[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2795 Introduced in House (IH)]






109th CONGRESS
  1st Session
                                H. R. 2795

  To amend title 35, United States Code, relating to the procurement, 
                 enforcement, and validity of patents.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              June 8, 2005

    Mr. Smith of Texas (for himself, Mr. Berman, Mr. Goodlatte, Mr. 
  Boucher, Ms. Zoe Lofgren of California, Mr. Cannon, Mr. Schiff, Mr. 
Issa, Mr. Conyers, and Mr. Coble) introduced the following bill; which 
             was referred to the Committee on the Judiciary

_______________________________________________________________________

                                 A BILL


 
  To amend title 35, United States Code, relating to the procurement, 
                 enforcement, and validity of patents.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Patent Reform Act 
of 2005''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Reference to title 35, United States Code.
Sec. 3. Right of the first inventor to file.
Sec. 4. Right to a patent.
Sec. 5. Duty of candor.
Sec. 6. Right of the inventor to obtain damages.
Sec. 7. Injunctions.
Sec. 8. Continuation applications.
Sec. 9. Post-grant procedures and other quality enhancements.
Sec. 10. Submissions by third parties.
Sec. 11. Applicability; transitional provisions.

SEC. 2. REFERENCE TO TITLE 35, UNITED STATES CODE.

    Whenever in this Act a section or other provision is amended or 
repealed, that amendment or repeal shall be considered to be made to 
that section or other provision of title 35, United States Code.

SEC. 3. RIGHT OF THE FIRST INVENTOR TO FILE.

    (a) Definitions.--Section 100 is amended by adding at the end the 
following:
    ``(f) The term `inventor' means the individual or, if a joint 
invention, the individuals collectively who invented or discovered the 
subject matter of the invention.
    ``(g) The terms `joint inventor' and `coinventor' mean any one of 
the individuals who invented or discovered the subject matter of a 
joint invention.
    ``(h) The `effective filing date' of a claimed invention is--
            ``(1) the filing date of the patent or the application for 
        patent containing the claim to the invention; or
            ``(2) if the patent or application for patent is entitled 
        to a right of priority of any other application under section 
        119, 365(a), or 365(b) or to the benefit of an earlier filing 
        date in the United States under section 120, 121, or 365(c), 
        the filing date of the earliest such application in which the 
        claimed invention is disclosed in the manner provided by the 
        first paragraph of section 112 of this title.
    ``(i) The term `claimed invention' means the subject matter defined 
by a claim in a patent or an application for a patent.''.
    (b) Conditions for Patentability.--
            (1) In general.--Section 102 is amended to read as follows:
``Sec. 102. Conditions for patentability; novelty
    ``(a) Novelty; Prior Art.--A patent for a claimed invention may not 
be obtained if--
            ``(1) the claimed invention was patented, described in a 
        printed publication, or otherwise publicly known--
                    ``(A) more than one year before the effective 
                filing date of the claimed invention; or
                    ``(B) before the effective filing date of the 
                claimed invention, other than through disclosures made 
                by the inventor or a joint inventor or by others who 
                obtained the subject matter disclosed directly or 
                indirectly from the inventor or a joint inventor; or
            ``(2) the claimed invention was described in a patent 
        issued under section 151, or in an application for patent 
        published or deemed published under section 122(b), in which 
        the patent or application, as the case may be, names another 
        inventor and was effectively filed before the effective filing 
        date of the claimed invention.
    ``(b) Limitation on Prior Art.--
            ``(1) Commonly assigned invention exception.--Subject 
        matter that would otherwise qualify as prior art only under 
        subsection (a)(2) shall not be prior art to a claimed invention 
        if the subject matter and the claimed invention were, not later 
        than the effective filing date of the claimed invention, owned 
        by the same person or subject to an obligation of assignment to 
        the same person.
            ``(2) Joint research agreement exception.--
                    ``(A) Exception.--Subject matter that would 
                otherwise qualify as prior art only under subsection 
                (a)(2) shall not be prior art for purposes of section 
                103 to a claimed invention if--
                            ``(i) the claimed invention was made by or 
                        on behalf of parties to a joint research 
                        agreement that was in effect on or before the 
                        effective filing date of the claimed invention;
                            ``(ii) the subject matter was developed and 
                        the claimed invention was made as a result of 
                        activities undertaken within the scope of the 
                        joint research agreement; and
                            ``(iii) the application for patent for the 
                        claimed invention discloses or is amended to 
                        disclose the names of the parties to the joint 
                        research agreement.
                    ``(B) Definition.--For purposes of subparagraph 
                (A), the term `joint research agreement' means a 
                written contract, grant, or cooperative agreement 
                entered into by two or more persons or entities for the 
                performance of experimental, developmental, or research 
                work in the field of the claimed invention.
            ``(3) Reasonable and effective accessibility requirement.--
                    ``(A) In general.--Subject matter is publicly known 
                for the purposes of subsection (a)(1) only when--
                            ``(i) it becomes reasonably and effectively 
                        accessible through its use, sale, or disclosure 
                        by other means; or
                            ``(ii) it is embodied in or otherwise 
                        inherent in subject matter that has become 
                        reasonably and effectively accessible.
                    ``(B) Reasonable and effective accessibility.--For 
                purposes of subparagraph (A)--
                            ``(i) subject matter is reasonably 
                        accessible if persons of ordinary skill in the 
                        art to which the subject matter pertains are 
                        able to gain access to the subject matter by 
                        without resort to undue efforts; and
                            ``(ii) subject matter is effectively 
                        accessible if persons of ordinary skill in the 
                        art to which the subject matter pertains are 
                        able to comprehend the content of the subject 
                        matter without resort to undue efforts.
            ``(4) Patents and published applications effectively 
        filed.--A patent or application for patent is effectively filed 
        under subsection (a)(2) with respect to any subject matter 
        described in the patent or application--
                    ``(A) as of the filing date of the patent or the 
                application for patent; or
                    ``(B) if the patent or application for patent is 
                entitled to claim a right of priority under section 
                119, 365(a), or 365(b) or to claim the benefit of an 
                earlier filing date under section 120, 121, or 365(c), 
                based upon one or more prior filed applications for 
                patent, as of the filing date of the earliest such 
                application that describes the subject matter.''.
            (2) Conforming amendment.--The item relating to section 102 
        in the table of sections for chapter 10 is amended to read as 
        follows:

``102. Conditions for patentability; novelty.''.
    (c) Conditions for Patentability; Non-Obvious Subject Matter.--
Section 103 is amended--
            (1) by striking subsections (b) and (c); and
            (2) in subsection (a)--
                    (A) by striking ``(a) A patent may not be obtained 
                through the invention'' and inserting ``A patent for a 
                claimed invention may not be obtained through the 
                claimed invention''; and
                    (B) by striking ``at the time the invention was 
                made'' and inserting ``before the effective filing date 
                of the claimed invention''.
    (d) Repeal of Requirements for Inventions Made Abroad.--Section 
104, and the item relating to that section in the table of sections for 
chapter 10, are repealed.
    (e) Repeal of Statutory Invention Registration.--Section 157, and 
the item relating to that section in the table of sections for chapter 
14, are repealed.
    (f) Earlier Filing Date for Inventor and Joint Inventor.--Section 
120 is amended by striking ``which is filed by an inventor or inventors 
named'' and inserting ``which names an inventor or joint inventor''.
    (g) Conforming Amendments.--
            (1) Right of priority.--Section 172 is amended by striking 
        ``and the time specified in section 102(d)''.
            (2) Limitation on remedies.--Section 287(c)(4) is amended 
        by striking ``the earliest effective filing date of which is 
        prior to'' and inserting ``which has an effective filing date 
        before''.
            (3) International application designating the united 
        states: effect.--Section 363 is amended by striking ``except as 
        otherwise provided in section 102(e) of this title''.
            (4) Publication of international application: effect.--
        Section 374 is amended by striking ``sections 102(e) and 
        154(d)'' and inserting ``section 154(d)''.
            (5) Patent issued on international application: effect.--
        The second sentence of section 375(a) is amended by striking 
        ``Subject to section 102(e) of this title, such'' and inserting 
        ``Such''.
            (6) Limit on right of priority.--Section 119(a) is amended 
        by striking ``; but no patent shall be granted'' and all that 
        follows through ``one year prior to such filing''.
            (7) Inventions made with federal assistance.--Section 
        202(c) is amended--
                    (A) in paragraph (2)--
                            (i) by striking ``publication, on sale, or 
                        public use,'' and all that follows through 
                        ``obtained in the United States'' and inserting 
                        ``the 1-year period referred to in section 
                        102(a) would end before the end of such 2-year 
                        period''; and
                            (ii) by striking ``the statutory'' and 
                        inserting ``the 1-year''; and
                    (B) in paragraph (3), by striking ``any statutory 
                bar date that may occur under this title due to 
                publication, on sale, or public use'' and inserting 
                ``the expiration of the 1-year period referred to in 
                section 102(a)''.
    (h) Repeal of Interfering Patent Remedies.--Section 291, and the 
item relating to that section in the table of sections for chapter 29, 
are repealed.
    (i) Inventor's Rights Contests.--Section 135(a) is amended to read 
as follows:
    ``(a) Dispute Over Right to Patent.--
            ``(1) Institution of inventor's rights contest.--Whenever 
        patents or applications for patent naming different individuals 
        as the inventor are deemed by the Director to interfere because 
        of a dispute over the right to patent under section 101, the 
        Director shall institute an inventor's rights contest for the 
        purpose of determining the right to patent.
            ``(2) Determination by board of patent appeals.--The Board 
        of Patent Appeals--
                    ``(A) shall determine the question of the right to 
                patent;
                    ``(B) in appropriate circumstances, may correct the 
                naming of the inventor in any application or patent at 
                issue; and
                    ``(C) shall issue a final decision on the right to 
                patent.
            ``(3) Effect of final decision.--The final decision of the 
        Board of Patent Appeals under paragraph (2), if adverse to the 
        claim of an applicant, shall constitute the final refusal by 
        the Patent and Trademark Office on the claims involved. The 
        Director may issue a patent to an applicant who is adjudged to 
        have the right to patent. The final decision of the Board, if 
        adverse to a patentee, shall, if no appeal or other review of 
        the decision has been or can be taken or had, constitute 
        cancellation of the claims involved in the patent, and notice 
        of such cancellation shall be endorsed on copies of the patent 
        distributed after such cancellation by the Patent and Trademark 
        Office.''.
    (j) Board of Patent Appeals.--
            (1) Elimination of references to interferences.--(A) 
        Sections 6, 41, 134, 141, 145, 146, 154, 305, and 314 are each 
        amended by striking ``Board of Patent Appeals and 
        Interferences'' each place it appears and inserting ``Board of 
        Patent Appeals''.
            (B) Sections 135, 141, 146, and 154 are each amended by 
        striking ``interference'' each place it appears and inserting 
        ``inventor's rights contest''.
            (C) The section heading for section 6 is amended to read as 
        follows:
``Sec. 6. Board of Patent Appeals''.
            (D) The section heading for section 134 is amended to read 
        as follows:
``Sec. 134. Appeal to the Board of Patent Appeals''.
            (E) The section heading for section 135 is amended to read 
        as follows:
``Sec. 135. Inventor's rights contests''.
            (F) The section heading for section 146 is amended to read 
        as follows:
``Sec. 146. Civil action in case of inventor's rights contest''.
            (G) Section 154(b)(1)(C) is amended by striking 
        ``interferences'' and inserting ``inventor's rights contests''.
            (H) The item relating to section 6 in the table of sections 
        for chapter 1 is amended to read as follows:

``6. Board of Patent Appeals.''.
            (I) The items relating to sections 134 and 135 in the table 
        of sections for chapter 12 are amended to read as follows:

``134. Appeal to the Board of Patent Appeals.
``135. Inventor's rights contests.''.
            (J) The item relating to section 146 in the table of 
        sections for chapter 13 is amended to read as follows:

``146. Civil action in case of inventor's rights contest.''.
            (2) Technical and conforming amendments.--Section 135(c) is 
        amended--
                    (A) by striking ``(c) Any'' and inserting ``(c)(1) 
                Any'';
                    (B) in the second paragraph, by striking ``The 
                Director'' and inserting ``(2) The Director''; and
                    (C) in the third paragraph, by striking ``Any 
                discretionary'' and inserting ``(3) Any 
                discretionary''.

SEC. 4. RIGHT TO A PATENT.

