[Congressional Record Volume 143, Number 46 (Thursday, April 17, 1997)]
[House]
[Pages H1629-H1643]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               21ST CENTURY PATENT SYSTEM IMPROVEMENT ACT

  Mr. McINNIS. Mr. Speaker, by direction of the Committee on Rules, I 
call up House Resolution 116 and ask for its immediate consideration.
  The Clerk read the resolution, as follows:

                              H. Res. 116

       Resolved, That at any time after the adoption of this 
     resolution the Speaker may, pursuant to clause 1(b) of rule 
     XXIII, declare the House resolved into the Committee of the 
     Whole House on the state of the Union for consideration of 
     the bill (H.R. 400) to amend title 35, United States Code, 
     with respect to patents, and for other purposes. The first 
     reading of the bill shall be dispensed with. All points of 
     order against consideration of the bill are waived. General 
     debate shall be confined to the bill and shall not exceed one 
     hour equally divided and controlled by the chairman and 
     ranking minority member of the Committee on the Judiciary. 
     After general debate the bill shall be considered for 
     amendment under the five-minute rule. It shall be in order to 
     consider as an original bill for the purpose of amendment 
     under the five-minute rule the amendment in the nature of a 
     substitute recommended by the Committee on the Judiciary now 
     printed in the bill, modified as specified in section 2 of 
     this resolution. The committee amendment in the nature of a 
     substitute, as modified, shall be considered as read. All 
     points of order against the committee amendment in the nature 
     of a substitute, as modified, are waived. During 
     consideration of the bill for amendment, the Chairman of the 
     Committee of the Whole may accord priority in recognition on 
     the basis of whether the Member offering an amendment has 
     caused it to be printed in the portion of the Congressional 
     Record designated for that purpose in clause 6 of rule XXIII. 
     Amendments so printed shall be considered as read. The 
     Chairman of the Committee of the Whole may: (1) postpone 
     until a time during further consideration in the Committee of 
     the Whole a request for a recorded vote on any amendment; and 
     (2) reduce to five minutes the minimum time for electronic 
     voting on any postponed question that follows another 
     electronic vote without intervening business, provided that 
     the minimum time for electronic voting on the first in any 
     series of questions shall be fifteen minutes. At the 
     conclusion of consideration of the bill for amendment the 
     Committee shall rise and report the bill to the House with 
     such amendments as may have been adopted. Any Member may 
     demand a separate vote in the House on any amendment adopted 
     in the Committee of the Whole to the bill or to the committee 
     amendment in the nature of a substitute, as modified. The 
     previous question shall be considered as ordered on the bill 
     and amendments thereto to final passage without intervening 
     motion except one motion to recommit with or without 
     instructions.
       Sec. 2. The amendment in the nature of a substitute 
     recommended by the Committee on the Judiciary now printed in 
     H.R. 400 is modified as follows:
       (a) page 14, line 19, after ``at'' insert ``a rate not to 
     exceed''; and
       (b) page 46, line 15, strike ``activities'' and insert in 
     lieu thereof ``activities, subject to the submission of a 
     plan to the Committees on Appropriations of the House and 
     Senate in accordance with the procedures set forth in section 
     605 of the Departments of Commerce, Justice, and State, the 
     Judiciary, and Related Agencies Appropriations Act 1997''.

                              {time}  1215


                         Parliamentary Inquiry

  Ms. JACKSON-LEE of Texas. Mr. Speaker, I have a parliamentary 
inquiry.
  The SPEAKER pro tempore (Mr. LaHood). The gentlewoman from Texas will 
state her parliamentary inquiry.
  Ms. JACKSON-LEE of Texas. Mr. Speaker, after the conciliatory remarks 
of the previous speaker, I have an inquiry to the Speaker as to his 
recollection: In the last 90 years of this House have we any time where 
this House has voted to censor a Member the entire day by rollcall 
vote?
  I would appreciate a response on that inquiry, Mr. Speaker.
  The SPEAKER pro tempore. The Chair would advise the gentlewoman from 
Texas [Ms. Jackson-Lee] in the House Manual on page 322, the Chair 
responded on June 25, 1992, to parliamentary inquiries relating in a 
practical sense to the pending proceedings but did not respond to 
requests to place them in historical context.
  The gentleman from Colorado [Mr. McInnis] is recognized for 1 hour.
  Mr. McINNIS. Mr. Speaker, for the purpose of debate only, I yield the 
customary 30 minutes to the gentleman from Massachusetts [Mr. Moakley], 
pending which I yield myself such time as I might consume. During the 
consideration of this resolution all time is yielded for the purpose of 
debate only.
  Mr. Speaker, House Resolution 116 is a noncontroversial resolution. 
The proposed rule is an open rule providing for 1 hour of general 
debate divided equally between the chairman and the ranking minority 
member of the Committee on the Judiciary. After general debate the bill 
shall be considered for amendment under the 5-minute rule.
  Furthermore, it shall be in order to consider as an original bill for 
the purpose of amendment under the 5-minute rule the amendment in the 
nature of a substitute recommended by the Committee on the Judiciary 
now printed in the bill modified as specified in section 2 of House 
Resolution 1616. The resolution waives all points of order against the 
committee amendment in the nature of a substitute, as modified, and 
provides that it shall be considered as read.
  Furthermore, Mr. Speaker, the resolution allows the Chair to accord 
priority recognition to Members who have preprinted their amendments in 
the Congressional Record, and the Chair may postpone votes in the 
Committee of the Whole and reduce votes to 5 minutes if those votes 
follow a 15-minute rule.
  At the conclusion of the consideration of the bill for amendment, the 
Committee shall rise and report the bill to the House with such 
amendments as may have been adopted.
  Finally, Mr. Speaker, the rule provides one motion to recommit with 
or without instructions.
  Mr. Speaker, this open rule was reported out of the Committee on 
Rules by a voice vote without any opposition. Under the proposed rule 
each Member has an opportunity to have their concerns addressed, 
debated and ultimately voted on, up or down, by this body.
  I urge my colleagues to support the bill.
  Mr. Speaker, I reserve the balance of my time.
  Mr. MOAKLEY. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I thank my colleague, my friend from Colorado [Mr. 
McInnis], for yielding me the customary half hour.
  Mr. Speaker, I think this is a day for celebration. We have finally 
gotten an open rule here on the floor. One of the 13 bills brought to 
the House by a rule this session, only 3 of them have been open. And as 
all my colleagues know, Mr. Speaker, we were promised more open rules, 
so I certainly hope that this is the beginning of a trend and not just 
a one-time occurrence.
  I do find it ironic, Mr. Speaker, however, that just 2 days ago, just 
2 days ago my colleagues on the Republican side of the aisle spent an 
entire afternoon trying to pass a constitutional amendment to require a 
two-thirds vote for any tax increase. Now they are bringing to the 
floor a bill that would pose new taxes. They can call them user fees, 
but I have got a letter from the gentleman from Texas [Mr. Archer], 
chairman of the Committee on Ways and Means, which says these are 
taxes, and they still increase costs to the American people.

[[Page H1630]]

