[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 4417 Introduced in Senate (IS)]

<DOC>






117th CONGRESS
  2d Session
                                S. 4417

 To amend title 35, United States Code, to address matters relating to 
   the Patent Trial and Appeal Board of the United States Patent and 
               Trademark Office, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             June 16, 2022

  Mr. Leahy (for himself, Mr. Cornyn, and Mr. Tillis) introduced the 
 following bill; which was read twice and referred to the Committee on 
                             the Judiciary

_______________________________________________________________________

                                 A BILL


 
 To amend title 35, United States Code, to address matters relating to 
   the Patent Trial and Appeal Board of the United States Patent and 
               Trademark Office, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Patent Trial and Appeal Board Reform 
Act of 2022''.

SEC. 2. PATENTS.

    (a) In General.--Title 35, United States Code, is amended--
            (1) in section 6--
                    (A) in subsection (a), by inserting after the third 
                sentence the following: ``Each member of the Patent 
                Trial and Appeal Board shall comply with the Code of 
                Conduct for United States Judges, including limitations 
                on ex parte communications, when performing the duties 
                enumerated in subsection (b).'';
                    (B) in subsection (c)--
                            (i) in the second sentence, by striking 
                        ``Only the'' and inserting ``The''; and
                            (ii) by adding at the end the following: 
                        ``After the constitution of a panel of the 
                        Patent Trial and Appeal Board under this 
                        subsection has been made public, any changes to 
                        the constitution of that panel, including 
                        changes that were made before the constitution 
                        of the panel was made public, shall be noted in 
                        the record.'';
                    (C) by redesignating subsection (d) as subsection 
                (e);
                    (D) by inserting after subsection (c) the 
                following:
    ``(d) Review by the Director.--
            ``(1) Opportunities for review.--
                    ``(A) In general.--With respect to a decision of 
                the Patent Trial and Appeal Board--
                            ``(i) the Director may, on the initiative 
                        of the Director, review, and modify or set 
                        aside, the decision;
                            ``(ii) if the decision is issued under 
                        section 318(a) or 328(a), a party to the 
                        applicable inter partes or post-grant review 
                        may request that the Director review, and 
                        modify or set aside, the decision; and
                            ``(iii) if the decision is issued under 
                        section 314 or 324 under a delegation by the 
                        Director, a party to the applicable inter 
                        partes or post-grant review petition may 
                        request that the Director review, and modify or 
                        set aside, the decision.
                    ``(B) Effect of request for review of determination 
                to institute review.--A request for review under 
                subparagraph (A)(iii) shall not be a basis to stay or 
                delay any proceeding.
            ``(2) Requirement.--
                    ``(A) In general.--Any review by the Director under 
                paragraph (1) shall be issued in a separate written 
                opinion that--
                            ``(i) is made part of the public record;
                            ``(ii) sets forth the reasons for the 
                        review, modification, or setting aside of the 
                        decision of the Patent Trial and Appeal Board; 
                        and
                            ``(iii) may be designated as precedential, 
                        and if it is designated as precedential, shall 
                        be followed by future panels of the Patent 
                        Trial and Appeal Board, unless and until the 
                        opinion is--
                                    ``(I) rescinded; or
                                    ``(II) superseded by--
                                            ``(aa) regulation;
                                            ``(bb) a decision of the 
                                        Director that is designated as 
                                        precedential; or
                                            ``(cc) a decision of a 
                                        court.
                    ``(B) Effect of precedential designation.--Nothing 
                in subparagraph (A)(iii) shall be construed to affect 
                the obligation of the Director to prescribe regulations 
                under section 316(a) or 326(a).
            ``(3) Timeline and bases for review.--Not later than 18 
        months after the date of enactment of the Patent Trial and 
        Appeal Board Reform Act of 2022, the Director shall promulgate 
        rules addressing the following issues:
                    ``(A) With respect to review of a decision on the 
                initiative of the Director under paragraph (1)(A)(i)--
                            ``(i) the timeline under which the Director 
                        may review the decision, which shall be 
                        consistent with the requirements under section 
                        318(e) or 328(e), if applicable; and
                            ``(ii) the bases on which the Director may 
                        review the decision.
