[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 23 Engrossed in Senate (ES)]
112th CONGRESS
1st Session
S. 23
_______________________________________________________________________
AN ACT
To amend title 35, United States Code, to provide for patent reform.
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 ``America Invents
Act''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. First inventor to file.
Sec. 3. Inventor's oath or declaration.
Sec. 4. Virtual marking and advice of counsel.
Sec. 5. Post-grant review proceedings.
Sec. 6. Patent Trial and Appeal Board.
Sec. 7. Preissuance submissions by third parties.
Sec. 8. Venue.
Sec. 9. Fee setting authority.
Sec. 10. Supplemental examination.
Sec. 11. Residency of Federal Circuit judges.
Sec. 12. Micro entity defined.
Sec. 13. Funding agreements.
Sec. 14. Tax strategies deemed within the prior art.
Sec. 15. Best mode requirement.
Sec. 16. Technical amendments.
Sec. 17. Clarification of jurisdiction.
Sec. 18. Transitional program for covered business-method patents.
Sec. 19. Travel expenses and payment of administrative judges.
Sec. 20. Patent and Trademark Office funding.
Sec. 21. Satellite offices.
Sec. 22. Patent Ombudsman Program for small business concerns.
Sec. 23. Priority examination for technologies important to American
competitiveness.
Sec. 24. Designation of Detroit satellite office.
Sec. 25. Effective date.
Sec. 26. Budgetary effects.
SEC. 2. FIRST INVENTOR TO FILE.
(a) Definitions.--Section 100 of title 35, United States Code, 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 1 of the
individuals who invented or discovered the subject matter of a joint
invention.
``(h) The term `joint research agreement' means a written contract,
grant, or cooperative agreement entered into by 2 or more persons or
entities for the performance of experimental, developmental, or
research work in the field of the claimed invention.
``(i)(1) The term `effective filing date' of a claimed invention in
a patent or application for patent means--
``(A) if subparagraph (B) does not apply, the actual filing
date of the patent or the application for the patent containing
a claim to the invention; or
``(B) the filing date of the earliest application for which
the patent or application is entitled, as to such invention, to
a right of priority under section 119, 365(a), or 365(b) or to
the benefit of an earlier filing date under section 120, 121,
or 365(c).
``(2) The effective filing date for a claimed invention in an
application for reissue or reissued patent shall be determined by
deeming the claim to the invention to have been contained in the patent
for which reissue was sought.
``(j) 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 of title 35, United States
Code, is amended to read as follows:
``Sec. 102. Conditions for patentability; novelty
``(a) Novelty; Prior Art.--A person shall be entitled to a patent
unless--
``(1) the claimed invention was patented, described in a
printed publication, or in public use, on sale, or otherwise
available to the public before the effective filing date of the
claimed invention; 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) Exceptions.--
``(1) Disclosures made 1 year or less before the effective
filing date of the claimed invention.--A disclosure made 1 year
or less before the effective filing date of a claimed invention
shall not be prior art to the claimed invention under
subsection (a)(1) if--
``(A) the disclosure was made by the inventor or
joint inventor or by another who obtained the subject
matter disclosed directly or indirectly from the
inventor or a joint inventor; or
``(B) the subject matter disclosed had, before such
disclosure, been publicly disclosed by the inventor or
a joint inventor or another who obtained the subject
matter disclosed directly or indirectly from the
inventor or a joint inventor.
``(2) Disclosures appearing in applications and patents.--A
disclosure shall not be prior art to a claimed invention under
subsection (a)(2) if--
``(A) the subject matter disclosed was obtained
directly or indirectly from the inventor or a joint
inventor;
``(B) the subject matter disclosed had, before such
subject matter was effectively filed under subsection
(a)(2), been publicly disclosed by the inventor or a
joint inventor or another who obtained the subject
matter disclosed directly or indirectly from the
inventor or a joint inventor; or
``(C) the subject matter disclosed and the claimed
invention, not later than the effective filing date of
the claimed invention, were owned by the same person or
subject to an obligation of assignment to the same
person.
``(c) Common Ownership Under Joint Research Agreements.--Subject
matter disclosed and a claimed invention shall be deemed to have been
owned by the same person or subject to an obligation of assignment to
the same person in applying the provisions of subsection (b)(2)(C) if--
``(1) the subject matter disclosed was developed and the
claimed invention was made by, or on behalf of, 1 or more
parties to a joint research agreement that was in effect on or
before the effective filing date of the claimed invention;
``(2) the claimed invention was made as a result of
activities undertaken within the scope of the joint research
agreement; and
``(3) the application for patent for the claimed invention
discloses or is amended to disclose the names of the parties to
the joint research agreement.
``(d) Patents and Published Applications Effective as Prior Art.--
For purposes of determining whether a patent or application for patent
is prior art to a claimed invention under subsection (a)(2), such
patent or application shall be considered to have been effectively
filed, with respect to any subject matter described in the patent or
application--
``(1) if paragraph (2) does not apply, as of the actual
filing date of the patent or the application for patent; or
``(2) 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 1 or more prior filed
applications for patent, as of the filing date of the earliest
such application that describes the subject matter.''.
(2) Continuity of intent under the create act.--The
enactment of section 102(c) of title 35, United States Code,
under the preceding paragraph is done with the same intent to
promote joint research activities that was expressed, including
in the legislative history, through the enactment of the
Cooperative Research and Technology Enhancement Act of 2004
(Public Law 108-453; the ``CREATE Act''), the amendments of
which are stricken by subsection (c). The United States Patent
and Trademark Office shall administer section 102(c) of title
35, United States Code, in a manner consistent with the
legislative history of the CREATE Act that was relevant to its
administration by the United States Patent and Trademark
Office.
(3) Conforming amendment.--The item relating to section 102
in the table of sections for chapter 10 of title 35, United
States Code, is amended to read as follows:
``102. Conditions for patentability; novelty.''.
(c) Conditions for Patentability; Nonobvious Subject Matter.--
Section 103 of title 35, United States Code, is amended to read as
follows:
``Sec. 103. Conditions for patentability; nonobvious subject matter
``A patent for a claimed invention may not be obtained,
notwithstanding that the claimed invention is not identically disclosed
as set forth in section 102, if the differences between the claimed
invention and the prior art are such that the claimed invention as a
whole would have been obvious before the effective filing date of the
claimed invention to a person having ordinary skill in the art to which
the claimed invention pertains. Patentability shall not be negated by
the manner in which the invention was made.''.
(d) Repeal of Requirements for Inventions Made Abroad.--Section 104
of title 35, United States Code, and the item relating to that section
in the table of sections for chapter 10 of title 35, United States
Code, are repealed.
(e) Repeal of Statutory Invention Registration.--
(1) In general.--Section 157 of title 35, United States
Code, and the item relating to that section in the table of
sections for chapter 14 of title 35, United States Code, are
repealed.
(2) Removal of cross references.--Section 111(b)(8) of
title 35, United States Code, is amended by striking ``sections
115, 131, 135, and 157'' and inserting ``sections 131 and
135''.
(3) Effective date.--The amendments made by this subsection
shall take effect 18 months after the date of the enactment of
this Act, and shall apply to any request for a statutory
invention registration filed on or after that date.
(f) Earlier Filing Date for Inventor and Joint Inventor.--Section
120 of title 35, United States Code, 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 of title 35, United
States Code, is amended by striking ``and the time specified in
section 102(d)''.
(2) Limitation on remedies.--Section 287(c)(4) of title 35,
United States Code, 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 of title 35, United States Code,
is amended by striking ``except as otherwise provided in
section 102(e) of this title''.
(4) Publication of international application: effect.--
Section 374 of title 35, United States Code, 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) of title 35, United
States Code, 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) of title
35, United States Code, 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) of title 35, United States Code, 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(b) would end before the end of that 2-year
period''; and
(ii) by striking ``the statutory'' and
inserting ``that 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(b)''.
(h) Derived Patents.--Section 291 of title 35, United States Code,
is amended to read as follows:
``Sec. 291. Derived patents
``(a) In General.--The owner of a patent may have relief by civil
action against the owner of another patent that claims the same
invention and has an earlier effective filing date if the invention
claimed in such other patent was derived from the inventor of the
invention claimed in the patent owned by the person seeking relief
under this section.
``(b) Filing Limitation.--An action under this section may only be
filed within 1 year after the issuance of the first patent containing a
claim to the allegedly derived invention and naming an individual
alleged to have derived such invention as the inventor or joint
inventor.''.
(i) Derivation Proceedings.--Section 135 of title 35, United States
Code, is amended to read as follows:
``Sec. 135. Derivation proceedings
``(a) Institution of Proceeding.--An applicant for patent may file
a petition to institute a derivation proceeding in the Office. The
petition shall set forth with particularity the basis for finding that
an inventor named in an earlier application derived the claimed
invention from an inventor named in the petitioner's application and,
without authorization, the earlier application claiming such invention
was filed. Any such petition may only be filed within 1 year after the
first publication of a claim to an invention that is the same or
substantially the same as the earlier application's claim to the
invention, shall be made under oath, and shall be supported by
substantial evidence. Whenever the Director determines that a petition
filed under this subsection demonstrates that the standards for
instituting a derivation proceeding are met, the Director may institute
a derivation proceeding. The determination by the Director whether to
institute a derivation proceeding shall be final and nonappealable.
``(b) Determination by Patent Trial and Appeal Board.--In a
derivation proceeding instituted under subsection (a), the Patent Trial
and Appeal Board shall determine whether an inventor named in the
earlier application derived the claimed invention from an inventor
named in the petitioner's application and, without authorization, the
earlier application claiming such invention was filed. The Director
shall prescribe regulations setting forth standards for the conduct of
derivation proceedings.
``(c) Deferral of Decision.--The Patent Trial and Appeal Board may
defer action on a petition for a derivation proceeding until 3 months
after the date on which the Director issues a patent that includes the
claimed invention that is the subject of the petition. The Patent Trial
and Appeal Board also may defer action on a petition for a derivation
proceeding, or stay the proceeding after it has been instituted, until
the termination of a proceeding under chapter 30, 31, or 32 involving
the patent of the earlier applicant.
``(d) Effect of Final Decision.--The final decision of the Patent
Trial and Appeal Board, if adverse to claims in an application for
patent, shall constitute the final refusal by the Office on those
claims. The final decision of the Patent Trial and Appeal Board, if
adverse to claims in a patent, shall, if no appeal or other review of
the decision has been or can be taken or had, constitute cancellation
of those claims, and notice of such cancellation shall be endorsed on
copies of the patent distributed after such cancellation.
``(e) Settlement.--Parties to a proceeding instituted under
subsection (a) may terminate the proceeding by filing a written
statement reflecting the agreement of the parties as to the correct
inventors of the claimed invention in dispute. Unless the Patent Trial
and Appeal Board finds the agreement to be inconsistent with the
evidence of record, if any, it shall take action consistent with the
agreement. Any written settlement or understanding of the parties shall
be filed with the Director. At the request of a party to the
proceeding, the agreement or understanding shall be treated as business
confidential information, shall be kept separate from the file of the
involved patents or applications, and shall be made available only to
Government agencies on written request, or to any person on a showing
of good cause.
``(f) Arbitration.--Parties to a proceeding instituted under
subsection (a) may, within such time as may be specified by the
Director by regulation, determine such contest or any aspect thereof by
arbitration. Such arbitration shall be governed by the provisions of
title 9, to the extent such title is not inconsistent with this
section. The parties shall give notice of any arbitration award to the
Director, and such award shall, as between the parties to the
arbitration, be dispositive of the issues to which it relates. The
arbitration award shall be unenforceable until such notice is given.
Nothing in this subsection shall preclude the Director from determining
the patentability of the claimed inventions involved in the
proceeding.''.
(j) Elimination of References to Interferences.--(1) Sections 41,
134, 145, 146, 154, 305, and 314 of title 35, United States Code, are
each amended by striking ``Board of Patent Appeals and Interferences''
each place it appears and inserting ``Patent Trial and Appeal Board''.
(2)(A) Sections 146 and 154 of title 35, United States Code, are
each amended--
(i) by striking ``an interference'' each place it
appears and inserting ``a derivation proceeding''; and
(ii) by striking ``interference'' each additional
place it appears and inserting ``derivation
proceeding''.
(B) The subparagraph heading for section 154(b)(1)(C) of
title 35, United States Code, as amended by this paragraph, is
further amended by--
(i) striking ``or'' and inserting ``of''; and
(ii) striking ``secrecy order'' and inserting
``secrecy orders''.
(3) The section heading for section 134 of title 35, United States
Code, is amended to read as follows:
``Sec. 134. Appeal to the Patent Trial and Appeal Board''.
(4) The section heading for section 146 of title 35, United States
Code, is amended to read as follows:
``Sec. 146. Civil action in case of derivation proceeding''.
