[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5299 Introduced in House (IH)]






108th CONGRESS
  2d Session
                                H. R. 5299

  To amend title 35, United States Code, to modify certain procedures 
                          relating to patents.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 8, 2004

Mr. Berman (for himself and Mr. Boucher) introduced the following bill; 
          which was referred to the Committee on the Judiciary

_______________________________________________________________________

                                 A BILL


 
  To amend title 35, United States Code, to modify certain procedures 
                          relating to patents.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Patent Quality Assistance Act of 
2004''.

SEC. 2. OPPOSITION PROCEDURES.

    (a) In General.--Title 35, United States Code, is amended by 
inserting after chapter 31 the following new chapter:

             ``CHAPTER 32--POST-GRANT OPPOSITION PROCEDURES

``Sec.
``321. Right to oppose patent; opposition request.
``322. Real party in interest.
``323. Timing of opposition request.
``324. Limits on scope of validity issues raised.
``325. Institution of the opposition proceeding.
``326. Patent owner response.
``327. Amendment of claims.
``328. Discovery and sanctions.
``329. Supplemental submissions.
``330. Hearing and briefs.
``331. Written decision.
``332. Burden of proof and evidence.
``333. Reconsideration.
``334. Appeal.
``335. Certificate.
``336. Estoppel.
``337. Duration of opposition.
``338. Settlement.
``339. Intervening rights.
``340. Relationship with reexamination proceedings.
``Sec. 321. Right to oppose patent; opposition request
    ``(a) Filing of Opposition.--A person may request that the grant or 
reissue of a patent be reconsidered by the Patent and Trademark Office 
by filing an opposition seeking to invalidate 1 or more claims in the 
patent. The Director shall establish, by regulation, fees to be paid by 
the person filing the opposition (in this chapter referred to as the 
`opposer'). Copies of patents and printed publications to be relied 
upon in support of the request must be filed with the request. If an 
opposer relies on other factual evidence or on expert opinions in 
support of the opposition, such evidence and opinions must be filed 
with the request through one or more accompanying affidavits or 
declarations.
    ``(b) Copies Provided to Patent Owner.--Copies of any documents 
filed under subsection (a) must be provided to the patent owner or, if 
applicable, the designated representative of the patent owner, at the 
time of filing under subsection (a), except that if a request is made 
that the identity of a real party in interest be kept separate pursuant 
to section 322(b), then the identity of the real party in interest may 
be redacted from the copies provided.
    ``(c) File Available to the Public.--The file of any opposition 
proceeding shall be made available to the public, except as provided in 
section 322.
``Sec. 322. Real party in interest
    ``(a) Identification.--The person making a request under section 
321 shall identify in writing each real party in interest, and the 
opposition pursuant to the request shall proceed in the name of the 
real party in interest.
    ``(b) Identity Kept Separate Upon Request.--
            ``(1) In general.--Subject to paragraph (2), if requested 
        by the opposer, the identity of a real party in interest shall 
        be kept separate from the file of the opposition and made 
        available only to Government agencies upon written request, or 
        to any person upon a showing of good cause. If the identity of 
        a real party in interest is kept separate from the file under 
        this paragraph, then the opposition shall proceed in the name 
        of the individual filing the request as the representative of 
        the real party in interest.
            ``(2) Exception.--No request under paragraph (1) to keep 
        the identity of a real party in interest separate from the file 
        of the opposition may be made or maintained if the opposer 
        relies upon factual evidence or expert opinions in the form of 
        affidavits or declarations during the opposition proceeding or 
        if the opposer exercises the right to appeal under section 141.
``Sec. 323. Timing of opposition request
    ``A person may not make an opposition request under section 321 
later than 9 months after the grant of the patent or issuance of the 
reissue patent, as the case may be, or later than 6 months after 
receiving notice from the patent holder alleging infringement of the 
patent, except that, if the patent owner consents in writing, an 
opposition request may be filed anytime during the period of 
enforceability of the patent. A court having jurisdiction over an issue 
of validity of a patent may not require the patent owner to consent to 
such a request.
``Sec. 324. Limits on scope of validity issues raised
    ``An opposition request under section 321 must identify with 
particularity the claims that are alleged to be invalid and, as to each 
claim, 1 or more issues of invalidity on which the opposition is based. 
The issues of invalidity that may be considered during the opposition 
proceeding are double patenting and any of the requirements for 
patentability set forth in sections 101, 102, 103, and 112, and the 
fourth paragraph of section 251, except for--
            ``(1) any requirement contained in the first paragraph of 
        section 112 relating to disclosing the best mode; and
            ``(2) any issue arising under subsection (c), (f), or (g) 
        of section 102.
``Sec. 325. Institution of the opposition proceeding
    ``(a) Dismissal; Institution.--
            ``(1) Dismissal.--The Director may dismiss an opposition 
        request that the Director determines lacks substantial merit. 
        The determination by the Director to dismiss an opposition 
        request shall not be appealable. The dismissal of an opposition 
        request shall not be admissible in any civil action related to 
        the patent against which a dismissed request was filed.