                    ``(B) With respect to a request by a party under 
                clause (ii) or (iii) of paragraph (1)(A)--
                            ``(i) the timeline for submitting such a 
                        request;
                            ``(ii) the content that the party is 
                        required to include in such a request;
                            ``(iii) the bases on which the party may 
                        submit such a request; and
                            ``(iv) the timeline for any response or 
                        reply to such a request such that the request 
                        can be decided within the deadline imposed 
                        under section 318(e) or 328(e), as applicable.
            ``(4) Determination whether to review final decisions of 
        board.--Notwithstanding the bases for review promulgated under 
        paragraph (3), the determination whether to review a final 
        decision of the Patent Trial and Appeal Board under this 
        subsection is committed to the discretion of the Director.
            ``(5) Rule of construction.--For the purposes of an appeal 
        permitted under section 141, any decision on review of a final 
        written decision of the Patent Trial and Appeal Board under 
        section 318(a) or 328(a), that is issued by the Director under 
        this subsection, shall be deemed a final written decision of 
        the Patent Trial and Appeal Board.''; and
                    (E) in subsection (e), as so redesignated--
                            (i) in the first sentence--
                                    (I) by striking ``of this 
                                subsection'' and inserting ``of the 
                                Patent Trial and Appeal Board Reform 
                                Act of 2022'';
                                    (II) by inserting ``or the 
                                Secretary'' after ``appointment by the 
                                Director''; and
                                    (III) by inserting ``or the 
                                Secretary, as applicable,'' after ``on 
                                which the Director''; and
                            (ii) in the second sentence--
                                    (I) by inserting ``, or, before the 
                                date of enactment of the Patent Trial 
                                and Appeal Board Reform Act of 2022, 
                                having performed duties no longer 
                                performed by administrative patent 
                                judges,'' after ``by the Director''; 
                                and
                                    (II) by striking ``that the 
                                administrative patent judge so 
                                appointed'' and inserting ``that the 
                                applicable administrative patent 
                                judge'';
            (2) in chapter 31--
                    (A) in section 314(d), by striking ``section'' and 
                inserting ``chapter'';
                    (B) in section 315--
                            (i) in subsection (b), by striking ``shall 
                        not apply to a request for joinder under 
                        subsection (c).'' and inserting the following: 
                        ``shall be subject to the following 
                        limitations:
            ``(1) The time limitation shall not apply--
                    ``(A) to a request for joinder under subsection 
                (c); or
                    ``(B) if the complaint is dismissed without 
                prejudice.
            ``(2) If new or amended claims issue from reexamination 
        after the petitioner, real party in interest, or privy of the 
        petitioner is served with the complaint, an inter partes review 
        of those claims, and any dependent claims depending from those 
        claims, may be instituted if the petition requesting the review 
        is filed not later than 1 year after the date on which the new 
        or amended claims are asserted against the petitioner, real 
        party in interest, or privy of the petitioner.'';
                            (ii) in subsection (c), by inserting ``a 
                        request to join the inter partes review and'' 
                        before ``a petition under section 311'';
                            (iii) in subsection (d)--
                                    (I) by striking ``Notwithstanding'' 
                                and inserting the following:
            ``(1) In general.--Notwithstanding''; and
                                    (II) by striking ``before the 
                                Office,'' and all that follows and 
                                inserting the following: ``before the 
                                Office--
                    ``(A) the parties shall notify the Director;
                    ``(B) the Director shall issue a decision 
                determining the manner in which the other proceeding or 
                matter may proceed, including providing for stay, 
                transfer, consolidation, or termination of any such 
                proceeding or matter; and
                    ``(C) a party may seek review of the decision by 
                way of petition to the Director.
            ``(2) No extension.--A decision of the Director under 
        paragraph (1)(B) may not--
                    ``(A) extend any statutory deadline under this 
                chapter; or
                    ``(B) terminate an inter partes proceeding in favor 
                of an ex parte proceeding.