(5) Section 154(b)(1)(C) of title 35, United States Code, is
amended by striking ``interferences'' and inserting ``derivation
proceedings''.
(6) The item relating to section 6 in the table of sections for
chapter 1 of title 35, United States Code, is amended to read as
follows:
``6. Patent Trial and Appeal Board.''.
(7) The items relating to sections 134 and 135 in the table of
sections for chapter 12 of title 35, United States Code, are amended to
read as follows:
``134. Appeal to the Patent Trial and Appeal Board.
``135. Derivation proceedings.''.
(8) The item relating to section 146 in the table of sections for
chapter 13 of title 35, United States Code, is amended to read as
follows:
``146. Civil action in case of derivation proceeding.''.
(k) False Marking.--
(1) In general.--Section 292 of title 35, United States
Code, is amended--
(A) in subsection (a), by adding at the end the
following:
``Only the United States may sue for the penalty authorized by this
subsection.''; and
(B) by striking subsection (b) and inserting the
following:
``(b) Any person who has suffered a competitive injury as a result
of a violation of this section may file a civil action in a district
court of the United States for recovery of damages adequate to
compensate for the injury.''.
(2) Effective date.--The amendments made by this subsection
shall apply to all cases, without exception, pending on or
after the date of the enactment of this Act.
(l) Statute of Limitations.--
(1) In general.--Section 32 of title 35, United States
Code, is amended by inserting between the third and fourth
sentences the following: ``A proceeding under this section
shall be commenced not later than the earlier of either 10
years after the date on which the misconduct forming the basis
for the proceeding occurred, or 1 year after the date on which
the misconduct forming the basis for the proceeding is made
known to an officer or employee of the Office as prescribed in
the regulations established under section 2(b)(2)(D).''.
(2) Report to congress.--The Director shall provide on a
biennial basis to the Judiciary Committees of the Senate and
House of Representatives a report providing a short description
of incidents made known to an officer or employee of the Office
as prescribed in the regulations established under section
2(b)(2)(D) of title 35, United States Code, that reflect
substantial evidence of misconduct before the Office but for
which the Office was barred from commencing a proceeding under
section 32 of title 35, United States Code, by the time
limitation established by the fourth sentence of that section.
(3) Effective date.--The amendment made by paragraph (1)
shall apply in all cases in which the time period for
instituting a proceeding under section 32 of title 35, United
State Code, had not lapsed prior to the date of the enactment
of this Act.
(m) Small Business Study.--
(1) Definitions.--In this subsection--
(A) the term ``Chief Counsel'' means the Chief
Counsel for Advocacy of the Small Business
Administration;
(B) the term ``General Counsel'' means the General
Counsel of the United States Patent and Trademark
Office; and
(C) the term ``small business concern'' has the
meaning given that term under section 3 of the Small
Business Act (15 U.S.C. 632).
(2) Study.--
(A) In general.--The Chief Counsel, in consultation
with the General Counsel, shall conduct a study of the
effects of eliminating the use of dates of invention in
determining whether an applicant is entitled to a
patent under title 35, United States Code.
(B) Areas of study.--The study conducted under
subparagraph (A) shall include examination of the
effects of eliminating the use of invention dates,
including examining--
(i) how the change would affect the ability
of small business concerns to obtain patents
and their costs of obtaining patents;
(ii) whether the change would create,
mitigate, or exacerbate any disadvantage for
applicants for patents that are small business
concerns relative to applicants for patents
that are not small business concerns, and
whether the change would create any advantages
for applicants for patents that are small
business concerns relative to applicants for
patents that are not small business concerns;
(iii) the cost savings and other potential
benefits to small business concerns of the
change; and
(iv) the feasibility and costs and benefits
to small business concerns of alternative means
of determining whether an applicant is entitled
to a patent under title 35, United States Code.
(3) Report.--Not later than 1 year after the date of
enactment of this Act, the Chief Counsel shall submit to the
Committee on Small Business and Entrepreneurship and the
Committee on the Judiciary of the Senate and the Committee on
Small Business and the Committee on the Judiciary of the House
of Representatives a report regarding the results of the study
under paragraph (2).
(n) Report on Prior User Rights.--
(1) In general.--Not later than 1 year after the date of
the enactment of this Act, the Director shall report, to the
Committee on the Judiciary of the Senate and the Committee on
the Judiciary of the House of Representatives, the findings and
recommendations of the Director on the operation of prior user
rights in selected countries in the industrialized world. The
report shall include the following:
(A) A comparison between patent laws of the United
States and the laws of other industrialized countries,
including members of the European Union and Japan,
Canada, and Australia.
(B) An analysis of the effect of prior user rights
on innovation rates in the selected countries.
(C) An analysis of the correlation, if any, between
prior user rights and start-up enterprises and the
ability to attract venture capital to start new
companies.
(D) An analysis of the effect of prior user rights,
if any, on small businesses, universities, and
individual inventors.
(E) An analysis of legal and constitutional issues,
if any, that arise from placing trade secret law in
patent law.
(F) An analysis of whether the change to a first-
to-file patent system creates a particular need for
prior user rights.
(2) Consultation with other agencies.--In preparing the
report required under paragraph (1), the Director shall consult
with the United States Trade Representative, the Secretary of
State, and the Attorney General.
(o) Effective Date.--
(1) In general.--Except as otherwise provided by this
section, the amendments made by this section shall take effect
on the date that is 18 months after the date of the enactment
of this Act, and shall apply to any application for patent, and
to any patent issuing thereon, that contains or contained at
any time--
(A) a claim to a claimed invention that has an
effective filing date as defined in section 100(i) of
title 35, United States Code, that is 18 months or more
after the date of the enactment of this Act; or
(B) a specific reference under section 120, 121, or
365(c) of title 35, United States Code, to any patent
or application that contains or contained at any time
such a claim.
(2) Interfering patents.--The provisions of sections
102(g), 135, and 291 of title 35, United States Code, in effect
on the day prior to the date of the enactment of this Act,
shall apply to each claim of an application for patent, and any
patent issued thereon, for which the amendments made by this
section also apply, if such application or patent contains or
contained at any time--
(A) a claim to an invention having an effective
filing date as defined in section 100(i) of title 35,
United States Code, earlier than 18 months after the
date of the enactment of this Act; or
(B) a specific reference under section 120, 121, or
365(c) of title 35, United States Code, to any patent
or application that contains or contained at any time
such a claim.
SEC. 3. INVENTOR'S OATH OR DECLARATION.
(a) Inventor's Oath or Declaration.--
(1) In general.--Section 115 of title 35, United States
Code, is amended to read as follows:
``Sec. 115. Inventor's oath or declaration
``(a) Naming the Inventor; Inventor's Oath or Declaration.--An
application for patent that is filed under section 111(a) or commences
the national stage under section 371 shall include, or be amended to
include, the name of the inventor for any invention claimed in the
application. Except as otherwise provided in this section, each
individual who is the inventor or a joint inventor of a claimed
invention in an application for patent shall execute an oath or
declaration in connection with the application.
``(b) Required Statements.--An oath or declaration under subsection
(a) shall contain statements that--
``(1) the application was made or was authorized to be made
by the affiant or declarant; and
``(2) such individual believes himself or herself to be the
original inventor or an original joint inventor of a claimed
invention in the application.
``(c) Additional Requirements.--The Director may specify additional
information relating to the inventor and the invention that is required
to be included in an oath or declaration under subsection (a).
``(d) Substitute Statement.--
``(1) In general.--In lieu of executing an oath or
declaration under subsection (a), the applicant for patent may
provide a substitute statement under the circumstances
described in paragraph (2) and such additional circumstances
that the Director may specify by regulation.
``(2) Permitted circumstances.--A substitute statement
under paragraph (1) is permitted with respect to any individual
who--
``(A) is unable to file the oath or declaration
under subsection (a) because the individual--
``(i) is deceased;
``(ii) is under legal incapacity; or
``(iii) cannot be found or reached after
diligent effort; or
``(B) is under an obligation to assign the
invention but has refused to make the oath or
declaration required under subsection (a).
``(3) Contents.--A substitute statement under this
subsection shall--
``(A) identify the individual with respect to whom
the statement applies;
``(B) set forth the circumstances representing the
permitted basis for the filing of the substitute
statement in lieu of the oath or declaration under
subsection (a); and
``(C) contain any additional information, including
any showing, required by the Director.
``(e) Making Required Statements in Assignment of Record.--An
individual who is under an obligation of assignment of an application
for patent may include the required statements under subsections (b)
and (c) in the assignment executed by the individual, in lieu of filing
such statements separately.
``(f) Time for Filing.--A notice of allowance under section 151 may
be provided to an applicant for patent only if the applicant for patent
has filed each required oath or declaration under subsection (a) or has
filed a substitute statement under subsection (d) or recorded an
assignment meeting the requirements of subsection (e).
``(g) Earlier-Filed Application Containing Required Statements or
Substitute Statement.--
``(1) Exception.--The requirements under this section shall
not apply to an individual with respect to an application for
patent in which the individual is named as the inventor or a
joint inventor and who claims the benefit under section 120,
121, or 365(c) of the filing of an earlier-filed application,
if--
``(A) an oath or declaration meeting the
requirements of subsection (a) was executed by the
individual and was filed in connection with the
earlier-filed application;
``(B) a substitute statement meeting the
requirements of subsection (d) was filed in the earlier
filed application with respect to the individual; or
``(C) an assignment meeting the requirements of
subsection (e) was executed with respect to the
earlier-filed application by the individual and was
recorded in connection with the earlier-filed
application.
``(2) Copies of oaths, declarations, statements, or
assignments.--Notwithstanding paragraph (1), the Director may
require that a copy of the executed oath or declaration, the
substitute statement, or the assignment filed in the earlier-
filed application be included in the later-filed application.
``(h) Supplemental and Corrected Statements; Filing Additional
Statements.--
``(1) In general.--Any person making a statement required
under this section may withdraw, replace, or otherwise correct
the statement at any time. If a change is made in the naming of
the inventor requiring the filing of 1 or more additional
statements under this section, the Director shall establish
regulations under which such additional statements may be
filed.
``(2) Supplemental statements not required.--If an
individual has executed an oath or declaration meeting the
requirements of subsection (a) or an assignment meeting the
requirements of subsection (e) with respect to an application
for patent, the Director may not thereafter require that
individual to make any additional oath, declaration, or other
statement equivalent to those required by this section in
connection with the application for patent or any patent
issuing thereon.
``(3) Savings clause.--No patent shall be invalid or
unenforceable based upon the failure to comply with a
requirement under this section if the failure is remedied as
provided under paragraph (1).
``(i) Acknowledgment of Penalties.--Any declaration or statement
filed pursuant to this section shall contain an acknowledgment that any
willful false statement made in such declaration or statement is
punishable under section 1001 of title 18 by fine or imprisonment of
not more than 5 years, or both.''.
(2) Relationship to divisional applications.--Section 121
of title 35, United States Code, is amended by striking ``If a
divisional application'' and all that follows through
``inventor.''.
(3) Requirements for nonprovisional applications.--Section
111(a) of title 35, United States Code, is amended--
(A) in paragraph (2)(C), by striking ``by the
applicant'' and inserting ``or declaration'';
(B) in the heading for paragraph (3), by inserting
``or declaration'' after ``and oath''; and
(C) by inserting ``or declaration'' after ``and
oath'' each place it appears.
(4) Conforming amendment.--The item relating to section 115
in the table of sections for chapter 11 of title 35, United
States Code, is amended to read as follows:
``115. Inventor's oath or declaration.''.
(b) Filing by Other Than Inventor.--
(1) In general.--Section 118 of title 35, United States
Code, 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.''.
(2) Conforming amendment.--Section 251 of title 35, United
States Code, is amended in the third undesignated paragraph by
inserting ``or the application for the original patent was
filed by the assignee of the entire interest'' after ``claims
of the original patent''.
(c) Specification.--Section 112 of title 35, United States Code, is
amended--
(1) in the first paragraph--
(A) by striking ``The specification'' and inserting
``(a) In General.--The specification''; and
(B) by striking ``of carrying out his invention''
and inserting ``or joint inventor of carrying out the
invention'';
(2) in the second paragraph--
(A) by striking ``The specification'' 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''.
(d) Conforming Amendments.--
(1) Sections 111(b)(1)(A) is amended by striking ``the
first paragraph of section 112 of this title'' and inserting
``section 112(a)''.
(2) Section 111(b)(2) is amended by striking ``the second
through fifth paragraphs of section 112,'' and inserting
``subsections (b) through (e) of section 112,''.
(e) Effective Date.--The amendments made by this section shall take
effect 1 year after the date of the enactment of this Act and shall
apply to patent applications that are filed on or after that effective
date.
SEC. 4. VIRTUAL MARKING AND ADVICE OF COUNSEL.