  Mr. Speaker, the goals of H.R. 400 are laudable, to strengthen our 
patent laws and patent process and to bring them into compliance with 
the standards utilized by the international community. The bill would 
also establish the U.S. Patent and Trademark Office as a separate 
Government agency to serve in a more efficient manner for those who 
utilize its services.
  The United States, Mr. Speaker, is No. 1 in the world when it comes 
to the production of intellectual property. The development of a sound 
and effective policy for the protection of this property is critically 
important to our Nation's future dominance in this area.
  But having said that, Mr. Speaker, this bill is not without its 
controversies. Some small inventors and others have some valid concerns 
with this legislation. But the time and place to address these problems 
is during the consideration of the bill itself. Under the open rule 
process, any amendment or substitute that is germane and does not 
violate any other House rules can be offered at that time.
  Hopefully, these concerns will be thoroughly debated and addressed by 
the full House.
  So, Mr. Speaker, I urge passage of this rule so that we may proceed 
to the consideration of the bill itself.
  Mr. Speaker, I reserve the balance of my time.
  Mr. McINNIS. Mr. Speaker, I yield 5 minutes to the gentleman from 
California [Mr. Rohrabacher].
  Mr. ROHRABACHER. Mr. Speaker, the day has finally come, and I rise in 
support of the rule and in opposition to H.R. 400. I know a lot of 
people may vote in favor of my substitute to H.R. 400 just to shut me 
up and to keep me from giving all these special orders all the time, 
but the day has finally come when we will have a head-to-head 
discussion on the issue of what the patent law of the United States of 
America should be, and as I have pointed out on numerous occasions over 
the last few months, that the bill that was being crafted and, yes, the 
bill that finally went through the system is taking America in exactly 
the wrong direction.
  Mr. Speaker, the United States of America has had essentially the 
same patent protections, the strongest patent system in the world up 
until this date, and if this vote passes today on H.R. 400, America's 
patent system will be gutted, that is gutted, and we will hear during 
this debate that they are doing it simply to get out a thing called the 
submarine patent.
  Let me note this: That is very similar by saying the only way we are 
going to be able to handle Hustler magazine is to destroy all freedom 
of speech in the United States or the equivalent of saying, ``You have 
a hangnail that might be infected, and the only way to cure it is to 
cut off your leg,'' and that is not the case. The Congressional 
Research Service states that my substitute bill to H.R. 400 will 
eliminate the practice of submarine patenting. It never was necessary 
to cut one's leg off to handle the hangnail.
  What we have here is an attempt to use a small problem which can be 
cured in other ways, the submarine patent problem, as an excuse to gut 
the strongest patent system in the world.
  The essential ingredient, we have offered to compromise time and time 
again with those people who are supporting H.R. 400, but they came back 
and were unwilling to compromise on the essential point, which was our 
country believes that, until a patent is issued, that the patent 
applicant has a right of confidentiality. This bill as it is written, 
and it has not changed, they have not exempted any of the small 
business they claim to have exempted; this bill would mandate that all 
of our secrets, every one of our secrets that would be held 
confidential under the current system under what they are proposing is 
a system that will publish them after 18 months for the world to see. 
Everyone can understand that.
  Mr. Speaker, that is why the American people have risen up and called 
their Member of Congress to say we do not want to make America's 
technology vulnerable to foreign theft and the theft from huge 
corporations domestically. This, after asking for compromise for 2 
years, we have not been able to compromise on this point because that 
is what the purpose of this bill is.
  H.R. 400, when it was introduced last session, was called the Patent 
Publication Act. So all of the other wonderful things that we hear 
about this bill we have accepted in the substitute. I will be offering 
in the substitute almost all the wonderful things that we will hear, 
but the disagreement, the fundamental disagreement, is, No. 1, should 
we basically gut the patent system by corporatizing the Patent Office 
and taking it out of the U.S. Government, making it a corporate entity, 
taking our patent examiners, making them vulnerable to outside 
influences, No. 1; and No. 2, should we publish the information about 
our inventors' patent applications even before the patent is granted? 
If we succeed today or if the other side succeeds today, foreign 
corporations, whether in China or Japan or elsewhere, will be able to 
steal this information, use it, go into production, but those 
proponents say: But we give them the right to sue once the patent is 
issued.
  Mr. and Mrs. America has to decide on that. Is this really an option 
if the People's Liberation Army is manufacturing some technology 
developed here and 4 or 5 years later the patent is issued giving the 
person who owns the patent the right to sue the People's Liberation 
Army 5 years later? Is that really recourse?
  This is setting up, this is a set up for the biggest ripoff of 
technology in the history of the United States. Our most important 
ideas will be stolen from us by our worst adversaries and used against 
us; and when the court action comes up, what is going to happen? When 
the court action comes up, they will be using the money for 
manufacturing with stolen technology to defeat our people in court.
  I ask my colleagues to support the rule, I ask my colleagues to 
oppose H.R. 400, the Steal American Technologies Act, and to support 
the Rohrabacher substitute.
  Mr. MOAKLEY. Mr. Speaker, I would like to inquire of my distinguished 
colleague from Colorado how many speakers he has left.
  Mr. McINNIS. To my good friend from Massachusetts, I have a number of 
speakers who have just now signed up, so I assume that I will take the 
entire 30 minutes.
  Mr. MOAKLEY. The only speaker I have is myself to finish our side of 
the debate, so I will allow my dear friend from Colorado to go forward.
  Mr. Speaker, I reserve the balance of my time.
  Mr. McINNIS. Mr. Speaker, I yield 5 minutes to the gentleman from 
North Carolina [Mr. Coble].
  Mr. COBLE. Mr. Speaker, I have been called a puppet of the Japanese 
industrial complex as a result of this bill. I resent it. I have been 
called worse than that. We have tried to keep this on an evenhanded 
course, but alas to no avail.
  The patent law, Mr. Speaker, as my colleagues know, provides a forum 
whereby cute, sexy questions can be propounded, but because of the 
complexity of the subject matters, cute, sexy responses are not that 
easy to be forthcoming.
  This is a good bill. In contrast to what our opponents would have my 
colleagues believe, H.R. 400 has received more process than any patent 
bill in history. It is developed over a 2-year period and was the 
subject of more than 50 negotiating sessions with interested parties 
and the administration. And incidently, Mr. Speaker, in addition to the 
Clinton administration, the Bush and Reagan administrations heartily 
endorsed this proposal. During this time over 80 witnesses testified at 
eight different hearings to help craft its contents. I have no pride of 
exclusive authorship in H.R. 400 since so many fingerprints cover the 
bill including those of independent inventors, small and big business, 
industry groups, universities and research laboratories.

                              {time}  1230

  Our bill is supported by 75 American companies responsible for 90 
percent of the patents issued to American applicants in the United 
States. Twenty-one CEO's of our Nation's high-technology companies 
which employ 1.4 million men and women and which hold 55,000 U.S. 
patents endorse H.R. 400 and oppose the Rohrabacher substitute. Mr. 
Speaker, pardon my immodesty, but that hardly sounds like a puppet of 
the Japanese industrial complex.

[[Page H1631]]

  Title I of H.R. 400 would transform the Patent and Trademark Office, 
or the PTO, into a Government corporation. It would remain a Federal 
agency subject to congressional oversight and protected by all of the 
benefits and safeguards afforded any agency and its employees under 
title V of the U.S. Code.
  The whole point of title I is to allow the PTO to operate more 
efficiently on a day-to-day basis. To illustrate, the agency would no 
longer be required to solicit permission from the General Services 
Administration each time it wished to buy a box of pencils or note 
pads.
  Furthermore, title I would permit the PTO to keep all its funding 
derived from user fees. Last year alone, $92 million were diverted from 
those funds, which are exclusively funded by users, and the intent at 
the time of collection is to use those fees to operate and maintain the 
Patent and Trademark Office.
  First, H.R. 400 helps American inventors under title II who file for 
patent protection overseas. Since all other developed countries which 
have patent systems require publication after 18 months, American 
inventors have their applications published in the language of the 
relative host country at this time. In contrast, foreign companies 
which seek protection in the United States do not reveal their 
applications until the U.S. patent issues. This is unfair on its face, 
since foreign companies are therefore able to study our latest 
technological developments abroad but are not required to reveal their 
work to our inventors on these same terms here. Eighteen-month 
publication, therefore, levels the international playing field.
  Second, the publication inhibits the practice of patent submarining. 
My colleagues will hear more about that as this debate develops. A 
submariner is a bad-faith inventor who attempts to game the existing 
patent system by indulging in dilatory tactics that prevent the 
expeditious review of the application. By biding his time, the 
submariner can eventually identify a company which has independently 
developed the same idea, then sue for royalties. Quite obviously, this 
constitutes bad public policy, since the submariner has no intention of 
using an invention to manufacture a product or create a new job. The 
motivation of the submariner is to subsist off the work of others, and 
they do real well at it. I refer my colleagues to a recent article that 
appeared in last week's Wall Street Journal.
  Mr. MOAKLEY. Mr. Speaker, I yield 4 minutes to the gentleman from 
Michigan [Mr. Conyers], the ranking member on the Committee on the 
Judiciary.
  (Mr. CONYERS asked and was given permission to revise and extend his 
remarks.)
  Mr. CONYERS. Mr. Speaker, I am here in my capacity as ranking member 
to urge that this rule be adopted. I understand that everybody that has 
spoken on the rule is supporting the rule, so very good. The only thing 
is that the first speaker, the gentleman from California [Mr. 
Rohrabacher], in supporting the rule, said this was a bill that would 
gut the American patent process, if I heard him correctly. He is 
nodding, and apparently I did hear him correctly; that this bill, H.R. 
400, would gut the U.S. patent process.
  This is the same bill that has passed out of two Republican 
Congresses and two judiciary committees unanimously, and but for the 
tremendous acumen of the gentleman from California [Mr. Rohrabacher] we 
would unwittingly have passed out last Congress and this Congress a 
bill that would gut the patent process of the United States of America.
  We obviously owe this gentleman from California [Mr. Rohrabacher] a 
huge debt. I mean our obligation must go up to the sky. I thank the 
gentleman from California [Mr. Rohrabacher] for this great single feat 
of saving the American legal system from what would happen were it not 
for his substitute.
  Fortunately, however, there is a remedy. The rule will call for the 
substitute, but until the debate occurs, could the gentleman help us 
keep the confusion level down to about its norm by refraining from 
these unsubstantiated statements so far in this debate. I know in the 
gentleman's mind the gentleman is pretty firm where he is coming from, 
but for those who may not be committed yet to this bill and who may not 
be on the substitute, could we have a debate that merely tries to 
describe what our humble Committee on the Judiciary and two Congresses 
have attempted to do on this, and if we could do that, I think it would 
win the approval of all of us in the Congress and it would help us a 
great deal.
  Now, this bill is supported by five of the last six Commissioners of 
the Patent and Trademark Office. That means that the highest Government 
officials on this subject in the past have all signed off on this bill. 
There have been years of negotiation on this bill. We have finally 
reached, we thought, almost unanimity. It will stop cheating in the 
patent process by ending the prime delaying tactic, and on this, the 
gentleman from California [Mr. Rohrabacher] and I agree, submarine 
patenting. It will end that process where lawyers now are coming 
forward representing people that are subverting the patent process.
  This is the best thing that has ever happened for the small inventor, 
and I urge the support of the rule.
  Mr. McINNIS. Mr. Speaker, I yield 5 minutes to the gentleman from 
Florida [Mr. Goss].
  (Mr. GOSS asked and was given permission to revise and extend his 
remarks.)
  Mr. GOSS. Mr. Speaker, I thank the distinguished gentleman from 
Colorado for yielding me this time.
  Mr. Speaker, I appreciate and I rise in strong support of this wide-
open rule providing for consideration of H.R. 400. This open rule will 
allow for full debate on this very complex and controversial measure.
  Mr. Speaker, the objective of this legislation is to promote greater 
efficiency in our patent system, and of course put us on an even 
footing overseas, at the same time balance this with fair protection 
for the independent inventor, and this is obviously a very delicate 
process.
  My district is home to the Edison Inventors Association. We are very 
proud of that. They have directly and personally conveyed to me their 
very real concerns with the legislation as it is written, and I am sure 
the gentleman from California [Mr. Rohrabacher] is going to speak to 
several of those issues as the day goes along. I have also spoken with 
proponents of H.R. 400, and they have made a compelling case for 
certain items in H.R. 400. So it seems we are getting most of the good 
issues out.
  Among the inventors, there is a real concern that the 18-month 
publication period provision in this bill will pose a risk to the 
little guy, the independent inventor. We certainly do not want to 
inadvertently create a situation, unintended negative consequences, 
where these entrepreneurs are squeezed out in the courtroom by large 
corporations. This is a real concern, and I know it will be addressed 
today.
  On the other hand, I think we all agree that the proposed diversion 
of fees paid to the Patent and Trademark Office in the Clinton budget 
is a very bad idea. There was unanimity on this issue yesterday, I 
believe, in the Committee on Rules, and I am gratified that H.R. 400 
hits this right on. Our inventors need to know that these fees are not 
being diverted to fund other initiatives, but are helping to speed the 
patent process along.
  Mr. Speaker, I am not certain that the promised benefits in H.R. 400 
are not outweighed by the potential setbacks. I am waiting to be 
convinced by the debate. Whenever we consider sweeping reform we would 
be wise, in my view, to follow the model of the medical profession. 
First, do no harm. While I remain uncertain that H.R. 400 is truly a 
step forward, I am glad that we are going to be able to have vigorous 
debate on this floor where both sides can make their case, and I 
certainly appreciate the hard work and long efforts of the committee on 
this process.
  What we have here today is deliberative democracy at work in the 
people's House. I urge support for this good rule for that reason, and 
I commend the gentleman from New York [Mr. Solomon] and the gentleman 
from Colorado [Mr. McInnis] for bringing this rule forward.