            ``(3) Limit on repeated petitions.--The Director may not 
        authorize an inter partes review to be instituted if the 
        Director has previously instituted an inter partes review or 
        post-grant review that includes one or more of the same claims 
        based on a petition that was filed on a different day by the 
        same petitioner, or a real party in interest or privy of the 
        same petitioner.'';
                            (iv) in subsection (e)--
                                    (I) in paragraph (2), by inserting 
                                ``that the claim is not unpatentable'' 
                                after ``decision under section 
                                318(a)''; and
                                    (II) by adding at the end the 
                                following:
            ``(3) Applicability.--The prohibitions under this 
        subsection shall apply to the petitioner in an inter partes 
        review upon the issuance of the final written decision for that 
        review.''; and
                            (v) by adding at the end the following:
    ``(f) Institution Not To Be Denied Based on Parallel Proceedings.--
In deciding whether to institute an inter partes review proceeding, the 
Director shall not in any respect consider an ongoing civil action or a 
proceeding before the International Trade Commission under section 337 
of the Tariff Act of 1930 (19 U.S.C. 1337), other than with respect 
to--
            ``(1) the bars specified in subsections (a) and (b); or
            ``(2) the determination under section 314(a) that there is 
        a reasonable likelihood that the petitioner would prevail with 
        respect to at least 1 of the claims challenged in the 
        petition.'';
                    (C) in section 316--
                            (i) in subsection (a)--
                                    (I) in paragraph (5)--
                                            (aa) in subparagraph (A), 
                                        by striking ``and'' at the end;
                                            (bb) by redesignating 
                                        subparagraph (B) as 
                                        subparagraph (C); and
                                            (cc) by inserting after 
                                        subparagraph (A) the following:
                    ``(B) evidence identifying real parties in interest 
                of the petitioner who would be statutorily prohibited 
                from filing a petition under section 311; and'';
                                    (II) in paragraph (6)--
                                            (aa) by inserting after 
                                        ``abuse of process,'' the 
                                        following: ``including a 
                                        petitioner deliberately 
                                        delaying or losing, or offering 
                                        to deliberately delay or lose, 
                                        an instituted proceeding in 
                                        exchange for consideration,''; 
                                        and
                                            (bb) by inserting before 
                                        the semicolon at the end the 
                                        following: ``, which sanctions 
                                        shall be equally applicable to 
                                        petitioners and patent owners 
                                        and may include, among other 
                                        things--
                    ``(A) shifting costs, expert witness fees, or 
                attorney fees;
                    ``(B) referring counsel to the Office of Enrollment 
                and Discipline;
                    ``(C) a bar preventing a party from filing certain 
                documents; and
                    ``(D) a bar preventing a party from filing any 
                inter partes review or post-grant review petition for a 
                period of 1 year'';
                                    (III) in paragraph (11), by 
                                inserting ``or consolidation under 
                                section 315(d)'' after ``under section 
                                315(c)'';
                                    (IV) in paragraph (12), by striking 
                                ``and'' at the end;
                                    (V) in paragraph (13), by striking 
                                the period at the end and inserting ``; 
                                and''; and
                                    (VI) by adding at the end the 
                                following:
            ``(14) providing that for all purposes under this chapter--
                    ``(A) each term in a challenged claim of a patent 
                shall be construed using the same claim construction 
                standard that would be used to construe the term in a 
                civil action under chapter 29; and
                    ``(B) if a court has previously construed a term in 
                a civil action involving the patent under chapter 29, 
                the Office--
                            ``(i) shall make that construction of 
                        record in the proceeding; and
                            ``(ii) shall consider but shall not be 
                        bound by that construction.'';
                            (ii) in subsection (c)--
                                    (I) by striking ``The Patent'' and 
                                inserting the following:
            ``(1) In general.--The Patent''; and
