (A) shall govern the manner in which its business 
                will be conducted and the powers granted to it by law 
                will be exercised; and
                    (B) shall be made after notice and opportunity for 
                full participation by interested public and private 
                parties;
            (6)(A) may acquire, construct, purchase, lease, hold, 
        manage, operate, improve, alter, and renovate any real, 
        personal, or mixed property, or any interest therein, as it 
        considers necessary to carry out its functions; and
            (B) sell, lease, grant, and dispose of such property as it 
        considers necessary to effectuate the purposes of this Act;
            (7)(A) may make such purchases, contracts for the 
        construction, maintenance, or management and operation of 
        facilities, and contracts for supplies or services, without 
        regard to the provisions of the Federal Property and 
        Administrative Services Act of 1949 (40 U.S.C. 471 et seq.), 
        the Public Buildings Act (40 U.S.C. 601 et seq.), and the 
        Stewart B. McKinney Homeless Assistance Act (42 U.S.C. 11301 et 
        seq.); and
            (B) may enter into and perform such purchases and contracts 
        for printing services, including the process of composition, 
        platemaking, presswork, silk screen processes, binding, 
        microform, and the products of such processes, as it considers 
        necessary to carry out the functions of the Organization, 
        without regard to sections 501 through 517 and 1101 through 
        1123 of title 44, United States Code;
            (8) may use, with their consent, services, equipment, 
        personnel, and facilities of other departments, agencies, and 
        instrumentalities of the Federal Government, on a reimbursable 
        basis, and cooperate with such other departments, agencies, and 
        instrumentalities in the establishment and use of services, 
        equipment, and facilities of the Organization;
            (9) may obtain from the Administrator of General Services 
        such services as the Administrator is authorized to provide to 
        other agencies of the United States, on the same basis as those 
        services are provided to other agencies of the United States;
            (10) may use, with the consent of the United States and the 
        agency, government, or international organization concerned, 
        the services, records, facilities, or personnel of any State or 
        local government agency or instrumentality or foreign 
        government or international organization to perform functions 
        on its behalf;
            (11) may determine the character of, and the necessity for, 
        its obligations and expenditures and the manner in which they 
        shall be incurred, allowed, and paid, subject to the provisions 
        of title 35, United States Code and the Act of July 5, 1946 
        (commonly referred to as the Trademark Act of 1946);
            (12) may retain and use all of its revenues and receipts, 
        including revenues from the sale, lease, or disposal of any 
        real, personal, or mixed property, or any interest therein, of 
        the Organization, including for research and development and 
        capital investment, subject to the provisions of section 10101 
        of the Omnibus Budget Reconciliation Act of 1990 (35 U.S.C. 41 
        note);
            (13) shall have the priority of the United States with 
        respect to the payment of debts from bankrupt, insolvent, and 
        decedents' estates;
            (14) may accept monetary gifts or donations of services, or 
        of real, personal, intellectual, or mixed property, in order to 
        enhance libraries and museums operated by the Organization, 
        support the educational programs of the Organization, or 
        otherwise carry out the functions of the Organization;
            (15) may execute, in accordance with its bylaws, rules, and 
        regulations, all instruments necessary and appropriate in the 
        exercise of any of its powers; and
            (16) may provide for liability insurance and insurance 
        against any loss in connection with its property, other assets, 
        or operations either by contract or by self-insurance.
    (d) Restrictions on Gifts.--Any acceptance of a gift or donation 
under subsection (c)(14) shall be subject to section 201 of title 18, 
United States Code. The Director shall establish regulations for the 
acceptance of such gifts and donations including regulations 
prohibiting gifts or donations to the Organization by foreign 
countries.
    (e) Rule of Construction.--Nothing in this section shall be 
construed to nullify, void, cancel, or interrupt any pending request-
for-proposal let or contract issued by the General Services 
Administration for the specific purpose of relocating or leasing space 
to the United States Patent and Trademark Organization.

SEC. 113. ORGANIZATION AND MANAGEMENT.

    (a) Offices.--The United States Patent and Trademark Organization 
shall consist of--
            (1) the Office of the Director;
            (2) the United States Patent Office; and
            (3) the United States Trademark Office.
    (b) Director.--
            (1) In general.--The management of the United States Patent 
        and Trademark Organization shall be vested in a Director of the 
        United States Patent and Trademark Organization (hereafter in 
        this title referred to as the ``Director'', unless the context 
        provides otherwise), who shall be a citizen of the United 
        States and who shall be appointed by the President, by and with 
        the advice and consent of the Senate. The Director shall be a 
        person who, by reason of professional background and experience 
        in patent or trademark law, is especially qualified to manage 
        the Organization.
            (2) Duties.--(A) The Director shall--
                    (i) be responsible for the Management and direction 
                of the Organization and shall perform this duty in a 
                fair, impartial, and equitable manner; and
                    (ii) strive to meet the goals set forth in the 
                performance agreement described under paragraph (4).
            (B) The Director shall advise the President, through and 
        under the policy direction of the Secretary of Commerce, of all 
        activities of the Organization undertaken in response to 
        obligations of the United States under treaties and executive 
        agreements, or which relate to cooperative programs with those 
        authorities of foreign governments that are responsible for 
        granting patents or registering trademarks. The Director shall 
        also recommend to the President, through and under the policy 
        direction of the Secretary of Commerce, changes in law or 
        policy which may improve the ability of United States citizens 
        to secure and enforce patent and trademark rights in the United 
        States or in foreign countries.
            (C)(i) At the direction of the President, the Director may 
        represent the United States in international negotiations on 
        matters of patents or trademarks, or may designate an officer 
        or officers of the Organization to participate in such 
        negotiations.
            (ii) Nothing in this subparagraph shall be construed to 
        alter any statutory responsibility of the Secretary of State or 
        the United States Trade Representative.
            (D) The Director, in consultation with the Director of the 
        Office of Personnel Management, shall maintain a program for 
        identifying national security positions and providing for 
        appropriate security clearances.
            (E) The Director may perform such personnel, procurement, 
        and other functions, with respect to the United States Patent 
        Office and the United States Trademark Office, where a 
        centralized administration of such functions would improve the 
        efficiency of the Offices, by continuous unanimous agreement of 
        the Director, the Commissioner of Patents, and the Commissioner 
        of Trademarks. The agreement shall be in writing and shall 
        indicate the allocation of costs among the Office of the 
        Director, the United States Patent Office, and the United 
        States Trademark Office.
            (F) Except as otherwise provided in this title, the 
        Director shall ensure that--
                    (i) the United States Patent Office and the United 
                States Trademark Office, respectively, shall--
                            (I) prepare all appropriation requests 
                        under section 1108 of title 31, United States 
                        Code, for each office for submission by the 
                        Director;
                            (II) adjust fees to provide sufficient 
                        revenues to cover the expenses of such office; 
                        and
                            (III) expend funds derived from such fees 
                        for only the functions of such office; and
                    (ii) each such office is not involved in the 
                management of any other office.
            (G) The Director shall submit to Congress annually such 
        information as is required under chapter 91 of title 31, United 
        States Code, including--
                    (i) the total monies received and expended by the 
                Organization;
                    (ii) the purpose for which the monies were spent;
                    (iii) the amount of any surplus revenues retained 
                by the Organization;
                    (iv) the quality and quantity of the work of the 
                Organization; and
                    (v) other information relating to the Organization.
            (3) Oath.--The Director shall, before taking office, take 
        an oath to discharge faithfully the duties of the Organization.
            (4) Compensation.--The Director shall receive compensation 
        at the rate of pay in effect for level III of the Executive 
        Schedule under section 5314 of title 5, United States Code and, 
        in addition, may receive as a bonus, an amount which would 
        raise total compensation to the equivalent of the level of the 
        rate of pay in effect for level II of the Executive Schedule 
        under section 5313 of title 5, based upon an evaluation by the 
        Secretary of Commerce of the Director's performance as defined 
        in an annual performance agreement between the Director and the 
        Secretary. The annual performance agreement shall incorporate 
        measurable goals as delineated in an annual performance plan 
        agreed to by the Director and the Secretary.
            (5) Removal.--The Director shall serve at the pleasure of 
        the President.
            (6) Designee of director.--The Director shall designate an 
        officer of the Organization who shall be vested with the 
        authority to act in the capacity of the Director in the event 
        of the absence or incapacity of the Director.
            (7) Relationship with existing authorities.--Nothing in 
        this section shall derogate from the duties or functions of the 
        Register of Copyrights.
    (c) Officers and Employees of the Organization.--
            (1) Commissioners of patents and trademarks.--The Director 
        shall appoint a Commissioner of Patents and a Commissioner of 
        Trademarks under section 3 of title 35, United States Code and 
        section 53 of the Act of July 5, 1946 (commonly referred to as 
        the Trademark Act of 1946), respectively, as amended by this 
        Act.
            (2) Other officers and employees.--The Director shall--
                    (A) appoint officers, employees (including 
                attorneys), and agents of the Organization, who shall 
                be citizens of the United States, as the Director 
                considers necessary to carry out its functions;
                    (B) fix the compensation of such officers and 
                employees, except as provided in subsection (e); and
                    (C) define the authority and duties of such 
                officers and employees and delegate to them such of the 
                powers vested in the Organization as the Director may 
                determine.
            (3) Personnel limitations.--The Organization shall not be 
        subject to any administratively or statutorily imposed 
        limitation on positions or personnel, and no positions or 
        personnel of the Organization shall be taken into account for 
        purposes of applying any such limitation.
    (d) Limits on Compensation.--Except as otherwise provided by law, 
the annual rate of basic pay of an officer or employee of the 
Organization may not be fixed at a rate that exceeds, and total 
compensation payable to any such officer or employee for any year may 
not exceed, the annual rate of basic pay in effect for level II of the 
Executive Schedule under section 5313 of title 5, United States Code. 
The Director shall prescribe such regulations as may be necessary to 
carry out this subsection.
    (e) Inapplicability of Title 5, United States Code, Generally.--
Except as otherwise provided in this section, officers and employees of 
the Organization shall not be subject to the provisions of title 5, 
United States Code, relating to Federal employees.
    (f) Continued Applicability of Certain Provisions of Title 5, 
United States Code.--
            (1) In general.--The following provisions of title 5, 
        United States Code, shall apply to the Organization and its 
        officers and employees:
                    (A) Section 3110 (relating to employment of 
                relatives; restrictions).
                    (B) Subchapter II of chapter 55 (relating to 
                withholding pay).
                    (C) Subchapters II and III of chapter 73 (relating 
                to employment limitations and political activities, 
                respectively).
                    (D) Chapter 71 (relating to labor-management 
                relations), subject to paragraph (2) and subsection 
                (g).
                    (E) Section 3303 (relating to political 
                recommendations).
                    (F) Subchapter II of chapter 61 (relating to 
                flexible and compressed work schedules).
                    (G) Section 2302(b)(8) (relating to whistleblower 
                protection) and whistleblower related provisions of 