(a) Defense to Infringement Based on Earlier Inventor.--Section
273(b)(6) of title 35, United States Code, is amended to read as
follows:
``(6) Personal defense.--The defense under this section may
be asserted only by the person who performed or caused the
performance of the acts necessary to establish the defense as
well as any other entity that controls, is controlled by, or is
under common control with such person and, except for any
transfer to the patent owner, the right to assert the defense
shall not be licensed or assigned or transferred to another
person except as an ancillary and subordinate part of a good
faith assignment or transfer for other reasons of the entire
enterprise or line of business to which the defense relates.
Notwithstanding the preceding sentence, any person may, on its
own behalf, assert a defense based on the exhaustion of rights
provided under paragraph (3), including any necessary elements
thereof.''.
(b) Virtual Marking.--Section 287(a) of title 35, United States
Code, is amended by inserting ``, or by fixing thereon the word
`patent' or the abbreviation `pat.' together with an address of a
posting on the Internet, accessible to the public without charge for
accessing the address, that associates the patented article with the
number of the patent'' before ``, or when''.
(c) Advice of Counsel.--Chapter 29 of title 35, United States Code,
is amended by adding at the end the following:
``Sec. 298. Advice of Counsel
``The failure of an infringer to obtain the advice of counsel with
respect to any allegedly infringed patent or the failure of the
infringer to present such advice to the court or jury may not be used
to prove that the accused infringer willfully infringed the patent or
that the infringer intended to induce infringement of the patent.''.
(d) Effective Date.--The amendments made by this section shall
apply to any civil action commenced on or after the date of the
enactment of this Act.
SEC. 5. POST-GRANT REVIEW PROCEEDINGS.
(a) Inter Partes Review.--Chapter 31 of title 35, United States
Code, is amended to read as follows:
``CHAPTER 31--INTER PARTES REVIEW
``Sec.
``311. Inter partes review.
``312. Petitions.
``313. Preliminary response to petition.
``314. Institution of inter partes review.
``315. Relation to other proceedings or actions.
``316. Conduct of inter partes review.
``317. Settlement.
``318. Decision of the board.
``319. Appeal.
``Sec. 311. Inter partes review
``(a) In General.--Subject to the provisions of this chapter, a
person who is not the patent owner may file with the Office a petition
to institute an inter partes review for a patent. The Director shall
establish, by regulation, fees to be paid by the person requesting the
review, in such amounts as the Director determines to be reasonable,
considering the aggregate costs of the review.
``(b) Scope.--A petitioner in an inter partes review may request to
cancel as unpatentable 1 or more claims of a patent only on a ground
that could be raised under section 102 or 103 and only on the basis of
prior art consisting of patents or printed publications.
``(c) Filing Deadline.--A petition for inter partes review shall be
filed after the later of either--
``(1) 9 months after the grant of a patent or issuance of a
reissue of a patent; or
``(2) if a post-grant review is instituted under chapter
32, the date of the termination of such post-grant review.
``Sec. 312. Petitions
``(a) Requirements of Petition.--A petition filed under section 311
may be considered only if--
``(1) the petition is accompanied by payment of the fee
established by the Director under section 311;
``(2) the petition identifies all real parties in interest;
``(3) the petition identifies, in writing and with
particularity, each claim challenged, the grounds on which the
challenge to each claim is based, and the evidence that
supports the grounds for the challenge to each claim,
including--
``(A) copies of patents and printed publications
that the petitioner relies upon in support of the
petition; and
``(B) affidavits or declarations of supporting
evidence and opinions, if the petitioner relies on
expert opinions;
``(4) the petition provides such other information as the
Director may require by regulation; and
``(5) the petitioner provides copies of any of the
documents required under paragraphs (2), (3), and (4) to the
patent owner or, if applicable, the designated representative
of the patent owner.
``(b) Public Availability.--As soon as practicable after the
receipt of a petition under section 311, the Director shall make the
petition available to the public.
``Sec. 313. Preliminary response to petition
``(a) Preliminary Response.--If an inter partes review petition is
filed under section 311, the patent owner shall have the right to file
a preliminary response within a time period set by the Director.
``(b) Content of Response.--A preliminary response to a petition
for inter partes review shall set forth reasons why no inter partes
review should be instituted based upon the failure of the petition to
meet any requirement of this chapter.
``Sec. 314. Institution of inter partes review
``(a) Threshold.--The Director may not authorize an inter partes
review to commence unless the Director determines that the information
presented in the petition filed under section 311 and any response
filed under section 313 shows that there is a reasonable likelihood
that the petitioner would prevail with respect to at least 1 of the
claims challenged in the petition.
``(b) Timing.--The Director shall determine whether to institute an
inter partes review under this chapter within 3 months after receiving
a preliminary response under section 313 or, if none is filed, within
three months after the expiration of the time for filing such a
response.
``(c) Notice.--The Director shall notify the petitioner and patent
owner, in writing, of the Director's determination under subsection
(a), and shall make such notice available to the public as soon as is
practicable. Such notice shall list the date on which the review shall
commence.
``(d) No Appeal.--The determination by the Director whether to
institute an inter partes review under this section shall be final and
nonappealable.
``Sec. 315. Relation to other proceedings or actions
``(a) Infringer's Action.--An inter partes review may not be
instituted or maintained if the petitioner or real party in interest
has filed a civil action challenging the validity of a claim of the
patent.
``(b) Patent Owner's Action.--An inter partes review may not be
instituted if the petition requesting the proceeding is filed more than
6 months after the date on which the petitioner, real party in
interest, or his privy is served with a complaint alleging infringement
of the patent. The time limitation set forth in the preceding sentence
shall not apply to a request for joinder under subsection (c).
``(c) Joinder.--If the Director institutes an inter partes review,
the Director, in his discretion, may join as a party to that inter
partes review any person who properly files a petition under section
311 that the Director, after receiving a preliminary response under
section 313 or the expiration of the time for filing such a response,
determines warrants the institution of an inter partes review under
section 314.
``(d) Multiple Proceedings.--Notwithstanding sections 135(a), 251,
and 252, and chapter 30, during the pendency of an inter partes review,
if another proceeding or matter involving the patent is before the
Office, the Director may determine the manner in which the inter partes
review or other proceeding or matter may proceed, including providing
for stay, transfer, consolidation, or termination of any such matter or
proceeding.
``(e) Estoppel.--
``(1) Proceedings before the office.--The petitioner in an
inter partes review under this chapter, or his real party in
interest or privy, may not request or maintain a proceeding
before the Office with respect to a claim on any ground that
the petitioner raised or reasonably could have raised during an
inter partes review of the claim that resulted in a final
written decision under section 318(a).
``(2) Civil actions and other proceedings.--The petitioner
in an inter partes review under this chapter, or his real party
in interest or privy, may not assert either in a civil action
arising in whole or in part under section 1338 of title 28 or
in a proceeding before the International Trade Commission that
a claim in a patent is invalid on any ground that the
petitioner raised or reasonably could have raised during an
inter partes review of the claim that resulted in a final
written decision under section 318(a).
``Sec. 316. Conduct of inter partes review
``(a) Regulations.--The Director shall prescribe regulations--
``(1) providing that the file of any proceeding under this
chapter shall be made available to the public, except that any
petition or document filed with the intent that it be sealed
shall be accompanied by a motion to seal, and such petition or
document shall be treated as sealed pending the outcome of the
ruling on the motion;
``(2) setting forth the standards for the showing of
sufficient grounds to institute a review under section 314(a);
``(3) establishing procedures for the submission of
supplemental information after the petition is filed;
``(4) in accordance with section 2(b)(2), establishing and
governing inter partes review under this chapter and the
relationship of such review to other proceedings under this
title;
``(5) setting a time period for requesting joinder under
section 315(c);
``(6) setting forth standards and procedures for discovery
of relevant evidence, including that such discovery shall be
limited to--
``(A) the deposition of witnesses submitting
affidavits or declarations; and
``(B) what is otherwise necessary in the interest
of justice;
``(7) prescribing sanctions for abuse of discovery, abuse
of process, or any other improper use of the proceeding, such
as to harass or to cause unnecessary delay or an unnecessary
increase in the cost of the proceeding;
``(8) providing for protective orders governing the
exchange and submission of confidential information;
``(9) allowing the patent owner to file a response to the
petition after an inter partes review has been instituted, and
requiring that the patent owner file with such response,
through affidavits or declarations, any additional factual
evidence and expert opinions on which the patent owner relies
in support of the response;
``(10) setting forth standards and procedures for allowing
the patent owner to move to amend the patent under subsection
(d) to cancel a challenged claim or propose a reasonable number
of substitute claims, and ensuring that any information
submitted by the patent owner in support of any amendment
entered under subsection (d) is made available to the public as
part of the prosecution history of the patent;
``(11) providing either party with the right to an oral
hearing as part of the proceeding; and
``(12) requiring that the final determination in an inter
partes review be issued not later than 1 year after the date on
which the Director notices the institution of a review under
this chapter, except that the Director may, for good cause
shown, extend the 1-year period by not more than 6 months, and
may adjust the time periods in this paragraph in the case of
joinder under section 315(c).
``(b) Considerations.--In prescribing regulations under this
section, the Director shall consider the effect of any such regulation
on the economy, the integrity of the patent system, the efficient
administration of the Office, and the ability of the Office to timely
complete proceedings instituted under this chapter.
``(c) Patent Trial and Appeal Board.--The Patent Trial and Appeal
Board shall, in accordance with section 6, conduct each proceeding
authorized by the Director.
``(d) Amendment of the Patent.--
``(1) In general.--During an inter partes review instituted
under this chapter, the patent owner may file 1 motion to amend
the patent in 1 or more of the following ways:
``(A) Cancel any challenged patent claim.
``(B) For each challenged claim, propose a
reasonable number of substitute claims.
``(2) Additional motions.--Additional motions to amend may
be permitted upon the joint request of the petitioner and the
patent owner to materially advance the settlement of a
proceeding under section 317, or as permitted by regulations
prescribed by the Director.
``(3) Scope of claims.--An amendment under this subsection
may not enlarge the scope of the claims of the patent or
introduce new matter.
``(e) Evidentiary Standards.--In an inter partes review instituted
under this chapter, the petitioner shall have the burden of proving a
proposition of unpatentability by a preponderance of the evidence.
``Sec. 317. Settlement
``(a) In General.--An inter partes review instituted under this
chapter shall be terminated with respect to any petitioner upon the
joint request of the petitioner and the patent owner, unless the Office
has decided the merits of the proceeding before the request for
termination is filed. If the inter partes review is terminated with
respect to a petitioner under this section, no estoppel under section
315(e) shall apply to that petitioner. If no petitioner remains in the
inter partes review, the Office may terminate the review or proceed to
a final written decision under section 318(a).
``(b) Agreements in Writing.--Any agreement or understanding
between the patent owner and a petitioner, including any collateral
agreements referred to in such agreement or understanding, made in
connection with, or in contemplation of, the termination of an inter
partes review under this section shall be in writing and a true copy of
such agreement or understanding shall be filed in the Office before the
termination of the inter partes review as between the parties. If any
party filing such agreement or understanding so requests, the copy
shall be kept separate from the file of the inter partes review, and
shall be made available only to Federal Government agencies upon
written request, or to any other person on a showing of good cause.
``Sec. 318. Decision of the board
``(a) Final Written Decision.--If an inter partes review is
instituted and not dismissed under this chapter, the Patent Trial and
Appeal Board shall issue a final written decision with respect to the
patentability of any patent claim challenged by the petitioner and any
new claim added under section 316(d).
``(b) Certificate.--If the Patent Trial and Appeal Board issues a
final written decision under subsection (a) and the time for appeal has
expired or any appeal has terminated, the Director shall issue and
publish a certificate canceling any claim of the patent finally
determined to be unpatentable, confirming any claim of the patent
determined to be patentable, and incorporating in the patent by
operation of the certificate any new or amended claim determined to be
patentable.
``(c) Data on Length of Review.--The Patent and Trademark Office
shall make available to the public data describing the length of time
between the commencement of each inter partes review and the conclusion
of that review.
``Sec. 319. Appeal
``A party dissatisfied with the final written decision of the
Patent Trial and Appeal Board under section 318(a) may appeal the
decision pursuant to sections 141 through 144. Any party to the inter
partes review shall have the right to be a party to the appeal.''.
(b) Technical and Conforming Amendment.--The table of chapters for
part III of title 35, United States Code, is amended by striking the
item relating to chapter 31 and inserting the following:
``31. Inter Partes Review................................... 311.''.
(c) Regulations and Effective Date.--
(1) Regulations.--The Director shall, not later than the
date that is 1 year after the date of the enactment of this
Act, issue regulations to carry out chapter 31 of title 35,
United States Code, as amended by subsection (a) of this
section.
(2) Applicability.--
(A) In general.--The amendments made by subsection
(a) shall take effect on the date that is 1 year after
the date of the enactment of this Act and shall apply
to all patents issued before, on, or after the
effective date of subsection (a).