                                    (II) by adding at the end the 
                                following:
            ``(2) Ex parte communication.--An officer who has 
        supervisory authority or disciplinary authority with respect to 
        an administrative patent judge of the Patent Trial and Appeal 
        Board (or a delegate of such an officer), and who is not a 
        member of a panel described in section 6(c), shall refrain from 
        ex parte communication with such a judge who is a member of 
        that panel concerning any pending matter before that panel, 
        except as allowed under the Code of Conduct for United States 
        Judges.''; and
                            (iii) in subsection (e)--
                                    (I) by striking ``In an'' and 
                                inserting the following:
            ``(1) In general.--In an'';
                                    (II) in paragraph (1), as so 
                                designated, by inserting ``of 
                                challenged patent claims'' after 
                                ``unpatentability''; and
                                    (III) by adding at the end the 
                                following:
            ``(2) Claim amendment.--For any substitute claim proposed 
        under subsection (d), the burden of proving patentability, 
        including under sections 101, 102, 103, and 112, shall be the 
        same as in examination under section 131.'';
                    (D) in section 318--
                            (i) in subsection (b), by inserting ``, not 
                        later than 60 days after the date on which the 
                        parties to the inter partes review have 
                        informed the Director that the time for appeal 
                        has expired or any appeal has terminated,'' 
                        after ``the Director shall''; and
                            (ii) by adding at the end the following:
    ``(e) Rehearing.--Not later than 120 days after the date on which 
the Patent Trial and Appeal Board issues a final written decision under 
subsection (a), the Board or the Director shall finally decide any 
request for reconsideration, rehearing, or review that is submitted 
with respect to the decision, except that the Director may, for good 
cause shown, extend that 120-day period by not more than 60 days.'';
                    (E) in section 319--
                            (i) by striking ``A party'' and inserting 
                        the following:
    ``(a) In General.--A party''; and
                            (ii) by adding at the end the following:
    ``(b) Standing To Appeal.--For the purposes of an appeal described 
in subsection (a), the right to appeal shall extend at least to any 
dissatisfied party that reasonably expects that another person will 
assert estoppel against the party under section 315(e) as a result of 
the decision.
    ``(c) Timing on Remand After Appeal.--Not later than 120 days after 
the date on which a mandate issues from the court remanding to the 
Patent Trial and Appeal Board after an appeal under subsection (a), the 
Board or the Director shall finally decide any issue on remand, except 
that the Director may, for good cause shown, extend that 120-day period 
by not more than 60 days.''; and
                    (F) by adding at the end the following:
``Sec. 320. Support for small and micro entities in inter partes review 
              and post-grant review
    ``(a) Covered Patent Defined.--In this section, the term `covered 
patent' means a patent--
            ``(1) that is the subject of a petition for inter partes 
        review under chapter 31 or post-grant review under chapter 32;
            ``(2) whose owner at the time of the patent application 
        qualified for small entity or micro entity status;
            ``(3) whose owner, on the date on which the petition is 
        filed, would qualify for small entity or micro entity status if 
        that owner were to file a patent application;
            ``(4) whose owner has not asserted the patent in 
        litigation;
            ``(5) that has not been licensed to any other party that 
        would not qualify for small entity or micro entity status if 
        that party were to file a patent application; and
            ``(6) the owner or exclusive licensee of which makes or 
        uses the claimed invention in a commercial enterprise, or has 
        made substantial preparations to do so.
    ``(b) Expenses Covered.--
            ``(1) In general.--The Office shall pay to the owner of a 
        covered patent all of the reasonable expenses of the proceeding 
        actually incurred by the patent owner (and not expenses 
        incurred by a third party funding the proceeding), including 
        reasonable expert witness fees and reasonable attorney fees, 
        for defending the inter partes review or post-grant review.
            ``(2) Expenses included.--The expenses to be paid under 
        paragraph (1) shall include expenses of--
                    ``(A) a preliminary response under section 313 or 
                323;
                    ``(B) a response under section 316(a)(8) or 
                326(a)(8);
                    ``(C) any discovery under section 316(a)(5) or 
                326(a)(5);
                    ``(D) motions filed at the Patent Trial and Appeal 
                Board;
                    ``(E) any requests for reconsideration, rehearing, 
                or review; and
                    ``(F) any proceedings after a remand from the Court 
                of Appeals for the Federal Circuit.
            ``(3) Payment not dependent on outcome.--The Office shall 
        pay reasonable expenses under paragraph (1) regardless of the 
        outcome of the proceeding.