    (a) Right to Patent.--
            (1) In general.--Section 101 is amended to read as follows:
``Sec. 101. Right to patent; subject matter eligible for patenting
    ``The inventor of any new and useful process, machine, manufacture, 
or composition of matter, or any new and useful improvement thereof, 
has the right to apply for and to obtain a patent therefor, subject to 
the conditions and requirements of this title.''.
            (2) Conforming amendment.--The item relating to section 101 
        in the table of sections for chapter 10 is amended to read as 
        follows:

``101. Right to patent; subject matter eligible for patenting.''.
    (b) Oath of Applicant.--Section 115 is amended to read as follows:
``Sec. 115. Oath of applicant
    ``The Director may require the applicant to make an oath setting 
forth particulars relating to the inventor and the invention.''.
    (c) Filing by Other Than Inventor.--Section 118 is amended to read 
as follows:
``Sec. 118. Filing by other than inventor
    ``A person to whom the inventor has assigned or is under an 
obligation to assign the invention may make an application for patent. 
A person who otherwise shows sufficient proprietary interest in the 
matter may make an application for patent on behalf of and as agent for 
the inventor on proof of the pertinent facts and a showing that such 
action is appropriate to preserve the rights of the parties. If the 
Director grants a patent on an application filed under this section by 
a person other than the inventor, the patent shall be granted to the 
real party in interest and upon such notice to the inventor as the 
Director considers to be sufficient.''.
    (d) Specification.--Section 112 is amended--
            (1) in the first paragraph--
                    (A) by striking ``The specification'' and inserting 
                ``(a) In General.--The specification''; and
                    (B) by striking ``, and shall set forth the best 
                mode contemplated by the inventor of carrying out his 
                invention'';
            (2) in the second paragraph--
                    (A) by striking ``The specifications'' and 
                inserting ``(b) Conclusion.--The specification''; and
                    (B) by striking ``applicant regards as his 
                invention'' and inserting ``inventor or a joint 
                inventor regards as the invention'';
            (3) in the third paragraph, by striking ``A claim'' and 
        inserting ``(c) Form.--A claim'';
            (4) in the fourth paragraph, by striking ``Subject to the 
        following paragraph,'' and inserting ``(d) Reference in 
        Dependent Forms.--Subject to subsection (e),'';
            (5) in the fifth paragraph, by striking ``A claim'' and 
        inserting ``(e) Reference in Multiple Dependent Form.--A 
        claim''; and
            (6) in the last paragraph, by striking ``An element'' and 
        inserting ``(f) Element in Claim for a Combination.--An 
        element''.

SEC. 5. DUTY OF CANDOR.