(B) Exception.--The provisions of chapter 31 of
title 35, United States Code, as amended by paragraph
(3), shall continue to apply to requests for inter
partes reexamination that are filed prior to the
effective date of subsection (a) as if subsection (a)
had not been enacted.
(C) Graduated implementation.--The Director may
impose a limit on the number of inter partes reviews
that may be instituted during each of the first 4 years
following the effective date of subsection (a),
provided that such number shall in each year be
equivalent to or greater than the number of inter
partes reexaminations that are ordered in the last full
fiscal year prior to the effective date of subsection
(a).
(3) Transition.--
(A) In general.--Chapter 31 of title 35, United
States Code, is amended--
(i) in section 312--
(I) in subsection (a)--
(aa) in the first sentence,
by striking ``a substantial new
question of patentability
affecting any claim of the
patent concerned is raised by
the request,'' and inserting
``the information presented in
the request shows that there is
a reasonable likelihood that
the requester would prevail
with respect to at least 1 of
the claims challenged in the
request,''; and
(bb) in the second
sentence, by striking ``The
existence of a substantial new
question of patentability'' and
inserting ``A showing that
there is a reasonable
likelihood that the requester
would prevail with respect to
at least 1 of the claims
challenged in the request'';
and
(II) in subsection (c), in the
second sentence, by striking ``no
substantial new question of
patentability has been raised,'' and
inserting ``the showing required by
subsection (a) has not been made,'';
and
(ii) in section 313, by striking ``a
substantial new question of patentability
affecting a claim of the patent is raised'' and
inserting ``it has been shown that there is a
reasonable likelihood that the requester would
prevail with respect to at least 1 of the
claims challenged in the request''.
(B) Application.--The amendments made by this
paragraph shall apply to requests for inter partes
reexamination that are filed on or after the date of
the enactment of this Act, but prior to the effective
date of subsection (a).
(d) Post-Grant Review.--Part III of title 35, United States Code,
is amended by adding at the end the following:
``CHAPTER 32--POST-GRANT REVIEW
``Sec.
``321. Post-grant review.
``322. Petitions.
``323. Preliminary response to petition.
``324. Institution of post-grant review.
``325. Relation to other proceedings or actions.
``326. Conduct of post-grant review.
``327. Settlement.
``328. Decision of the board.
``329. Appeal.
``Sec. 321. Post-grant review
``(a) In General.--Subject to the provisions of this chapter, a
person who is not the patent owner may file with the Office a petition
to institute a post-grant review for a patent. The Director shall
establish, by regulation, fees to be paid by the person requesting the
review, in such amounts as the Director determines to be reasonable,
considering the aggregate costs of the post-grant review.
``(b) Scope.--A petitioner in a post-grant review may request to
cancel as unpatentable 1 or more claims of a patent on any ground that
could be raised under paragraph (2) or (3) of section 282(b) (relating
to invalidity of the patent or any claim).
``(c) Filing Deadline.--A petition for a post-grant review shall be
filed not later than 9 months after the grant of the patent or issuance
of a reissue patent.
``Sec. 322. Petitions
``(a) Requirements of Petition.--A petition filed under section 321
may be considered only if--
``(1) the petition is accompanied by payment of the fee
established by the Director under section 321;
``(2) the petition identifies all real parties in interest;
``(3) the petition identifies, in writing and with
particularity, each claim challenged, the grounds on which the
challenge to each claim is based, and the evidence that
supports the grounds for the challenge to each claim,
including--
``(A) copies of patents and printed publications
that the petitioner relies upon in support of the
petition; and
``(B) affidavits or declarations of supporting
evidence and opinions, if the petitioner relies on
other factual evidence or on expert opinions;
``(4) the petition provides such other information as the
Director may require by regulation; and
``(5) the petitioner provides copies of any of the
documents required under paragraphs (2), (3), and (4) to the
patent owner or, if applicable, the designated representative
of the patent owner.
``(b) Public Availability.--As soon as practicable after the
receipt of a petition under section 321, the Director shall make the
petition available to the public.
``Sec. 323. Preliminary response to petition
``(a) Preliminary Response.--If a post-grant review petition is
filed under section 321, the patent owner shall have the right to file
a preliminary response within 2 months of the filing of the petition.
``(b) Content of Response.--A preliminary response to a petition
for post-grant review shall set forth reasons why no post-grant review
should be instituted based upon the failure of the petition to meet any
requirement of this chapter.
``Sec. 324. Institution of post-grant review
``(a) Threshold.--The Director may not authorize a post-grant
review to commence unless the Director determines that the information
presented in the petition, if such information is not rebutted, would
demonstrate that it is more likely than not that at least 1 of the
claims challenged in the petition is unpatentable.
``(b) Additional Grounds.--The determination required under
subsection (a) may also be satisfied by a showing that the petition
raises a novel or unsettled legal question that is important to other
patents or patent applications.
``(c) Timing.--The Director shall determine whether to institute a
post-grant review under this chapter within 3 months after receiving a
preliminary response under section 323 or, if none is filed, the
expiration of the time for filing such a response.
``(d) Notice.--The Director shall notify the petitioner and patent
owner, in writing, of the Director's determination under subsection (a)
or (b), and shall make such notice available to the public as soon as
is practicable. The Director shall make each notice of the institution
of a post-grant review available to the public. Such notice shall list
the date on which the review shall commence.
``(e) No Appeal.--The determination by the Director whether to
institute a post-grant review under this section shall be final and
nonappealable.
``Sec. 325. Relation to other proceedings or actions
``(a) Infringer's Action.--A post-grant review may not be
instituted or maintained if the petitioner or real party in interest
has filed a civil action challenging the validity of a claim of the
patent.
``(b) Preliminary Injunctions.--If a civil action alleging
infringement of a patent is filed within 3 months of the grant of the
patent, the court may not stay its consideration of the patent owner's
motion for a preliminary injunction against infringement of the patent
on the basis that a petition for post-grant review has been filed or
that such a proceeding has been instituted.
``(c) Joinder.--If more than 1 petition for a post-grant review is
properly filed against the same patent and the Director determines that
more than 1 of these petitions warrants the institution of a post-grant
review under section 324, the Director may consolidate such reviews
into a single post-grant review.
``(d) Multiple Proceedings.--Notwithstanding sections 135(a), 251,
and 252, and chapter 30, during the pendency of any post-grant review,
if another proceeding or matter involving the patent is before the
Office, the Director may determine the manner in which the post-grant
review or other proceeding or matter may proceed, including providing
for stay, transfer, consolidation, or termination of any such matter or
proceeding. In determining whether to institute or order a proceeding
under this chapter, chapter 30, or chapter 31, the Director may take
into account whether, and reject the petition or request because, the
same or substantially the same prior art or arguments previously were
presented to the Office.
``(e) Estoppel.--
``(1) Proceedings before the office.--The petitioner in a
post-grant review under this chapter, or his real party in
interest or privy, may not request or maintain a proceeding
before the Office with respect to a claim on any ground that
the petitioner raised or reasonably could have raised during a
post-grant review of the claim that resulted in a final written
decision under section 328(a).
``(2) Civil actions and other proceedings.--The petitioner
in a post-grant review under this chapter, or his real party in
interest or privy, may not assert either in a civil action
arising in whole or in part under section 1338 of title 28 or
in a proceeding before the International Trade Commission that
a claim in a patent is invalid on any ground that the
petitioner raised during a post-grant review of the claim that
resulted in a final written decision under section 328(a).
``(f) Reissue Patents.--A post-grant review may not be instituted
if the petition requests cancellation of a claim in a reissue patent
that is identical to or narrower than a claim in the original patent
from which the reissue patent was issued, and the time limitations in
section 321(c) would bar filing a petition for a post-grant review for
such original patent.
``Sec. 326. Conduct of post-grant review
``(a) Regulations.--The Director shall prescribe regulations--
``(1) providing that the file of any proceeding under this
chapter shall be made available to the public, except that any
petition or document filed with the intent that it be sealed
shall be accompanied by a motion to seal, and such petition or
document shall be treated as sealed pending the outcome of the
ruling on the motion;
``(2) setting forth the standards for the showing of
sufficient grounds to institute a review under subsections (a)
and (b) of section 324;
``(3) establishing procedures for the submission of
supplemental information after the petition is filed;
``(4) in accordance with section 2(b)(2), establishing and
governing a post-grant review under this chapter and the
relationship of such review to other proceedings under this
title;
``(5) setting forth standards and procedures for discovery
of relevant evidence, including that such discovery shall be
limited to evidence directly related to factual assertions
advanced by either party in the proceeding;
``(6) prescribing sanctions for abuse of discovery, abuse
of process, or any other improper use of the proceeding, such
as to harass or to cause unnecessary delay or an unnecessary
increase in the cost of the proceeding;
``(7) providing for protective orders governing the
exchange and submission of confidential information;
``(8) allowing the patent owner to file a response to the
petition after a post-grant review has been instituted, and
requiring that the patent owner file with such response,
through affidavits or declarations, any additional factual
evidence and expert opinions on which the patent owner relies
in support of the response;
``(9) setting forth standards and procedures for allowing
the patent owner to move to amend the patent under subsection
(d) to cancel a challenged claim or propose a reasonable number
of substitute claims, and ensuring that any information
submitted by the patent owner in support of any amendment
entered under subsection (d) is made available to the public as
part of the prosecution history of the patent;
``(10) providing either party with the right to an oral
hearing as part of the proceeding; and
``(11) requiring that the final determination in any post-
grant review be issued not later than 1 year after the date on
which the Director notices the institution of a proceeding
under this chapter, except that the Director may, for good
cause shown, extend the 1-year period by not more than 6
months, and may adjust the time periods in this paragraph in
the case of joinder under section 325(c).
``(b) Considerations.--In prescribing regulations under this
section, the Director shall consider the effect of any such regulation
on the economy, the integrity of the patent system, the efficient
administration of the Office, and the ability of the Office to timely
complete proceedings instituted under this chapter.
``(c) Patent Trial and Appeal Board.--The Patent Trial and Appeal
Board shall, in accordance with section 6, conduct each proceeding
authorized by the Director.
``(d) Amendment of the Patent.--
``(1) In general.--During a post-grant review instituted
under this chapter, the patent owner may file 1 motion to amend
the patent in 1 or more of the following ways:
``(A) Cancel any challenged patent claim.
``(B) For each challenged claim, propose a
reasonable number of substitute claims.
``(2) Additional motions.--Additional motions to amend may
be permitted upon the joint request of the petitioner and the
patent owner to materially advance the settlement of a
proceeding under section 327, or upon the request of the patent
owner for good cause shown.
``(3) Scope of claims.--An amendment under this subsection
may not enlarge the scope of the claims of the patent or
introduce new matter.
``(e) Evidentiary Standards.--In a post-grant review instituted
under this chapter, the petitioner shall have the burden of proving a
proposition of unpatentability by a preponderance of the evidence.
``Sec. 327. Settlement
``(a) In General.--A post-grant review instituted under this
chapter shall be terminated with respect to any petitioner upon the
joint request of the petitioner and the patent owner, unless the Office
has decided the merits of the proceeding before the request for
termination is filed. If the post-grant review is terminated with
respect to a petitioner under this section, no estoppel under section
325(e) shall apply to that petitioner. If no petitioner remains in the
post-grant review, the Office may terminate the post-grant review or
proceed to a final written decision under section 328(a).
``(b) Agreements in Writing.--Any agreement or understanding
between the patent owner and a petitioner, including any collateral
agreements referred to in such agreement or understanding, made in
connection with, or in contemplation of, the termination of a post-
grant review under this section shall be in writing, and a true copy of
such agreement or understanding shall be filed in the Office before the
termination of the post-grant review as between the parties. If any
party filing such agreement or understanding so requests, the copy
shall be kept separate from the file of the post-grant review, and
shall be made available only to Federal Government agencies upon
written request, or to any other person on a showing of good cause.
``Sec. 328. Decision of the board
``(a) Final Written Decision.--If a post-grant review is instituted
and not dismissed under this chapter, the Patent Trial and Appeal Board
shall issue a final written decision with respect to the patentability
of any patent claim challenged by the petitioner and any new claim
added under section 326(d).
``(b) Certificate.--If the Patent Trial and Appeal Board issues a
final written decision under subsection (a) and the time for appeal has
expired or any appeal has terminated, the Director shall issue and
publish a certificate canceling any claim of the patent finally
determined to be unpatentable, confirming any claim of the patent
determined to be patentable, and incorporating in the patent by
operation of the certificate any new or amended claim determined to be
patentable.
``(c) Data on Length of Review.--The Patent and Trademark Office
shall make available to the public data describing the length of time
between the commencement of each post-grant review and the conclusion
of that review.