                chapter 12 (covering the role of the Office of Special 
                Counsel).
            (2) Compensation subject to collective bargaining.--
                    (A) In general.--Notwithstanding any other 
                provision of law, for purposes of applying chapter 71 
                of title 5, United States Code, pursuant to paragraph 
                (1)(D), basic pay and other forms of compensation shall 
                be considered to be among the matters as to which the 
                duty to bargain in good faith extends under such 
                chapter.
                    (B) Exceptions.--The duty to bargain in good faith 
                shall not, by reason of subparagraph (A), be considered 
                to extend to any benefit under title 5, United States 
                Code, which is afforded by paragraph (1), (2), (3), or 
                (4) of subsection (g).
                    (C) Limitations apply.--Nothing in this subsection 
                shall be considered to allow any limitation under 
                subsection (d) to be exceeded.
    (g) Provisions of Title 5, United States Code, That Continue To 
Apply, Subject to Certain Requirements.--
            (1) Retirement.--(A) The provisions of subchapter III of 
        chapter 83 and chapter 84 of title 5, United States Code, shall 
        apply to the Organization and its officers and employees, 
        subject to subparagraph (B).
            (B)(i) The amount required of the Organization under the 
        second sentence of section 8334(a)(1) of title 5, United States 
        Code, with respect to any particular individual shall, instead 
        of the amount which would otherwise apply, be equal to the 
        normal-cost percentage (determined with respect to officers and 
        employees of the Organization using dynamic assumptions, as 
        defined by section 8401(9) of such title) of the individual's 
        basic pay, minus the amount required to be withheld from such 
        pay under such section 8334(a)(1).
            (ii) The amount required of the Organization under section 
        8334(k)(1)(B) of title 5, United States Code, with respect to 
        any particular individual shall be equal to an amount computed 
        in a manner similar to that specified in clause (i), as 
        determined in accordance with clause (iii).
            (iii) Any regulations necessary to carry out this 
        subparagraph shall be prescribed by the Office of Personnel 
        Management.
            (C) The United States Patent and Trademark Organization may 
        supplement the benefits provided under the preceding provisions 
        of this paragraph.
            (2) Health benefits.--(A) The provisions of chapter 89 of 
        title 5, United States Code, shall apply to the Organization 
        and its officers and employees, subject to subparagraph (B).
            (B)(i) With respect to any individual who becomes an 
        officer or employee of the Organization pursuant to subsection 
        (i), the eligibility of such individual to participate in such 
        program as an annuitant (or of any other person to participate 
        in such program as an annuitant based on the death of such 
        individual) shall be determined disregarding the requirements 
        of section 8905(b) of title 5, United States Code. The 
        preceding sentence shall not apply if the individual ceases to 
        be an officer or employee of the Organization for any period of 
        time after becoming an officer or employee of the Organization 
        pursuant to subsection (i) and before separation.
            (ii) The Government contributions authorized by section 
        8906 of title 5, United States Code, for health benefits for 
        anyone participating in the health benefits program pursuant to 
        this subparagraph shall be made by the Organization in the same 
        manner as provided under section 8906(g)(2) of such title with 
        respect to the United States Postal Service for individuals 
        associated therewith.
            (iii) For purposes of this subparagraph, the term 
        ``annuitant'' has the meaning given such term by section 
        8901(3) of title 5, United States Code.
            (C) The Organization may supplement the benefits provided 
        under the preceding provisions of this paragraph.
            (3) Life insurance.--(A) The provisions of chapter 87 of 
        title 5, United States Code, shall apply to the Organization 
        and its officers and employees, subject to subparagraph (B).
            (B)(i) Eligibility for life insurance coverage after 
        retirement or while in receipt of compensation under subchapter 
        I of chapter 81 of title 5, United States Code, shall be 
        determined, in the case of any individual who becomes an 
        officer or employee of the Organization pursuant to subsection 
        (i), without regard to the requirements of section 8706(b) (1) 
        or (2) of such title, but subject to the condition specified in 
        the last sentence of paragraph (2)(B)(i) of this subsection.
            (ii) Government contributions under section 8708(d) of such 
        title on behalf of any such individual shall be made by the 
        Organization in the same manner as provided under paragraph (3) 
        thereof with respect to the United States Postal Service for 
        individuals associated therewith.
            (C) The Organization may supplement the benefits provided 
        under the preceding provisions of this paragraph.
            (4) Employees' compensation fund.--(A) Officers and 
        employees of the Organization shall not become ineligible to 
        participate in the program under chapter 81 of title 5, United 
        States Code, relating to compensation for work injuries, by 
        reason of subsection (e).
            (B) The Organization shall remain responsible for 
        reimbursing the Employees' Compensation Fund, pursuant to 
        section 8147 of title 5, United States Code, for compensation 
        paid or payable after the effective date of this title in 
        accordance with chapter 81 of title 5, United States Code, with 
        regard to any injury, disability, or death due to events 
        arising before such date, whether or not a claim has been filed 
        or is final on such date.
    (h) Labor-Management Relations.--
            (1) Labor relations and employee relations programs.--The 
        Organization shall develop hiring practices, labor relations 
        and employee relations programs with the objective of improving 
        productivity and efficiency, incorporating the following 
        principles:
                    (A) Such programs shall be consistent with the 
                merit principles in section 2301(b) of title 5, United 
                States Code.
                    (B) Such programs shall provide veterans preference 
                protections equivalent to those established by sections 
                2108, 3308 through 3318, 3320, 3502, and 3504 of title 
                5, United States Code.
                    (C)(i) The right to work shall not be subject to 
                undue restraint or coercion. The right to work shall 
                not be infringed or restricted in any way based on 
                membership in, affiliation with, or financial support 
                of a labor organization.
                    (ii) No person shall be required, as a condition of 
                employment or continuation of employment--
                            (I) to resign or refrain from voluntary 
                        membership in, voluntary affiliation with, or 
                        voluntary financial support of a labor 
                        organization;
                            (II) to become or remain a member of a 
                        labor organization;
                            (III) to pay any dues, fees, assessments, 
                        or other charges of any kind or amount to a 
                        labor organization;
                            (IV) to pay to any charity or other third 
                        party, in lieu of such payments, any amount 
                        equivalent to or a pro rata portion of dues, 
                        fees, assessments, or other charges regularly 
                        required of members of a labor organization; or
                            (V) to be recommended, approved, referred, 
                        or cleared by or through a labor organization.
                    (iii) This subparagraph shall not apply to a person 
                described in section 7103(a)(2)(v) of title 5, United 
                States Code, or a ``supervisor'', ``management 
                official'', or ``confidential employee'' as those terms 
                are defined in 7103(a) (10), (11), and (13) of such 
                title.
                    (iv) Any labor organization recognized by the 
                Organization as the exclusive representative of a unit 
                of employees of the Organization shall represent the 
                interests of all employees in that unit without 
                discrimination and without regard to labor organization 
                membership.
            (2) Adoption of existing labor agreements.--The 
        Organization shall adopt all labor agreements which are in 
        effect, as of the day before the effective date of this title, 
        with respect to such Organization (as then in effect).
    (i) Carryover of Personnel.--
            (1) From pto.--Effective as of the effective date of this 
        title, all officers and employees of the Patent and Trademark 
        Office on the day before such effective date shall become 
        officers and employees of the Organization, without a break in 
        service.
            (2) Other personnel.--(A) Any individual who, on the day 
        before the effective date of this title, is an officer or 
        employee of the Department of Commerce (other than an officer 
        or employee under paragraph (1)) shall be transferred to the 
Organization if--
                    (i) such individual serves in a position for which 
                a major function is the performance of work reimbursed 
                by the Patent and Trademark Office, as determined by 
                the Secretary of Commerce;
                    (ii) such individual serves in a position that 
                performed work in support of the Patent and Trademark 
                Office during at least half of the incumbent's work 
                time, as determined by the Secretary of Commerce; or
                    (iii) such transfer would be in the interest of the 
                Organization, as determined by the Secretary of 
                Commerce in consultation with the Director.
            (B) Any transfer under this paragraph shall be effective as 
        of the same effective date as referred to in paragraph (1), and 
        shall be made without a break in service.
            (3) Accumulated leave.--The amount of sick and annual leave 
        and compensatory time accumulated under title 5, United States 
        Code, before the effective date described in paragraph (1), by 
        any individual who becomes an officer or employee of the 
        Organization under this subsection, are obligations of the 
        Organization.
            (4) Termination rights.--Any employee referred to in 
        paragraph (1) or (2) of this subsection whose employment with 
        the Organization is terminated during the 1-year period 
        beginning on the effective date of this title shall be entitled 
        to rights and benefits, to be afforded by the Organization, 
        similar to those such employee would have had under Federal law 
        if termination had occurred immediately before such date. An 
        employee who would have been entitled to appeal any such 
        termination to the Merit Systems Protection Board, if such 
        termination had occurred immediately before such effective 
        date, may appeal any such termination occurring within such 1-
        year period to the Board under such procedures as it may 
        prescribe.
            (5) Transition provisions.--(A)(i) On or after the 
        effective date of this title, the President shall appoint a 
        Director of the United States Patent and Trademark Organization 
        who shall serve until the earlier of--
                    (I) the date on which a Director qualifies under 
                subsection (b); or
                    (II) the date occurring 1 year after the effective 
                date of this title.
            (ii) The President shall not make more than 1 appointment 
        under this subparagraph.
            (B) The individual serving as the Assistant Commissioner of 
        Patents on the day before the effective date of this title 
        shall serve as the Commissioner of Patents until the date on 
        which a Commissioner of Patents is appointed under section 3 of 
        title 35, United States Code, as amended by this Act.
            (C) The individual serving as the Assistant Commissioner of 
        Trademarks on the day before the effective date of this title 
        shall serve as the Commissioner of Trademarks until the date on 
        which a Commissioner of Trademarks is appointed under section 
        53 of the Act of July 5, 1946 (commonly referred to as the 
        Trademark Act of 1946), as amended by this Act.
    (j) Competitive Status.--For purposes of appointment to a position 
in the competitive service for which an officer or employee of the 
Organization is qualified, such officer or employee shall not forfeit 
any competitive status, acquired by such officer or employee before the 
effective date of this title, by reason of becoming an officer or 
employee of the Organization under subsection (i).
    (k) Savings Provisions.--Compensation, benefits, and other terms 
and conditions of employment in effect immediately before the effective 
date of this title, whether provided by statute or by rules and 
regulations of the former Patent and Trademark Office or the executive 
branch of the Government of the United States, shall continue to apply 
to officers and employees of the Organization, until changed in 
accordance with this section (whether by action of the Director or 
otherwise).
    (l) Removal of Quasi-Judicial Examiners.--The Organization may 
remove a patent examiner or examiner-in-chief, or a trademark examiner 
or member of a Trademark Trial and Appeal Board only for such cause as 
will promote the efficiency of the Organization.