[[Page H1632]]

  Mr. MOAKLEY. Mr. Speaker, I yield myself 3 minutes.
  Mr. Speaker, I really cannot pass this opportunity to mention one 
more time that this bill contains a revenue increase. This bill 
contains a tax increase.
  The fee in question is clearly a revenue increase, under the 
Speaker's guidelines on jurisdictional concepts distinguishing user 
fees from taxes. The guidelines were announced again on opening day, 
January 7, 1997, page H32, Congressional Record. The proceeds will be 
used to benefit some who did not pay the charge, and thus cannot be 
construed as a user fee. There are substantive charges to the existing 
patent fee so as to make this charge a tax.
  Mr. Speaker, I include for the Record at this time a letter from the 
gentleman from Texas [Mr. Archer], the chairman of the Committee on 
Ways and Means, making it very clear that this fee is a tax.

                                    U.S. House of Representatives,


                                  Committee on Ways and Means,

                                   Washington, DC, April 16, 1996.
     Hon. Henry J. Hyde,
     Chairman, House Committee on Judiciary, Rayburn HOB, 
         Washington, DC.
       Dear Chairman Hyde: As you know, H.R. 400, the ``21st 
     Century Patent System Improvement Act,'' would make various 
     changes regarding the Patent and Trademark Office. In 
     particular, section 122 would extend permanently these patent 
     and trademark fee surcharges. In addition, it would also 
     permit the imposition and collection of new fees to recover 
     the costs of publication of patent applications and 
     reexamination proceedings.
       In determining what is a revenue measure within the 
     jurisdiction of the Committee on Ways and Means, the 
     Committee relies upon the statement issued by Speaker Foley 
     in January 1991 (and reiterated by Speaker Gingrich on 
     January 7, 1997) regarding the jurisdiction of the House 
     Committees with respect to fees and revenue measures. 
     Pursuant to that statement, the Committee on Ways and Means 
     generally will not assert jurisdiction over ``true'' 
     regulatory fees that meet the following requirements:
       (i) The fees are assessed and collected solely to cover the 
     costs of specified regulatory activities (not including 
     public information activities and other activities benefiting 
     the public in general);
       (ii) The fees are assessed and collected only in such 
     manner as may reasonably be expected to result in an 
     aggregate amount collected during any fiscal year which does 
     not exceed the aggregate amount of the regulatory costs 
     referred to in (i) above;
       (iii) The only persons subject to the fees are those who 
     directly avail themselves of, or are directly subject to, the 
     regulatory activities referred to in (i) above; and
       (iv) The amounts of the fees (a) are structured such that 
     any person's liability for such fees is reasonably based on 
     the proportion of the regulatory activities which relate to 
     such person, and (b) are nondiscriminatory between foreign 
     and domestic entities.
       Additionally, pursuant to the Speaker's statement, the mere 
     reauthorization of a preexisting fee that had not 
     historically been considered a tax would not necessarily 
     require a sequential referral to the Committee on Ways and 
     Means. However, if such a preexisting fee were fundamentally 
     changed, it properly should be referred to the Committee on 
     Ways and Means.
       On October 20, 1995, I wrote to you regarding a fee 
     provision adopted by the Committee on Judiciary during its 
     budget reconciliation recommendations. That provision would 
     have extended the expiration date of certain patent and 
     trademark fee surcharges for four years, until 2002. Although 
     the Committee on Ways and Means did not assert any 
     jurisdictional claim over the fee at that time, I expressed 
     my strong interest in working with you to conform this 
     provision as closely as possible to a true ``fee.'' With 
     respect to similar ``fees'' that raise more revenue than is 
     reasonable, the Committee on Ways and Means has worked with 
     other committees on jurisdiction to design a means of 
     reducing the ``fees'' over time so that the charges become 
     true ``fees'' that are tied to the cost of the regulatory 
     activity. I extended the same offer to work with you and the 
     Appropriations Committee to reduce these charges over time so 
     that they become true regulatory fees.
       I understand that H.R. 400 is intended to make the current 
     fees more closely resemble true ``fees.'' Since he surcharge 
     was imposed by the Omnibus Budget Reconciliation Act of 1990, 
     only a portion of the surcharge proceeds have been made 
     available to the PTO. The balance of the proceeds have been 
     diverted to finance other governmental activities. By making 
     the PTO fully financed through fees, this excessive 
     imposition of PTO fees should be substantially reduced.
       Nonetheless, the surcharge and the reexamination fee (due 
     to its 50% reduction for qualified small entities) do not 
     meet all four requirements set forth above. To the extent 
     that any fee is set at a level to recover completely an 
     agency's costs associated with a particular entity, a 
     surcharge, by definition, will be excessive and therefore 
     cause the ``fees'' to exceed the agency's costs associated 
     with the entity. Moreover, at least a portion of the 
     activities of the PTO benefit the public generally and cannot 
     be recovered through narrowly-based fees.
       With respect to the reexamination fee, to the extent that 
     it is based upon the size of the affected entity, rather than 
     the costs associated with that entity, it would violate (iv) 
     above. Accordingly, I have been advised that the bill in its 
     present form would violate Rule XXI clause 5(b) to the Rules 
     of the House, which provides that no bill carrying a tax or 
     tariff measure shall be reported by any committee not having 
     jurisdiction to report tax and tariff measures.
       Although the amount of fees and the manner in which they 
     are imposed do not conform to the criteria discussed above, 
     the modifications made by the bill would make PTO fees 
     generally less of a revenue measure than they are currently. 
     I also understand that H.R. 400 reflects a carefully 
     constructed balance of competing interests, and is shortly 
     due to be considered on the House Floor. Accordingly, I will 
     not seek a sequential referral, or object to consideration of 
     H.R. 400 on the Floor at this time.
       However, this is being done with the understanding that the 
     Committee will be treated without prejudice in the future as 
     to its jurisdictional prerogatives on this or similar 
     provisions, and it should not be considered as precedent for 
     consideration of matters of jurisdictional interest to the 
     Committee on Ways and Means in the future. It is also being 
     done with the understanding that you will contact me if the 
     fees are modified on the House floor or in conference, in 
     which case I reserve the right to seek to have Members of the 
     Committee on Ways and Means named as additional conferees. 
     Finally, I would appreciate your response to this letter, 
     confirming this understanding with respect to H.R. 400.
       Thank you for your cooperation in this matter. With best 
     personal regards,
           Sincerely,
                                                      Bill Archer,
                                                         Chariman.