            ``(2) Institution.--If the Director receives 1 or more 
        requests that meet the requirements of section 321 regarding 
        the same patent by the Director and are not dismissed under 
        paragraph (1), an opposition proceeding shall be promptly 
        instituted pursuant to the request or requests, but not before 
        a period of 9 months has elapsed since the date on which the 
        patent was granted.
            ``(3) Consolidated proceeding.--If an opposition proceeding 
        is instituted based upon more than 1 opposition request, the 
        opposition shall proceed as a single consolidated proceeding, 
        unless later divided under subsection (c).
    ``(b) Parties.--The parties to an opposition proceeding under this 
section shall be the patent owner and each opposer whose request meets 
the requirements of section 321 and has not been dismissed under 
subsection (a)(1).
    ``(c) Decision by Panel.--The Director shall assign the opposition 
proceeding to a panel of three administrative patent judges (in this 
chapter referred to as the `panel'). The panel shall decide the 
questions of patentability raised in each opposition request for which 
an opposition proceeding has been instituted. The decision shall be 
based upon the prosecution record that was the basis for the grant of 
the patent and the additional submissions by the parties to the 
opposition proceeding authorized under this chapter. The panel may, in 
appropriate cases, divide the opposition into separate proceedings if 
the opposition involves multiple opposition requests by different 
parties.
``Sec. 326. Patent owner response
    ``After the Director has instituted an opposition proceeding under 
section 325, the patent owner shall have the right to file, within the 
time period set by the panel, a response to each opposition request 
that is the subject of the proceeding. The patent owner, in responding 
to an opposition request, shall file with the response, through 
affidavits or declarations, any additional factual evidence and expert 
opinions on which the patent owner relies in support of the response.
``Sec. 327. Amendment of claims
    ``The patent owner is entitled to request amendment of any claims 
that are the subject of an opposition proceeding under this chapter, 
including by the addition of new claims. The patent owner shall file 
any such request for amendment with the patent owner's response to an 
opposition request under section 326. The panel may permit further 
requests for amendment of the claims only upon good cause shown by the 
patent owner. No amendment enlarging the scope of the claims of the 
patent shall be permitted in the opposition proceeding.
``Sec. 328. Discovery and sanctions
    ``(a) Discovery.--After an opposition proceeding is instituted 
under this chapter, the patent owner shall have the right to depose 
each person submitting an affidavit or declaration on behalf of any 
opposer, and each opposer shall have the right to depose each person 
submitting an affidavit or declaration on behalf of the patent owner. 
Such depositions shall be limited to cross-examination on matters 
relevant to the affidavit or declaration. No other discovery shall be 
permitted unless the panel determines that additional discovery is 
required in the interest of justice. The panel shall determine the 
schedule for the taking of discovery under this subsection.
    ``(b) Sanctions.--If any party to an opposition proceeding fails to 
properly respond to any discovery under subsection (a), the panel may 
draw appropriate adverse inferences and take other action permitted by 
statute, rule, or regulation.
``Sec. 329. Supplemental submissions
    ``The panel may permit one or more supplemental submissions to be 
made by any party to an opposition proceeding under this chapter, 
subject to the rights and limitations on discovery under section 328.
``Sec. 330. Hearing and briefs
    ``Any party to an opposition proceeding under this chapter may 
request an oral hearing within the time set by the panel. If a hearing 
is requested or the panel determines sua sponte that a hearing is 
needed, the panel shall set a time for the hearing. The panel may 
permit the partied to file briefs for the hearing, and shall permit 
cross-examination of all affiants and declarants in the hearing, either 
before the panel or by deposition taken under section 328.
``Sec. 331. Written decision
    ``The panel shall issue a written decision on each issue of 
patentability with respect to each claim that is the subject of an 
opposition proceeding under this chapter. The written decision shall 
consist of findings of fact and conclusions of law. The written 
decision shall become a final determination of the Office on the issues 
raised in the opposition unless a party to the opposition files a 
request for reconsideration and modification of the written decision 
within a period set by the panel, which shall not be less than two 
weeks from the date of the written decision.
``Sec. 332. Burden of proof and evidence
    ``(a) Burden of Proof.--The opposer in an opposition proceeding 
under this chapter shall have the burden to prove the invalidity of a 
claim by a preponderance of the evidence. The determination of 
invalidity shall be based upon the broadest reasonable construction of 
the claim.
    ``(b) Evidence.--The Federal Rules of Evidence shall apply to the 
opposition proceeding, except to the extent inconsistent with any 
provision of this chapter.
``Sec. 333. Reconsideration
    ``If a request is filed for reconsideration of the written decision 
in an opposition proceeding under this chapter, the panel may authorize 
a party to the proceeding who did not file such a request to file a 
response to the request for reconsideration. Following any 
reconsideration, the panel shall either deny the request for 
modification of the written decision or grant the request and issue a 
modified written decision, which shall constitute the final 
determination of the Office on the issues raised in the opposition 
proceeding.
``Sec. 334. Appeal
    ``A party dissatisfied with the final determination of the panel in 