``Sec. 329. Appeal
``A party dissatisfied with the final written decision of the
Patent Trial and Appeal Board under section 328(a) may appeal the
decision pursuant to sections 141 through 144. Any party to the post-
grant review shall have the right to be a party to the appeal.''.
(e) Technical and 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 Review..................................... 321.''.
(f) Regulations and Effective Date.--
(1) Regulations.--The Director shall, not later than the
date that is 1 year after the date of the enactment of this
Act, issue regulations to carry out chapter 32 of title 35,
United States Code, as added by subsection (d) of this section.
(2) Applicability.--The amendments made by subsection (d)
shall take effect on the date that is 1 year after the date of
the enactment of this Act and, except as provided in section 18
and in paragraph (3), shall apply only to patents that are
described in section 2(o)(1). The Director may impose a limit
on the number of post-grant reviews that may be instituted
during each of the 4 years following the effective date of
subsection (d).
(3) Pending interferences.--The Director shall determine
the procedures under which interferences commenced before the
effective date of subsection (d) are to proceed, including
whether any such interference is to be dismissed without
prejudice to the filing of a petition for a post-grant review
under chapter 32 of title 35, United States Code, or is to
proceed as if this Act had not been enacted. The Director shall
include such procedures in regulations issued under paragraph
(1). For purposes of an interference that is commenced before
the effective date of subsection (d), the Director may deem the
Patent Trial and Appeal Board to be the Board of Patent Appeals
and Interferences, and may allow the Patent Trial and Appeal
Board to conduct any further proceedings in that interference.
The authorization to appeal or have remedy from derivation
proceedings in sections 141(d) and 146 of title 35, United
States Code, and the jurisdiction to entertain appeals from
derivation proceedings in section 1295(a)(4)(A) of title 28,
United States Code, shall be deemed to extend to final
decisions in interferences that are commenced before the
effective date of subsection (d) and that are not dismissed
pursuant to this paragraph.
(g) Citation of Prior Art and Written Statements.--
(1) In general.--Section 301 of title 35, United States
Code, is amended to read as follows:
``Sec. 301. Citation of prior art and written statements
``(a) In General.--Any person at any time may cite to the Office in
writing--
``(1) prior art consisting of patents or printed
publications which that person believes to have a bearing on
the patentability of any claim of a particular patent; or
``(2) statements of the patent owner filed in a proceeding
before a Federal court or the Office in which the patent owner
took a position on the scope of any claim of a particular
patent.
``(b) Official File.--If the person citing prior art or written
statements pursuant to subsection (a) explains in writing the
pertinence and manner of applying the prior art or written statements
to at least 1 claim of the patent, the citation of the prior art or
written statements and the explanation thereof shall become a part of
the official file of the patent.
``(c) Additional Information.--A party that submits a written
statement pursuant to subsection (a)(2) shall include any other
documents, pleadings, or evidence from the proceeding in which the
statement was filed that addresses the written statement.
``(d) Limitations.--A written statement submitted pursuant to
subsection (a)(2), and additional information submitted pursuant to
subsection (c), shall not be considered by the Office for any purpose
other than to determine the proper meaning of a patent claim in a
proceeding that is ordered or instituted pursuant to section 304, 314,
or 324. If any such written statement or additional information is
subject to an applicable protective order, it shall be redacted to
exclude information that is subject to that order.
``(e) Confidentiality.--Upon the written request of the person
citing prior art or written statements pursuant to subsection (a), that
person's identity shall be excluded from the patent file and kept
confidential.''.
(2) Effective date.--The amendment made by this subsection
shall take effect 1 year after the date of the enactment of
this Act and shall apply to patents issued before, on, or after
that effective date.
(h) Reexamination.--
(1) Determination by director.--
(A) In general.--Section 303(a) of title 35, United
States Code, is amended by striking ``section 301 of
this title'' and inserting ``section 301 or 302''.
(B) Effective date.--The amendment made by this
paragraph shall take effect 1 year after the date of
the enactment of this Act and shall apply to patents
issued before, on, or after that effective date.
(2) Appeal.--
(A) In general.--Section 306 of title 35, United
States Code, is amended by striking ``145'' and
inserting ``144''.
(B) Effective date.--The amendment made by this
paragraph shall take effect on the date of enactment of
this Act and shall apply to appeals of reexaminations
that are pending before the Board of Patent Appeals and
Interferences or the Patent Trial and Appeal Board on
or after the date of the enactment of this Act.
SEC. 6. PATENT TRIAL AND APPEAL BOARD.
(a) Composition and Duties.--Section 6 of title 35, United States
Code, is amended to read as follows:
``Sec. 6. Patent Trial and Appeal Board
``(a) There shall be in the Office a Patent Trial and Appeal Board.
The Director, the Deputy Director, the Commissioner for Patents, the
Commissioner for Trademarks, and the administrative patent judges shall
constitute the Patent Trial and Appeal Board. The administrative patent
judges shall be persons of competent legal knowledge and scientific
ability who are appointed by the Secretary, in consultation with the
Director. Any reference in any Federal law, Executive order, rule,
regulation, or delegation of authority, or any document of or
pertaining to the Board of Patent Appeals and Interferences is deemed
to refer to the Patent Trial and Appeal Board.
``(b) The Patent Trial and Appeal Board shall--
``(1) on written appeal of an applicant, review adverse
decisions of examiners upon applications for patents pursuant
to section 134(a);
``(2) review appeals of reexaminations pursuant to section
134(b);
``(3) conduct derivation proceedings pursuant to section
135; and
``(4) conduct inter partes reviews and post-grant reviews
pursuant to chapters 31 and 32.
``(c) Each appeal, derivation proceeding, post-grant review, and
inter partes review shall be heard by at least 3 members of the Patent
Trial and Appeal Board, who shall be designated by the Director. Only
the Patent Trial and Appeal Board may grant rehearings.
``(d) The Secretary of Commerce may, in his discretion, deem the
appointment of an administrative patent judge who, before the date of
the enactment of this subsection, held office pursuant to an
appointment by the Director to take effect on the date on which the
Director initially appointed the administrative patent judge. It shall
be a defense to a challenge to the appointment of an administrative
patent judge on the basis of the judge's having been originally
appointed by the Director that the administrative patent judge so
appointed was acting as a de facto officer.''.
(b) Administrative Appeals.--Section 134 of title 35, United States
Code, is amended--
(1) in subsection (b), by striking ``any reexamination
proceeding'' and inserting ``a reexamination''; and
(2) by striking subsection (c).
(c) Circuit Appeals.--
(1) In general.--Section 141 of title 35, United States
Code, is amended to read as follows:
``Sec. 141. Appeal to the Court of Appeals for the Federal Circuit
``(a) Examinations.--An applicant who is dissatisfied with the
final decision in an appeal to the Patent Trial and Appeal Board under
section 134(a) may appeal the Board's decision to the United States
Court of Appeals for the Federal Circuit. By filing such an appeal, the
applicant waives his right to proceed under section 145.
``(b) Reexaminations.--A patent owner who is dissatisfied with the
final decision in an appeal of a reexamination to the Patent Trial and
Appeal Board under section 134(b) may appeal the Board's decision only
to the United States Court of Appeals for the Federal Circuit.
``(c) Post-Grant and Inter Partes Reviews.--A party to a post-grant
or inter partes review who is dissatisfied with the final written
decision of the Patent Trial and Appeal Board under section 318(a) or
328(a) may appeal the Board's decision only to the United States Court
of Appeals for the Federal Circuit.
``(d) Derivation Proceedings.--A party to a derivation proceeding
who is dissatisfied with the final decision of the Patent Trial and
Appeal Board on the proceeding may appeal the decision to the United
States Court of Appeals for the Federal Circuit, but such appeal shall
be dismissed if any adverse party to such derivation proceeding, within
20 days after the appellant has filed notice of appeal in accordance
with section 142, files notice with the Director that the party elects
to have all further proceedings conducted as provided in section 146.
If the appellant does not, within 30 days after the filing of such
notice by the adverse party, file a civil action under section 146, the
Board's decision shall govern the further proceedings in the case.''.
(2) Jurisdiction.--Section 1295(a)(4)(A) of title 28,
United States Code, is amended to read as follows:
``(A) the Patent Trial and Appeal Board of the
United States Patent and Trademark Office with respect
to patent applications, derivation proceedings,
reexaminations, post-grant reviews, and inter partes
reviews at the instance of a party who exercised his
right to participate in a proceeding before or appeal
to the Board, except that an applicant or a party to a
derivation proceeding may also have remedy by civil
action pursuant to section 145 or 146 of title 35. An
appeal under this subparagraph of a decision of the
Board with respect to an application or derivation
proceeding shall waive the right of such applicant or
party to proceed under section 145 or 146 of title
35;''.
(3) Proceedings on appeal.--Section 143 of title 35, United
States Code, is amended--
(A) by striking the third sentence and inserting
the following: ``In an ex parte case, the Director
shall submit to the court in writing the grounds for
the decision of the Patent and Trademark Office,
addressing all of the issues raised in the appeal. The
Director shall have the right to intervene in an appeal
from a decision entered by the Patent Trial and Appeal
Board in a derivation proceeding under section 135 or
in an inter partes or post-grant review under chapter
31 or 32.''; and
(B) by repealing the second of the two identical
fourth sentences.
(d) Effective Date.--The amendments made by this section shall take
effect 1 year after the date of the enactment of this Act and shall
apply to proceedings commenced on or after that effective date, except
that--
(1) the extension of jurisdiction to the United States
Court of Appeals for the Federal Circuit to entertain appeals
of decisions of the Patent Trial and Appeal Board in
reexaminations under the amendment made by subsection (c)(2)
shall be deemed to take effect on the date of enactment of this
Act and shall extend to any decision of the Board of Patent
Appeals and Interferences with respect to a reexamination that
is entered before, on, or after the date of the enactment of
this Act;
(2) the provisions of sections 6, 134, and 141 of title 35,
United States Code, in effect on the day prior to the date of
the enactment of this Act shall continue to apply to inter
partes reexaminations that are requested under section 311
prior to the date that is 1 year after the date of the
enactment of this Act;
(3) the Patent Trial and Appeal Board may be deemed to be
the Board of Patent Appeals and Interferences for purposes of
appeals of inter partes reexaminations that are requested under
section 311 prior to the date that is 1 year after the date of
the enactment of this Act; and
(4) the Director's right under the last sentence of section
143 of title 35, United States Code, as amended by subsection
(c)(3), to intervene in an appeal from a decision entered by
the Patent Trial and Appeal Board shall be deemed to extend to
inter partes reexaminations that are requested under section
311 prior to the date that is 1 year after the date of the
enactment of this Act.
SEC. 7. PREISSUANCE SUBMISSIONS BY THIRD PARTIES.
(a) In General.--Section 122 of title 35, United States Code, is
amended by adding at the end the following:
``(e) Preissuance Submissions by Third Parties.--
``(1) In general.--Any third party may submit for
consideration and inclusion in the record of a patent
application, any patent, published patent application, or other
printed 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 given or mailed in the application for patent;
or
``(B) the later of--
``(i) 6 months after the date on which the
application for patent is first published under
section 122 by the Office, 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.
``(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 person making such
submission affirming that the submission was made in
compliance with this section.''.
(b) Effective Date.--The amendments made by this section shall take
effect 1 year after the date of the enactment of this Act and shall
apply to patent applications filed before, on, or after that effective
date.
SEC. 8. VENUE.
(a) Technical Amendments Relating to Venue.--Sections 32, 145, 146,
154(b)(4)(A), and 293 of title 35, United States Code, and section
21(b)(4) of the Act entitled ``An Act to provide for the registration
and protection of trademarks used in commerce, to carry out the
provisions of certain international conventions, and for other
purposes'', approved July 5, 1946 (commonly referred to as the
``Trademark Act of 1946'' or the ``Lanham Act''; 15 U.S.C. 1071(b)(4)),
are each amended by striking ``United States District Court for the
District of Columbia'' each place that term appears and inserting
``United States District Court for the Eastern District of Virginia''.
(b) Effective Date.--The amendments made by this section shall take
effect upon the date of the enactment of this Act and shall apply to
civil actions commenced on or after that date.
SEC. 9. FEE SETTING AUTHORITY.
(a) Fee Setting.--
(1) In general.--The Director shall have authority to set
or adjust by rule any fee established, authorized, or charged
under title 35, United States Code, and the Trademark Act of
1946 (15 U.S.C. 1051 et seq.), notwithstanding the fee amounts
established, authorized, or charged thereunder, for all
services performed by or materials furnished by, the Office,
provided that patent and trademark fee amounts are in the
aggregate set to recover the estimated cost to the Office for
processing, activities, services, and materials relating to
patents and trademarks, respectively, including proportionate
shares of the administrative costs of the Office.
(2) Small and micro entities.--The fees established under
paragraph (1) for filing, searching, examining, issuing,
appealing, and maintaining patent applications and patents
shall be reduced by 50 percent with respect to their
application to any small entity that qualifies for reduced fees
under section 41(h)(1) of title 35, United States Code, and
shall be reduced by 75 percent with respect to their
application to any micro entity as defined in section 123 of
that title.