  Since it is a tax increase, Mr. Speaker, I am waiting to see if my 
colleagues who supported the constitutional amendment to seek to amend 
the rule to require two-thirds vote to increase taxes will come forward 
because this is an open rule. They can come forward and put an 
amendment in to increase the vote by two-thirds in order to pass this 
bill because it has a tax increase.
  Mr. Speaker, I reserve the balance of my time.
  Mr. McINNIS. Mr. Speaker, I yield 3 minutes to the gentleman from 
California [Mr. Hunter].
  Mr. HUNTER. Mr. Speaker, I thank my friend for yielding this time to 
me. I thank all of the Members of this debate, because I think we are 
starting to frame the debate fairly effectively.
  Let me say first that the gentleman from Illinois [Mr. Hyde], the 
chairman of the full committee, is one of the giants of this 
legislature, and I think we all recognize him as such on both sides of 
the aisle; the gentleman from North Carolina [Mr. Coble], my good 
friend, who is the chairman of the subcommittee, one of my finest 
friends ever in the House of Representatives, and a superb legislator 
and a guy for whom I have a lot of respect. I know both gentlemen have 
worked long and hard on this bill.
  Let me say that as we move along in this body, we begin to realize 
more and more how easy it is to get up and complain about something 
that is a work product that other folks have done a lot of work on, and 
we should not take that role or that opportunity frivolously.
  Mr. Speaker, I thought one of the last things that the gentleman from 
Florida [Mr. Goss] said was a very important thing. He said that the 
first rule of the physician is do no harm.

                              {time}  1245

  While I think there are a lot of good things in H.R. 400, I think 
there are a few fatal defects that do some harm.
  The other thing that I think we have to realize when we go into this 
debate is that this is an enormous debate because it has a great deal 
to do with our most important property rights, our intellectual 
property rights; the centerpiece of America, the idea, the creator of 
technology, the innovator. And this property is just as valuable as 
real property that we cherish, the right to have real property; this 
right of an inventor to go out, come up with an idea, and get paid for 
that idea. We have a system that accords certain rights and privileges 
to that inventor. We are changing those rights and privileges markedly 
in this bill.
  There are two sides to this debate, I think that is something we need 
to establish early, two legitimate sides to the debate. I was just 
going through the list of people who oppose the bill.

[[Page H1633]]

 Dr. Forrest Bird, inventor of the neonatal respirator; Dr. Paul 
Burstein, the inventor of rocket motor inspection system. Raymond 
Damadian, inventor of the MRI. He is opposed to the bill.
  We have several Nobel laureates here: Gertrude Elion, the inventor of 
leukemia-fighting and transplant rejection drugs, Nobel laureate; the 
inventor of the Hovercraft, Charles Fletcher; Franco Modigliani, the 
inventor of the credit management system, Nobel laureate.
  There are legitimate arguments on the other side of this bill. We are 
going to lay those out. The one thing that I am going to concentrate on 
is publication, because every inventor needs a period of secrecy, and 
there is no substitute for secrecy. I think that is what we are going 
to find out as this debate goes on. If we publish, if we expose this 
inventor's secrets 18 months after he has applied, it is going to kill 
him. I think we can lay that out clearly in the debate. I thank the 
gentleman for yielding me this time, and I like the rule.
  Mr. MOAKLEY. Mr. Speaker, it gives me great pleasure to yield 4 
minutes to the gentlewoman from California [Ms. Lofgren].
  Ms. LOFGREN. Mr. Speaker, I think there has been a great debate in 
the public that has unnecessarily and I think unduly alarmed Americans 
who are not immersed or totally familiar with the arcane details of 
patent law, and it has become very difficult for people to sort through 
the various arguments that are being made back and forth, and I am sure 
being made in good faith.
  But I thought it would be helpful to this House to hear the comments 
made by the technology chairs of the White House Conference on Small 
Business, because much has been said that this might be a bill between 
the big guys and the little guys.
  For those of us who have spent the past 2\1/2\ years sorting through 
this bill line by line so it would represent a good, solid, bipartisan 
effort to protect American industry, we were encouraged that the 
technology chairs of the White House Conference on Small Business were 
assigned by the other small business men and women of America to take a 
look at the bill and to examine the various claims being made.
  It was very gracious of them to give the following report. I will not 
read their entire comments, but I would like to quote a few specific 
items. This is a direct quote: ``During the past year,'' all 10 chair 
persons say, ``Independent inventors and the small business community 
have been subjected to an intense campaign of fear, xenophobia, and 
misinformation. The White House Conference on Small Business researched 
many of the most emotional issues and found that much of the 
information being promulgated is simply wrong. Legislation based on bad 
data is bad legislation.''
  And then they go through the issues. First, the 20-year system. They 
conclude that ``We believe most of the hysteria over the new 20-year 
term is based on misinformation.''
  Regarding the publication of patent applications, they say, ``The 
vast majority of American patent applications are also filed in foreign 
countries where they are automatically published. Failure to publish 
these applications in the United States gives our foreign competitors a 
huge advantage. They can read our applications but we cannot read 
theirs. We need a level playing field with our foreign competitors.''
  Finally, on the issue of stealing American inventions, the small 
business men and women said, ``It is misleading to suggest that the 
opportunity to copy U.S. inventions would be newly created by either of 
these bills.'' To that they refer to the predecessor bills to both H.R. 
400 and the Rohrabacher amendment.
  Mr. Speaker, the feared opportunity already exists. Foreigners are 
presently free to read and copy any U.S. patent. The publication 
provision of either of these bills will have no effect on this reality. 
``Stealing'' is a false issue.
  ``The barrage of misinformation has caused great confusion and 
alarm,'' they say. ``Further attention has been diverted from the much-
needed modernization of U.S. Patent Law.'' Then they go on to endorse 
the elements that are encompassed in H.R. 400.
  Mr. Speaker, it is important for the many citizens and Congress 
Members who are watching this debate today to understand that it is 
easy to make wild allegations, but hard, to do the tough work done by 
the gentleman from Michigan [Mr. Conyers] and the gentleman from 
Illinois [Mr. Hyde], by the gentleman from North Carolina [Mr. Coble] 
and the gentleman from Massachusetts [Mr. Frank]--to go through the 
bill that protects American inventions and fosters prosperity for this 
country.
  Mr. McINNIS. Mr. Speaker, I yield 1 minute to the gentleman from New 
York [Mr. Forbes].
  (Mr. FORBES asked and was given permission to revise and extend his 
remarks.)
  Mr. FORBES. Mr. Speaker, I rise today in support of the rule and in 
vehement opposition to H.R. 400.
  My dear friends, much has been made just a moment ago about small 
business. I could tell the Members that the Small Business Legislative 
Council, the Small Business Survival Caucus and Committee, and the 
Small Business Technological Committee and Coalition have all opposed 
H.R. 400 because they believe that it will be bad for small businesses 
and even more horrendous for entrepreneurs and the people out there who 
are working full-time jobs and spending extra hours at their garage or 
kitchen table coming up with a new invention. We are talking about 
Americans coming up with ideas that they will try to market here in 
America, not abroad.
  I would just reference two wonderful books, which are two of many. If 
Members would remember, there are so many young children out there who 
go to the fourth grade or fifth grade, they go to the library and they 
take out books about Eli Whitney and books about Thomas Edison, and the 
great inventors of this Nation. They come home and they get energized 
about the greatness of America and that all things are possible.
  H.R. 400 would kill that off, and it would make the entrepreneur 
extinct as far as the current patent situation as we know it today.
  Mr. McINNIS. Mr. Speaker, I yield 5 minutes to the gentleman from 
California [Mr. Campbell].
  (Mr. CAMPBELL asked and was given permission to revise and extend his 
remarks.)
  Mr. CAMPBELL. Mr. Speaker, there are two very serious errors in H.R. 
400. Let me just start with these and try to return to these 
frequently. They are these.
  First of all, if you are an inventor, you should not have to publish 
what your invention is until you get the patent. You should not have 
to. The reason for that is that if you do not want to make it known to 
the world at large, you should not have to, because you might be able 
to market it to a company as a trade secret. The reward to inventors 
sometimes is not to get it patented but to apply a trade secret. That 
is what Coca-Cola has done for more than a century.
  This bill, H.R. 400, requires that even if you have not gotten the 
patent, when 18 months have run from the time that you have applied, 
you have to publish. That is a mistake.
  The second error is this: When there is a prior user, somebody else 
who has been using this idea in a commercial way, under existing law 
that person does not win over the person who invents, the person who 
files the patent. That person has the right to that invention. But H.R. 
400 says no, if there is a prior commercial user, that prior commercial 
user can continue, and not only continue, he or she can expand. If they 
were making 10 products a month, they can go to a thousand, and then if 
they are seeking to be acquired by a company, what they can do is say, 
``Look, here is the crown jewel. We have a prior commercial use as to 
this patent. Take over our company, and maybe we do not have the 
ability to go from 10 to 1 million units, but you do.''
  On these two points there is a very serious taking away from the 
patent applicant in the United States law from the present system. 
Somebody who spends the time to invent right now has the right to go 
around and market their idea and say, you know, it is a patent pending 
right now. If we get the patent, I am willing to sell it to you. If we 
do not, I am going to find that out from the Patent Office and keep it 
secret and try to sell you a trade secret. That would now change.