SEC. 114. UNITED STATES PATENT OFFICE.

    (a) Establishment of the Patent Office as a Separate Administrative 
Unit.--Section 1 of title 35, United States Code, is amended to read as 
follows:
``Sec. 1. Establishment
    ``(a) Establishment.--The United States Patent Office is 
established as a separate administrative unit of the United States 
Patent and Trademark Organization, where records, books, drawings, 
specifications, and other papers and things pertaining to patents shall 
be kept and preserved, except as otherwise provided by law.
    ``(b) Reference.--For purposes of this title, the United States 
Patent Office shall also be referred to as the `Office' and the `Patent 
Office'.''.
    (b) Powers and Duties.--Section 2 of title 35, United States Code, 
is amended to read as follows:
``Sec. 2. Powers and duties
    ``The United States Patent Office, under the policy direction of 
the Secretary of Commerce through the Director of the United States 
Patent and Trademark Organization, shall be responsible for--
            ``(1) granting and issuing patents;
            ``(2) conducting studies, programs, or exchanges of items 
        or services regarding domestic and international patent law, 
        the administration of the Organization, or any other function 
        vested in the Organization by law, including programs to 
        recognize, identify, assess, and forecast the technology of 
        patented inventions and their utility to industry;
            ``(3) authorizing or conducting studies and programs 
        cooperatively with foreign patent offices and international 
        organizations, in connection with the granting and issuing of 
        patents; and
            ``(4) disseminating to the public information with respect 
        to patents.''.
    (c) Organization and Management.--Section 3 of title 35, United 
States Code, is amended to read as follows:
``Sec. 3. Officers and employees
    ``(a) Commissioner.--
            ``(1) In general.--The management of the United States 
        Patent Office shall be vested in a Commissioner of Patents, who 
        shall be a citizen of the United States and who shall be 
        appointed by the Director of the United States Patent and 
        Trademark Organization and shall serve at the pleasure of the 
        Director of the United States Patent and Trademark 
        Organization. The Commissioner of Patents shall be a person 
        who, by reason of professional background and experience in 
        patent law, is especially qualified to manage the Office.
            ``(2) Duties.--
                    ``(A) In general.--The Commissioner shall be 
                responsible for all aspects of the management, 
                administration, and operation of the Office, including 
                the granting and issuing of patents, and shall perform 
                these duties in a fair, impartial, and equitable 
                manner.
                    ``(B) Advising the director of the united states 
                patent and trademark organization.--The Commissioner of 
                Patents shall advise the Director of the United States 
                Patent and Trademark Organization of all activities of 
                the Office undertaken in response to obligations of the 
                United States under treaties and executive agreements, 
                or which relate to cooperative programs with those 
                authorities of foreign governments that are responsible 
                for granting patents. The Commissioner of Patents shall 
                advise the Director of the United States Patent and 
                Trademark Organization on matters of patent law and 
                shall recommend to the Director of the United States 
                Patent and Trademark Organization changes in law or 
                policy which may improve the ability of United States 
                citizens to secure and enforce patent rights in the 
                United States or in foreign countries.
                    ``(C) Regulations.--The Commissioner may establish 
                regulations, not inconsistent with law, for the conduct 
                of proceedings in the Patent Office. The Director of 
                the United States Patent and Trademark Organization 
                shall determine whether such regulations are consistent 
                with the policy direction of the Secretary of Commerce.
                    ``(D) Consultation with the management advisory 
                board.--(i) The Commissioner shall consult with the 
                Management Advisory Board established in section 5--
                            ``(I) on a regular basis on matters 
                        relating to the operation of the Office; and
                            ``(II) before submitting budgetary 
                        proposals to the Director of the United States 
                        Patent and Trademark Organization for 
                        submission to the Office of Management and 
                        Budget or changing or proposing to change 
                        patent user fees or patent regulations.
                    ``(ii) The Director of the United States Patent and 
                Trademark Organization shall determine whether such 
                fees or regulations are consistent with the policy 
                direction of the Secretary of Commerce.
            ``(3) Oath.--The Commissioner shall, before taking office, 
        take an oath to discharge faithfully the duties of the Office.
            ``(4) Compensation.--
                    ``(A) In general.--The Commissioner shall receive 
                compensation at the rate of pay in effect for level IV 
                of the Executive Schedule under section 5315 of title 
                5.
                    ``(B) Bonus.--In addition to compensation under 
                subparagraph (A), the Commissioner may, at the 
                discretion of the Director of the United States Patent 
                and Trademark Organization, receive as a bonus, an 
                amount which would raise total compensation to the 
                equivalent of the rate of pay in effect for level III 
                of the Executive Schedule under section 5314 of title 
                5.
    ``(b) Officers and Employees.--
            ``(1) Deputy commissioner of patents.--The Commissioner 
        shall appoint a Deputy Commissioner of Patents who shall be 
        vested with the authority to act in the capacity of the 
        Commissioner in the event of the absence or incapacity of the 
Commissioner. In the event of a vacancy in the office of Commissioner, 
the Deputy Commissioner shall fill the office of Commissioner until a 
new Commissioner is appointed and takes office.
            ``(2) Ombudsman.--The Commissioner shall appoint an 
        ombudsman to advise the Commissioner on the concerns of 
        independent inventors, nonprofit organizations, and small 
        business concerns.
            ``(3) Other officers and employees.--Other officers, 
        attorneys, employees, and agents shall be selected and 
        appointed by the Commissioner, and shall be vested with such 
        powers and duties as the Commissioner may determine.''.
    (d) Management Advisory Board.--Chapter 1 of part I of title 35, 
United States Code, is amended by inserting after section 4 the 
following:
``Sec. 5. Patent Office Management Advisory Board
    ``(a) Establishment of Management Advisory Board.--
            ``(1) Appointment.--The United States Patent Office shall 
        have a Management Advisory Board (hereafter in this title 
        referred to as the `Advisory Board') of 5 members, who shall be 
        appointed by the President and shall serve at the pleasure of 
        the President. Not more than 3 of the 5 members shall be 
        members of the same political party. At least 1 member shall be 
        an independent inventor, as defined in regulations issued by 
        the Commissioner.
            ``(2) Chair.--The President shall designate a Chair of the 
        Advisory Board, whose term as chair shall be for 3 years.
            ``(3) Timing of appointments.--Initial appointments to the 
        Advisory Board shall be made within 3 months after the 
        effective date of the United States Patent and Trademark 
        Organization Act of 1997. Vacancies shall be filled in the 
        manner in which the original appointment was made under this 
        subsection within 3 months after they occur.
    ``(b) Basis for Appointments.--Members of the Advisory Board shall 
be citizens of the United States who shall be chosen so as to represent 
the interests of diverse users of the United States Patent Office, and 
shall include individuals with substantial background and achievement 
in corporate finance and management.
    ``(c) Meetings.--The Advisory Board shall meet at the call of the 
Chair to consider an agenda set by the Chair.
    ``(d) Duties.--The Advisory Board shall--
            ``(1) review the policies, goals, performance, budget, and 
        user fees of the United States Patent Office, and advise the 
        Commissioner on these matters;
            ``(2) within 60 days after the end of each fiscal year--
                    ``(A) prepare an annual report on the matters 
                referred to in paragraph (1);
                    ``(B) transmit the report to the Director of the 
                United States Patent and Trademark Organization, the 
                President, and the Committees on the Judiciary of the 
                Senate and the House of Representatives; and
                    ``(C) publish the report in the Patent Office 
                Official Gazette.
    ``(e) Compensation.--Each member of the Advisory Board shall be 
compensated for each day (including travel time) during which such 
member is attending meetings or conferences of the Advisory Board or 
otherwise engaged in the business of the Advisory Board, at the rate 
which is the daily equivalent of the annual rate of basic pay in effect 
for level III of the Executive Schedule under section 5314 of title 5, 
and while away from such member's home or regular place of business 
such member may be allowed travel expenses, including per diem in lieu 
of subsistence, as authorized by section 5703 of title 5.
    ``(f) Access to Information.--Members of the Advisory Board shall 
be provided access to records and information in the United States 
Patent Office, except for personnel or other privileged information and 
information concerning patent applications required to be kept in 
confidence by section 122.
    ``(g) Applicability of Certain Ethics Laws.--Members of the 
Advisory Board shall be special Government employees within the meaning 
of section 202 of title 18.''.
    (e) Conforming Amendments.--Section 6 of title 35, United States 
Code, and the item relating to such section in the table of contents 
for chapter 1 of title 35, United States Code, are repealed.
    (f) Board of Patent Appeals and Interferences.--Section 7 of title 
35, United States Code, is amended to read as follows:
``Sec. 7. Board of Patent Appeals and Interferences
    ``(a) Establishment and Composition.--There shall be in the United 
States Patent Office a Board of Patent Appeals and Interferences. The 
Commissioner, the Deputy Commissioner, and the administrative patent 
judges shall constitute the Board. The administrative patent judges 
shall be persons of competent legal knowledge and scientific ability.
    ``(b) Duties.--
            ``(1) In general.--The Board of Patent Appeals and 
        Interferences shall, on written appeal of an applicant, a 
        patent owner, or a third-party requester in a reexamination 
        proceeding--
                    ``(A) review adverse decisions of examiners--
                            ``(i) upon applications for patents; and
                            ``(ii) in reexamination proceedings; and
                    ``(B) determine priority and patentability of 
                invention in interferences declared under section 
                135(a).
            ``(2) Hearings.--Each appeal and interference shall be 
        heard by at least 3 members of the Board, who shall be 
        designated by the Deputy Commissioner. Only the Board of Patent 
        Appeals and Interferences may grant rehearings.''.
    (g) Annual Report of Commissioner.--Section 14 of title 35, United 
States Code, is amended to read as follows:
``Sec. 14. Annual report to Congress
    ``The Commissioner shall report to the Director of the United 
States Patent and Trademark Organization such information as the 
Director is required to submit to Congress annually under section 
157(d) of this title, and under chapter 91 of title 31, including--
            ``(1) the total of the moneys received and expended by the 
        Office;
            ``(2) the purposes for which the moneys were spent;
            ``(3) the quality and quantity of the work of the Office; 
        and
            ``(4) other information relating to the Office.''.
    (h) Practice Before Patent Office.--
            (1) In general.--Section 31 of title 35, United States 
        Code, is amended to read as follows:
``Sec. 31. Regulations for agents and attorneys
    ``The Commissioner may prescribe regulations governing the 
recognition and conduct of agents, attorneys, or other persons 
representing applicants or other parties before the Office. The 
regulations may require such persons, before being recognized as 
representatives of applicants or other persons, to show that they are 
of good moral character and reputation and are possessed of the 
necessary qualifications to render to applicants or other persons 
valuable service, advice, and assistance in the presentation or 
prosecution of their applications or other business before the 
Office.''.
            (2) Designation of attorney to conduct hearing.--Section 32 
        of title 35, United States Code, is amended in the first 
        sentence by striking ``Patent and Trademark Office'' and 
        inserting ``Patent Office'' and by inserting before the last 
        sentence the following: ``The Commissioner shall have the 
        discretion to designate any attorney who is an officer or 
        employee of the United States Patent Office to conduct the 
        hearing required by this section.''.
    (i) Funding.--
            (1) Adjustment of fees.--Section 41(f) of title 35, United 
        States Code, is amended to read as follows:
    ``(f) The Commissioner, after consulting with the Patent Office 
Management Advisory Board pursuant to section 3(a)(2)(C) of this title 
and after notice and opportunity for full participation by interested 
public and private parties, may, by regulation, adjust the fees 
established in this section. The Director of the United States Patent 
and Trademark Organization shall determine whether such fees are 
consistent with the policy direction of the Secretary of Commerce.''.
            (2) Patent office funding.--Section 42 of title 35, United 
        States Code, is amended to read as follows:
``Sec. 42. Patent Office funding
    ``(a) Fees Payable to the Office.--All fees for services performed 
by or materials furnished by the United States Patent Office shall be 
payable to the Office.
    ``(b) Use of Moneys.--Moneys from fees shall be available to the 
United States Patent Office to carry out, to the extent provided in 
appropriations Acts, the functions of the Office. Moneys of the Office 
not otherwise used to carry out the functions of the Office shall be 
kept in cash on hand or on deposit, or invested in obligations of the 
United States or guaranteed by the United States, or in obligations or 
other instruments which are lawful investments for fiduciary, trust, or 
public funds. Fees available to the Commissioner under this title shall 
be used only for the processing of patent applications and for other 
services and materials relating to patents, including the agreed upon 
share of any centralized function, as set forth in section 113(b)(2)(E) 
of the United States Patent and Trademark Organization Act of 1997.
    ``(c) Contribution to the Office of the Director of the United 
States Patent and Trademark Organization.--The Patent Office shall 
contribute 50 percent of the annual budget of the Office of the 
Director of the United States Patent and Trademark Organization.''.

SEC. 115. UNITED STATES TRADEMARK OFFICE.

    (a) Establishment of the United States Trademark Office as a 
Separate Administrative Unit.--The Act of July 5, 1946 (commonly 
referred to as the Trademark Act of 1946) is amended--
            (1) by redesignating titles X and XI as titles XI and XII, 
        respectively;
            (2) by redesignating sections 45, 46, 47, 48, 49, 50, and 
        51 as sections 61, 71, 72, 73, 74, 75, and 76, respectively; 
        and
            (3) by inserting after title IX the following new title:

               ``TITLE X--UNITED STATES TRADEMARK OFFICE

``SEC. 51. ESTABLISHMENT.

    ``(a) Establishment.--The United States Trademark Office is 
established as a separate administrative unit of the United States 
Patent and Trademark Organization.
    ``(b) Reference.--For purposes of this chapter, the United States 
Trademark Office shall also be referred to as the `Office' and the 
`Trademark Office'.

``SEC. 52. POWERS AND DUTIES.

    ``The United States Trademark Office, under the policy direction of 
the Secretary of Commerce through the Director of the United States 
Patent and Trademark Organization, shall be responsible for--
            ``(1) the registration of trademarks;
            ``(2) conducting studies, programs, or exchanges of items 
        or services regarding domestic and international trademark law 
        or the administration of the Office;
            ``(3) authorizing or conducting studies and programs 
        cooperatively with foreign trademark offices and international 
        organizations, in connection with the registration of 
        trademarks; and
            ``(4) disseminating to the public information with respect 
        to trademarks.

``SEC. 53. OFFICERS AND EMPLOYEES.

    ``(a) Commissioner.--
            ``(1) In general.--The management of the United States 
        Trademark Office shall be vested in a Commissioner of 
        Trademarks, who shall be a citizen of the United States and who 
        shall be appointed by the Director of the United States Patent 
        and Trademark Organization and shall serve at the pleasure of 
        the Director of the United States Patent and Trademark 
        Organization. The Commissioner of Trademarks shall be a person 
        who, by reason of professional background and experience in 
        trademark law, is especially qualified to manage the Office.
            ``(2) Duties.--
                    ``(A) In general.--The Commissioner shall be 
                responsible for all aspects of the management, 
                administration, and operation of the Office, including 
                the registration of trademarks, and shall perform these 
                duties in a fair, impartial, and equitable manner.
                    ``(B) Advising the director of the united states 
                patent and trademark organization.--The Commissioner of 
                Trademarks shall advise the Director of the United 
                States Patent and Trademark Organization of all 
                activities of the Office undertaken in response to 
                obligations of the United States under treaties and 
                executive agreements, or which relate to cooperative 
                programs with those authorities of foreign governments 
                that are responsible for registering trademarks. The 
                Commissioner of Trademarks shall advise the Director of 
                the United States Patent and Trademark Organization on 
                matters of trademark law and shall recommend to the 
                Director of the United States Patent and Trademark 
                Organization changes in law or policy which may improve 
                the ability of United States citizens to secure and 
                enforce trademark rights in the United States or in 
                foreign countries.
                    ``(C) Regulations.--The Commissioner may establish 
                regulations, not inconsistent with law, for the conduct 
                of proceedings in the Trademark Office. The Director of 
                the United States Patent and Trademark Organization 
                shall determine whether such regulations are consistent 
                with the policy direction of the Secretary of Commerce.
                    ``(D) Consultation with the management advisory 
                board.--(i) The Commissioner shall consult with the 
                Trademark Office Management Advisory Board established 
                under section 54--
                            ``(I) on a regular basis on matters 
                        relating to the operation of the Office; and
                            ``(II) before submitting budgetary 
                        proposals to the Director of the United States 
Patent and Trademark Organization for submission to the Office of 
Management and Budget or changing or proposing to change trademark user 
fees or trademark regulations.
                    ``(ii) The Director of the United States Patent and 
                Trademark Organization shall determine whether such 
                fees or regulations are consistent with the policy 
                direction of the Secretary of Commerce.
                    ``(E) Publications.--(i) The Commissioner may 
                print, or cause to be printed, the following:
                            ``(I) Certificates of trademark 
                        registrations, including statements and 
                        drawings, together with copies of the same.
                            ``(II) The Official Gazette of the United 
                        States Trademark Office.
                            ``(III) Annual indexes of trademarks and 
                        registrants.
                            ``(IV) Annual volumes of decisions in 
                        trademark cases.
                            ``(V) Pamphlet copies of laws and rules 
                        relating to trademarks and circulars or other 
                        publications relating to the business of the 
                        Office.
                    ``(ii) The Commissioner may exchange any of the 
                publications specified under clause (i) 
for publications desirable for the use of the Trademark Office.
            ``(3) Oath.--The Commissioner shall, before taking office, 
        take an oath to discharge faithfully the duties of the Office.
            ``(4) Compensation.--
                    ``(A) In general.--The Commissioner shall receive 
                compensation at the rate of pay in effect for level IV 
                of the Executive Schedule under section 5315 of title 
                5, United States Code.
                    ``(B) Bonus.--In addition to compensation under 
                subparagraph (A), the Commissioner may, at the 
                discretion of the Director of the United States Patent 
                and Trademark Organization, receive as a bonus, an 
                amount which would raise total compensation to the 
                equivalent of the rate of pay in effect for level III 
                of the Executive Schedule under section 5314 of title 
                5.
    ``(b) Officers and Employees.--The Commissioner shall appoint a 
Deputy Commissioner of Trademarks who shall be vested with the 
authority to act in the capacity of the Commissioner in the event of 
the absence or incapacity of the Commissioner. In the event of a 
vacancy in the office of Commissioner, the Deputy Commissioner shall 
fill the office of Commissioner until a new Commissioner is appointed 
and takes office. Other officers, attorneys, employees, and agents 
shall be selected and appointed by the Commissioner, and shall be 
vested with such powers and duties as the Commissioner may determine.