(3) Reduction of fees in certain fiscal years.--In any
fiscal year, the Director--
(A) shall consult with the Patent Public Advisory
Committee and the Trademark Public Advisory Committee
on the advisability of reducing any fees described in
paragraph (1); and
(B) after the consultation required under
subparagraph (A), may reduce such fees.
(4) Role of the public advisory committee.--The Director
shall--
(A) submit to the Patent Public Advisory Committee
or the Trademark Public Advisory Committee, or both, as
appropriate, any proposed fee under paragraph (1) not
less than 45 days before publishing any proposed fee in
the Federal Register;
(B) provide the relevant advisory committee
described in subparagraph (A) a 30-day period following
the submission of any proposed fee, on which to
deliberate, consider, and comment on such proposal, and
require that--
(i) during such 30-day period, the relevant
advisory committee hold a public hearing
related to such proposal; and
(ii) the Director shall assist the relevant
advisory committee in carrying out such public
hearing, including by offering the use of
Office resources to notify and promote the
hearing to the public and interested
stakeholders;
(C) require the relevant advisory committee to make
available to the public a written report detailing the
comments, advice, and recommendations of the committee
regarding any proposed fee;
(D) consider and analyze any comments, advice, or
recommendations received from the relevant advisory
committee before setting or adjusting any fee; and
(E) notify, through the Chair and Ranking Member of
the Senate and House Judiciary Committees, the Congress
of any final rule setting or adjusting fees under
paragraph (1).
(5) Publication in the federal register.--
(A) In general.--Any rules prescribed under this
subsection shall be published in the Federal Register.
(B) Rationale.--Any proposal for a change in fees
under this section shall--
(i) be published in the Federal Register;
and
(ii) include, in such publication, the
specific rationale and purpose for the
proposal, including the possible expectations
or benefits resulting from the proposed change.
(C) Public comment period.--Following the
publication of any proposed fee in the Federal Register
pursuant to subparagraph (A), the Director shall seek
public comment for a period of not less than 45 days.
(6) Congressional comment period.--Following the
notification described in paragraph (3)(E), Congress shall have
not more than 45 days to consider and comment on any final rule
setting or adjusting fees under paragraph (1). No fee set or
adjusted under paragraph (1) shall be effective prior to the
end of such 45-day comment period.
(7) Rule of construction.--No rules prescribed under this
subsection may diminish--
(A) an applicant's rights under title 35, United
States Code, or the Trademark Act of 1946; or
(B) any rights under a ratified treaty.
(b) Fees for Patent Services.--Division B of Public Law 108-447 is
amended in title VIII of the Departments of Commerce, Justice, and
State, the Judiciary, and Related Agencies Appropriations Act, 2005--
(1) in subsections (a), (b), and (c) of section 801, by--
(A) striking ``During'' and all that follows
through `` 2006, subsection'' and inserting
``Subsection''; and
(B) striking ``shall be administered as though that
subsection reads'' and inserting ``is amended to
read'';
(2) in subsection (d) of section 801, by striking
``During'' and all that follows through `` 2006, subsection''
and inserting ``Subsection''; and
(3) in subsection (e) of section 801, by--
(A) striking ``During'' and all that follows
through ``2006, subsection'' and inserting
``Subsection''; and
(B) striking ``shall be administered as though that
subsection''.
(c) Adjustment of Trademark Fees.--Division B of Public Law 108-447
is amended in title VIII of the Departments of Commerce, Justice and
State, the Judiciary and Related Agencies Appropriations Act, 2005, in
section 802(a) by striking ``During fiscal years 2005, 2006 and 2007'',
and inserting ``Until such time as the Director sets or adjusts the
fees otherwise,''.
(d) Effective Date, Applicability, and Transition Provisions.--
Division B of Public Law 108-447 is amended in title VIII of the
Departments of Commerce, Justice and State, the Judiciary and Related
Agencies Appropriations Act, 2005, in section 803(a) by striking ``and
shall apply only with respect to the remaining portion of fiscal year
2005, 2006 and 2007''.
(e) Statutory Authority.--Section 41(d)(1)(A) of title 35, United
States Code, is amended by striking ``, and the Director may not
increase any such fee thereafter''.
(f) Rule of Construction.--Nothing in this section shall be
construed to affect any other provision of Division B of Public Law
108-447, including section 801(c) of title VIII of the Departments of
Commerce, Justice and State, the Judiciary and Related Agencies
Appropriations Act, 2005.
(g) Definitions.--In this section, the following definitions shall
apply:
(1) Director.--The term ``Director'' means the Director of
the United States Patent and Trademark Office.
(2) Office.--The term ``Office'' means the United States
Patent and Trademark Office.
(3) Trademark act of 1946.--The term ``Trademark Act of
1946'' means an Act entitled ``Act to provide for the
registration and protection of trademarks used in commerce, to
carry out the provisions of certain international conventions,
and for other purposes'', approved July 5, 1946 (15 U.S.C. 1051
et seq.) (commonly referred to as the Trademark Act of 1946 or
the Lanham Act).
(h) Electronic Filing Incentive.--
(1) In general.--Notwithstanding any other provision of
this section, a fee of $400 shall be established for each
application for an original patent, except for a design, plant,
or provisional application, that is not filed by electronic
means as prescribed by the Director. The fee established by
this subsection shall be reduced 50 percent for small entities
that qualify for reduced fees under section 41(h)(1) of title
35, United States Code. All fees paid under this subsection
shall be deposited in the Treasury as an offsetting receipt
that shall not be available for obligation or expenditure.
(2) Effective date.--This subsection shall become effective
60 days after the date of the enactment of this Act.
(i) Reduction in Fees for Small Entity Patents.--The Director shall
reduce fees for providing prioritized examination of utility and plant
patent applications by 50 percent for small entities that qualify for
reduced fees under section 41(h)(1) of title 35, United States Code, so
long as the fees of the prioritized examination program are set to
recover the estimated cost of the program.
(j) Effective Date.--Except as provided in subsection (h), the
provisions of this section shall take effect upon the date of the
enactment of this Act.
SEC. 10. SUPPLEMENTAL EXAMINATION.
(a) In General.--Chapter 25 of title 35, United States Code, is
amended by adding at the end the following:
``Sec. 257. Supplemental examinations to consider, reconsider, or
correct information
``(a) In General.--A patent owner may request supplemental
examination of a patent in the Office to consider, reconsider, or
correct information believed to be relevant to the patent. Within 3
months of the date a request for supplemental examination meeting the
requirements of this section is received, the Director shall conduct
the supplemental examination and shall conclude such examination by
issuing a certificate indicating whether the information presented in
the request raises a substantial new question of patentability.
``(b) Reexamination Ordered.--If a substantial new question of
patentability is raised by 1 or more items of information in the
request, the Director shall order reexamination of the patent. The
reexamination shall be conducted according to procedures established by
chapter 30, except that the patent owner shall not have the right to
file a statement pursuant to section 304. During the reexamination, the
Director shall address each substantial new question of patentability
identified during the supplemental examination, notwithstanding the
limitations therein relating to patents and printed publication or any
other provision of chapter 30.
``(c) Effect.--
``(1) In general.--A patent shall not be held unenforceable
on the basis of conduct relating to information that had not
been considered, was inadequately considered, or was incorrect
in a prior examination of the patent if the information was
considered, reconsidered, or corrected during a supplemental
examination of the patent. The making of a request under
subsection (a), or the absence thereof, shall not be relevant
to enforceability of the patent under section 282.
``(2) Exceptions.--
``(A) Prior allegations.--This subsection shall not
apply to an allegation pled with particularity, or set
forth with particularity in a notice received by the
patent owner under section 505(j)(2)(B)(iv)(II) of the
Federal Food, Drug, and Cosmetic Act (21 U.S.C.
355(j)(2)(B)(iv)(II)), before the date of a
supplemental-examination request under subsection (a)
to consider, reconsider, or correct information forming
the basis for the allegation.
``(B) Patent enforcement actions.--In an action
brought under section 337(a) of the Tariff Act of 1930
(19 U.S.C. 1337(a)), or section 281 of this title, this
subsection shall not apply to any defense raised in the
action that is based upon information that was
considered, reconsidered, or corrected pursuant to a
supplemental-examination request under subsection (a)
unless the supplemental examination, and any
reexamination ordered pursuant to the request, are
concluded before the date on which the action is
brought.
``(d) Fees and Regulations.--The Director shall, by regulation,
establish fees for the submission of a request for supplemental
examination of a patent, and to consider each item of information
submitted in the request. If reexamination is ordered pursuant to
subsection (a), fees established and applicable to ex parte
reexamination proceedings under chapter 30 shall be paid in addition to
fees applicable to supplemental examination. The Director shall
promulgate regulations governing the form, content, and other
requirements of requests for supplemental examination, and establishing
procedures for conducting review of information submitted in such
requests.
``(e) Rule of Construction.--Nothing in this section shall be
construed--
``(1) to preclude the imposition of sanctions based upon
criminal or antitrust laws (including section 1001(a) of title
18, the first section of the Clayton Act, and section 5 of the
Federal Trade Commission Act to the extent that section relates
to unfair methods of competition);
``(2) to limit the authority of the Director to investigate
issues of possible misconduct and impose sanctions for
misconduct in connection with matters or proceedings before the
Office; or
``(3) to limit the authority of the Director to promulgate
regulations under chapter 3 relating to sanctions for
misconduct by representatives practicing before the Office.''.
(b) Effective Date.--This section shall take effect 1 year after
the date of the enactment of this Act and shall apply to patents issued
before, on, or after that date.
SEC. 11. RESIDENCY OF FEDERAL CIRCUIT JUDGES.
(a) In General.--Section 44(c) of title 28, United States Code, is
amended--
(1) by repealing the second sentence; and
(2) in the third sentence, by striking ``state'' and
inserting ``State''.
(b) No Provision of Facilities Authorized.--The repeal made by the
amendment in subsection (a)(1) shall not be construed to authorize the
provision of any court facilities or administrative support services
outside of the District of Columbia.
(c) Effective Date.--This section shall take effect on the date of
enactment of this Act.
SEC. 12. MICRO ENTITY DEFINED.
Chapter 11 of title 35, United States Code, is amended by adding at
the end the following new section:
``Sec. 123. Micro entity defined
``(a) In General.--For purposes of this title, the term `micro
entity' means an applicant who makes a certification that the
applicant--
``(1) qualifies as a small entity, as defined in
regulations issued by the Director;
``(2) has not been named on 5 or more previously filed
patent applications, not including applications filed in
another country, provisional applications under section 111(b),
or international applications filed under the treaty defined in
section 351(a) for which the basic national fee under section
41(a) was not paid;
``(3) did not in the prior calendar year have a gross
income, as defined in section 61(a) of the Internal Revenue
Code (26 U.S.C. 61(a)), exceeding 3 times the most recently
reported median household income, as reported by the Bureau of
Census; and
``(4) has not assigned, granted, conveyed, and is not under
an obligation by contract or law to assign, grant, or convey, a
license or other ownership interest in the particular
application to an entity that had a gross income, as defined in
section 61(a) of the Internal Revenue Code (26 U.S.C. 61(a)),
exceeding 3 times the most recently reported median household
income, as reported by the Bureau of the Census, in the
calendar year preceding the calendar year in which the fee is
being paid, other than an entity of higher education where the
applicant is not an employee, a relative of an employee, or
have any affiliation with the entity of higher education.
``(b) Applications Resulting From Prior Employment.--An applicant
is not considered to be named on a previously filed application for
purposes of subsection (a)(2) if the applicant has assigned, or is
under an obligation by contract or law to assign, all ownership rights
in the application as the result of the applicant's previous
employment.
``(c) Foreign Currency Exchange Rate.--If an applicant's or
entity's gross income in the preceding year is not in United States
dollars, the average currency exchange rate, as reported by the
Internal Revenue Service, during the preceding year shall be used to
determine whether the applicant's or entity's gross income exceeds the
threshold specified in paragraphs (3) or (4) of subsection (a).
``(d) State Institutions of Higher Education.--
``(1) In general.--For purposes of this section, a micro
entity shall include an applicant who certifies that--
``(A) the applicant's employer, from which the
applicant obtains the majority of the applicant's
income, is a State public institution of higher
education, as defined in section 102 of the Higher
Education Act of 1965 (20 U.S.C. 1002); or
``(B) the applicant has assigned, granted,
conveyed, or is under an obligation by contract or law
to assign, grant, or convey, a license or other
ownership interest in the particular application to
such State public institution.