    (a) In General.--Chapter 12 of title 35, United States Code, is 
amended by adding at the end the following:
``Sec. 136. Duty of candor: patents and applications for patent
    ``(a) Duty.--The Director shall by regulation impose a duty of 
candor and good faith on individuals associated with the filing and 
prosecution of an application for patent and on individuals assisting a 
patent owner in proceedings before the Office involving a patent. The 
duty shall require each such individual to timely disclose information 
known to that individual to be material to any issue before the Office 
in connection with the application or patent, and to not materially 
misrepresent information. The duty may further address the types of 
information for which disclosure is required and the standards upon 
which a finding of misrepresentation or concealment on the part of such 
individuals could be based. Any allegation of any type of violation of 
the duty of candor and good faith under this subsection shall be 
governed exclusively by this chapter.
    ``(b) Violation.--Any individual who is subject to the duty of 
candor and good faith under subsection (a) and who, with the intent to 
deceive or mislead, knowingly fails to disclose material information or 
knowingly and materially misrepresents information has engaged in 
misconduct under this section, if the Director or a court under 
subsection (d), as the case may be, finds, by clear and convincing 
evidence, that--
            ``(1) the individual failed to disclose information or 
        misrepresented information;
            ``(2) the information not disclosed was material or, in the 
        case of a misrepresentation, the misrepresentation was 
        material;
            ``(3) the individual had knowledge of the materiality of 
        the information not disclosed or, in the case of a 
        misrepresentation, of the misrepresentation and materiality of 
        the misrepresentation; and
            ``(4) the individual had the intent to deceive or mislead.
    ``(c) Adjudication by the Office.--
            ``(1) Other fora precluded.--No court or Federal department 
        or agency other than the Office, and no other Federal or State 
        governmental entity, may investigate or make a determination or 
        an adjudication with respect to an alleged violation of the 
        duty of candor and good faith under subsection (a) or with 
        respect to an alleged fraud, inequitable conduct, or other 
        misconduct in any proceeding before the Office involving a 
        patent or in connection with the filing or examination of an 
        application for patent, except as expressly permitted in this 
        section.
            ``(2) Exception regarding pending applications.--Nothing in 
        this subsection shall limit the authority of the Director to 
        enforce regulations concerning pending applications for patent, 
        including regulations relating to misconduct.
            ``(3) Limitation on defenses to enforcement of patent.-- No 
        defense of invalidity of a patent or other defense to the 
        enforcement of a patent may be based in whole or in part upon a 
        violation of the duty of candor and good faith under subsection 
        (a) or on any fraud, inequitable conduct, or other misconduct, 
        except as expressly permitted in this section.
            ``(4) Referral by court.--In any matter before a court 
        involving an issue of validity or infringement of a patent, if 
        the court determines that an issue of possible misconduct under 
        subsection (b) exists, the court shall refer the matter to the 
        Office for investigation and sanctions under this section. If 
        such referral is made, the matter shall be resolved as provided 
        in this section.
    ``(d) Unenforceability Action.--
            ``(1) In general.--A patent may be held unenforceable if a 
        court determines, pursuant to a pleading permitted under 
        paragraph (2), that--
                    ``(A) misconduct under subsection (b) has occurred 
                and constitutes fraud by reason of reliance by the 
                Office on the misconduct which has resulted in the 
                issuance of, or a certificate affirming patentability 
                of, one or more invalid claims in a patent; and
                    ``(B) the fraud is attributable to the patent 
                owner.
            ``(2) Required motion to plead unenforceability.--The 
        defense of unenforceability described in paragraph (1) may be 
        pled in an action before a court only upon a motion to amend 
        the pleadings in the action. The court shall not grant the 
        motion unless--
                    ``(A) the validity of one or more claims in the 
                patent is at issue in the action;
                    ``(B) the court has previously entered a judgment 
                in the action that a claim in the patent is invalid;
                    ``(C) the motion to amend the pleadings is brought 
                by a party to the action adverse to the patent owner 
                within 3 months after a judgment is entered by the 
                court invalidating the claim; and
                    ``(D) the motion sets out with particularity a 
                substantial basis for findings that--
                            ``(i) because of the reliance of the Office 
                        on the misconduct, fraud took place in a 
                        proceeding before the Office involving the 
                        patent or in connection with the filing or 
                        examination of the application for patent, and 
                        as a result at least 1 claim in the patent 
                        invalidated in the action was issued as a 
                        result of the reliance on the misconduct; and
                            ``(ii) the alleged fraud is attributable to 
                        the patent owner.
            ``(3) Required findings for unenforceability.--
                    ``(A) Liability of patent owner.--In determining 
                the unenforceability of a patent, no misconduct under 
                subsection (b) by an individual registered to practice 
                before the Office and acting in a representative 
                capacity before the Office in a proceeding before the 
                Office involving the patent or in connection with the 
                filing or examination of the application for patent 
                shall be attributable to the patent owner unless the 
                patent owner, or another individual who--
                            ``(i) is subject to the duty of candor and 
                        good faith with respect to the patent,
                            ``(ii) is not registered to practice before 
                        the Office, and
                            ``(iii) was acting on the patent owner's 
                        behalf,
                is determined to have violated the duty of candor and 
                good faith.
                    ``(B) Reliance of the patent examiner.--No 
                misconduct may be determined to constitute fraud 
                sufficient to support a finding that a patent is 
                unenforceable without clear and convincing evidence of 
                reliance of the Office on the alleged misconduct, 
                resulting in the issuance of a claim invalidated by the 
                court because a competent patent examiner either--
                            ``(i) would not have issued the invalidated 
                        claim, acting reasonably, in the absence of the 
                        misconduct; or
                            ``(ii) based upon the prosecution history 
                        as a whole objectively considered, would have 
                        done so based upon in whole or in part on 
                        account of the misconduct.
    ``(e) Investigation of Misconduct.--
            ``(1) In general.--The Director shall establish a special 
        office with authority to investigate possible violations of the 
        duty of candor and good faith, including possible misconduct, 
        in a proceeding before the Office involving a patent or in 
        connection with the filing or examination of an application for 
        patent, in cases in which such matters are referred to the 
        Office for investigation under subsection (c)(4). The special 
        office shall, following such referral, commence an 
        investigation into possible violations of the duty . After such 
        an investigation is begun, any subsequent decision to maintain 
        the investigation or abandon the investigation may be made only 
        by the Director, and such decision may not be appealed or 
        reviewed.
            ``(2) Procedures.--
                    ``(A) Subpoenas.--During the period in which a 
                misconduct investigation is conducted under paragraph 
                (1), the matter shall be a contested case in the Office 
                and the Director may seek evidence or other information 
                through subpoenas under section 24.
                    ``(B) Notice; subject parties.--The Director shall 
                provide written notice to the patent owner of the 
                commencement of the investigation and may provide such 
                written notice to persons who were owners of the patent 
                or application for patent (or persons to whom the 
                patent or application for patent was subject to an 
                obligation of assignment) at the time the conduct that 
                is the subject of the investigation occurred. Any 
                person receiving written notice under this subparagraph 
                shall be designated as a `subject party.' The Director 
                shall provide written notice under this subparagraph of 
                an investigation before seeking any evidence under 
                section 24, but otherwise at such time as the Director 
                shall determine. Upon providing such written notice to 
                the subject parties, the Director shall publish a 
                notice of the commencement of the investigation in the 
                Federal Register.
                    ``(C) Obtaining evidence.--Upon request of a 
                subject party, the Director shall determine the manner 
                in which to allow a subject party to obtain evidence of 
                potential relevance, including by authorizing the 
                subject party to seek subpoenas under section 24.
                    ``(D) Preliminary determination.--The Director, at 
                the earliest practicable time after the date on which 
                notice of the investigation is published under 
                subparagraph (B), shall conclude the investigation and 
                make a preliminary determination on the issues under 
                investigation. The Director shall, within 45 days after 
                an investigation is begun, establish a target date for 
                rendering a preliminary determination.
                    ``(E) Consultation with other departments and 
                agencies.--During the course of each investigation 
                under this section and section 137, the Director may 
                consult with, seek advice and information from, and 
                otherwise obtain assistance from the Attorney General, 
                the Federal Trade Commission, the International Trade 
                Commission, the Securities and Exchange Commission, and 
                the heads of such other departments and agencies as the 
                Director considers appropriate.
            ``(3) Notice of determination.--
                    ``(A) If no misconduct found.--If the Director 
                determines in an investigation under paragraph (2) that 
                there is no basis for concluding that misconduct under 
                subsection (b) has occurred, the Director shall provide 
                written notice of such determination to each of the 
                subject parties not later than 1 month after the 
                conclusion of the investigation. A determination of the 
                Director under this subparagraph is final and may not 
                be appealed.
                    ``(B) If misconduct may have occurred.--If the 
                Director makes a preliminary determination in an 
                investigation under paragraph (2) that misconduct under 
                subsection (b) may have occurred, the Director shall 
                provide written notice of the preliminary determination 
                to each of the subject parties not later than 1 month 
                after the conclusion of the investigation. Such written 
                notice shall provide a description with particularity 
                of the separate acts alleged to constitute such 
                possible misconduct. The Director shall afford the 
                subject parties an opportunity to respond to the 
                preliminary determination and a period of time within 
                which to reach a settlement of the issue before taking 
                any further action.
            ``(4) Final determination; appeal to board.--
                    ``(A) In general.--If a matter relating to possible 
                misconduct is not settled under paragraph (3), the 
                preliminary determination shall become final and may 
                not be appealed unless 1 or more of the subject parties 
                contests the preliminary determination by requesting a 
                hearing on the matter, within 2 months after the end of 
                the settlement period provided under paragraph (3)(B), 
                before a panel of the Board of Patent Appeals.
                    ``(B) Hearing.--If a hearing is timely requested 
                under subparagraph (A), the hearing shall provide the 
                Director and the patent owner an opportunity to present 
                evidence and arguments.
                    ``(C) Determination of panel.--The panel shall, not 
                later than 1 year after the date of the request by 1 or 
                more of the subject parties for a hearing under 
                subparagraph (B), issue a written determination 
                containing findings of facts and conclusions of law on 
                the matters before it. If the written determination by 
                the panel concludes that one or more alleged violations 
                of the duty of candor and good faith do not constitute 
                acts of misconduct, then the determination is final 
                with respect to such issues of possible misconduct and 
                may not be appealed, and no penalty shall be imposed 
                with respect to such issues. If the written 
                determination by the panel concludes that one or more 
                alleged violations of the duty of candor and good faith 
                do constitute acts of misconduct, then the decision of 
                the panel shall represent a final determination of the 
                Office on the matters involved.
            ``(5) Notice of final determination.--If a matter of 
        possible misconduct is not settled or otherwise terminated 
        following the opportunity for settlement and hearing under 
        paragraphs (3) and (4), the Director shall notify the subject 
        parties in writing of the final determination on the matter 
        under paragraph (4), setting forth--
                    ``(A) the factual findings of the investigation;
                    ``(B) the legal conclusions reached;
                    ``(C) a description of each separate act of 
                misconduct determined to have taken place;
                    ``(D) the amount of any civil monetary penalty 
                imposed against the subject parties under paragraph 
                (6); and
                    ``(E) a deadline for payment of any penalty 
                imposed, which may not be earlier than 6 months after 
                the date on which the notice is provided to the patent 
                owner under this paragraph of the final determination.
            ``(6) Penalty amount.--
                    ``(A) In general.--Subject to the limitations of 
                this paragraph, the Director may impose civil monetary 
                penalties on each subject party for each act of 
                misconduct of which notice is given under paragraph 
                (5), in amounts that the Director considers sufficient 
                in the Director's discretion to act as a deterrent to 
                future such violations of the duty of candor and good 
                faith under this section, taking into account the 
                totality of the circumstances in each individual case.
                    ``(B) Limitation on amount.--The amount of a civil 
                penalty imposed under subparagraph (A) may not exceed 
                $1,000,000 for each separate act of misconduct, except 
                that in a case in which the violation of the duty of 
                candor and good faith is found to be the result of 
                fraudulent or other particularly egregious misconduct, 
                the penalty imposed may not exceed $5,000,000 for such 
                act of misconduct. In an exceptional case, the Director 
                may impose an additional penalty in an amount equal to 
                the costs incurred by the Director in conducting the 
                investigation.
                    ``(C) Limitation on parties on which penalties may 
                be imposed.--No penalty based upon an act of misconduct 
                may be imposed under subparagraph (A) on a subject 
                party other than the patent owner unless the subject 
                party was the owner of a claimed invention in the 
                patent or application for patent (or entitled to an 
                assignment thereof), at the time the act of misconduct 
                giving rise to the penalty occurred. Unless otherwise 
                specified in the final determination, subject parties 
                shall be jointly and severally liable for any penalty 
                imposed.
            ``(7) Tolling of penalty; failure of timely payment.--The 
        deadline for payment of any penalty imposed shall be tolled 
        during the pendency of an appeal brought by a subject party 
        under paragraph (8). If the patent owner fails to make timely 
        payment of any penalty imposed on the patent owner, including 
        any penalty for which the patent owner is jointly liable, 
        before the expiration of the deadline provided under paragraph 
        (5)(E), the failure to pay the penalty constitutes a disclaimer 
        of all enforceable rights in each patent involved in the 
        violation of the duty of candor and good faith for which the 
        penalty was imposed.
            ``(8) Appeal.--A subject party dissatisfied with the final 
        determination of the Director under this section may, unless 
        the penalty has been paid pursuant to the final determination, 
        appeal the determination under sections 141 through 144.
    ``(f) Other Actions not Subject to Preemption.--Nothing in this 
section shall in any manner operate to--
            ``(1) prevent or otherwise obstruct a criminal 
        investigation or supersede any criminal law, or any penalty 
        imposed pursuant thereto, in connection with any matter 
        involving a patent or application for patent;
            ``(2) limit the ability of the courts of any State or the 
        District of Columbia to investigate and make determinations 
        with respect to issues of attorney malpractice and impose 
        sanctions on an attorney for malpractice; or
            ``(3) limit the ability of any entity before which an 
        individual is registered or otherwise entitled to practice a 
        profession to investigate and sanction such individual based 
        upon professional misconduct.
    ``(g) Actions Based Upon Prior Misconduct Adjudication.--If a 
final, nonappealable adjudication of misconduct has been made based 
upon a criminal action not subject to preemption under subsection 
(f)(1), a fraud pleading described in subsection (d), or a misconduct 
proceeding instituted pursuant to a referral described in subsection 
(e)(1), such adjudication of misconduct may be used as a basis for 
pursuing further remedies under any Federal or State law, including 
common law, except that nothing in this subsection shall authorize any 
investigation or determination of misconduct that is otherwise 
preempted under this section.
``Sec. 137. Duty of candor: parties adverse to a patent or application
    ``(a) Duty.--The Director shall prescribe by regulation a duty of 
candor and good faith applicable to individuals who are parties adverse 
to a patent or application for patent in contested cases before the 
Office. The duty shall apply to individuals associated with such a 
proceeding on behalf of a party adverse to the patent or application. 
Each such individual shall timely disclose information known to that 
individual to be material to issues raised or responded to by the 
adverse party on whose behalf the individual is involved and shall not 
materially misrepresent information.
    ``(b) Misconduct.--Misconduct under this section shall be defined 
with respect to individuals described in subsection (a) in the same 
manner as that provided in section 136(b) with respect to individuals 
under that section. The Director may conduct an investigation of 
possible misconduct by an individual based upon a violation of the duty 
described in subsection (a) in the manner provided in section 136(e), 
except that the written notice described in section 136(e)(2)(B) shall 
be given by the Director to each party on whose behalf an individual is 
acting who is being investigated for possible violation of the duty of 
candor and good faith under this section. The persons receiving such 
written notice shall be the subject parties of the investigation. If, 
on the basis of an investigation the Director determines that there is 
a basis for concluding that a violation of the duty that amounts to 
misconduct may have occurred, the Director shall provide written notice 
of the preliminary determination to each subject party and shall afford 
the subject party an opportunity to reach a settlement of the issue 
before taking any further action.
    ``(c) Penalties.--If an issue of misconduct arising from a possible 
violation of the duty of candor and good faith under this section is 
not settled or otherwise terminated following the opportunity for 
settlement and hearing described in subsection (b), the Director may 
impose a civil monetary penalty against the subject parties. The 
procedures described in section 136(e) shall be followed in imposing a 
civil penalty under this subsection, except that the maximum civil 
monetary penalty that may be imposed on a subject party under this 
section may not exceed $500,000.''.
    (b) Table of Sections.--The table of sections for chapter 12 is 
amended by adding at the end the following new items:

``136. Duty of candor: patents and applications for patent.
``137. Duty of candor: parties adverse to a patent or application.''.
    (c) Removal of Deceptive Intent Restriction.--
            (1) Inventor.--
                    (A) In general.--The third paragraph of section 116 
                is amended--
                            (i) by striking ``Whenever'' and inserting 
                        ``(c) Correction of Errors in Application.--
                        Whenever''; and
                            (ii) by striking ``, and such error arose 
                        without any deceptive intention on his part''.
                    (B) Correction of named inventor.--Section 256 is 
                amended--
                            (i) in the first paragraph--
                                    (I) by striking ``Whenever'' and 
                                inserting ``(a) Correction.--
                                Whenever''; and
                                    (II) by striking ``and such error 
                                arose without any deceptive intention 
                                on his part''; and
                            (ii) in the second paragraph, by striking 
                        ``The error'' and inserting ``(b) Patent Valid 
                        If Error Corrected.--The error''.
            (2) Filing.--
                    (A) Filing of application in foreign country.--The 
                first paragraph of section 184 is amended--
                            (i) by striking ``Except when'' and 
                        inserting ``(a) Filing in Foreign Country.--
                        Except when''; and
                            (ii) by striking ``and without deceptive 
                        intent''.
                    (B) Patent barred for filing without license.--
                Section 185 is amended by striking ``and without 
                deceptive intent''.
            (3) Reissue of defective patents.--The first paragraph of 
        section 251 is amended--
                    (A) by striking ``Whenever'' and inserting ``(a) In 
                General.--Whenever''; and
                    (B) by striking ``, through error without any 
                deceptive intention,''.
            (4) Disclaimer.--The first paragraph of section 253 is 
        amended--
                    (A) by striking ``Whenever'' and inserting ``(a) In 
                General.--Whenever''; and
                    (B) by striking ``, without any deceptive 
                intention,''.
            (5) Action for infringement.--Section 288 is amended by 
        striking ``, without deceptive intention,''.
    (d) Technical Amendments.--(1) Section 116 is amended--
            (A) in the first paragraph, by striking ``When'' and 
        inserting ``(a) Joint Inventions.--When''; and
            (B) in the second paragraph, by striking ``If a joint 
        inventor'' and inserting ``(b) Omitted Inventor.--If a joint 
        inventor''.
    (2) Section 184 is amended--
            (A) in the second paragraph, by striking ``The term'' and 
        inserting ``(b) Application.--The term''; and
            (B) in the third paragraph, by striking ``The scope'' and 
        inserting ``(c) Subsequent Modifications, Amendments, and 
        Supplements.--The scope''.
    (3) Section 251 is amended--
            (A) in the second paragraph, by striking ``The Director'' 
        and inserting ``(b) Multiple Reissued Patents.--The Director'';
            (B) in the third paragraph, by striking ``The provision'' 
        and inserting ``(c) Applicability of This Title.--The 
        provisions''; and
            (C) in the last paragraph, by striking ``No reissued 
        patent'' and inserting ``(d) Reissue Patent Enlarging Scope of 
        Claims.--No reissued patent''.
    (4) Section 253 is amended in the second paragraph, by striking 
``in like manner'' and inserting ``(b) Additional Disclaimer or 
Dedication.--In the manner set forth in subsection (a),''.