``SEC. 54. TRADEMARK OFFICE MANAGEMENT ADVISORY BOARD.

    ``(a) Establishment of Management Advisory Board.--
            ``(1) Appointment.--The United States Trademark Office 
        shall have a Management Advisory Board (hereafter in this title 
        referred to as the `Advisory Board') of 5 members, who shall be 
        appointed by the President and shall serve at the pleasure of 
        the President. Not more than 3 of the 5 members shall be 
        members of the same political party.
            ``(2) Chair.--The President shall designate a Chair of the 
        Advisory Board, whose term as chair shall be for 3 years.
            ``(3) Timing of appointments.--Initial appointments to the 
        Advisory Board shall be made within 3 months after the 
        effective date of the United States Patent and Trademark 
        Organization Act of 1997. Vacancies shall be filled in the 
        manner in which the original appointment was made under this 
        section within 3 months after they occur.
    ``(b) Basis for Appointments.--Members of the Advisory Board shall 
be citizens of the United States who shall be chosen so as to represent 
the interests of diverse users of the United States Trademark Office, 
and shall include individuals with substantial background and 
achievement in corporate finance and management.
    ``(c) Meetings.--The Advisory Board shall meet at the call of the 
Chair to consider an agenda set by the Chair.
    ``(d) Duties.--The Advisory Board shall--
            ``(1) review the policies, goals, performance, budget, and 
        user fees of the United States Trademark Office, and advise the 
        Commissioner on these matters; and
            ``(2) within 60 days after the end of each fiscal year--
                    ``(A) prepare an annual report on the matters 
                referred to under paragraph (1);
                    ``(B) transmit the report to the Director of the 
                United States Patent and Trademark Organization, the 
                President, and the Committees on the Judiciary of the 
                Senate and the House of Representatives; and
                    ``(C) publish the report in the Trademark Office 
                Official Gazette.
    ``(e) Compensation.--Each member of the Advisory Board shall be 
compensated for each day (including travel time) during which such 
member is attending meetings or conferences of the Advisory Board or 
otherwise engaged in the business of the Advisory Board, at the rate 
which is the daily equivalent of the annual rate of basic pay in effect 
for level III of the Executive Schedule under section 5314 of title 5, 
United States Code, and while away from such member's home or regular 
place of business such member may be allowed travel expenses, including 
per diem in lieu of subsistence, as authorized by section 5703 of title 
5, United States Code.
    ``(f) Access to Information.--Members of the Advisory Board shall 
be provided access to records and information in the United States 
Trademark Office, except for personnel or other privileged information.
    ``(g) Applicability of Certain Ethic Laws.--Members of the Advisory 
Board shall be special Government employees within the meaning of 
section 202 of title 18.

``SEC. 55. ANNUAL REPORT TO CONGRESS.

    ``The Commissioner shall report to the Director of the United 
States Patent and Trademark Organization such information as the 
Director is required to report to Congress annually under chapter 91 of 
title 5, including--
            ``(1) the moneys received and expended by the Office;
            ``(2) the purposes for which the moneys were spent;
            ``(3) the quality and quantity of the work of the Office; 
        and
            ``(4) other information relating to the Office.

``SEC. 56. TRADEMARK OFFICE FUNDING.

    ``(a) Fees Payable to the Office.--All fees for services performed 
by or materials furnished by the United States Trademark Office shall 
be payable to the Office.
    ``(b) Use of Moneys.--Moneys from fees shall be available to the 
United States Trademark Office to carry out, to the extent provided in 
appropriations Acts, the functions of the Office. Moneys of the Office 
not otherwise used to carry out the functions of the Office shall be 
kept in cash on hand or on deposit, or invested in obligations of the 
United States or guaranteed by the United States, or in obligations or 
other instruments which are lawful investments for fiduciary, trust, or 
public funds. Fees available to the Commissioner under this chapter 
shall be used only for the registration of trademarks and for other 
services and materials relating to trademarks, including the agreed 
upon share of any centralized function, as set forth in section 
113(b)(2)(E) of the United States Patent and Trademark Organization Act 
of 1997.
    ``(c) Contribution to the Office of the Director of the United 
States Patent and Trademark Organization.--The Trademark Office shall 
contribute 50 percent of the annual budget of the Office of the 
Director of the United States Patent and Trademark Organization.''.
    (b) Trademark Trial and Appeal Board.--Section 17 of the Act of 
July 5, 1946 (commonly referred to as the Trademark Act of 1946) (15 
U.S.C. 1067) is amended to read as follows:
    ``Sec. 17. (a) In every case of interference, opposition to 
registration, application to register as a lawful concurrent user, or 
application to cancel the registration of a mark, the Commissioner 
shall give notice to all parties and shall direct a Trademark Trial and 
Appeal Board to determine and decide the respective rights of 
registration.
    ``(b) The Trademark Trial and Appeal Board shall include the 
Commissioner of Trademarks, the Deputy Commissioner of Trademarks, and 
administrative trademark judges competent in trademark law who are 
appointed by the Commissioner.''.
    (c) Determination of Fees.--Section 31(a) of the Act of July 5, 
1946 (commonly referred to as the Trademark Act of 1946) (15 U.S.C. 
1067(a)) is amended by striking the second and third sentences and 
inserting the following: ``Fees established under this subsection may 
be adjusted by the Commissioner, after consulting with the Trademark 
Office Management Advisory Board in accordance with section 53(a)(2)(C) 
of this Act and after notice and opportunity for full participation by 
interested public and private parties. The Director of the United 
States Patent and Trademark Organization shall determine whether such 
fees are consistent with the policy direction of the Secretary of 
Commerce.''.

SEC. 116. SUITS BY AND AGAINST THE ORGANIZATION.

    (a) Actions Under United States Law.--Any civil action or 
proceeding to which the United States Patent and Trademark Organization 
is a party is deemed to arise under the laws of the United States. The 
Federal courts shall have exclusive jurisdiction over all civil actions 
by or against the Organization.
    (b) Representation by the Department of Justice.--The United States 
Patent and Trademark Organization shall be deemed an agency of the 
United States for purposes of section 516 of title 28, United States 
Code.
    (c) Prohibition on Attachment, Liens, or Similar Process.--No 
attachment, garnishment, lien, or similar process, intermediate or 
final, in law or equity, may be issued against property of the 
Organization.

SEC. 117. FUNDING.

    (a) In General.--The activities of the United States Patent and 
Trademark Organization and each office of the Organization shall be 
funded entirely through fees payable to the United States Patent Office 
(under section 42 of title 35, United States Code) and the United 
States Trademark Office (under section 56 of the Act of July 5, 1946 
(commonly known as the Trademark Act of 1946)), and surcharges 
appropriated by Congress, to the extent provided in appropriations Acts 
and subject to the provisions of subsection (b).
    (b) Borrowing Authority.--
            (1) In general.--The United States Patent and Trademark 
        Organization is authorized to issue from time to time for 
        purchase by the Secretary of the Treasury its debentures, 
        bonds, notes, and other evidences of indebtedness (hereafter in 
        this subsection referred to as ``obligations'') to assist in 
        financing the activities of the United States Patent Office and 
the United States Trademark Office. Borrowing under this section shall 
be subject to prior approval in appropriations Acts. Such borrowing 
shall not exceed amounts approved in appropriations Acts.
            (2) Borrowing authority.--Any borrowing under this 
        subsection shall be repaid only from fees paid to the Office 
        for which such obligations were issued and surcharges 
        appropriated by Congress. Such obligations shall be redeemable 
        at the option of the United States Patent and Trademark 
        Organization before maturity in the manner stipulated in such 
        obligations and shall have such maturity as is determined by 
        the United States Patent and Trademark Organization with the 
        approval of the Secretary of the Treasury. Each such obligation 
        issued to the Treasury shall bear interest at a rate not less 
        than the current yield on outstanding marketable obligations of 
        the United States of comparable maturity during the month 
        preceding the issuance of the obligation as determined by the 
        Secretary of the Treasury.
            (3) Purchase of obligations.--The Secretary of the Treasury 
        shall purchase any obligations of the United States Patent and 
        Trademark Organization issued under this subsection and for 
        such purpose the Secretary of the Treasury is authorized to use 
        as a public-debt transaction the proceeds of any securities 
        issued under chapter 31 of title 31, United States Code, and 
        the purposes for which securities may be issued under that 
        chapter are extended to include such purpose.
            (4) Treatment.--Payment under this subsection of the 
        purchase price of such obligations of the United States Patent 
        and Trademark Organization shall be treated as public debt 
        transactions of the United States.

SEC. 118. TRANSFERS.

    (a) Transfer of Functions.--Except as relates to the direction of 
patent and trademark policy, there are transferred to, and vested in, 
the United States Patent and Trademark Organization all functions, 
powers, and duties vested by law in the Secretary of Commerce or the 
Department of Commerce or in the officers or components in the 
Department of Commerce with respect to the authority to grant patents 
and register trademarks, and in the Patent and Trademark Office, as in 
effect on the day before the effective date of this title, and in the 
officers and components of such office.
    (b) Transfer of Funds and Property.--The Secretary of Commerce 
shall transfer to the United States Patent and Trademark Organization, 
on the effective date of this title, so much of the assets, 
liabilities, contracts, property, records, and unexpended and 
unobligated balances of appropriations, authorizations, allocations, 
and other funds employed, held, used, arising from, available to, or to 
be made available to the Department of Commerce, including funds set 
aside for accounts receivable which are related to functions, powers, 
and duties which are vested in the United States Patent and Trademark 
Office by this title.

SEC. 119. USE OF ORGANIZATION NAME.

    The use of the terms ``United States Patent and Trademark 
Organization'', ``Patent and Trademark Office'', ``United States Patent 
Office'', ``Patent Office'', ``United States Trademark Office'', 
``Trademark Office'', or any combination of such terms, as the name or 
part thereof under which an individual or entity does business, is 
prohibited. A violation of this section may be enjoined by any Federal 
court at the suit of the Organization. In any such suit, the 
Organization shall be entitled to statutory damages of $1,000 for each 
day during which such violation continues or is repeated following 
notice by the Organization and, in addition, may recover actual damages 
flowing from such violations.

            Subtitle B--Effective Date; Technical Amendments

SEC. 131. EFFECTIVE DATE.

    This title and the amendments made by this title shall take effect 
4 months after the date of the enactment of this Act.

SEC. 132. TECHNICAL AND CONFORMING AMENDMENTS.

    (a) Amendments to Title 35.--
            (1) Table of parts.--The item relating to part I in the 
        table of parts for title 35, United States Code, is amended to 
        read as follows:

``I. United States Patent Office............................      1.''.
            (2) Heading.--The heading for part I of title 35, United 
        States Code, is amended to read as follows:

                ``PART I--UNITED STATES PATENT OFFICE''.