[[Page H1634]]

  These are very significant differences. I have to ask the question: 
For what purpose? The answer we most frequently get is because there 
are submarine patents out there, and this is the term of art we will 
hear very frequently. The submariner is somebody who is gaming the 
system. That person can be dealt with explicitly, with a laser beam 
instead of with a floodlight.
  The individual who is attempting to game the system is somebody who 
files a patent application and then asks that it be continued, and asks 
that it be continued and then delayed and delayed, waiting for some 
other company to take the idea, turn it into a profitable enterprise, 
and then the submarine surfaces and fires its torpedoes.
  The solution to that is to deal with the person who is gaming the 
system. In other words, let us just say that the publication 
requirement, which obviously defeats this strategy, ought to apply if 
you have filed applications to continue to delay, to postpone.
  So I went to my good friend and colleague, the gentleman from 
California [Mr. Rohrabacher], and asked if he could add that to his 
bill, because I thought that the high-tech companies had a good point, 
that there might be an occasional instance of this submarine strategy, 
and he graciously agreed to do so.
  My colleague and dear friend, the gentleman from North Carolina, 
entertained the idea, but in the final event, he was not able to accept 
it. So in H.R. 400, what we have is a very, very broad solution to a 
very narrow problem, with the result that the inventor loses what he or 
she has under American law.
  We have heard already that H.R. 400 is supposed to level the playing 
field. Let me assure my colleagues, the level playing field exists 
right now. If you file in Europe, whether you are European, Asian, 
African, or American, you have to disclose after 18 months. If you file 
in America, whether you are Asian, European, American, or African, you 
do not. So there are two systems in the world. They are fair to 
everybody in each system, but the systems are different.
  I wish to conclude with a personal note of gratitude to the chairman, 
the gentleman from North Carolina, Howard Coble. This man is not 
engaged with any intent to do harm to the American public or to do harm 
to our patent system, by his lights.
  I have respectfully come to the conclusion that I cannot support his 
bill, but that does not diminish in the slightest my respect for him or 
the intentions that motivate him, which I believe are of the highest 
order. It is only my regret that after 2 months of good faith 
negotiations, we were not able to reach the accommodations in H.R. 400 
that I was able to achieve with H.R. 811 and H.R. 812.
  I support the rule because it allows the Rohrabacher alternative to 
be in order, and that, to me, is the preferable bill.
  Mr. MOAKLEY. Mr. Speaker, in the spirit of comity, I yield 2 minutes 
to the gentleman from Indiana [Mr. Pease], on the other side of the 
aisle.
  Mr. PEASE. Mr. Speaker, I thank the gentleman for yielding time to 
me.
  I had not intended that my first remark to this body would be without 
aid of a script prepared by my staff; however, the script prepared by 
my staff will be reserved for the later debate this afternoon.
  Let me just say this. I bring, I hope, to this discussion a different 
perspective. As many of the Members know, I am fortunate to have come 
from higher education, and there, though I do not speak for higher 
education, I have spoken extensively with the higher education 
community on this subject. They bring to us a perspective that is 
reflective of the inventor's community.
  We have solo practitioners, faculty members, and students who work on 
their own in the invention field, and we have those who work under 
contract with major international corporations.

                              {time}  1300

  So we come from the higher education community with the perspective 
that includes all of the players that one would hope would be protected 
in this legislation that is before us.
  The higher education community has debated extensively about the 
proposals in H.R. 400, and we have stayed in contact with them 
throughout the time that I have been involved in this discussion as 
well. Though most of them have not taken a position in terms of 
opposition or support of the proposed legislation, I am convinced, 
particularly with the amendments that will be offered through the floor 
managers' work, that the concerns that have been raised on this floor 
today will be addressed in the amended bill and that it will protect 
both the small inventors and the major corporate inventors and be good 
for the country.
  I urge Members' support of the rule and of the bill.
  Mr. McINNIS. Mr. Speaker, I yield 3 minutes to the gentleman from 
Virginia [Mr. Goodlatte].
  Mr. GOODLATTE. Mr. Speaker, I thank the gentleman from Colorado for 
yielding me this time. I rise in support of the rule and in strong 
support of H.R. 400.
  This is a very good bill and a very, very important bill to protect 
the competitiveness of American business and American inventors, large 
and small. Let me make that point very, very clear.
  I commend the gentleman from North Carolina [Mr. Coble], my good 
conservative friend, and the gentleman from Illinois, the chairman of 
the Committee on the Judiciary, for pushing this legislation forward. 
Mr. Hyde and Mr. Coble know how important this legislation is for the 
American people.
  We are not dealing with what the opponents would tell us is the Steal 
American Technologies Act. We are dealing with a situation where we 
have got to act and act now to protect American inventors from a 
situation where that technology is being stolen under current law.
  Under current law, every single patent that is filed in the other 
major industrial countries around the world is published after 18-
months, in Japanese, in German, in French, for those inventors and 
those countries to see. Forty-five percent of all the patents filed 
with the U.S. Patent Office are filed by foreign inventors, and U.S. 
inventors do not get to see that technology filed here in the United 
States.
  This bill provides greater protection for the small inventor by 
improving the patent pending provisions of the law. This bill protects 
the small inventor in this country by giving them the opportunity to 
get capital behind those inventions much sooner than they get under 
current law.
  The opponents would tell us that under the 18 month publication, they 
are going to have a gap between that publication, when they get the 
patent, and somebody is going to steal their ideas. That is not the 
experience they have had in Europe.
  In Europe they get that capital sooner because the entrepreneurial 
investors in Europe know that that particular inventor is the lead 
inventor on that item because it has been published, published ahead of 
anybody else who might be in the system ahead of them. We have no way 
of knowing that in this country. So the capital does not come here 
until the patent is issued. In Europe that has changed.
  This will help small inventors by giving them the opportunity to get 
that capital, get that product on the market sooner. It will give them 
the opportunity not to have to reinvent the wheel because they will 
know whether somebody else is already in the marketplace with that 
idea.
  This is a good bill. It is a good bill for the little guy, and we 
should vote for the rule and vote for the bill and get this major 
improvement, major improvement to competitiveness in the United States 
against our foreign competition done.
  Mr. Speaker, I thank the gentleman for yielding me the time.
  Mr. MOAKLEY. Mr. Speaker, I yield 3 minutes to the gentlewoman from 
Ohio [Ms. Kaptur].
  (Ms. KAPTUR asked and was given permission to revise and extend her 
remarks.)
  Ms. KAPTUR. Mr. Speaker, I reluctantly rise in support of this rule 
because, once it is passed, Members like myself who oppose H.R. 400 are 
going to be given about 15 minutes out of the hour, only one-quarter of 
the time to present our views. That is typical of what has been 
happening on this extremely important bill.
  I understand what the floor managers have to do here, but I truly 
object to the fact that we are not given equal time during debate to 
handle a bill of

[[Page H1635]]