``(2) Director's authority.--The Director may, in the
Director's discretion, impose income limits, annual filing
limits, or other limits on who may qualify as a micro entity
pursuant to this subsection if the Director determines that
such additional limits are reasonably necessary to avoid an
undue impact on other patent applicants or owners or are
otherwise reasonably necessary and appropriate. At least 3
months before any limits proposed to be imposed pursuant to
this paragraph shall take effect, the Director shall inform the
Committee on the Judiciary of the House of Representatives and
the Committee on the Judiciary of the Senate of any such
proposed limits.''.
SEC. 13. FUNDING AGREEMENTS.
(a) In General.--Section 202(c)(7)(E)(i) of title 35, United States
Code, is amended--
(1) by striking ``75 percent'' and inserting ``15
percent''; and
(2) by striking ``25 percent'' and inserting ``85
percent''.
(b) Effective Date.--The amendments made by this section shall take
effect on the date of enactment of this Act and shall apply to patents
issued before, on, or after that date.
SEC. 14. TAX STRATEGIES DEEMED WITHIN THE PRIOR ART.
(a) In General.--For purposes of evaluating an invention under
section 102 or 103 of title 35, United States Code, any strategy for
reducing, avoiding, or deferring tax liability, whether known or
unknown at the time of the invention or application for patent, shall
be deemed insufficient to differentiate a claimed invention from the
prior art.
(b) Definition.--For purposes of this section, the term ``tax
liability'' refers to any liability for a tax under any Federal, State,
or local law, or the law of any foreign jurisdiction, including any
statute, rule, regulation, or ordinance that levies, imposes, or
assesses such tax liability.
(c) Rule of Construction.--Nothing in this section shall be
construed to imply that other business methods are patentable or that
other business-method patents are valid.
(d) Effective Date; Applicability.--This section shall take effect
on the date of enactment of this Act and shall apply to any patent
application pending and any patent issued on or after that date.
(e) Exclusion.--This section does not apply to that part of an
invention that is a method, apparatus, computer program product, or
system, that is used solely for preparing a tax or information return
or other tax filing, including one that records, transmits, transfers,
or organizes data related to such filing.
SEC. 15. BEST MODE REQUIREMENT.
(a) In General.--Section 282 of title 35, United State Code, is
amended in its second undesignated paragraph by striking paragraph (3)
and inserting the following:
``(3) Invalidity of the patent or any claim in suit for
failure to comply with--
``(A) any requirement of section 112, except that
the failure to disclose the best mode shall not be a
basis on which any claim of a patent may be canceled or
held invalid or otherwise unenforceable; or
``(B) any requirement of section 251.''.
(b) Conforming Amendment.--Sections 119(e)(1) and 120 of title 35,
United States Code, are each amended by striking ``the first paragraph
of section 112 of this title'' and inserting ``section 112(a) (other
than the requirement to disclose the best mode)''.
(c) Effective Date.--The amendments made by this section shall take
effect upon the date of the enactment of this Act and shall apply to
proceedings commenced on or after that date.
SEC. 16. TECHNICAL AMENDMENTS.
(a) Joint Inventions.--Section 116 of title 35, United States Code,
is amended--
(1) in the first paragraph, by striking ``When''
and inserting ``(a) Joint Inventions.--When'';
(2) in the second paragraph, by striking ``If a
joint inventor'' and inserting ``(b) Omitted
Inventor.--If a joint inventor''; and
(3) in the third paragraph--
(A) by striking ``Whenever'' and inserting
``(c) Correction of Errors in Application.--
Whenever''; and
(B) by striking ``and such error arose
without any deceptive intent on his part,''.
(b) Filing of Application in Foreign Country.--Section 184 of title
35, United States Code, is amended--
(1) in the first paragraph--
(A) by striking ``Except when'' and inserting ``(a)
Filing in Foreign Country.--Except when''; and
(B) by striking ``and without deceptive intent'';
(2) in the second paragraph, by striking ``The term'' and
inserting ``(b) Application.--The term''; and
(3) in the third paragraph, by striking ``The scope'' and
inserting ``(c) Subsequent Modifications, Amendments, and
Supplements.--The scope''.
(c) Filing Without a License.--Section 185 of title 35, United
States Code, is amended by striking ``and without deceptive intent''.
(d) Reissue of Defective Patents.--Section 251 of title 35, United
States Code, is amended--
(1) in the first paragraph--
(A) by striking ``Whenever'' and inserting ``(a) In
General.--Whenever''; and
(B) by striking ``without any deceptive
intention'';
(2) in the second paragraph, by striking ``The Director''
and inserting ``(b) Multiple Reissued Patents.--The Director'';
(3) in the third paragraph, by striking ``The provisions''
and inserting ``(c) Applicability of This Title.--The
provisions''; and
(4) in the last paragraph, by striking ``No reissued
patent'' and inserting ``(d) Reissue Patent Enlarging Scope of
Claims.--No reissued patent''.
(e) Effect of Reissue.--Section 253 of title 35, United States
Code, is amended--
(1) in the first paragraph, by striking ``Whenever, without
any deceptive intention'' and inserting ``(a) In General.--
Whenever''; and
(2) in the second paragraph, by striking ``in like manner''
and inserting ``(b) Additional Disclaimer or Dedication.--In
the manner set forth in subsection (a),''.
(f) Correction of Named Inventor.--Section 256 of title 35, United
States Code, is amended--
(1) in the first paragraph--
(A) by striking ``Whenever'' and inserting ``(a)
Correction.--Whenever''; and
(B) by striking ``and such error arose without any
deceptive intention on his part''; and
(2) in the second paragraph, by striking ``The error'' and
inserting ``(b) Patent Valid if Error Corrected.--The error''.
(g) Presumption of Validity.--Section 282 of title 35, United
States Code, is amended--
(1) in the first undesignated paragraph--
(A) by striking ``A patent'' and inserting ``(a) In
General.--A patent''; and
(B) by striking the third sentence;
(2) in the second undesignated paragraph, by striking ``The
following'' and inserting ``(b) Defenses.--The following''; and
(3) in the third undesignated paragraph, by striking ``In
actions'' and inserting ``(c) Notice of Actions; Actions During
Extension of Patent Term.--In actions''.
(h) Action for Infringement.--Section 288 of title 35, United
States Code, is amended by striking ``, without deceptive intention,''.
(i) Reviser's Notes.--
(1) Section 3(e)(2) of title 35, United States Code, is
amended by striking ``this Act,'' and inserting ``that Act,''.
(2) Section 202 of title 35, United States Code, is
amended--
(A) in subsection (b)(3), by striking ``the section
203(b)'' and inserting ``section 203(b)''; and
(B) in subsection (c)(7)--
(i) in subparagraph (D), by striking
``except where it proves'' and all that follows
through ``; and'' and inserting: ``except where
it is determined to be infeasible following a
reasonable inquiry, a preference in the
licensing of subject inventions shall be given
to small business firms; and''; and
(ii) in subparagraph (E)(i), by striking
``as described above in this clause (D);'' and
inserting ``described above in this clause;''.
(3) Section 209(d)(1) of title 35, United States Code, is
amended by striking ``nontransferrable'' and inserting
``nontransferable''.
(4) Section 287(c)(2)(G) of title 35, United States Code,
is amended by striking ``any state'' and inserting ``any
State''.
(5) Section 371(b) of title 35, United States Code, is
amended by striking ``of the treaty'' and inserting ``of the
treaty.''.
(j) Unnecessary References.--
(1) In general.--Title 35, United States Code, is amended
by striking ``of this title'' each place that term appears.
(2) Exception.--The amendment made by paragraph (1) shall
not apply to the use of such term in the following sections of
title 35, United States Code:
(A) Section 1(c).
(B) Section 101.
(C) Subsections (a) and (b) of section 105.
(D) The first instance of the use of such term in
section 111(b)(8).
(E) Section 157(a).
(F) Section 161.
(G) Section 164.
(H) Section 171.
(I) Section 251(c), as so designated by this
section.
(J) Section 261.
(K) Subsections (g) and (h) of section 271.
(L) Section 287(b)(1).
(M) Section 289.
(N) The first instance of the use of such term in
section 375(a).
(k) Effective Date.--The amendments made by this section shall take
effect 1 year after the date of the enactment of this Act and shall
apply to proceedings commenced on or after that effective date.
SEC. 17. CLARIFICATION OF JURISDICTION.
(a) Short Title.--This section may be cited as the ``Intellectual
Property Jurisdiction Clarification Act of 2011''.
(b) State Court Jurisdiction.--Section 1338(a) of title 28, United
States Code, is amended by striking the second sentence and inserting
the following: ``No State court shall have jurisdiction over any claim
for relief arising under any Act of Congress relating to patents, plant
variety protection, or copyrights.''.
(c) Court of Appeals for the Federal Circuit.--Section 1295(a)(1)
of title 28, United States Code, is amended to read as follows:
``(1) of an appeal from a final decision of a district
court of the United States, the District Court of Guam, the
District Court of the Virgin Islands, or the District Court of
the Northern Mariana Islands, in any civil action arising
under, or in any civil action in which a party has asserted a
compulsory counterclaim arising under, any Act of Congress
relating to patents or plant variety protection;''.
(d) Removal.--
(1) In general.--Chapter 89 of title 28, United States
Code, is amended by adding at the end the following new
section:
``Sec. 1454. Patent, plant variety protection, and copyright cases
``(a) In General.--A civil action in which any party asserts a
claim for relief arising under any Act of Congress relating to patents,
plant variety protection, or copyrights may be removed to the district
court of the United States for the district and division embracing the
place where such action is pending.
``(b) Special Rules.--The removal of an action under this section
shall be made in accordance with section 1446 of this chapter, except
that if the removal is based solely on this section--
``(1) the action may be removed by any party; and
``(2) the time limitations contained in section 1446(b) may
be extended at any time for cause shown.
``(c) Derivative Jurisdiction Not Required.--The court to which a
civil action is removed under this section is not precluded from
hearing and determining any claim in such civil action because the
State court from which such civil action is removed did not have
jurisdiction over that claim.
``(d) Remand.--If a civil action is removed solely under this
section, the district court--
``(1) shall remand all claims that are neither a basis for
removal under subsection (a) nor within the original or
supplemental jurisdiction of the district court under any Act
of Congress; and
``(2) may, under the circumstances specified in section
1367(c), remand any claims within the supplemental jurisdiction
of the district court under section 1367.''.
(2) Conforming amendment.--The table of sections for
chapter 89 of title 28, United States Code, is amended by
adding at the end the following new item:
``1454. Patent, plant variety protection, and copyright cases.''.
(e) Transfer by Court of Appeals for the Federal Circuit.--
(1) In general.--Chapter 99 of title 28, United States
Code, is amended by adding at the end the following new
section:
``Sec. 1632. Transfer by the Court of Appeals for the Federal Circuit
``When a case is appealed to the Court of Appeals for the Federal
Circuit under section 1295(a)(1), and no claim for relief arising under
any Act of Congress relating to patents or plant variety protection is
the subject of the appeal by any party, the Court of Appeals for the
Federal Circuit shall transfer the appeal to the court of appeals for
the regional circuit embracing the district from which the appeal has
been taken.''.
(2) Conforming amendment.--The table of sections for
chapter 99 of title 28, United States Code, is amended by
adding at the end the following new item:
``1632. Transfer by the Court of Appeals for the Federal Circuit.''.
(f) Effective Date.--The amendments made by this section shall
apply to any civil action commenced on or after the date of the
enactment of this Act.
SEC. 18. TRANSITIONAL PROGRAM FOR COVERED BUSINESS-METHOD PATENTS.
(a) References.--Except as otherwise expressly provided, wherever
in this section language is expressed in terms of a section or chapter,
the reference shall be considered to be made to that section or chapter
in title 35, United States Code.
(b) Transitional Program.--
(1) Establishment.--Not later than 1 year after the date of
enactment of this Act, the Director shall issue regulations
establishing and implementing a transitional post-grant review
proceeding for review of the validity of covered business-
method patents. The transitional proceeding implemented
pursuant to this subsection shall be regarded as, and shall
employ the standards and procedures of, a post-grant review
under chapter 32, subject to the following exceptions and
qualifications:
(A) Section 321(c) and subsections (e)(2), (f), and
(g) of section 325 shall not apply to a transitional
proceeding.
(B) A person may not file a petition for a
transitional proceeding with respect to a covered
business-method patent unless the person or his real
party in interest has been sued for infringement of the
patent or has been charged with infringement under that
patent.
(C) A petitioner in a transitional proceeding who
challenges the validity of 1 or more claims in a
covered business-method patent on a ground raised under
section 102 or 103 as in effect on the day prior to the
date of enactment of this Act may support such ground
only on the basis of--
(i) prior art that is described by section
102(a) (as in effect on the day prior to the
date of enactment of this Act); or
(ii) prior art that--
(I) discloses the invention more
than 1 year prior to the date of the
application for patent in the United
States; and
(II) would be described by section
102(a) (as in effect on the day prior
to the date of enactment of this Act)
if the disclosure had been made by
another before the invention thereof by
the applicant for patent.