SEC. 6. RIGHT OF THE INVENTOR TO OBTAIN DAMAGES.

    Section 284 is amended--
            (1) in the first paragraph--
                    (A) by striking ``Upon'' and inserting ``(a) Award 
                of Damages.--Upon''; and
                    (B) by adding at the end the following: ``In 
                determining a reasonable royalty in the case of a 
                combination, the court shall consider, if relevant and 
                among other factors, the portion of the realizable 
                profit that should be credited to the inventive 
                contribution as distinguished from other features of 
                the combination, the manufacturing process, business 
                risks, or significant features or improvements added by 
                the infringer.'';
            (2) by amending the second paragraph to read as follows:
    ``(b) Willful Infringement.--
            ``(1) Increased damages.--A court that has determined that 
        the infringer has willfully infringed a patent or patents may 
        increase the damages up to three times the amount of damages 
        found or assessed under subsection (a), except that increased 
        damages under this paragraph shall not apply to provisional 
        rights under section 154(d) of this title.
            ``(2) Permitted grounds for willfulness.--A court may find 
        that an infringer has willfully infringed a patent only if the 
        patent owner presents clear and convincing evidence that--
                    ``(A) after receiving written notice from the 
                patentee--
                            ``(i) alleging acts of infringement in a 
                        manner sufficient to give the infringer an 
                        objectively reasonable apprehension of suit on 
                        such patent, and
                            ``(ii) identifying with particularity each 
                        claim of the patent, each product or process 
                        that the patent owner alleges infringes the 
                        patent, and the relationship of such product or 
                        process to such claim,
                the infringer, after a reasonable opportunity to 
                investigate, thereafter performed one or more of the 
                alleged acts of infringement;
                    ``(B) the infringer intentionally copied the 
                patented invention with knowledge that it was patented; 
                or
                    ``(C) after having been found by a court to have 
                infringed that patent, the infringer engaged in conduct 
                that was not colorably different from the conduct 
                previously found to have infringed the patent, and 
                which resulted in a separate finding of infringement of 
                the same patent.
            ``(3) Limitations on willfulness.--(A) A court shall not 
        find that an infringer has willfully infringed a patent under 
        paragraph (2) for any period of time during which the infringer 
        had an informed good faith belief that the patent was invalid 
        or unenforceable, or would not be infringed by the conduct 
        later shown to constitute infringement of the patent.
            ``(B) Reasonable reliance on advice of counsel shall 
        establish an informed good faith belief within the meaning of 
        subparagraph (A).
            ``(C) The decision of the infringer not to present evidence 
        of advice of counsel shall have no relevance to a determination 
        of willful infringement under paragraph (2).
            ``(4) Limitation on pleading.--A patentee may not plead, 
        and a court may not determine, that an infringer has willfully 
        infringed a patent before the date on which a determination has 
        been made that the patent in suit is not invalid, is 
        enforceable, and has been infringed by the infringer.''; and
            (3) in the third paragraph, by striking ``The court'' and 
        inserting ``(c) Expert Testimony.--The court''.

SEC. 7. INJUNCTIONS.

    Section 283 is amended by adding at the end the following:
``In determining equity, the court shall consider the fairness of the 
remedy in light of all the facts and the relevant interests of the 
parties associated with the invention. Unless the injunction is entered 
pursuant to a nonappealable judgment of infringement, a court shall 
stay the injunction pending an appeal upon an affirmative showing that 
the stay would not result in irreparable harm to the owner of the 
patent and that the balance of hardships from the stay does not favor 
the owner of the patent.''.

SEC. 8. CONTINUATION APPLICATIONS.

    (a) In General.--Chapter 11 is amended by adding at the end the 
following:
``Sec. 123. Limitations on continuation applications
    ``The Director may by regulation limit the circumstances under 
which an application for patent, other than a divisional application 
that meets the requirements for filing under section 121, may be 
entitled to the benefit under section 120 of the filing date of a 
prior-filed application. No such regulation may deny applicants an 
adequate opportunity to obtain claims for any invention disclosed in an 
application for patent.''.
    (b) Conforming Amendment.--The table of sections for chapter 11 is 
amended by adding at the end the following new item:

``123. Limitations on continuation applications.''.

SEC. 9. POST-GRANT PROCEDURES AND OTHER QUALITY ENHANCEMENTS.