this magnitude. There is absolutely no question that this bill concerns 
America's future. It concerns our jobs. It concerns who controls our 
technology.
  To be muzzled on the floor when we consider a bill that has 
constitutional implications is beyond my wildest dreams. Why would they 
do this to us? We know the Committee on Small Business has not been 
able to hold hearings because small inventors have not been allowed to 
present their case to the Congress. Now on the floor we will also have 
our hands tied behind our backs and be allowed so little time to 
discuss the merits.
  In view of that, I say to the Members who are listening to this 
debate and to the people of the country, how many complaints have you 
ever gotten from your inventors about the current patent system? The 
United States leads the world in patent filings. We have 10 times more 
intellectual property breakthroughs than any other Nation in the world. 
Why would we want to change our system?
  I heard the prior speaker say, ``Japan or some other country.'' But, 
we lead the world. Why would we want to do anything to harm the system 
that has created the largest industrial and agricultural power on the 
face of the Earth? There is much at stake here, and there are many 
private interests that want to get their hands into what is happening 
at our Patent Office. We understand that well.
  But there is more at stake here than just arcane rules that may be 
administered by a department that handles our patents.
  I say to the membership, if they have not read this bill, if they do 
not understand its implications, vote no on H.R. 400 and vote for the 
substitute.
  We will talk a lot about how the period is shortened for our 
inventors where, if you file a patent, in 18 months they will be able 
to get your blueprints. Your work will not be kept secret as it is 
today until the patent is issued. That is absolutely wrong. Why would 
we want to do that to the people who are creating our future in this 
country?
  Why would we want to corporatize the Patent Office and take away the 
objectivity of its examiners? And why in heaven's name would you want 
to produce a bill, page 11, lines 15 through 17, which permits this 
Office, which will not have the same kind of control we have today, to 
accept monetary gifts or donations of services, of real estate, 
personal or mixed property in order to carry out the functions of the 
Office? We have seen all kinds of bribes in this city.
  I hear from the chairman that may be out. Well, I will be really 
interested in what else is out of the bill because this truly is a work 
in progress. It is unfair to the membership. It is unfair to the people 
of this country who are creating our future to be muzzled here on this 
floor.
  Mr. MOAKLEY. Mr. Speaker, I yield myself such time as I may consume.
  As I said before, just a couple days ago there was a bill to amend 
the Constitution that required two-thirds to increase taxes. This bill 
increases taxes. And I was waiting to hear the amendment to the rule to 
require two-thirds vote for this bill to pass because it does raise 
taxes, but evidently it is not coming forward.
  Mr. Speaker, I yield back the balance of my time.
  Mr. McINNIS. Mr. Speaker, I yield myself such time as I may consume.
  I would like to clarify the comments just made by the gentlewoman 
from the State of Ohio. Her remarks were that she would be and, for 
some reason, Members that favor her position were being muzzled on the 
House floor. It is unfortunate that she was not in here for the 
previous conversations that we have had, but to assist her knowledge, I 
would suggest that she study an open rule. This is an open rule. No one 
is being muzzled here. An open rule allows open debate.
  I notice that the gentlewoman on a number of occasions, at least two, 
during her comments used the word ``muzzled.'' I think it is that kind 
of rhetoric, frankly, that heats up the debate here unnecessarily. It 
is an open rule.
  Mr. Speaker, I yield the balance of my time to the gentleman from 
Illinois [Mr. Hyde], distinguished chairman.
  The SPEAKER pro tempore (Mr. HOBSON). The gentleman from Illinois 
[Mr. Hyde] is recognized for 2\1/2\ minutes.
  (Mr. HYDE asked and was given permission to revise and extend his 
remarks.)
  Mr. HYDE. Mr. Speaker, I say to my dear friend from Toledo, it is too 
bad she did not come up to the Committee on Rules and ask to structure 
a rule that would give her all the time she wants. But she did not, and 
we got an hour's debate. And out of the goodness of our hearts, we are 
yielding 7\1/2\ minutes, I assume the gentleman from Michigan [Mr. 
Conyers], out of the goodness of his heart, will yield 7\1/2\ minutes, 
and there is 15 minutes plus an open rule. I think that ought to be 
enough, at least that is my humble opinion.
  Ms. KAPTUR. Mr. Speaker, will the gentleman yield?
  Mr. HYDE. I yield to the gentlewoman from Ohio.
  Ms. KAPTUR. Out of an hour, then I understand, Mr. Speaker, we will 
receive 15 minutes?
  Mr. HYDE. We each have a half hour. We have a half hour over here. We 
are going to give the gentlewoman 7\1/2\ minutes of it. She is against 
our bill, yes.
  Ms. KAPTUR. So 15 over 60 is 25 percent. So we are not being given 
equal time.
  Mr. HYDE. Mr. Speaker, the gentlewoman can talk to 6 p.m. or beyond 
this evening because we have an open rule. The gentleman from 
Massachusetts [Mr. Moakley] wanted it open.
  Ms. KAPTUR. Mr. Speaker, the rule is open to some, not all.
  Mr. HYDE. Mr. Speaker, let me just suggest to my friends that H.R. 
400 is a very good bill. We have heard about corporatizing the U.S. 
Patent Office, new word, ``corporatizing.'' There is more oversight 
over the corporate U.S. Patent Office than if we kept it as a bureau of 
the Department of Commerce. There will be an inspector general. There 
are reporting requirements to Congress. There are reporting 
requirements to the administration. The Government Cooperation Control 
Act has over 100 accountability provisions plus there is an advisory 
board, so that is a red herring.
  What is really at stake in this issue, and I could not imagine patent 
law could be made exciting or interesting, but we have submarines 
floating around. I expect to see periscopes surfacing during this 
debate because that is what this is all about, protecting people who do 
not invent to make society a better place but to make a fast buck.
  They file their applications and God forbid they should be published. 
They want to keep it below the surface so some poor guy who goes into 
business and is using a process and they find out about it, they 
surface, up periscope, and sue. And one person made $450 million doing 
that. His lawyer made $150 million, and they tell us submarine 
patenting is not a problem.
  If you want to protect your invention, you have to file overseas. And 
when you file, it is published after 18 months. The whole patent system 
was set up to give you exclusivity for a term of years, hopefully 20 
years, in exchange for sharing your deep, dark secret with the world 
and making this a better place to live. That is the trade-off. If you 
do not want to have your secret published, do not file for a patent. 
Keep it as a trade secret.
  Now, not publishing protects the submarine patent gamester who is out 
not to assist the economy but to fatten his personal treasury. It is, 
as I have said, the foreign patents. If you want protection overseas, 
you have got to file overseas in their language. They file here and it 
is not published. Nobody can find it. We want to play by the same rules 
overseas as we play here.
  This is a good bill. I have a letter from the commissioners of 
patents under Nixon, Ford, Reagan, Bush; all say this is an excellent 
bill. And the Democratic administration presently, the President's 
administration supports it.
  I say, pay attention, something is going on here. One of the handouts 
says, ``Don't be fooled.'' Those are good words. Do not be fooled. Do 
not protect the submarine patent gamesters who use the system not to 
assist society but to make a fast buck.
  Mr. McINNIS. Mr. Speaker, I yield back the balance of my time, and I 
move the previous question on the resolution.
  The previous question was ordered.
  The resolution was agreed to.

[[Page H1636]]

  A motion to reconsider was laid on the table.

                              {time}  1314

  The SPEAKER pro tempore (Mr. Hobson). Pursuant to House Resolution 
116 and rule XXIII, the Chair declares the House in the Committee of 
the Whole House on the State of the Union for the consideration of the 
bill, H.R. 400.
  The Chair designates the gentleman from Illinois [Mr. LaHood] as 
Chairman of the Committee of the Whole, and requests the gentleman from 
Michigan [Mr. Camp] to assume the Chair temporarily.

                              {time}  1315


                     In the Committee of the Whole

  Accordingly the House resolved itself into the Committee of the Whole 
House on the State of the Union for the consideration of the bill (H.R. 
400) to amend title 35, United States Code, with respect to patents, 
and for other purposes, with Mr. Camp, Chairman pro tempore, in the 
chair.
  The Clerk read the title of the bill.
  The CHAIRMAN pro tempore. Pursuant to the rule, the bill is 
considered as having been read the first time.
  Under the rule, the gentleman from North Carolina [Mr. Coble] and the 
gentleman from Michigan [Mr. Conyers] each will control 30 minutes.
  The Chair recognizes the gentleman from North Carolina [Mr. Coble].
  Mr. COBLE. Mr. Chairman, I yield myself such time as I may consume 
and say, before I get into this, that I want to extend what the 
gentleman from Illinois [Mr. Hyde] said to the gentlewoman from Ohio 
earlier about being muzzled and having their hands tied.
  We have, in the ultimate sense of fairness and comity, agreed to give 
7\1/2\ minutes to the gentleman from California [Mr. Rohrabacher] to 
manage as he sees fit, but that in no way binds the gentleman from 
Michigan [Mr. Conyers]. That was an agreement on this side, and the 
gentleman from Michigan may do as he likes.
  I just wanted to get that on the table, Mr. Chairman.
  Mr. Chairman, I ask unanimous consent to yield 7\1/2\ minutes to the 
gentleman from California [Mr. Rohrabacher] and that he be permitted to 
control that time.
  The CHAIRMAN pro tempore. Is there objection to the request of the 
gentleman from California?
  There was no objection.
  Mr. ROHRABACHER. Mr. Chairman, I yield myself such time as I may 
consume to thank the gentleman from North Carolina [Mr. Coble] very 
much for the courtesy of being able to participate in this debate as it 
goes along.
  Mr. Chairman, I reserve the balance of my time.