(D) The petitioner in a transitional proceeding, or
his real party in interest, may not assert either in a
civil action arising in whole or in part under section
1338 of title 28, United States Code, or in a
proceeding before the International Trade Commission
that a claim in a patent is invalid on any ground that
the petitioner raised during a transitional proceeding
that resulted in a final written decision.
(E) The Director may institute a transitional
proceeding only for a patent that is a covered
business-method patent.
(2) Effective date.--The regulations issued pursuant to
paragraph (1) shall take effect on the date that is 1 year
after the date of enactment of this Act and shall apply to all
covered business-method patents issued before, on, or after
such date of enactment, except that the regulations shall not
apply to a patent described in the first sentence of section
5(f)(2) of this Act during the period that a petition for post-
grant review of that patent would satisfy the requirements of
section 321(c).
(3) Sunset.--
(A) In general.--This subsection, and the
regulations issued pursuant to this subsection, are
repealed effective on the date that is 4 years after
the date that the regulations issued pursuant to
paragraph (1) take effect.
(B) Applicability.--Notwithstanding subparagraph
(A), this subsection and the regulations implemented
pursuant to this subsection shall continue to apply to
any petition for a transitional proceeding that is
filed prior to the date that this subsection is
repealed pursuant to subparagraph (A).
(c) Request for Stay.--
(1) In general.--If a party seeks a stay of a civil action
alleging infringement of a patent under section 281 in relation
to a transitional proceeding for that patent, the court shall
decide whether to enter a stay based on--
(A) whether a stay, or the denial thereof, will
simplify the issues in question and streamline the
trial;
(B) whether discovery is complete and whether a
trial date has been set;
(C) whether a stay, or the denial thereof, would
unduly prejudice the nonmoving party or present a clear
tactical advantage for the moving party; and
(D) whether a stay, or the denial thereof, will
reduce the burden of litigation on the parties and on
the court.
(2) Review.--A party may take an immediate interlocutory
appeal from a district court's decision under paragraph (1).
The United States Court of Appeals for the Federal Circuit
shall review the district court's decision to ensure consistent
application of established precedent, and such review may be de
novo.
(d) Definition.--For purposes of this section, the term ``covered
business method patent'' means a patent that claims a method or
corresponding apparatus for performing data processing operations
utilized in the practice, administration, or management of a financial
product or service, except that the term shall not include patents for
technological inventions. Solely for the purpose of implementing the
transitional proceeding authorized by this subsection, the Director
shall prescribe regulations for determining whether a patent is for a
technological invention.
(e) Rule of Construction.--Nothing in this section shall be
construed as amending or interpreting categories of patent-eligible
subject matter set forth under section 101.
SEC. 19. TRAVEL EXPENSES AND PAYMENT OF ADMINISTRATIVE JUDGES.
(a) Authority To Cover Certain Travel Related Expenses.--Section
2(b)(11) of title 35, United States Code, is amended by inserting ``,
and the Office is authorized to expend funds to cover the subsistence
expenses and travel-related expenses, including per diem, lodging
costs, and transportation costs, of non-federal employees attending
such programs'' after ``world''.
(b) Payment of Administrative Judges.--Section 3(b) of title 35,
United States Code, is amended by adding at the end the following:
``(6) Administrative patent judges and administrative
trademark judges.--The Director has the authority to fix the
rate of basic pay for the administrative patent judges
appointed pursuant to section 6 of this title and the
administrative trademark judges appointed pursuant to section
17 of the Trademark Act of 1946 (15 U.S.C. 1067) at not greater
than the rate of basic pay payable for Level III of the
Executive Schedule. The payment of a rate of basic pay under
this paragraph shall not be subject to the pay limitation of
section 5306(e) or 5373 of title 5.''.
SEC. 20. PATENT AND TRADEMARK OFFICE FUNDING.
(a) Definitions.--In this section, the following definitions shall
apply:
(1) Director.--The term ``Director'' means the Director of
the United States Patent and Trademark Office.
(2) Fund.--The term ``Fund'' means the public enterprise
revolving fund established under subsection (c).
(3) Office.--The term ``Office'' means the United States
Patent and Trademark Office.
(4) Trademark act of 1946.--The term ``Trademark Act of
1946'' means an Act entitled ``Act to provide for the
registration and protection of trademarks used in commerce, to
carry out the provisions of certain international conventions,
and for other purposes'', approved July 5, 1946 (15 U.S.C. 1051
et seq.) (commonly referred to as the ``Trademark Act of 1946''
or the ``Lanham Act'').
(5) Under secretary.--The term ``Under Secretary'' means
the Under Secretary of Commerce for Intellectual Property.
(b) Funding.--
(1) In general.--Section 42 of title 35, United States
Code, is amended--
(A) in subsection (b), by striking ``Patent and
Trademark Office Appropriation Account'' and inserting
``United States Patent and Trademark Office Public
Enterprise Fund''; and
(B) in subsection (c), in the first sentence--
(i) by striking ``To the extent'' and all
that follows through ``fees'' and inserting
``Fees''; and
(ii) by striking ``shall be collected by
and shall be available to the Director'' and
inserting ``shall be collected by the Director
and shall be available until expended''.
(2) Effective date.--The amendments made by paragraph (1)
shall take effect on the later of--
(A) October 1, 2011; or
(B) the first day of the first fiscal year that
begins after the date of the enactment of this Act.
(c) USPTO Revolving Fund.--
(1) Establishment.--There is established in the Treasury of
the United States a revolving fund to be known as the ``United
States Patent and Trademark Office Public Enterprise Fund''.
Any amounts in the Fund shall be available for use by the
Director without fiscal year limitation.
(2) Derivation of resources.--There shall be deposited into
the Fund on or after the effective date of subsection (b)(1)--
(A) any fees collected under sections 41, 42, and
376 of title 35, United States Code, provided that
notwithstanding any other provision of law, if such
fees are collected by, and payable to, the Director,
the Director shall transfer such amounts to the Fund,
provided, however, that no funds collected pursuant to
section 9(h) of this Act or section 1(a)(2) of Public
Law 111-45 shall be deposited in the Fund; and
(B) any fees collected under section 31 of the
Trademark Act of 1946 (15 U.S.C. 1113).
(3) Expenses.--Amounts deposited into the Fund under
paragraph (2) shall be available, without fiscal year
limitation, to cover--
(A) all expenses to the extent consistent with the
limitation on the use of fees set forth in section
42(c) of title 35, United States Code, including all
administrative and operating expenses, determined in
the discretion of the Under Secretary to be ordinary
and reasonable, incurred by the Under Secretary and the
Director for the continued operation of all services,
programs, activities, and duties of the Office relating
to patents and trademarks, as such services, programs,
activities, and duties are described under--
(i) title 35, United States Code; and
(ii) the Trademark Act of 1946; and
(B) all expenses incurred pursuant to any
obligation, representation, or other commitment of the
Office.
(d) Annual Report.--Not later than 60 days after the end of each
fiscal year, the Under Secretary and the Director shall submit a report
to Congress which shall--
(1) summarize the operations of the Office for the
preceding fiscal year, including financial details and staff
levels broken down by each major activity of the Office;
(2) detail the operating plan of the Office, including
specific expense and staff needs for the upcoming fiscal year;
(3) describe the long term modernization plans of the
Office;
(4) set forth details of any progress towards such
modernization plans made in the previous fiscal year; and
(5) include the results of the most recent audit carried
out under subsection (f).
(e) Annual Spending Plan.--
(1) In general.--Not later than 30 days after the beginning
of each fiscal year, the Director shall notify the Committees
on Appropriations of both Houses of Congress of the plan for
the obligation and expenditure of the total amount of the funds
for that fiscal year in accordance with section 605 of the
Science, State, Justice, Commerce, and Related Agencies
Appropriations Act, 2006 (Public Law 109-108; 119 Stat. 2334).
(2) Contents.--Each plan under paragraph (1) shall--
(A) summarize the operations of the Office for the
current fiscal year, including financial details and
staff levels with respect to major activities; and
(B) detail the operating plan of the Office,
including specific expense and staff needs, for the
current fiscal year.
(f) Audit.--The Under Secretary shall, on an annual basis, provide
for an independent audit of the financial statements of the Office.
Such audit shall be conducted in accordance with generally acceptable
accounting procedures.
(g) Budget.--The Fund shall prepare and submit each year to the
President a business-type budget in a manner, and before a date, as the
President prescribes by regulation for the budget program.
SEC. 21. SATELLITE OFFICES.
(a) Establishment.--Subject to available resources, the Director
may establish 3 or more satellite offices in the United States to carry
out the responsibilities of the Patent and Trademark Office.
(b) Purpose.--The purpose of the satellite offices established
under subsection (a) are to--
(1) increase outreach activities to better connect patent
filers and innovators with the Patent and Trademark Office;
(2) enhance patent examiner retention;
(3) improve recruitment of patent examiners; and
(4) decrease the number of patent applications waiting for
examination and improve the quality of patent examination.
(c) Required Considerations.--In selecting the locale of each
satellite office to be established under subsection (a), the Director--
(1) shall ensure geographic diversity among the offices,
including by ensuring that such offices are established in
different States and regions throughout the Nation;
(2) may rely upon any previous evaluations by the Patent
and Trademark Office of potential locales for satellite
offices, including any evaluations prepared as part of the
Patent and Trademark Office's Nationwide Workforce Program that
resulted in the 2010 selection of Detroit, Michigan as the
first ever satellite office of the Patent and Trademark Office;
and
(3) nothing in the preceding paragraph shall constrain the
Patent and Trademark Office to only consider its prior work
from 2010. The process for site selection shall be open.
(d) Phase-in.--The Director shall satisfy the requirements of
subsection (a) over the 3-year period beginning on the date of
enactment of this Act.
(e) Report to Congress.--Not later than the end of the first fiscal
year that occurs after the date of the enactment of this Act, and each
fiscal year thereafter, the Director shall submit a report to Congress
on--
(1) the rationale of the Director in selecting the locale
of any satellite office required under subsection (a);
(2) the progress of the Director in establishing all such
satellite offices; and
(3) whether the operation of existing satellite offices is
achieving the purposes required under subsection (b).
(f) Definitions.--In this section, the following definitions shall
apply:
(1) Director.--The term ``Director'' means the Director of
the United States Patent and Trademark Office.
(2) Patent and trademark office.--The term ``Patent and
Trademark Office'' means the United States Patent and Trademark
Office.
SEC. 22. PATENT OMBUDSMAN PROGRAM FOR SMALL BUSINESS CONCERNS.
Subject to available resources, the Director may establish in the
United States Patent and Trademark Office a Patent Ombudsman Program.
The duties of the Program's staff shall include providing support and
services relating to patent filings to small business concerns.
SEC. 23. PRIORITY EXAMINATION FOR TECHNOLOGIES IMPORTANT TO AMERICAN
COMPETITIVENESS.
Section 2(b)(2) of title 35, United States Code, is amended--
(1) in subparagraph (E), by striking ``; and'' and
inserting a semicolon;
(2) in subparagraph (F), by striking the semicolon and
inserting ``; and''; and
(3) by adding at the end the following:
``(G) may, subject to any conditions prescribed by
the Director and at the request of the patent
applicant, provide for prioritization of examination of
applications for products, processes, or technologies
that are important to the national economy or national
competitiveness without recovering the aggregate extra
cost of providing such prioritization, notwithstanding
section 41 or any other provision of law;''.
SEC. 24. DESIGNATION OF DETROIT SATELLITE OFFICE.
(a) Designation.--The satellite office of the United States Patent
and Trademark Office to be located in Detroit, Michigan shall be known
and designated as the ``Elijah J. McCoy United States Patent and
Trademark Office''.
(b) References.--Any reference in a law, map, regulation, document,
paper, or other record of the United States to the satellite office of
the United States Patent and Trademark Office to be located in Detroit,
Michigan referred to in subsection (a) shall be deemed to be a
reference to the ``Elijah J. McCoy United States Patent and Trademark
Office''.
SEC. 25. EFFECTIVE DATE.
Except as otherwise provided in this Act, the provisions of this
Act shall take effect 1 year after the date of the enactment of this
Act and shall apply to any patent issued on or after that effective
date.
SEC. 26. BUDGETARY EFFECTS.
The budgetary effects of this Act, for the purpose of complying
with the Statutory Pay-As-You-Go-Act of 2010, shall be determined by
reference to the latest statement titled ``Budgetary Effects of PAYGO
Legislation'' for this Act, submitted for printing in the Congressional
Record by the Chairman of the Senate Budget Committee, provided that
such statement has been submitted prior to the vote on passage.
Passed the Senate March 8, 2011.
Attest:
Secretary.
112th CONGRESS
1st Session
S. 23
_______________________________________________________________________
AN ACT
To amend title 35, United States Code, to provide for patent reform.