            (3) Table of chapters.--The table of chapters for part I of 
        title 35, United States Code, is amended by amending the item 
        relating to chapter 1 to read as follows:

``1. Establishment, Officers and Employees, Functions.......       1''.
            (4) Table of sections.--The table of sections for chapter 1 
        of title 35, United States Code, is amended to read as follows:

     ``CHAPTER 1--ESTABLISHMENT, OFFICERS AND EMPLOYEES, FUNCTIONS

``Sec.
``1. Establishment.
``2. Powers and duties.
``3. Officers and employees.
``4. Restrictions on officers and employees as to interest in patents.
``5. Patent Office Management Advisory Board.
``6. Duties of Commissioner.
``7. Board of Patent Appeals and Interferences.
``8. Library.
``9. Classification of patents.
``10. Certified copies of records.
``11. Publications.
``12. Exchange of copies of patents with foreign countries.
``13. Copies of patents for public libraries.
``14. Annual report to Congress.''.
            (5) Commissioner of patents and trademarks.--(A) Section 
        41(h)(1) of title 35, United States Code, is amended by 
        striking ``Commissioner of Patents and Trademarks'' and 
        inserting ``Commissioner''.
            (B) Section 155 of title 35, United States Code, is amended 
        by striking ``Commissioner of Patents and Trademarks'' and 
        inserting ``Commissioner''.
            (C) Section 155A(c) of title 35, United States Code, is 
        amended by striking ``Commissioner of Patents'' and inserting 
        ``Commissioner''.
            (6) Patent and trademark office.--The provisions of title 
        35, United States Code, are amended by striking ``Patent and 
        Trademark Office'' each place it appears and inserting ``Patent 
        Office''.
            (7) Secretary of commerce.--Section 157(d) of title 35, 
        United States Code, is amended by striking ``Secretary of 
        Commerce'' and inserting ``Director of the United States Patent 
        and Trademark Organization''.
    (b) Amendments to the Trademark Act of 1946.--
            (1) References.--All amendments in this subsection refer to 
        the Act of July 5, 1946 (commonly referred to as the Trademark 
        Act of 1946).
            (2) Amendments relating to commissioner.--Section 61 (as 
        redesignated by section 115(a)(2) of this Act) is amended by 
        striking the undesignated paragraph relating to the definition 
        of the term ``Commissioner'' and inserting the following:
    ``The term `Commissioner' means the Commissioner of Trademarks.''.
            (3) Amendments relating to patent and trademark office.--
        (A) Section 1(a)(1) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (B) Section 1(a)(2) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (C) Section 1(b)(1) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (D) Section 1(b)(2) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (E) Section 1(d)(1) is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (F) Section 1(e) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (G) Section 2(d) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (H) Section 7(a) is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (I) Section 7(d) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (J) Section 7(e) is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (K) Section 7(f) is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (L) Section 7(g) is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (M) Section 8(a) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (N) Section 8(b) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (O) Section 10 is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (P) Section 12(a) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (Q) Section 13(a) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (R) Section 13(b)(1) is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (S) Section 15(2) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (T) Section 17 is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (U) Section 21(a)(2) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (V) Section 21(a)(3) is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (W) Section 21(a)(4) is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (X) Section 21(b)(3) is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (Y) Section 21(b)(4) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (Z) Section 24 is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (AA) Section 29 is amended by striking ``Patent and 
        Trademark Office'' each place such term appears and inserting 
        ``Trademark Office''.
            (BB) Section 30 is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (CC) Section 31(a) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (DD) Section 34(a) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (EE) Section 34(d)(1)(B)(i) is amended by striking ``Patent 
        and Trademark Office'' and inserting ``Trademark Office''.
            (FF) Section 35(a) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (GG) Section 36 is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (HH) Section 37 is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (II) Section 38 is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (JJ) Section 39(b) is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (KK) Section 41 is amended by striking ``Patent and 
        Trademark Office'' and inserting ``Trademark Office''.
            (LL) Section 61 (as redesignated under section 115(a)(2) of 
        this Act) is amended in the undesignated paragraph relating to 
        the definition of ``registered mark''--
                    (i) by striking ``Patent and Trade Mark Office'' 
                and inserting ``Trademark Office''; and
                    (ii) by striking ``Patent and Trade Office'' and 
                inserting ``Trademark Office''.
            (MM) Section 72(a) (as redesignated under section 115(a)(2) 
        of this Act) is amended by striking ``Patent and Trademark 
        Office'' and inserting ``Trademark Office''.
            (NN) Section 75 (as redesignated under section 115(a)(2) of 
        this Act) is amended by striking ``Patent and Trademark 
        Office'' and inserting ``Trademark Office''.
    (c) Amendments to Title 5.--Title 5, United States Code, is 
amended--
            (1) in section 5102(c)(23)--
                    (A) by striking ``examiners-in-chief'' in each 
                place it appears and inserting ``administrative patent 
                judges''; and
                    (B) by striking ``Office, Department of Commerce'' 
                and inserting ``Organization''; and
            (2) in section 5316--
                    (A) by striking ``Commissioner of Patents, 
                Department of Commerce.''; and
                    (B) by striking:
            ``Deputy Commissioner of Patents and Trademarks.
            ``Assistant Commissioner for Patents.
            ``Assistant Commissioner for Trademarks.''.
    (d) Amendment to Title 31.--Section 9101(3) of title 31, United 
States Code, is amended by adding at the end the following:
                    ``(O) the United States Patent and Trademark 
                Organization.''.
    (e) Amendments to Inspector General Act of 1978.--Section 11 of the 
Inspector General Act of 1978 (5 U.S.C. App.) is amended--
            (1) in paragraph (1) by striking ``or the Commissioner of 
        Social Security, Social Security Administration;'' and 
        inserting ``the Commissioner of Social Security, Social 
        Security Administration; or the Director of the United States 
        Patent and Trademark Organization, United States Patent and 
        Trademark Organization;''; and
            (2) in paragraph (2) by striking ``or the Veterans' 
        Administration, or the Social Security Administration;'' and 
        inserting ``the Veterans' Administration, the Social Security 
        Administration, or the United States Patent and Trademark 
        Organization;''.

                  Subtitle C--Miscellaneous Provisions

SEC. 141. REFERENCES.

    Any reference in any other Federal law, Executive order, rule, 
regulation, or delegation of authority, or any document of or 
pertaining to a department, agency, or office from which a function is 
transferred by this title--
            (1) to the head of such department, agency, or office is 
        deemed to refer to the head of the department, agency, or 
        office to which such function is transferred; or
            (2) to such department, agency, or office is deemed to 
        refer to the department, agency, or office to which such 
        function is transferred.

SEC. 142. EXERCISE OF AUTHORITIES.

    Except as otherwise provided by law, a Federal official to whom a 
function is transferred by this title may, for purposes of performing 
the function, exercise all authorities under any other provision of law 
that were available with respect to the performance of that function to 
the official responsible for the performance of the function 
immediately before the effective date of the transfer of the function 
under this title.

SEC. 143. SAVINGS PROVISIONS.

    (a) Legal Documents.--All orders, determinations, rules, 
regulations, permits, grants, loans, contracts, agreements, 
certificates, licenses, and privileges that--
            (1) have been issued, made, granted, or allowed to become 
        effective by the President, the Secretary of Commerce, any 
        officer or employee of any office transferred by this title, or 
        any other Government official, or by a court of competent 
        jurisdiction, in the performance of any function that is 
        transferred by this title, and
            (2) are in effect on the effective date of such transfer 
        (or become effective after such date pursuant to their terms as 
        in effect on such effective date), shall continue in effect 
        according to their terms until modified, terminated, 
        superseded, set aside, or revoked in accordance with law by the 
        President, any other authorized official, a court of competent 
        jurisdiction, or operation of law.
    (b) Proceedings.--This title shall not affect any proceedings or 
any application for any benefits, service, license, permit, 
certificate, or financial assistance pending on the effective date of 
this title before an office transferred by this title, but such 
proceedings and applications shall be continued. Orders shall be issued 
in such proceedings, appeals shall be taken therefrom, and payments 
shall be made pursuant to such orders, as if this title had not been 
enacted, and orders issued in any such proceeding shall continue in 
effect until modified, terminated, superseded, or revoked by a duly 
authorized official, by a court of competent jurisdiction, or by 
operation of law. Nothing in this subsection shall be considered to 
prohibit the discontinuance or modification of any such proceeding 
under the same terms and conditions and to the same extent that such 
proceeding could have been discontinued or modified if this title had 
not been enacted.
    (c) Suits.--This title shall not affect suits commenced before the 
effective date of this title, and in all such suits, proceedings shall 
be had, appeals taken, and judgments rendered in the same manner and 
with the same effect as if this title had not been enacted.
    (d) Nonabatement of Actions.--No suit, action, or other proceeding 
commenced by or against the Department of Commerce or the Secretary of 
Commerce, or by or against any individual in the official capacity of 
such individual as an officer or employee of an office transferred by 
this title, shall abate by reason of the enactment of this title.
    (e) Continuance of Suits.--If any Government officer in the 
official capacity of such officer is party to a suit with respect to a 
function of the officer, and under this title such function is 
transferred to any other officer or office, then such suit shall be 
continued with the other officer or the head of such other office, as 
applicable, substituted or added as a party.
    (f) Administrative Procedure and Judicial Review.--Except as 
otherwise provided by this title, any statutory requirements relating 
to notice, hearings, action upon the record, or administrative or 
judicial review that apply to any function transferred by this title 
shall apply to the exercise of such function by the head of the Federal 
agency, and other officers of the agency, to which such function is 
transferred by this title.

SEC. 144. TRANSFER OF ASSETS.

    Except as otherwise provided in this title, so much of the 
personnel, property, records, and unexpended balances of 
appropriations, allocations, and other funds employed, used, held, 
available, or to be made available in connection with a function 
transferred to an official or agency by this title shall be available 
to the official or the head of that agency, respectively, at such time 
or times as the Director of the Office of Management and Budget directs 
for use in connection with the functions transferred.

SEC. 145. DELEGATION AND ASSIGNMENT.

    (a) In General.--Except as otherwise expressly prohibited by law or 
otherwise provided in this title, an official to whom functions are 
transferred under this title (including the head of any office to which 
functions are transferred under this title) may--
            (1) delegate any of the functions so transferred to such 
        officers and employees of the office of the official as the 
        official may designate; and
            (2) authorize successive redelegations of such functions as 
        may be necessary or appropriate.
    (b) Responsibility for Administration.--No delegation of functions 
under this section or under any other provision of this title shall 
relieve the official to whom a function is transferred under this title 
of responsibility for the administration of the function.

SEC. 146. AUTHORITY OF DIRECTOR OF THE OFFICE OF MANAGEMENT AND BUDGET 
              WITH RESPECT TO FUNCTIONS TRANSFERRED.

    (a) Determinations.--If necessary, the Director of the Office of 
Management and Budget shall make any determination of the functions 
that are transferred under this title.
    (b) Incidental Transfers.--The Director of the Office of Management 
and Budget, at such time or times as the Director shall provide, may 
make such determinations as may be necessary with regard to the 
functions transferred by this title, and to make such additional 
incidental dispositions of personnel, assets, liabilities, grants, 
contracts, property, records, and unexpended balances of 
appropriations, authorizations, allocations, and other funds held, 
used, arising from, available to, or to be made available in connection 
with such functions, as may be necessary to carry out the provisions of 
this title.
    (c) Termination of Affairs.--The Director shall provide for the 
termination of the affairs of all entities terminated by this title and 
for such further measures and dispositions as may be necessary to 
effectuate the purposes of this title.

SEC. 147. CERTAIN VESTING OF FUNCTIONS CONSIDERED TRANSFERS.

    For purposes of this title, the vesting of a function in a 
department, agency, or office pursuant to reestablishment of an office 
shall be considered to be the transfer of the function.

SEC. 148. AVAILABILITY OF EXISTING FUNDS.

    Existing appropriations and funds available for the performance of 
functions, programs, and activities terminated pursuant to this title 
shall remain available, for the duration of their period of 
availability, for necessary expenses in connection with the termination 
and resolution of such functions, programs, and activities.

SEC. 149. DEFINITIONS.

    For purposes of this title--
            (1) the term ``function'' includes any duty, obligation, 
        power, authority, responsibility, right, privilege, activity, 
        or program; and
            (2) the term ``office'' includes any office, 
        administration, agency, bureau, institute, council, unit, 
        organizational entity, or component thereof.

           TITLE II--EARLY PUBLICATION OF PATENT APPLICATIONS

SEC. 201. SHORT TITLE.

    This title may be cited as the ``Patent Application Publication Act 
of 1997''.

SEC. 202. EARLY PUBLICATION.