an opposition proceeding under this chapter may appeal the 
determination under sections 141 through 144. Any party to the 
opposition proceeding shall have the right to be a party to the appeal.
``Sec. 335. Certificate
    ``When a decision of a panel in an opposition proceeding under the 
chapter has become final under section 331, 333, or 334, as the case 
may be, the Director shall issue and publish a certificate in 
accordance with the decision, canceling any claim of the patent 
determined to be unpatentable, and shall incorporate into the patent 
any new or amended claims determined to be patentable. The issuance of 
the certificate shall terminate the opposition proceeding.
``Sec. 336. Estoppel
    ``(a) Estoppel.--
            ``(1) In general.--Subject to paragraph (2), after a 
        certificate has been issued under section 335 in accordance 
        with the decision of the panel in an opposition proceeding, the 
        determination with respect to an issue of invalidity raised by 
        an opposer shall bar that opposer from raising, in any 
        subsequent proceeding involving that opposer under this title, 
        any issue of fact or law actually decided and necessary to the 
        determination of that issue.
            ``(2) Exception.--If an opposer in an opposition proceeding 
        demonstrates, in a subsequent proceeding referred to in 
        paragraph (1), that there is additional factual evidence that 
        is material to an issue of fact actually decided in the 
        opposition proceeding, and necessary to the final determination 
        in the opposition proceeding, that could not reasonably have 
        been discovered or presented in the opposition proceeding by 
        that opposer, the opposer may raise, in that subsequent 
        proceeding, that issue of fact and any determined issue of law 
        for which the issue of fact was necessary.
    ``(b) Expanded Definition of Opposer.--For purposes of this 
section, the term `opposer' includes the person making the request 
under section 321, any real party in interest, and their successors in 
interest.
    ``(c) New Party-in-Interest.--If a proceeding arising by reason of 
additional factual evidence raised under subsection (a)(2) involves a 
real party in interest not identified to the patent owner under section 
322, the real party in interest shall notify the Director and the 
patent owner of that fact and of the proceeding, within 30 days after 
receiving notice that the proceeding has been filed.
``Sec. 337. Duration of opposition
    ``The determination of a panel in an opposition proceeding under 
this chapter, including any determinations pursuant to a request for 
reconsideration under section 133, shall be issued not later than 1 
year after the date on which the opposition proceeding is instituted 
under section 325. Upon good cause shown, the Director may extend the 
1-year period by not more than 6 months.
``Sec. 338. Settlement
    ``(a) In General.--An opposition proceeding under this chapter 
shall be terminated with respect to any opposer upon the joint request 
of the opposer and the patent owner, unless the panel has issued a 
written decision under section 331 before the request for termination 
is filed. If the opposition is terminated with respect to an opposer 
under this section, no estoppel under section 336 shall apply to that 
opposer with respect to an issue of invalidity raised in the opposition 
proceeding. The written decision under section 331 shall thereafter be 
issued only with respect to issues of invalidity raised by opposers 
that remain in the opposition proceeding.
    ``(b) Agreements in Writing.--Any agreement or understanding 
between the patent owner and an opposer, including any collateral 
agreements referred to therein, that is made in connection with or in 
contemplation of the termination of an opposition proceeding under 
subsection (a) shall be in writing. The opposition with respect to the 
parties to the agreement or understanding shall not be terminated until 
a true copy of the agreement or understanding, including any such 
collateral agreements, has been filed in the Patent and Trademark 
Office. If any party filing such an agreement or understanding 
requests, the agreement or understanding shall be kept separate from 
the file of the opposition, and shall be made available only to 
Government agencies on written request, or to any person on a showing 
of good cause.
    ``(c) Discretionary Actions Reviewable.--Any discretionary action 
of the Director under subsection (b) shall be reviewable under chapter 
7 of title 5.
``Sec. 339. Intervening rights
    ``Any proposed amended or new claim determined to be patentable and 
incorporated into a patent following an opposition proceeding under 
this chapter shall have the same effect as that specified in section 
252 of this title for reissued patents on the right of any person who 
made, purchased, or used within the United States, or imported into the 
United States, anything patented by such proposed amended or new claim, 
or who made substantial preparation therefor, before the certificate 
issued under section 335 with respect to that amended or new claim.
``Sec. 340. Relationship with reexamination proceedings
    ``(a) Estoppel.--A patent for which an opposition proceeding has 
been instituted under this chapter may not thereafter be made the 
subject of a request under section 302 or 311 for reexamination, by the 
same opposer or on behalf of the same real party in interest, on the 
same claim and on the same issue that was the basis of the opposition 
proceeding.
    ``(b) Staying of Other Proceedings.--[If, after an opposition 
proceeding has been instituted under this chapter, a request for 
reexamination under section 302 or section 311 is made by or on behalf 
of a person other than the opposer or the same real party in interest, 
such reexamination shall be stayed during the pendency of any 
opposition proceeding under this chapter.]''.
    (b) Clerical Amendment.--The table of chapters for part III of 
title 35, United States Code, is amended by adding at the end the 
following:

``32. Opposition Procedures.................................    321.''.

SEC. 3. PUBLICATION OF PATENT APPLICATIONS.

    Section 122 of title 35, United States Code, is amended by striking 
subsection (c) and redesignating subsection (d) as subsection (c).

SEC. 4. SUBMISSIONS BY THIRD PARTIES.

     Section 131 of title 35, United States Code, is amended--
            (1) by striking ``The Director'' and inserting ``(a) In 
        General.--The Director''; and
            (2) by adding at the end the following:
    ``(b) Third Party Submissions.--Any party shall have the 
opportunity to submit for consideration and for inclusion in the 
record, prior art (including, but not limited to, evidence of knowledge 
or use, or public use or sale, under section 102), to determine whether 
the invention was known or used, or was in public use, or on sale, 
under section 102 or would have been obvious under section 103. The 
Director shall consider such submissions if the request--
            ``(1) is made in writing not later than--
                    ``(A) 6 months after the date on which the patent 
                application is published under section 122, or
                    ``(B) before the date on which a notice of 
                allowance is mailed under section 151 for a patent on 
                the invention,
        whichever occurs first;
            ``(2) is accompanied by the payment of a fee established by 
        the Director under section 41 for third party submissions;
            ``(3) sets forth the teaching and applicability of each 
        reference and the basis on which the submission is offered; and
            ``(4) includes a sworn declaration attesting to the 
        relevance and accuracy of the submissions.
Information submitted under this subsection shall be considered during 
the examination of the patent application.''.