            ``(4) Expenses not included.--The expenses to be paid under 
        paragraph (1) shall not include expenses incurred--
                    ``(A) in a proceeding at the Court of Appeals for 
                the Federal Circuit or any tribunal outside the Office; 
                or
                    ``(B) in moving to amend any patent claim under--
                            ``(i) subsection (a)(9), (d), or (e) of 
                        section 316; or
                            ``(ii) subsection (a)(9), (d), or (e) of 
                        section 326.
    ``(c) Source of Funds.--The total estimated expenses paid to owners 
of covered patents under this section--
            ``(1) shall be considered part of the aggregate costs under 
        section 311(a) or 321(a); and
            ``(2) shall be recovered through fees paid by 
        petitioners.''; and
            (3) in chapter 32--
                    (A) in section 324(e), by striking ``section'' and 
                inserting ``chapter'';
                    (B) in section 325--
                            (i) in subsection (c), by inserting ``, the 
                        petitioner files a request to join the post-
                        grant review,'' before ``and the Director'';
                            (ii) by striking subsection (d) and 
                        inserting the following:
    ``(d) Multiple Proceedings.--
            ``(1) In general.--Notwithstanding sections 135(a), 251, 
        and 252, and chapter 30, during the pendency of any post-grant 
        review under this chapter, if another proceeding or matter 
        involving the patent is before the Office--
                    ``(A) the parties shall notify the Director;
                    ``(B) the Director shall issue a decision 
                determining the manner in which the other proceeding or 
                matter may proceed, including providing for stay, 
                transfer, consolidation, or termination of any such 
                proceeding or matter; and
                    ``(C) a party may seek review of the decision by 
                way of petition to the Director.
            ``(2) No extension.--A decision of the Director under 
        paragraph (1)(B) may not--
                    ``(A) extend any statutory deadline under this 
                chapter; or
                    ``(B) terminate an inter partes proceeding in favor 
                of an ex parte proceeding.
            ``(3) Limit on repeated petitions.--The Director shall not 
        authorize a post-grant review to be instituted if the Director 
        has previously instituted an inter partes review or post-grant 
        review that includes one or more of the same claims based on a 
        petition that was filed on a different day by the same 
        petitioner, or a real party in interest or privy of the same 
        petitioner.
            ``(4) Considerations.--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.'';
                            (iii) in subsection (e)--
                                    (I) in paragraph (2), by inserting 
                                ``that the claim is not unpatentable'' 
                                after ``decision under section 
                                328(a)''; and
                                    (II) by adding at the end the 
                                following:
            ``(3) Applicability.--The prohibitions under this 
        subsection shall apply to the petitioner in a post-grant review 
        upon the issuance of the final written decision for that 
        review.''; and
                            (iv) by adding at the end the following:
    ``(g) Institution Not To Be Denied Based on Parallel Proceedings.--
In deciding whether to institute a post-grant review proceeding, the 
Director shall not in any respect consider an ongoing civil action or a 
proceeding before the International Trade Commission under section 337 
of the Tariff Act of 1930 (19 U.S.C. 1337), other than with respect to 
the determination under section 324(a) that there is a reasonable 
likelihood that the petitioner would prevail with respect to at least 1 
of the claims challenged in the petition.'';
                    (C) in section 326--
                            (i) in subsection (a)--
                                    (I) in paragraph (5)--
                                            (aa) by striking ``shall be 
                                        limited to evidence'' and 
                                        inserting the following: 
                                        ``shall be limited to--
                    ``(A) evidence''; and
                                            (bb) by adding at the end 
                                        the following: ``and
                    ``(B) evidence identifying real parties in interest 
                of the petitioner who would be statutorily prohibited 
                from filing a petition under section 321;'';
                                    (II) in paragraph (6)--
                                            (aa) by inserting after 
                                        ``abuse of process,'' the 
                                        following: ``including a 
                                        petitioner deliberately 
                                        delaying or losing, or offering 
                                        to deliberately delay or lose, 
                                        an instituted proceeding in 
                                        exchange for consideration,''; 
                                        and
                                            (bb) by inserting before 
                                        the semicolon at the end the 
                                        following: ``, which sanctions 
                                        shall be equally applicable to 
                                        petitioners and patent owners 