    Section 122 of title 35, United States Code, is amended to read as 
follows:
``Sec. 122. Confidential status of applications; publication of patent 
              applications
    ``(a) Confidentiality.--Except as provided in subsection (b), 
applications for patents shall be kept in confidence by the Patent 
Office and no information concerning the same given without authority 
of the applicant or owner unless necessary to carry out the provisions 
of an Act of Congress or in such special circumstances as may be 
determined by the Commissioner.
    ``(b) Publication.--
            ``(1) In general.--(A) Subject to paragraph (2), each 
        application for patent, except applications for design patents 
        filed under chapter 16 of this title and provisional 
        applications filed under section 111(b) of this title, shall be 
        published, in accordance with procedures determined by the 
        Commissioner, as soon as possible after the expiration of a 
        period of 18 months from the earliest filing date for which a 
        benefit is sought under this title. At the request of the 
        applicant, an application may be published earlier than the end 
        of such 18-month period.
            ``(B) No information concerning published patent 
        applications shall be made available to the public except as 
        the Commissioner determines.
            ``(C) Notwithstanding any other provision of law, a 
        determination by the Commissioner to release or not to release 
        information concerning a published patent application shall be 
        final and nonreviewable.
            ``(2) Exceptions.--(A) An application that is no longer 
        pending shall not be published.
            ``(B) An application that is subject to a secrecy order 
        pursuant to section 181 of this title shall not be published.
            ``(C)(i) Where an applicant makes a request upon filing, 
        certifying that the invention disclosed in the application has 
        not and will not be the subject of an application filed in a 
        foreign country, the application shall not be published as 
        provided in paragraph (1).
            ``(ii) An applicant may rescind a request made under clause 
        (i) at any time. An applicant has a duty to notify the Director 
        within 1 month of filing an application in a foreign country.
            ``(iii) Where an applicant rescinds a request made under 
        clause (i) or notifies the Director that an application was 
        filed in a foreign country, the application shall be published 
        in accordance with the provisions of paragraph (1).
    ``(c) Pre-Issuance Opposition.--The provisions of this section 
shall not operate to create any new opportunity for pre-issuance 
opposition. The Commissioner may establish appropriate procedures to 
ensure that this section does not create any new opportunity for pre-
issuance opposition that did not exist prior to the adoption of this 
section.
    ``(d) Study.--
            ``(1) In general.--The General Accounting Office shall 
        conduct a 3-year study of the applicants who file only in the 
        United States after the effective date of this title.
            ``(2) Contents.--The study conducted under paragraph (1) 
        shall--
                    ``(A) consider the number of such applicants in 
                relation to the number of applicants who file in the 
                United States and outside the United States;
                    ``(B) examine how many domestic-only filers request 
                at the time of filing not to be published;
                    ``(C) examine how many such filers rescind that 
                request or later choose to file abroad; and
                    ``(D) examine the manner of entity seeking an 
                application and any correlation that may exist between 
                such manner and publication of patent applications.''.

SEC. 203. TIME FOR CLAIMING BENEFIT OF EARLIER FILING DATE.

    (a) In a Foreign Country.--Section 119(b) of title 35, United 
States Code, is amended to read as follows:
    ``(b)(1) No application for patent shall be entitled to this right 
of priority unless a claim, identifying the foreign application by 
specifying its application number, country, and the day, month, and 
year of its filing, is filed in the Patent Office at such time during 
the pendency of the application as required by the Commissioner.
    ``(2) The Commissioner may consider the failure of the applicant to 
file a timely claim for priority as a waiver of any such claim. The 
Commissioner may establish procedures, including the payment of a 
surcharge, to accept an unintentionally delayed claim under this 
section.
    ``(3) The Commissioner may require a certified copy of the original 
foreign application, specification, and drawings upon which it is 
based, a translation if not in the English language, and such other 
information as the Commissioner considers necessary. Any such 
certification shall be made by the foreign intellectual property 
authority in which the foreign application was filed and show the date 
of the application and of the filing of the specification and other 
papers.''.
    (b) In the United States.--Section 120 of title 35, United States 
Code, is amended by adding at the end the following: ``The Commissioner 
may determine the time period during the pendency of the application 
within which an amendment containing the specific reference to the 
earlier filed application is submitted. The Commissioner may consider 
the failure to submit such an amendment within that time period as a 
waiver of any benefit under this section. The Commissioner may 
establish procedures, including the payment of a surcharge, to accept 
unavoidably late submissions of amendments under this section.''.

SEC. 204. PROVISIONAL RIGHTS.

    Section 154 of title 35, United States Code, is amended--
            (1) in the section caption by inserting ``; provisional 
        rights'' after ``patent''; and
            (2) by adding at the end the following new subsection:
    ``(d) Provisional Rights.--
            ``(1) In general.--In addition to other rights provided by 
        this section, a patent shall include the right to obtain a 
        reasonable royalty from any person who, during the period 
        beginning on the date of publication of the application for 
        such patent pursuant to section 122(b) of this title, or in the 
        case of an international application filed under the treaty 
        defined in section 351(a) of this title designating the United 
        States under Article 21(2)(a) of such treaty, the date of 
        publication of the application, and ending on the date the 
        patent is issued--
                    ``(A)(i) makes, uses, offers for sale, or sells in 
                the United States the invention as claimed in the 
                published patent application or imports such an 
                invention into the United States; or
                    ``(ii) if the invention as claimed in the published 
                patent application is a process, uses, offers for sale, 
                or sells in the United States or imports into the 
                United States products made by that process as claimed 
                in the published patent application; and
                    ``(B) had actual notice of the published patent 
                application, and where the right arising under this 
                paragraph is based upon an international application 
                designating the United States that is published in a 
                language other than English, a translation of the 
                international application into the English language.
            ``(2) Right based on substantially identical inventions.--
        The right under paragraph (1) to obtain a reasonable royalty 
        shall not be available under this subsection unless the 
        invention as claimed in the patent is substantially identical 
        to the invention as claimed in the published patent 
        application.
            ``(3) Time limitation on obtaining a reasonable royalty.--
        The right under paragraph (1) to obtain a reasonable royalty 
        shall be available only in an action brought not later than 6 
        years after the patent is issued. The right under paragraph (1) 
        to obtain a reasonable royalty shall not be affected by the 
        duration of the period described in paragraph (1).
            ``(4) Requirements for international applications.--
                    ``(A) Effective date.--The right under paragraph 
                (1) to obtain a reasonable royalty based upon the 
                publication under the treaty of an international 
                application designating the United States shall 
                commence from the date that the Patent Office receives 
                a copy of the publication under the treaty defined in 
                section 351(a) of this title of the international 
                application, or, if the publication under the treaty of 
                the international application is in a language other 
                than English, from the date that the Patent Office 
                receives a translation of the international application 
                in the English language.
                    ``(B) Copies.--The Commissioner may require the 
                applicant to provide a copy of the international 
                application and a translation thereof.
            ``(5) Issuance of patents on individual claims.--Where the 
        Director in a notification to the applicant under section 132 
        of this title indicates that one or more claims of a published 
        application are allowable, the applicant may request the 
        issuance of a patent incorporating those claims. The applicant 
        may continue prosecution of the remaining claims as provided in 
        chapter 12 of this title. Any subsequently allowed claims may 
        be incorporated into the patent. The Director may establish 
        appropriate fees to cover the costs of incorporating any 
        additional claims into the patent.''.

SEC. 205. PRIOR ART EFFECT OF PUBLISHED APPLICATIONS.

    Section 102(e) of title 35, United States Code, is amended to read 
as follows:
    ``(e) the invention was described in--
            ``(1)(A) an application for patent, published pursuant to 
        section 122(b) of this title, by another filed in the United 
        States before the invention by the applicant for patent, except 
        that an international application filed under the treaty 
        defined in section 351(a) of this title shall have the effect 
        under this subsection of a national application published under 
        section 122(b) of this title only if the international 
        application designating the United States was published under 
        Article 21(2)(a) of such treaty in the English language, or
            ``(B) a patent granted on an application for patent by 
        another filed in the United States before the invention by the 
        applicant for patent, or''.

SEC. 206. COST RECOVERY FOR PUBLICATION.

    The Commissioner shall recover the cost of early publication 
required by the amendment made by section 202 by adjusting the filing, 
issue, and maintenance fees under title 35, United States Code, by 
charging a separate publication fee, or by any combination of these 
methods.

SEC. 207. CONFORMING CHANGES.

    The following provisions of title 35, United States Code, are 
amended:
            (1) Section 11 is amended in paragraph 1 of subsection (a) 
        by inserting ``and published applications for patents'' after 
        ``Patents''.
            (2) Section 12 is amended--
                    (A) in the section caption by inserting ``and 
                applications'' after ``patents''; and
                    (B) by inserting ``and published applications for 
                patents'' after ``patents''.
            (3) Section 13 is amended--
                    (A) in the section caption by inserting ``and 
                applications'' after ``patents''; and
                    (B) by inserting ``and published applications for 
                patents'' after ``patents''.
            (4) The items relating to sections 12 and 13 in the table 
        of sections for chapter 1 are each amended by inserting ``and 
        applications'' after ``patents''.
            (5) The item relating to section 122 in the table of 
        sections for chapter 11 is amended by inserting ``; publication 
        of patent applications'' after ``applications''.
            (6) The item relating to section 154 in the table of 
        sections for chapter 14 is amended by inserting ``; provisional 
        rights'' after ``patent''.
            (7) Section 181 is amended--
                    (A) in the first undesignated paragraph--
                            (i) by inserting ``by the publication of an 
                        application or'' after ``disclosure''; and
                            (ii) ``the publication of the application 
                        or'' after ``withhold'';
                    (B) in the second undesignated paragraph by 
                inserting ``by the publication of an application or'' 
                after ``disclosure of an invention'';
                    (C) in the third undesignated paragraph--
                            (i) by inserting ``by the publication of 
                        the application or'' after ``disclosure of the 
                        invention''; and
                            (ii) ``the publication of the application 
                        or'' after ``withhold''; and
                    (D) in the fourth undesignated paragraph by 
                inserting ``the publication of an application or'' 
                after ``and'' in the first sentence.
            (8) Section 252 is amended in the first undesignated 
        paragraph by inserting ``substantially'' before ``identical'' 
        each place it appears.
            (9) Section 284 is amended by adding at the end of the 
        second undesignated paragraph the following: ``Increased 
        damages under this paragraph shall not apply to provisional 
        rights under section 154(d) of this title.''.
            (10) Section 374 is amended to read as follows:
``Sec. 374. Publication of international application: Effect
    ``The publication under the treaty, defined in section 351(a) of 
this title, of an international application designating the United 
States shall confer the same rights and shall have the same effect 
under this title as an application for patent published under section 
122(b), except as provided in sections 102(e) and 154(d) of this 
title.''.

SEC. 208. LAST DAY OF PENDENCY OF PROVISIONAL APPLICATION.

    Section 119(e) of title 35, United States Code, is amended by 
adding at the end the following:
    ``(3) If the day that is 12 months after the filing date of a 
provisional application falls on a Saturday, Sunday, or legal holiday 
as defined in rule 6(a) of the Federal Rules of Civil Procedure, the 
period of pendency of the provisional application shall be extended to 
the next succeeding business day.''.

SEC. 209. EFFECTIVE DATE.

    (a) Sections 202 Through 207.--Sections 202 through 207, and the 
amendments made by such sections, shall take effect on the date that is 
1 year after the date of enactment of this Act and shall apply to all 
applications filed under section 111 of title 35, United States Code, 
on or after that date, and all applications complying with section 371 
of title 35, United States Code, that resulted from international 
applications filed on or after that date. The amendment made by section 
204 shall also apply to international applications designating the 
United States that are filed on or after the date that is 1 year after 
the date of enactment of this Act.
    (b) Section 208.--The amendments made by section 208 shall take 
effect on the date of the enactment of this Act and, except for a 
design patent application filed under chapter 16 of title 35, United 
States Code, shall apply to any application filed on or after June 8, 
1995.

                   TITLE III--PATENT TERM RESTORATION

SEC. 301. PATENT TERM RESTORATION AUTHORITY.