    (a) Publication.--Section 122(b)(2) is amended--
            (1) by striking subparagraph (B); and
            (2) in subparagraph (A)--
                    (A) by striking ``(A) An application'' and 
                inserting ``An application''; and
                    (B) by redesignating clauses (i) through (iv) as 
                subparagraphs (A) through (D), respectively.
    (b) Defense to Infringement Based on Earlier Inventor.--Section 273 
of title 35, United States Code, is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1)--
                            (i) by striking ``of a method''; and
                            (ii) by striking ``review period;'' and 
                        inserting ``review period; and'';
                    (B) in paragraph (2)(B), by striking the semicolon 
                at the end and inserting a period; and
                    (C) by striking paragraphs (3) and (4);
            (2) in subsection (b)--
                    (A) in paragraph (1)--
                            (i) by striking ``for a method''; and
                            (ii) by striking ``at least 1 year before 
                        the effective filing date of such patent, and'' 
                        and all that follows through the period and 
                        inserting ``and commercially used, or made 
                        substantial preparations for commercial use of, 
                        the subject matter before the effective filing 
                        date of the claimed invention.'';
                    (B) in paragraph (2)--
                            (i) by striking ``The sale or other 
                        disposition of a useful end result produced by 
                        a patented method'' and inserting ``The sale or 
                        other disposition of subject matter that 
                        qualifies for the defense set forth in this 
                        section''; and
                            (ii) by striking ``a defense under this 
                        section with respect to that useful end 
                        result'' and inserting ``such defense''; and
                    (C) in paragraph (3)--
                            (i) by striking subparagraph (A); and
                            (ii) by redesignating subparagraphs (B) and 
                        (C) as subparagraphs (A) and (B), respectively;
            (3) in paragraph (7), by striking ``of the patent'' and 
        inserting ``of the claimed invention''; and
            (4) by amending the heading to read as follows:
``Sec. 273. Special defenses to and exemptions from infringement''.
    (c) Table of Sections.--The item related to section 273 in the 
table of sections for chapter 28 is amended to read as follows:

``273. Special defenses to and exemptions from infringement.''.
    (d) Reexamination.--Section 315(c) is amended by striking ``or 
could have raised''.
    (e) Effective Dates.--Notwithstanding any other provision of law, 
sections 311 through 318 of title 35, United States Code, as amended by 
this Act, shall apply to any patent that issues from an original 
application filed on any date.
    (f) Post-Grant Opposition Procedures.--
            (1) In general.--Part III is amended by adding at the end 
        the following new chapter:

             ``CHAPTER 32--POST-GRANT OPPOSITION PROCEDURES

``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 Office by filing an 
opposition seeking to invalidate one or more claims in the patent. The 
Director shall establish, by regulation, fees to be paid by 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 
under section 322(b) that the identity of a real party in interest be 
kept separate, 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 the request under section 
321 shall identify in writing each real party in interest, and the 
opposition shall proceed in the name of the real party in interest.
    ``(b) Identity Kept Secret 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 subsection, then the opposition shall proceed in the name 
        of the individual filing the request as representative of the 
        real party in interest.
            ``(2) Exception.--No request under this 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 becomes a party to an appeal under section 141.
``Sec. 323. Timing of opposition request
    ``An person may not make an opposition request under section 321 
later than 9 months after the grant of the patent or issuance of a 
reissue patent, or later than 6 months after receiving notice from the 
patent holder alleging infringement, except that, if the patent owner 
consents in writing, an opposition request may be filed at any time 
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 must identify with particularity the claims 
that are alleged to be invalid and, as to each claim, one 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, 112, and 251(d).
``Sec. 325. Institution of the opposition proceeding; stay upon timely 
              filed suit
    ``(a) Determination on Opposition Request; Institution of 
Opposition Proceeding.--
            ``(1) Determination by the director.--For each opposition 
        request submitted under section 321(a), the Director shall 
        determine if the written statement, and any evidence submitted 
        with the request, establish that a substantial question of 
        patentability exists for at least one claim in the patent. The 
        Director shall notify the patent owner and each opposer in 
        writing of the Director's findings, not later than the date in 
        which an opposition proceeding is instituted pursuant to the 
        request. Any determination made by the Director under this 
        paragraph shall not be appealable.
            ``(2) Institution.--If the Director makes a determination 
        under paragraph (1) that a substantial question of 
        patentability exists, the Director shall commence an opposition 
        proceeding. The Director shall institute such proceeding not 
        earlier than the date on which the applicable period specified 
        in section 323 expires, and not later than the date that is 
        three months after such date. Absent a showing of good cause, 
        the opposition proceeding shall be limited to review of the 
        claim or claims and the issues identified in the opposition 
        request.
            ``(3) Consolidated proceeding.--If an opposition is 
        instituted based upon more than one opposition request, the 
        opposition shall proceed as a single consolidated proceeding, 
        unless later divided under subsection (c).
    ``(b) Parties.--The parties to the opposition proceeding shall be 
the patent owner and each opposer who has filed a request that results 
in a determination under subsection (a)(2) to institute the opposition 
proceeding.
    ``(c) Assignment to 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 the opposition request. The 
decision shall be based upon the prosecution record that was the basis 
for the grant or reissue 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.
    ``(d) Stay of Opposition.--If the owner of a patent files suit 
alleging infringement of the patent before the expiration of the 9-
month or 6-month period for filing an opposition request under section 
321, the Director, if requested by the patent owner, shall stay the 
opposition proceeding until judgment in the suit, and all appeals 
thereof, have become final.
``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 a 
time period set by the panel, a response to each opposition request 
that results in a determination under section 325(a)(2) to institute an 
opposition proceeding. The patent owner 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. Any such request for amendment 
shall be filed with the patent owner's response to an opposition 
request. 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) Depositions.--After an opposition proceeding under this 
chapter is instituted, 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.
    ``(b) Additional Discovery.--No discovery other than that provided 
for in subsection (a) shall be permitted unless the panel determines 
that additional discovery is required in the interest of justice.
    ``(c) Schedule.--The panel shall determine the schedule for the 
taking of discovery under subsections (a) and (b).
    ``(d) Consequences for Failure to Respond Properly.--If any party 
to an opposition proceeding fails to properly respond to any discovery 
under subsection (a) or (b), 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
    ``A party to an opposition proceeding under this chapter may 
request an oral hearing by the date set by the panel. If a hearing is 
requested or the panel determines sua sponte that a hearing is 
warranted, the panel shall set a time for the hearing. The panel may 
permit the parties 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 of time set by the panel. Such time period shall not be 
less than two weeks after 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 this 
chapter has become final under section 331, 333, or 334, 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 the opposer from asserting, in any 
        subsequent proceeding before the Office or a court involving 
        that opposer under this title, that any claim of that patent 
        addressed in the opposition proceeding is invalid on the basis 
        of any issue of fact or law actually decided by the panel 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 and necessary to 
        the final determination in the opposition proceeding, that 
        could not reasonably have been discovered 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 subsequent proceeding, within 30 
days after receiving notice that the subsequent proceeding has been 
filed.
``Sec. 337. Duration of opposition
    ``The final determination of a panel described in section 333 shall 
issue not later than one 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 six 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. If no opposer remains in the proceeding, the panel may 
terminate the proceeding or proceed without the opposer to issue a 
written decision under section 331.
    ``(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, shall be 
in writing. An opposition proceeding as between 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 Office. If any party filing 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 is 
issued under section 335 with respect to that amended or new claim.
``Sec. 340. Relationship with reexamination proceedings
    ``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. An ex parte 
reexamination request made by a person other than the patent owner 
during the 9-month or 6-month period specified in section 323, or an 
inter partes reexamination request made during the 9-month or 6-month 
period specified in section 323, shall be treated as a request under 
section 321, and no ex parte reexamination or inter partes 
reexamination may be ordered based on such request. A request for ex 
parte reexamination or inter partes reexamination made after the 9-
month or 6-month period specified in section 323, and a request for ex 
parte reexamination made by the patent owner at any time, shall be 
stayed during the pendency of any opposition proceeding under this 
chapter.''.
    (g) Conforming Amendment.--The table of chapters for part III of 
title 35, United States Code, is amended by adding at the end the 
following:

``32. Post-Grant Opposition Procedures......................     321''.

SEC. 10. SUBMISSIONS BY THIRD PARTIES.

    Section 122 is amended by adding at the end the following:
    ``(e) Preissuance Submissions by Third Parties.--
            ``(1) In general.--Any person may submit for consideration 
        and inclusion in the record of a patent application, any 
        patent, published patent application or other publication of 
        potential relevance to the examination of the application, if 
        such submission is made in writing before the earlier of--
                    ``(A) the date a notice of allowance under section 
                151 is mailed in the application for patent; or
                    ``(B) either--
                            ``(i) six months after the date on which 
                        the application for patent is published under 
                        section 122, or
                            ``(ii) the date of the first rejection 
                        under section 132 of any claim by the examiner 
                        during the examination of the application for 
                        patent,
                whichever occurs later.
            ``(2) Other requirements.--Any submission under paragraph 
        (1) shall--
                    ``(A) set forth a concise description of the 
                asserted relevance of each submitted document;
                    ``(B) be accompanied by such fee as the Director 
                may prescribe; and
                    ``(C) include a statement by the submitter 
                affirming that the submission was made in compliance 
                with this section.''.

SEC. 11. APPLICABILITY; TRANSITIONAL PROVISIONS.

    (a) Section 3.--The amendments made by section 3 shall apply to 
applications for patent, and any patents issued thereon, that contain a 
claim to a claimed invention that has an effective filing date (as 
defined in section 100(h) of title 35, United States Code) that is one 
year or more after the date of the enactment of this Act. With respect 
to any patent or application for patent to which the amendments made by 
section 3 apply, no claim in the patent or in the application shall be 
entitled to an effective filing date that is before the date of the 
enactment of this Act.
    (b) Sections 4, 6, and 7.--The amendments made by sections 4, 6, 
and 7 shall take effect on the date of the enactment of this Act, 
except that such amendments shall not apply to any action brought in 
any court before such date of the enactment.
    (c) Section 5.--The amendments made by section 5 shall take effect 
on the date of the enactment of this Act and shall apply to patents 
issued on or after such date of enactment, except that, in any action 
brought on or after the date of the enactment of this Act in any court 
involving a patent issued before the date of the enactment of this Act, 
the patent owner may consent to--
            (1) the jurisdiction of the United States Patent and 
        Trademark Office based on a referral by the court under section 
        136(c)(4) of title 35, United States Code; and
            (2) any penalty imposed by the Patent and Trademark Office 
        under section 136(e) of such title pursuant to such referral.
    (d) Section 8.--Any regulations issued under section 123 of title 
35, United States Code, as added by section 8 of this Act, shall apply 
to any application for patent that is filed on or after the effective 
date of such regulations. Such regulations may not take effect before 
the end of the 1-year period beginning on the date of the enactment of 
this Act.
    (e) Section 9.--(1) The amendments made by section 9(a) shall apply 
to applications for patent filed on or after the date of the enactment 
of this Act.
    (2) The amendments made by section 9(b) shall apply to patents 
issuing on applications filed on or after the date of the enactment of 
this Act.
    (3) The amendments made by subsections (c) and (d) of section 9 
shall apply to any request made under section 311 of title 35, United 
States Code, on or after the date of the enactment of this Act.
    (4) The amendments made by section 9(e) shall take effect on the 
date of the enactment of this Act, except that--
            (A) no request for institution of an opposition proceeding 
        under chapter 32 of title 35, United States Code, may be made 
        until--
                    (i) the end of the 1-year period beginning on the 
                date of the enactment of this Act; or
                    (ii) such later date that the Director may 
                establish through notice published in the Federal 
                Register; and
            (B) no such request may be made unless the amendments made 
        by section 3 apply with respect to the patent that is the 
        subject of the request.
    (f) Section 10.--The amendments made by section 10 shall take 
effect at the end of the 1-year period beginning on the date of the 
enactment of this Act.
    (g) Determining Validity of Claims.--For the purpose of determining 
the validity of a claim in any patent or the patentability of any claim 
in a nonprovisional application for patent that is made before the 
effective date of the amendments made by section 3, other than in an 
action brought in a court before the date of the enactment of this 
Act--
            (1) the provisions of sections 102(c) and 102(d) of title 
        35, United States Code, shall be deemed to be repealed;
            (2) the provisions of sections 102(f) of title 35, United 
        States Code, shall be deemed to be repealed and replaced by the 
        provisions of section 101 of title 35, United States Code, as 
        amended by section 4(a) of this Act, relating to the inventor's 
        right to seek and obtain a patent, except that a claim in a 
        patent that is otherwise valid shall not be invalidated by 
        reason of this paragraph; and
            (3) the term ``in public use or on sale'' as used in 
        section 102(b) of title 35, United States Code, shall be deemed 
        to exclude the use, sale, or offer for sale of any subject 
        matter that had not become reasonably and effectively 
        accessible to persons of ordinary skill in the art to which the 
        subject matter pertains, as defined in the amendments made by 
        section 3 of this Act.
    (h) Effect of European Patent Convention and Patent Laws of 
Japan.--Before the date, if ever, that the Director of the United 
States Patent and Trademark Office publishes a notice in the Official 
Gazette of the Office declaring that both the European Patent 
Convention and the patent laws of Japan afford inventors seeking 
patents a 1-year period prior to the effective filing date of a claimed 
invention during which disclosures made by the inventor or by others 
who obtained the subject matter disclosed directly or indirectly from 
the inventor do not constitute prior art, the term ``effective filing 
date'' as used in section 102(a)(1)(A) of title 35, United States Code, 
shall be construed by disregarding any right of priority except that 
provided under section 119(e) of title 35, United States Code.
                                 <all>