SEC. 5. EFFECT OF NOTICES OF INFRINGEMENT.

    A notice by a patent holder alleging infringement of the patent 
shall not be deemed sufficient to subject a recipient of the notice to 
liability for willful infringement of the patent unless the notice 
would cause the recipient to have standing in a proceeding pursuant to 
a motion for declaratory judgment with respect to the subject matter of 
the notice.

SEC. 6. INJUNCTIONS.

     Section 283 of title 35, United States Code, is amended--
            (1) by striking ``The several'' and inserting ``(a) In 
        General.--The several''; and
            (2) by adding at the end the following:
    ``(b) Grounds for Granting Injunction.--A court shall not grant an 
injunction under this section unless it finds that the patentee is 
likely to suffer irreparable harm that cannot be remedied by payment of 
money damages. In making or rejecting such a finding, the court shall 
not presume the existence of irreparable harm, but rather the court 
shall consider and weigh evidence, if any, tending to establish or 
negate any equitable factor relevant to a determination of the 
existence of irreparable harm, including, but not limited to, the 
extent to which the patentee makes use of the technology claimed by the 
patent.''.

SEC. 7. INTER PARTES REEXAMINATION.

    (a) Estoppel Provision.--Section 315(c) of title 35, United States 
Code, is amended by striking ``or could have raised''.
    (b) Applicability.--Notwithstanding section 4608(a) of the 
Intellectual Property and Communications Reform Act of 1999, as enacted 
by section 1000(a)(9) of Public Law 106-113 (41 U.S.C. note), sections 
311 through 318 of title 35, United States Code, as amended by this 
section, shall apply to any patent that issues from an original 
application filed before, on, or after November 29, 1999.

SEC. 8. NONOBVIOUSNESS.

    Section 103 of title 35, United States Code, is amended by adding 
at the end the following:
    ``(d)(1) A business method invention shall be presumed obvious 
under this section if the only significant difference between the 
combined teachings of the prior art and the claimed invention is that 
the claimed invention is appropriate for use with a computer 
technology, unless--
            ``(A) the application of the computer technology is novel; 
        or
            ``(B) the computer technology is novel and not the subject 
        of another patent or patent application.
    ``(2)(A) An applicant or patentee may rebut the presumption under 
paragraph (1) upon a showing by a preponderance of the evidence that 
the invention is not obvious to persons of ordinary skill in all 
relevant arts.
    ``(B) Those areas of art which are relevant for purposes of 
subparagraph (A) include the field of the business method and the field 
of the computer implementation.''.

SEC. 9. CONFORMING AMENDMENTS.

    (a) Definitions.--Section 100(e) of title 35, United States Code, 
is amended by striking ``or inter partes reexamination under section 
311'' and inserting ``inter partes reexamination under section 311, or 
an opposition under section 321,''.
    (b) Appeal to Court of Appeals.--(1) Section 141 of title 35, 
United States Code, is amended in the first sentence, by inserting ``or 
a final determination of a panel of administrative patent judges under 
chapter 32 of this title'' after ``134 of this title''.
    (2) Section 143 of title 35, United States Code, is amended by 
inserting after the third sentence the following: ``In any opposition 
proceeding, the panel of administrative patent judges making the 
determination in the proceeding shall submit to the court in writing 
the grounds for the decision of the panel, addressing all the issues 
involved in the appeal.''

SEC. 10. EFFECTIVE DATE.

    Except as provided in section 7(b), the amendments made by this Act 
shall apply to patents issued, and applications for patent that are 
made, on and after the date of the enactment of this Act.
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