                        Parliamentary Inquiries

  Mr. HYDE. Mr. Chairman, parliamentary inquiry.
  The CHAIRMAN pro tempore. The gentleman will state his parliamentary 
inquiry.
  Mr. HYDE. Mr. Chairman, it was our intention that the gentleman from 
California [Mr. Rohrabacher] be given 7\1/2\ minutes from our side. We 
had hoped, and I had not had the opportunity to ask the gentleman from 
Michigan [Mr. Conyers] to give him 7\1/2\ minutes. The purpose was so 
that he could go first and get his statements out and then we could 
proceed with the rest of the debate.
  Evidently, Mr. Chairman, the gentleman wants to go last. So if the 
gentleman wishes to reserve his time and then go last, that is not in 
the contemplation of our agreement or our wish.
  Mr. Chairman, I would ask the gentleman from Michigan if he is so 
inclined to give 7\1/2\ minutes to the gentleman from California?
  Mr. CONYERS. Mr. Chairman, I hate to reveal my inclination at this 
time, but there has been nobody that has requested it.
  Mr. ROHRABACHER. Mr. Chairman, the gentlewoman from Ohio [Ms. Kaptur] 
was probably not informed of the agreement.
  Mr. HYDE. Mr. Chairman, on my parliamentary inquiry, I yield to the 
gentleman from California.
  The CHAIRMAN pro tempore. The gentleman may not yield on a 
parliamentary inquiry.
  The Chair would state that three Members are in control of time and 
would ask which Member chooses to yield time.
  Mr. ROHRABACHER. Point of information, Mr. Speaker.
  The CHAIRMAN pro tempore. Does the gentleman wish to state a 
parliamentary inquiry?
  Mr. ROHRABACHER. Yes, or point of information.
  Mr. Chairman, when someone yields a 7\1/2\-minute segment during a 
debate like this, it is possible for us to have an interchange so that 
the whole 7\1/2\ minutes is not used up at one moment, is it not, so 
that we can actually have an exchange of ideas rather than just having 
one person express their point of view and having the rest of the time 
being used to refute those arguments?
  The CHAIRMAN pro tempore. The gentleman controls his time and may 
reserve it.
  Mr. COBLE. Point of inquiry, Mr. Chairman.
  The CHAIRMAN pro tempore. The gentleman will state his parliamentary 
inquiry.
  Mr. COBLE. Mr. Chairman, my point of inquiry is that I assume I have 
the right to close debate; is that correct?
  The CHAIRMAN pro tempore. The gentleman from North Carolina is 
correct; he has the right to close debate.
  Mr. ROHRABACHER. Mr. Chairman, I would ask permission from the 
gentleman from Michigan [Mr. Conyers] if I can claim the 7\1/2\ minutes 
and yield it to the gentlewoman from Ohio [Ms. Kaptur] if she does show 
up here for the debate.
  Mr. CONYERS. Mr. Chairman, if the gentleman would yield, I have never 
yielded a Republican Democratic time in that large amount.
  Mr. ROHRABACHER. So the gentlewoman from Ohio [Ms. Kaptur], another 
Democrat, would have to come forward for that time to be yielded to.
  I am told the gentlewoman is on the way, by the way.
  The CHAIRMAN pro tempore. The Chair must insist on some Member using 
his time.
  Mr. COBLE. Mr. Chairman, to alleviate the problem, I will do that 
with the understanding that our side has the right to close, which the 
Chairman just assured me of.
  The CHAIRMAN pro tempore. The gentleman from North Carolina [Mr. 
Coble] is recognized.
  Mr. COBLE. Mr. Chairman, I yield myself such time as I may consume.
  Rhetoric is conventionally defined as the art of speaking or writing 
effectively, but it may also be defined as speaking or writing 
redundantly, deceptively, misleadingly, inaccurately, or untruthfully. 
All these versions, Mr. Chairman, have surfaced during the debate that 
has surrounded H.R. 400.
  Patent law is complex and arcane. It is not sexy or engaging when 
seriously discussed, especially on television or radio. And when the 
rhetoric pertaining to such a subject is clearly manipulated and 
twisted to distort the facts, the complexity of the issue is 
compounded, and utter confusion is the result.
  Mr. Chairman, I am not a patent lawyer, but the members of the 
Subcommittee on Courts and Intellectual Property are not assigned the 
duty of litigating contested patent cases. Our responsibility is to 
draft and promote the enactment of responsible legislation as it 
applies to the patent and trademark community, including the PTO, the 
Patent and Trademark Office, inventors, small and large, those with 
limited means and others blessed with more generous resources. The 
ultimate beneficiary of our work is the American consumer.
  One need not possess the intellect of a rocket scientist, and 
incidentally, neither am I a rocket scientist, to conclude that H.R. 
400 is sound, fair legislation that will benefit American consumers and 
American inventors, contrary to some of the aforementioned rhetoric 
that has been widely disseminated on the subject at hand.
  Mr. Chairman, title I of H.R. 400 consists of those changes needed to 
streamline the Patent and Trademark Office into a modern government 
agency subject to the oversight authority of Congress. Currently, 
patent filings have greatly increased, but the PTO, as a result of 
government restrictions may not hire, train, and retain with extra pay 
additional examiners. This regulatory burden only results in fewer 
patents being processed expeditiously, which hurts the users of the 
system who fund the agency.
  Under H.R. 400, the agency will have the authority to earmark the 
necessary funds more quickly, to hire

[[Page H1637]]

more examiners. Another prominent feature of title I is that all 
application or user fees paid to the PTO will remain with the agency. 
Last year, $54 million of PTO money was spent elsewhere, and this next 
fiscal year, $92 million is proposed. This practice will cease under 
H.R. 400.
  I should also emphasize that nothing in title I compromises the 
ability of the PTO employees to discharge their duties in a 
professional manner. All workers under the bill are protected by the 
full panoply of title 5 civil service safeguards.
  Title II of H.R. 400 contains major improvements to our examining 
procedures for patents. The first of these will require, in most 
instances, the publication of a patent application after 18 months from 
the date of filing. Since the entire patent system is predicated on 
bringing new inventions into the public light for development, no 
inventor who seeks court-enforced patent protection can credibly assert 
his inventions should be kept secret based on a personal whim. If so, 
such an inventor may pursue protection provided by State trade secret 
and unfair competition statutes.
  Most patents are granted within a 20- to 22-month timeframe, and all 
patents under the current system are published upon grant. Why make the 
change to 18 months?
  First, it will enable small inventors to advertise or shop their 
ideas to perspective backers. This is important because small investors 
lack the necessary venture capital to commercialize an idea.
  Second, it levels the playing field between our inventors and foreign 
corporations. Under present law, all other developed countries have an 
18-month publication requirement. This means that an American inventor 
filing for protection abroad, and incidentally, Mr. Chairman, 75 to 78 
percent of all patents filed in this country are filed abroad, this 
means the American inventor filing for protection abroad has his 
application published after 18 months in the language of the host 
country, enabling foreign companies to review the latest developments 
in American technology.
  In contrast, however, a foreign corporation, filing in the United 
States, does not have its application published within the same time 
frame. This is unfair, since the practical effect is that they can 
study our technology overseas while our inventors are denied the same 
right to inspect their work in the United States.
  The 18-month publication provision of H.R. 400 will, therefore, level 
this playing field between American inventors and their foreign 
counterparts.
  Finally, publication at 18 months helps to deter an ongoing abuse in 
the current system, previously mentioned, ``patent submarining.'' 
Submarining is appropriately described as those efforts in which a 
patent filer games the existing system by indulging in dilatory 
practices.
  I quoted the words of a country song yesterday entitled ``Playin' 
Possum and Layin' Low.'' That is precisely, Mr. Chairman, what a 
submarine patent applicant does. But to what end? Such an ill-
intentioned inventor has no desire to help the Patent and Trademark 
Office process his or her application to secure a patent as quickly as 
possible.
  Instead, the submariner waits to identify an unsuspecting inventor 
who has no knowledge of the unpublished application. Upon locating a 
company or inventor that has developed its idea independently and which 
has commercialized it through investment, manufacturing and the 
creation of jobs, the submariner surfaces and sues the company for 
infringement.
  Mr. Chairman, this activity damages the American economy by promoting 
duplicative research, distorting financial decisionmaking and 
encouraging unnecessary litigation.
  The 18-month publication requirement will place the good-faith 
company and inventor in this illustration on notice that a patent is 
pending on an invention it wishes to develop. The inventor may then 
decide how to devote or expend the financial resources to other 
endeavors.
  Notwithstanding these benefits that accrue from the publication 
requirements of title II, a special provision has been inserted in H.R. 
400 that will protect the independent inventors and small businesses 
who are genuinely unsure as to the patentability of an idea. The 
Manager's Amendment to H.R. 400, which we will discuss later, gives an 
independent inventor or small business who does not file abroad the 
option to withdraw his application up to 3 months prior to publication 
if the PTO has made two determinations that a patent will not issue. 
The inventor may then refine the application and try again, or seek 
protection under State trade secrecy law.
  Most importantly, title II of the bill creates the presumption that 
any good-faith inventor who has diligently assisted the PTO in 
prosecuting his application is the victim of unusual administrative 
delay after 3 years of nonissuance, and at that point, the applicant is 
granted a day-for-day protection once the patent issues, in other 
words, a guarantee for a minimum of 17 years of term.
  Finally, current law affords no protection against any third party 
which appropriates the subject of a patent and commercializes it before 
the patent is granted. H.R. 400 corrects this problem by establishing a 
new inventor entitlement, a provisional right to compensation, which 
addresses the problem the gentlewoman from Ohio mentioned. This would 
allow an inventor to receive fair compensation from any third party who 
commercializes his or her idea between the time of publication and the 
time the patent issues.
  Title III of the bill addresses the issue of prior domestic 
commercial use of a patented technology.
  I want to speed this up so I can give my chairman some time.
  Title IV of H.R. 400 is designed to protect novice inventors from 
unscrupulous invention development firms which often charge 
unsuspecting clients thousands of dollars for little work that rarely 
results in a patent or a commercial use of the invention.
  Title V makes needed but limited changes to PTO reexamination 
procedures. The existing system was intended to provide an efficient 
and inexpensive way for the PTO to consider whether an issued patent 
was violated in light of patents and printed materials which an 
examiner may have overlooked during the initial examination.