    Section 154(b) of title 35, United States Code, is amended to read 
as follows:
    ``(b) Adjustment of Patent Term.--
            ``(1) Basis for patent term restoration.--
                    ``(A) Delay.--Subject to the limitations under 
                paragraph (2), if the issue of an original patent is 
                delayed due to--
                            ``(i) a proceeding under section 135(a) of 
                        this title;
                            ``(ii) the imposition of an order pursuant 
                        to section 181 of this title;
                            ``(iii) appellate review by the Board of 
                        Patent Appeals and Interferences or by a 
                        Federal court where the patent was issued 
                        pursuant to a decision in the review reversing 
                        an adverse determination of patentability; or
                            ``(iv) an unusual administrative delay by 
                        the Patent Office in issuing the patent,
                the term of the patent shall be adjusted for the period 
                of delay.
                    ``(B) Administrative delay.--For purposes of 
                subparagraph (A)(iv), an unusual administrative delay 
                by the Patent Office is the failure to--
                            ``(i) make a notification of the rejection 
                        of any claim for a patent or any objection or 
                        argument under section 132 of this title or 
                        give or mail a written notice of allowance 
                        under section 151 of this title not later than 
                        14 months after the date on which the 
                        application was filed;
                            ``(ii) respond to a reply under section 132 
                        of this title or to an appeal taken under 
                        section 134 of this title not later than 4 
                        months after the date on which the reply was 
                        filed or the appeal was taken;
                            ``(iii) act on an application not later 
                        than 4 months after the date of a decision by 
                        the Board of Patent Appeals and Interferences 
                        under section 134 or 135 of this title or a 
                        decision by a Federal court under section 141, 
                        145, or 146 of this title where allowable 
                        claims remain in an application;
                            ``(iv) issue a patent not later than 4 
                        months after the date on which the issue fee 
                        was paid under section 151 of this title and 
                        all outstanding requirements were satisfied; or
                            ``(v) issue a patent within 3 years after 
                        the actual filing date of the application in 
                        the United States, if the applicant--
                                    ``(I) has not obtained further 
                                limited examination of the application 
                                under section 132(b) of this title;
                                    ``(II) has not benefited from an 
                                adjustment of patent term under clause 
                                (i), (ii), or (iii) or paragraph 
                                (1)(A);
                                    ``(III) has not sought or obtained 
                                appellate review by the Board of Patent 
                                Appeals and Interferences or by a 
                                Federal court other than in a case in 
                                which the patent was issued pursuant to 
                                a decision in the review reversing an 
                                adverse determination of patentability; 
                                and
                                    ``(IV) has not requested any delay 
                                in the processing of the application by 
                                the Patent Office.
            ``(2) Limitations.--
                    ``(A) In general.--The total duration of any 
                adjustments granted pursuant to either subclause (iii) 
                or (iv) of paragraph (1)(A) or both such subclauses 
                shall not exceed 10 years. To the extent that periods 
                of delay attributable to grounds specified in paragraph 
                (1) overlap, the period of any adjustment granted under 
                this subsection shall not exceed the actual number of 
                days the issuance of the patent was delayed.
                    ``(B) Reduction of adjustment.--The period of 
                adjustment of the term of a patent under this 
                subsection shall be reduced by a period equal to the 
                time in which the applicant failed to engage in 
                reasonable efforts to conclude prosecution of the 
                application. The Commissioner shall prescribe 
                regulations establishing the circumstances that 
                constitute a failure of an applicant to engage in 
                reasonable efforts to conclude processing or 
                examination of an application.
                    ``(C) Disclaimed term.--No patent the term of which 
                has been disclaimed beyond a specified date may be 
                adjusted under this section beyond the expiration date 
                specified in the disclaimer.
                    ``(D) Applicant delay.--The period of adjustment of 
                the term of a patent under clause (iv) of paragraph 
                (1)(A), which is based on the failure of the Patent 
                Office to meet the criteria set forth in clause (v) of 
                paragraph (1)(B), shall be reduced by the cumulative 
                total of any periods of time that an applicant takes to 
                respond in excess of 3 months after the date on which 
                the Patent Office makes any rejection, objection, 
                argument, or other request, except that the 
                Commissioner, upon petition from the applicant in the 
                case of a nonprofit research laboratory or nonprofit 
                entity such as a university, research center, or 
                hospital, shall reinstate all or part of such time upon 
                a showing of good cause by the applicant, but in no 
                case more than 3 additional months for each such 
                response beyond 3 months.
            ``(3) Procedures.--The Commissioner shall prescribe 
        regulations establishing procedures for the notification of 
        patent term extensions under this subsection and procedures for 
        contesting patent term extensions under this subsection.
            ``(4) Notice to commissioner.--In a case in which a patent 
        term is adjusted under this subsection, the Commissioner shall 
        determine the period of any patent term adjustment available 
        under this section and shall include a copy of that 
        determination with the final notice. The Commissioner shall 
        prescribe regulations establishing procedures for the 
        application for, and notification of, patent term adjustments 
        granted by the Commissioner under this subsection.
            ``(5) Judicial review.--Any applicant dissatisfied with a 
        determination of the Commissioner under paragraph (3) may have 
        remedy by civil action in the United States Court of Federal 
        Claims if commenced within 180 days after the mailing of the 
        notice of allowance as the Commissioner appoints. The 
        initiation of a civil action under this section shall not delay 
        the issuance of a patent.''.

SEC. 302. FURTHER EXAMINATION OF PATENT APPLICATIONS.

    Section 132 of title 35, United States Code, is amended--
            (1) in the first sentence by striking ``Whenever'' and 
        inserting ``(a) Whenever''; and
            (2) by adding at the end the following:
    ``(b) The Commissioner shall prescribe regulations to provide for 
the further limited reexamination of applications for patent at the 
request of the applicant. The Commissioner may establish appropriate 
fees for such further limited examination and shall be authorized to 
provide a 50 percent reduction on such fees for small entities that 
qualify for reduced fees under section 41(h)(1) of this title.''.

SEC. 303. TECHNICAL CLARIFICATION.

    Section 156(a) of title 35, United States Code, is amended--
            (1) in the matter preceding paragraph (1) by inserting ``, 
        which shall include any patent term adjustment granted under 
        section 154(b),'' after ``the original expiration date of the 
        patent''.

SEC. 304. EFFECTIVE DATE.

    The amendments made by section 301 shall take effect on the date of 
the enactment of this Act and, except for a design patent application 
filed under chapter 16 of title 35, United States Code, shall apply to 
any application filed on or after June 8, 1995.

                TITLE IV--PRIOR DOMESTIC COMMERCIAL USE

SEC. 401. SHORT TITLE.

    This title may be cited as the ``Prior Domestic Commercial Use Act 
of 1997''.

SEC. 402. DEFENSE TO PATENT INFRINGEMENT BASED ON PRIOR DOMESTIC 
              COMMERCIAL USE.

    (a) Defense.--Chapter 28 of title 35, United States Code, is 
amended by adding at the end the following new section:
``Sec. 273. Prior domestic commercial use; defense to infringement
    ``(a) Definitions.--For purposes of this section--
            ``(1) the terms `commercially used', `commercially use', 
        and `commercial use'--
                    ``(A) mean the use in the United States in 
                commerce, use by the United States, or the use in the 
design, testing, or production in the United States of a product or 
service which is used in commerce or used by the United States, whether 
or not the subject matter at issue is accessible to or otherwise known 
to the public; and
                    ``(B) includes in the case of activities performed 
                by a nonprofit research laboratory, or nonprofit entity 
                such as a university, research center, or hospital, a 
                use for which the public is the intended beneficiary 
                shall be considered to be a use described in 
                subparagraph (A) except that the use--
                            ``(i) may be asserted as a defense under 
                        this section only for continued use by and in 
                        the laboratory or nonprofit entity; and
                            ``(ii) may not be asserted as a defense 
                        with respect to any subsequent 
                        commercialization or use outside such 
                        laboratory or nonprofit entity;
            ``(2) the terms `used in commerce', and `use in commerce' 
        mean that there has been an actual arms-length sale or other 
        commercial transfer, or use by the United States, of the 
        subject matter at issue or that there has been an actual arms-
        length sale or other commercial transfer, or use by the United 
        States, of a product or service resulting from the use of the 
        subject matter at issue; and
            ``(3) the `effective filing date' of a patent is the 
        earlier of the actual filing date of the application for the 
        patent or the filing date of any earlier United States, 
        foreign, or international application to which the subject 
        matter at issue is entitled under section 119, 120, or 365 of 
        this title.
    ``(b) Defense to Infringement.--
            ``(1) In general.--A person shall not be liable as an 
        infringer under section 271 of this title, nor shall the United 
        States be held liable under section 1498(a) of title 28, with 
        respect to any subject matter that would otherwise infringe one 
        or more claims in the patent being asserted against such 
        person, if such person had, acting in good faith, commercially 
        used the subject matter before the effective filing date of 
        such patent.
            ``(2) Exhaustion of right.--The sale or other disposition 
        of the subject matter of a patent by a person entitled to 
        assert a defense under this section with respect to that 
        subject matter shall exhaust the patent owner's rights under 
        the patent to the extent such rights would have been exhausted 
        had such sale or other disposition been made by the patent 
        owner.
    ``(c) Limitations and Qualifications of Defense.--The defense to 
infringement under this section is subject to the following:
            ``(1) Derivation.--A person may not assert the defense 
        under this section if the subject matter on which the defense 
        is based was derived from the patentee or persons in privity 
        with the patentee.
            ``(2) Not a general license.--The defense asserted by a 
        person under this section is not a general license under all 
        claims of the patent at issue, but extends only to the subject 
        matter claimed in the patent with respect to which the person 
        can assert a defense under this chapter, except that the 
        defense shall also extend to variations in the quantity or 
        volume of use of the claimed subject matter, and to 
        improvements in the claimed subject matter that do not infringe 
        additional specifically claimed subject matter of the patent.
            ``(3) Effective and serious preparation.--With respect to 
        subject matter that cannot be commercialized without a 
        significant investment of time, money, and effort, a person 
        shall be deemed to have commercially used the subject matter 
        if--
                    ``(A) before the effective filing date of the 
                patent, the person reduced the subject matter to 
                practice in the United States, completed a significant 
                portion of the total investment necessary to 
                commercially use the subject matter, and made an arms-
                length commercial transaction in the United States in 
                connection with the preparation to use the subject 
                matter; and
                    ``(B) thereafter the person diligently completed 
                the remainder of the activities and investments 
                necessary to commercially use the subject matter, and 
                promptly began commercial use of the subject matter, 
                even if such activities were conducted after the 
                effective filing date of the patent.
            ``(4) Burden of proof.--A person asserting the defense 
        under this section shall have the burden of establishing the 
        defense.
            ``(5) Abandonment of use.--A person who has abandoned 
        commercial use of subject matter may not rely on activities 
        performed before the date of such abandonment in establishing a 
        defense under subsection (b) with respect to actions taken 
        after the date of such abandonment.
            ``(6) Personal defense.--The defense under this section may 
        only be asserted by the person who performed the acts necessary 
        to establish the defense and, except for any transfer to the 
        patent owner, the right to assert the defense shall not be 
        licensed or assigned or transferred to another person except in 
        connection with the good faith assignment or transfer of the 
        entire enterprise or line of business to which the defense 
        relates.
            ``(7) One-year limitation.--A person may not assert a 
        defense under this section unless the subject matter on which 
        the defense is based had been commercially used or actually 
        reduced to practice more than one year prior to the effective 
        filing date of the patent by the person asserting the defense 
        or someone in privity with that person.
    ``(d) Unsuccessful Assertion of Defense.--If the defense under this 
section is pleaded by a person who is found to infringe the patent and 
who subsequently fails to demonstrate a reasonable basis for asserting 
the defense, the court shall find the case exceptional for the purpose 
of awarding attorney's fees under section 285 of this title.
    ``(e) Invalidity.--A patent shall not be deemed to be invalid under 
section 102 or 103 of this title solely because a defense is 
established under this section.''.
    (b) Conforming Amendment.--The table of sections at the beginning 
of chapter 28 of title 35, United States Code, is amended by adding at 
the end the following new item:

``Sec. 273. Prior domestic commercial use; defense to infringement.''.

SEC. 403. EFFECTIVE DATE AND APPLICABILITY.

    This title and the amendments made by this title shall take effect 
on the date of the enactment of this Act, but shall not apply to any 
action for infringement that is pending on such date of enactment or 
with respect to any subject matter for which an adjudication of 
infringement, including a consent judgment, has been made before such 
date of enactment.

                  TITLE V--PATENT REEXAMINATION REFORM

SEC. 501. SHORT TITLE.

    This title may be cited as the ``Patent Reexamination Reform Act of 
1997''.

SEC. 502. DEFINITIONS.

    Section 100 of title 35, United States Code, is amended by adding 
at the end the following new subsection:
    ``(e) The term `third-party requester' means a person requesting 
reexamination under section 302 of this title who is not the patent 
owner.''.

SEC. 503. REEXAMINATION PROCEDURES.