                                        and may include, among other 
                                        things--
                    ``(A) shifting costs, expert witness fees, or 
                attorney fees;
                    ``(B) referring counsel to the Office of Enrollment 
                and Discipline;
                    ``(C) a bar preventing a party from filing certain 
                documents; and
                    ``(D) a bar preventing a party from filing any 
                inter partes review or post-grant review petition for a 
                period of 1 year'';
                                    (III) in paragraph (11)--
                                            (aa) by inserting ``or 
                                        consolidation under section 
                                        325(d)'' after ``under section 
                                        325(c)''; and
                                            (bb) by striking ``and'' at 
                                        the end;
                                    (IV) in paragraph (12), by striking 
                                the period at the end and inserting ``; 
                                and''; and
                                    (V) by adding at the end the 
                                following:
            ``(13) providing that for all purposes under this chapter--
                    ``(A) each term in a challenged claim of a patent 
                shall be construed using the same claim construction 
                standard that would be used to construe the term in a 
                civil action under chapter 29; and
                    ``(B) if a court has previously construed a term in 
                a civil action involving the patent under chapter 29, 
                the Office--
                            ``(i) shall make that construction of 
                        record in the proceeding; and
                            ``(ii) shall consider but shall not be 
                        bound by that construction.'';
                            (ii) in subsection (c)--
                                    (I) by striking ``The Patent'' and 
                                inserting the following:
            ``(1) In general.--The Patent''; and
                                    (II) by adding at the end the 
                                following:
            ``(2) Ex parte communication.--An officer who has 
        supervisory authority or disciplinary authority with respect to 
        an administrative patent judge of the Patent Trial and Appeal 
        Board (or a delegate of such an officer), and who is not a 
        member of a panel described in section 6(c), shall refrain from 
        ex parte communication with such a judge who is a member of 
        that panel concerning any pending matter before that panel, 
        except as allowed under the Code of Conduct for United States 
        Judges.''; and
                            (iii) in subsection (e)--
                                    (I) by striking ``In a'' and 
                                inserting the following:
            ``(1) In general.--In a'';
                                    (II) in paragraph (1), as so 
                                designated, by inserting ``of 
                                challenged patent claims'' after 
                                ``unpatentability''; and
                                    (III) by adding at the end the 
                                following:
            ``(2) Claim amendment.--For any substitute claim proposed 
        under subsection (d), the burden of proving patentability, 
        including under sections 101, 102, 103, and 112, shall be the 
        same as in examination under section 131.'';
                    (D) in section 328--
                            (i) in subsection (b), by inserting ``, not 
                        later than 60 days after the date on which the 
                        parties to the post-grant review have informed 
                        the Director that the time for appeal has 
                        expired or any appeal has terminated,'' after 
                        ``the Director shall''; and
                            (ii) by adding at the end the following:
    ``(e) Rehearing.--Not later than 120 days after the date on which 
the Patent Trial and Appeal Board issues a final written decision under 
subsection (a), the Board or the Director shall finally decide any 
request for reconsideration, rehearing, or review that is submitted 
with respect to the decision, except that the Director may, for good 
cause shown, extend that 120-day period by not more than 60 days.''; 
and
                    (E) in section 329--
                            (i) by striking ``A party'' and inserting 
                        the following:
    ``(a) In General.--A party''; and
                            (ii) by adding at the end the following:
    ``(b) Standing To Appeal.--For the purposes of an appeal described 
in subsection (a), the right to appeal shall extend at least to any 
dissatisfied party that reasonably expects that another person will 
assert estoppel against the party under section 325(e) as a result of 
the decision.
    ``(c) Timing on Remand After Appeal.--Not later than 120 days after 
the date on which a mandate issues from the court remanding to the 
Patent Trial and Appeal Board after an appeal under subsection (a), the 
Board or the Director shall finally decide any issue on remand, except 
that the Director may, for good cause shown, extend that 120-day period 
by not more than 60 days.''.
    (b) Technical and Conforming Amendment.--The table of sections for 
chapter 31 of title 35, United States Code, is amended by adding at the 
end the following:

``320. Support for small and micro entities in inter partes review and 
                            post-grant review.''.
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