    (a) Request for Reexamination.--Section 302 of title 35, United 
States Code, is amended to read as follows:
``Sec. 302. Request for reexamination
    ``(a) In General.--Any person at any time may file a request for 
reexamination by the Office of a patent on the basis of any prior art 
cited under the provisions of section 301 of this title.
    ``(b) Requirements.--The request shall--
            ``(1) be in writing, include the identity of the real party 
        in interest, and be accompanied by payment of a reexamination 
        fee established by the Commissioner of Patents pursuant to the 
        provisions of section 41 of this title; and
            ``(2) set forth the pertinency and manner of applying cited 
        prior art to every claim for which reexamination is requested.
    ``(c) Copy.--Unless the requesting person is the owner of the 
patent, the Commissioner promptly shall send a copy of the request to 
the owner of record of the patent.''.
    (b) Determination of Issue by Commissioner.--Section 303 of title 
35, United States Code, is amended to read as follows:
``Sec. 303. Determination of issue by Commissioner
    ``(a) Reexamination.--Not later than 3 months after the filing of a 
request for reexamination under the provisions of section 302 of this 
title, the Commissioner shall determine whether a substantial new 
question of patentability affecting any claim of the patent concerned 
is raised by the request, with or without consideration of other 
patents or printed publications. On the Commissioner's initiative, and 
any time, the Commissioner may determine whether a substantial new 
question of patentability is raised by patents and publications.
    ``(b) Record.--A record of the Commissioner's determination under 
subsection (a) shall be placed in the official file of the patent, and 
a copy shall be promptly given or mailed to the owner of record of the 
patent and to the third-party requester, if any.
    ``(c) Final Decision.--A determination by the Commissioner pursuant 
to subsection (a) shall be final and nonappealable. Upon a 
determination that no substantial new question of patentability has 
been raised, the Commissioner may refund a portion of the reexamination 
fee required under section 302 of this title.''.
    (c) Reexamination Order by Commissioner.--Section 304 of title 35, 
United States Code, is amended to read as follows:
``Sec. 304. Reexamination order by Commissioner
    ``If, in a determination made under the provisions of section 
303(a) of this title, the Commissioner finds that a substantial new 
question of patentability affecting a claim of a patent is raised, the 
determination shall include an order for reexamination of the patent 
for resolution of the question. The order may be accompanied by the 
initial action of the Patent Office on the merits of the reexamination 
conducted in accordance with section 305 of this title.''.
    (d) Conduct of Reexamination Proceedings.--Section 305 of title 35, 
United States Code, is amended to read as follows:
``Sec. 305. Conduct of reexamination proceedings
    ``(a) In General.--Subject to subsection (b), reexamination shall 
be conducted according to the procedures established for initial 
examination under the provisions of sections 132 and 133 of this title. 
In any reexamination proceeding under this chapter, the patent owner 
shall be permitted to propose any amendment to the patent and a new 
claim or claims, except that no proposed amended or new claim enlarging 
the scope of the claims of the patent shall be permitted.
    ``(b) Response.--(1) This subsection shall apply to any 
reexamination proceeding in which the order for reexamination is based 
upon a request by a third-party requester.
    ``(2) With the exception of the reexamination request, any document 
filed by either the patent owner or the third-party requester shall be 
served on the other party.
    ``(3) If the patent owner files a response to any Patent Office 
action on the merits, the third-party requester shall have 1 
opportunity to file written comments within a reasonable period not 
less than 1 month after the date of service of the patent owner's 
response. Written comments provided under this paragraph shall be 
limited to issues covered by the Patent Office action or the patent 
owner's response.
    ``(c) Special Dispatch.--Unless otherwise provided by the 
Commissioner for good cause, all reexamination proceedings under this 
section, including any appeal to the Board of Patent Appeals and 
Interferences, shall be conducted with special dispatch within the 
Office.''.
    (e) Appeal.--Section 306 of title 35, United States Code, is 
amended to read as follows:
``Sec. 306. Appeal
    ``(a) Patent Owner.--The patent owner involved in a reexamination 
proceeding under this chapter--
            ``(1) may appeal under the provisions of section 134 of 
        this title, and may appeal under the provisions of sections 141 
        through 144 of this title, with respect to any decision adverse 
        to the patentability of any original or proposed amended or new 
        claim of the patent, and
            ``(2) may be a party to any appeal taken by a third-party 
        requester pursuant to subsection (b) of this section.
    ``(b) Third-Party Requester.--A third-party requester may--
            ``(1) appeal under the provisions of section 134 of this 
        title, and may appeal under the provisions of sections 141 
        through 144 of this title, with respect to any final decision 
        favorable to the patentability of any original or proposed 
        amended or new claim of the patent; or
            ``(2) be a party to any appeal taken by the patent owner, 
        subject to subsection (c) of this section.
    ``(c) Participation as Party.--
            ``(1) In general.--A third-party requester whose request 
        for a reexamination results in an order under section 304 of 
        this title is estopped from asserting at a later time, in any 
        civil action arising in whole or in part under section 1338 of 
        title 28, the invalidity of any claim determined to be 
        patentable on appeal on any ground which the third-party 
        requester raised or could have raised during the reexamination 
        proceedings. This subsection does not prevent the assertion of 
        invalidity based on newly discovered prior art unavailable to 
        the third-party requester and the Patent Office at the time of 
        the reexamination proceedings.
            ``(2) Election to participate.--A third-party requester is 
        deemed not to have participated as a party to an appeal by the 
        patent owner unless, not later than 20 days after the patent 
        owner has filed notice of appeal, the third-party requester 
        files notice with the Commissioner electing to participate.''.
    (f) Reexamination Prohibited.--
            (1) In general.--Chapter 30 of title 35, United States 
        Code, is amended by adding at the end the following new 
        section:
``Sec. 308. Reexamination prohibited
    ``(a) Order for Reexamination.--Notwithstanding any provision of 
this chapter, once an order for reexamination of a patent has been 
issued under section 304 of this title, neither the patent owner nor 
the third-party requester, if any, nor privies of either, may file a 
subsequent request for reexamination of the patent until a 
reexamination certificate is issued and published under section 307 of 
this title, unless authorized by the Commissioner.
    ``(b) Final Decision.--Once a final decision has been entered 
against a party in a civil action arising in whole or in part under 
section 1338 of title 28 that the party has not sustained its burden of 
proving the invalidity of any patent claim in suit or if a final 
decision in a reexamination proceeding instituted by a third-party 
requester is favorable to a patentability of any original or proposed 
amended as new claim of the patent and such decision is not appealed by 
the third-party requester under section 306(b), then neither that party 
nor its privies may thereafter request reexamination of any such patent 
claim on the basis of issues which that party or its privies raised or 
could have raised in such civil action or reexamination proceeding, and 
a reexamination requested by that party or its privies on the basis of 
such issues may not thereafter be maintained by the Office, 
notwithstanding any other provision of this chapter. This subsection 
does not prevent the assertion of invalidity based on newly discovered 
prior art unavailable to the third-party requester and the Patent 
Office at the time of the reexamination proceedings.''.
            (2) Technical and conforming amendment.--The table of 
        sections for chapter 30 of title 35, United States Code, is 
        amended by adding at the end the following:

``308. Reexamination prohibited.''.

SEC. 504. CONFORMING AMENDMENTS.

    (a) Patent Fees; Patent Search Systems.--Section 41(a)(7) of title 
35, United States Code, is amended to read as follows:
            ``(7) On filing each petition for the revival of an 
        unintentionally abandoned application for a patent, for the 
        unintentionally delayed payment of the fee for issuing each 
        patent, or for an unintentionally delayed response by the 
        patent owner in a reexamination proceeding, $1,250, unless the 
        petition is filed under sections 133 or 151 of this title, in 
        which case the fee shall be $110.''.
    (b) Appeal to the Board of Patent Appeals and Interferences.--
Section 134 of title 35, United States Code, is amended to read as 
follows:
``Sec. 134. Appeal to the Board of Patent Appeals and Interferences
    ``(a) Patent Applicant.--An applicant for a patent, any of whose 
claims has been twice rejected, may appeal from the decision of the 
primary examiner to the Board of Patent Appeals and Interferences, 
having once paid the fee for such appeal.
    ``(b) Patent Owner.--A patent owner in a reexamination proceeding 
may appeal from the final rejection of any claim by the primary 
examiner to the Board of Patent Appeals and Interferences, having once 
paid the fee for such appeal.
    ``(c) Third-Party.--A third-party requester may appeal to the Board 
of Patent Appeals and Interferences from the final decision of the 
primary examiner favorable to the patentability of any original or 
proposed amended or new claim of a patent, having once paid the fee for 
such appeal.''.
    (c) Appeal to Court of Appeals for the Federal Circuit.--Section 
141 of title 35, United States Code, is amended by amending the first 
sentence to read as follows: ``An applicant, a patent owner, or a 
third-party requester, dissatisfied with the final decision in an 
appeal to the Board of Patent Appeals and Interferences under section 
134 of this title, may appeal the decision to the United States Court 
of Appeals for the Federal Circuit.''.
    (d) Proceedings on Appeal.--Section 143 of title 35, United States 
Code, is amended by amending the third sentence to read as follows: 
``In ex parte and reexamination cases, the Commissioner shall submit to 
the court in writing the grounds for the decision of the Patent Office, 
addressing all the issues involved in the appeal.''.
    (e) Civil Action To Obtain Patent.--Section 145 of title 35, United 
States Code, is amended in the first sentence by inserting ``(a)'' 
after ``section 134''.

SEC. 505. REPORT TO CONGRESS.

    Not later than 5 years after the effective date of this title, the 
Director shall submit to the Congress a report evaluating whether the 
reexamination proceedings established under the amendments made by this 
title are inequitable to any of the parties in interest and, if so, the 
report shall contain recommendations for changes to the amendments made 
by this title to remove such inequity.

SEC. 506. EFFECTIVE DATE.

    This title and the amendments made by this title shall take effect 
on the date that is 1 year after the date of the enactment of this Act 
and shall apply to all reexamination requests filed on or after such 
date.

               TITLE VI--MISCELLANEOUS PATENT PROVISIONS

SEC. 601. PROVISIONAL APPLICATIONS.

    (a) Abandonment.--Section 111(b)(5) of title 35, United States 
Code, is amended to read as follows:
            ``(5) Abandonment.--Notwithstanding the absence of a claim, 
        upon timely request and as prescribed by the Commissioner, a 
        provisional application may be treated as an application filed 
        under subsection (a). Subject to section 1993(c)(3) of this 
        title, if no such request is made, the provisional application 
        shall be regarded as abandoned 12 months after the filing date 
        of such application and shall not be subject to revival 
        thereafter.''.
    (b) Technical Amendment Relating to Weekends and Holidays.--Section 
119(e) of title 35, United States Code, is amended by adding at the end 
the following:
            ``(3) If the day that is 12 months after the filing date of 
        a provisional application falls on a Saturday, Sunday, or 
        Federal holiday within the District of Columbia, the period of 
        pendency of the provisional application shall be extended to 
        the next succeeding secular or business day.''.
    (c) Effective Date.--The amendments made by subsection (a) apply to 
a provisional application filed on or after June 8, 1995.

SEC. 602. INTERNATIONAL APPLICATIONS.

    Section 119 of title 35, United States Code, is amended as follows:
            (1) In subsection (a), insert ``or in a WTO member 
        country'' after ``or to citizens of the United States,''.
            (2) At the end of section 119 add the following new 
        subsections:
    ``(f) Applications for plant breeder's rights filed in a WTO member 
country (or in a foreign UPOV Contracting Party) shall have the same 
effect for the purpose of the right of priority under subsections (a) 
through (c) of this section as applications for patents, subject to the 
same conditions and requirements of this section as apply to 
applications for patents.
    ``(g) As used in this section--
            ``(1) the term `WTO member country' has the same meaning as 
        the term is defined in section 104(b)(2) of this title; and
            ``(2) the term `UPOV Contracting Party' means a member of 
        the International Convention for the Protection of New 
        Varieties of Plants.''.

SEC. 603. ACCESS TO ELECTRONIC PATENT INFORMATION.

    (a) In General.--The United States Patent and Trademark 
Organization shall develop and implement statewide computer networks 
with remote library sites in requesting rural States such that citizens 
in those States will have enhanced access to information in their 
State's patent and trademark depository library.
    (b) Definition.--In this section, the term ``rural States'' means 
the States that qualified on January 1, 1997, as rural States under 
section 1501(b) of the Omnibus Crime Control and Safe Streets Act of 
1968 (42 U.S.C. 379bb(b)).

SEC. 604. CERTAIN LIMITATIONS ON DAMAGES FOR PATENT INFRINGEMENT NOT 
              APPLICABLE.

    Section 287(c) of title 35, United States Code, is amended in 
paragraph (4) by striking ``before the date of enactment of this 
subsection'' and inserting ``based on an application the earliest 
effective filing date of which is prior to September 30, 1996''.

SEC. 605. PLANT PATENTS.

    (a) Tuber Propagated Plants.--Section 161 of title 35, United 
States Code, is amended by striking ``a tuber propagated plant or''.
    (b) Rights in Plant Patents.--The text of section 163 of title 35, 
United States Code, is amended to read as follows: ``In the case of a 
plant patent, the grant to the patentee, such patentee's heirs or 
assigns, shall have the right to exclude others from asexually 
reproducing the plant, and from using, offering for sale, or selling 
the plant so reproduced, or any of its parts, throughout the United 
States, or from importing the plant so reproduced, or any parts 
thereof, into the United States.''.
    (c) Effective Date.--The amendments by subsection (a) shall apply 
on the date of enactment of this Act. The amendments made by subsection 
(b) shall apply to any plant patent issued on or after the date of 
enactment of this Act.

SEC. 606. ELECTRONIC FILING.

    Section 22 of title 35, United States Code, is amended by striking 
``printed or typewritten'' and inserting ``printed, typewritten, or on 
an electronic medium''.

SEC. 607. STUDY AND REPORT ON BIOLOGICAL DEPOSITS IN SUPPORT OF 
              BIOTECHNOLOGY PATENTS.

    (a) In General.--No later than 6 months after the date of enactment 
of this Act, the General Accounting Office, in consultation with the 
United States Patent Office, shall conduct a study and submit a report 
to Congress on the potential risks to the United States biotechnology 
industry relating to biological deposits in support of biotechnology 
patents.
    (b) Contents.--The study conducted under this section shall 
include--
            (1) an examination of the risk of export and the risk of 
        third-party transfer of biological deposits, and the risks 
        posed by the change to 18-month publication requirements;
            (2) an analysis of comparative legal and regulatory 
        regimes; and
            (3) any related recommendations.
    (c) Consideration of Report.--In drafting regulations affecting 
biological deposits (including any modification of 37 Code of Federal 
Regulations 1.801 et seq.), the United States Patent Office shall 
consider the recommendations of the study conducted under this section.

            Passed the House of Representatives April 24, 1997.

            Attest:

                                                ROBIN H. CARLE,

                                                                 Clerk.