                              {time}  1330

  H.R. 400 amends the existing reexamination process to provide more 
due process for a third party.
  Mr. Chairman, this concludes my general description of the contents 
of H.R. 400. The legislation will benefit members of the patent and 
trademark communities as well as the public at large.
  Mr. Chairman, I reserve the balance of my time.
  Mr. CONYERS. Mr. Chairman, I rise to announce that, as Chairman Hyde 
indicated, out of the goodness of my heart, I will yield to the 
gentlewoman from Ohio [Ms. Kaptur], a dear friend of mine, 7\1/2\ 
minutes for her to dispense with as she chooses.
  The CHAIRMAN pro tempore (Mr. Camp). Without objection, the 
gentlewoman from Ohio [Ms. Kaptur] will control 7\1/2\ minutes.
  There was no objection.
  Ms. KAPTUR. Mr. Chairman, I yield myself such time as I may consume. 
I thank the gentleman for yielding me the time. Though I hoped it would 
be more, we will take what we can get at this point, so I thank the 
gentleman very much.
  Mr. Chairman, I rise in obvious strong opposition to H.R. 400. If 
this bill were so wonderful, then why are America's preeminent 
inventors opposed to it? Dr. Raymond Damadian, inventor of magnetic 
resonance scanning, Dr. Wilson Greatbatch, inventor of the cardiac 
pacemaker, Dr. Stephanie Kwolick, inventor of Kevlar, Dr. Jay 
Forrester, inventor of core memory, the first practical RAM. If this is 
such a great idea, then why are the people who have created America's 
future opposing it?
  I have to say this bill is about a whole lot more than just arcane 
patent law. It is about what our Constitution guaranteed, and that is 
the property rights of our inventors. I hear all this concern about 
foreign countries and putting us on an equal footing with foreign 
countries. The facts are, we are the leader in the world.
  Why should we want to dumb down our system or make it easier for 
others to tap into the inventions that our people produce? Why should 
we ask our inventors to have a greater burden of

[[Page H1638]]

proof? Why should we make them be forced to get into this reexamination 
system? Why should we do this to the people who have built the greatest 
industrial and agricultural power on the face of the Earth?
  I say to the membership, how many complaints have my colleagues 
received from their small inventors except on this bill? The system 
works for them. The only complaint one might get is about the 
maintenance fees, how much they have to pay to maintain a patent, and 
truly that needs to be improved. But we have a wonderful system that 
says if you have an idea, you file it at our patent office, that that 
idea is yours, it is secret until that patent is issued. Why would we 
want to change that system?
  Mr. HUNTER. Mr. Chairman, will the gentlewoman yield?
  Ms. KAPTUR. I yield to the gentleman from California.
  Mr. HUNTER. Mr. Speaker, I thank my friend for yielding.
  The theme has been that we should be like Europe and Japan, but the 
fact is that high technology startups are something that is uniquely 
American. There are very few high technology startup companies in 
Europe and Japan. That is because they lose the one thing which is 
central to their success, and that is secrecy, because once they 
publish in 18 months, the big companies come in and sweep them off the 
map by patenting around them, which is called patent flooding. The 
gentlewoman is absolutely right.
  Ms. KAPTUR. Mr. Speaker, reclaiming my time, I thank the gentleman 
for that comment. This whole question of submarine patents and so 
forth, there is less than \13/1000\ percent of those that even affect 
this entire system, and even then we have to be about the task of 
protecting American inventors' rights. To the extent we can get other 
nations to conform their systems to ours, terrific, but why should we 
try to conform our system to theirs? Why should we make it more 
difficult for our inventors to pay the fees?
  This office I am told has been changed as we are sitting here today. 
With this corporatization of the patent office, that now apparently is 
not going to be allowed to accept gifts and real estate, because of 
pressure from Members of Congress like myself, as it is in the base 
bill, when I read the amendment, and I really do not have a copy of it 
here, but it basically says you are going to require gift rules be 
drafted to ensure that gifts to this new office are not only legal but 
avoid any appearance of impropriety. Why should they be given those 
gifts in the first place? Why should that be happening under this bill? 
And why should we take away the objectivity of our patent examiners who 
are completely insulated from any kind of economic coercion by the 
current system?
  I have to say that patents are the trade routes for the 21st century. 
America under H.R. 400 is throwing away our technological lead by 
publishing patent applications much earlier and taking away the secrecy 
that is inherent in our system to our inventors and making other 
radical changes which, by the way, to the membership, if anybody has a 
final copy of this bill I hope they will give it to me because somebody 
who has been as involved in this issue as any other Member, I cannot 
give my colleagues a bill that we will be asked to vote on here today 
that is accurate in terms of legislative language.
  We have the choice here today to create prosperity for our Nation, to 
provide opportunities to our children, but if we change the patent 
system as H.R. 400 proposes, we will be throwing away the American 
dream of opportunity embedded in the Constitution of the United States. 
I guarantee my colleagues if this bill passes, there is going to be 
decades of litigation as the American people fight for the rights they 
were granted under our Constitution.
  Our patent system is the heart of our economic strength because it 
creates new money, jobs, and new industries. I ask the membership to 
vote no on H.R. 400.
  Mr. Chairman, I reserve the balance of my time.
  Mr. ROHRABACHER. Mr. Chairman, I reserve the balance of my time.
  Mr. COBLE. Mr. Chairman, I yield 6\1/2\ minutes to the gentleman from 
the Roanoke Valley of Virginia [Mr. Goodlatte] who has been very 
helpful in the movement of this bill, H.R. 400.
  Mr. GOODLATTE. Mr. Chairman, I rise in strong support of H.R. 400, 
the 21st Century Patent System Improvement Act. Just remember that 
title. That is what this is about, improving our patent system. I would 
like to thank the gentleman from North Carolina [Mr. Coble], chairman, 
for his hard work and dedication on this important issue.
  This legislation has been subject to a great deal of confusion in 
recent weeks, due largely to the blatant misrepresentations of its 
opponents. People who make their livings gaming our patent laws will 
stop at nothing in their effort to prevent meaningful and necessary 
reform of the system. Opponents of patent reform have engaged in a 
campaign of deliberate misrepresentation and confusion in the hopes 
that they might convince Members that H.R. 400 is an international 
sellout that will undermine the patent system created by our Founding 
Fathers. Nothing could be further from the truth.
  H.R. 400 is one of the most thoroughly debated bills to come before 
the House this year. The provisions contained in this bill have been 
developed over the last 2 years and have been the subject of 10 full 
days of hearings with over 80 witnesses. Patent and trademark 
commissioners who dedicate themselves to the integrity of our patent 
system, from the Nixon, Ford, Reagan, Bush, and Clinton administrations 
support the major provisions of H.R. 400. These experts also oppose the 
major provisions of the Rohrabacher substitute, which was written on 
behalf of those who ignore the intent of our Founding Fathers by using 
subterfuge to destroy the integrity of the U.S. patent system. Taking 
the word of patent submariners on patent reform is like asking a fox 
for advice on how to guard the henhouse.
  H.R. 400 is the unanimous product of the Committee on the Judiciary. 
Unanimous, 35 members of the committee. Not one voted against this, not 
one Democrat, not one Republican. Yet this issue has been demagogued by 
a very few. Through the legislative process, the committee has worked 
with independent inventors, small businesses, universities, industry 
groups, the White House Conference on Small Business, and the Senate. 
Over 75 U.S. companies, large and small alike, which employ 1.4 million 
American workers and hold 55,000 U.S. patents, support H.R. 400.
  This legislation is critical to ensuring that America maintains our 
position as the world leader in intellectual property. H.R. 400 
benefits independent inventors, small businesses, and other Americans 
who utilize our patent system in four key areas.
  First, it guarantees diligent patent applicants at least 17 years of 
patent term and ensures that they will not lose their rights due to 
delays by the patent office. Second, the bill protects early domestic 
commercial inventors, including universities and researchers who use 
later patented technologies. Third, the legislation deters invention 
promoters from defrauding unsus-pecting inventors. Finally, H.R. 400 
gives all Americans a new property right while their patents are 
pending before the Patent Office.
  Unfortunately, opponents of patent reform are unwilling to give up 
the loopholes through which they undermine the integrity of America's 
patent system. Their proposal, offered today by the gentleman from 
California [Mr. Rohrabacher] as a substitute to H.R. 400, would 
encourage abuses of our patent system that currently cost American 
taxpayers and consumers hundreds of millions of dollars. Although they 
may argue otherwise, the Rohrabacher substitute is nothing more than a 
recipe for economic disaster.
  Since opponents of meaningful patent reform allege that H.R. 400 is a 
huge corporate giveaway, I would like to respond by highlighting the 
ways in which H.R. 400 benefit small inventors. First, under H.R. 400, 
small inventors will be able to acquire venture capital to market their 
inventions more quickly and easily. This will put small inventors on a 
more level playing field with large multinational corporations, 
allowing individuals and small businesses to fully compete in the 
global marketplace.
  Mr. Chairman, H.R. 400 also gives small inventors greater protection

[[Page H1639]]

against those who try to steal their ideas. Under current law, small 
inventors have no protection against would-be thieves that steal the 
subject of a patent and commercialize it before the patent is granted. 
These inventors are then helpless to stop the commercialization of 
their inventions or to share in the profits until the patents are 
granted.
  I should also note that the Rohrabacher substitute does nothing to 
help small inventors with this problem.
  H.R. 400, however, allows small inventors to receive fair 
compensation from any third party who commercializes their ideas 
between the time of publication and the time the patent issues. Every 
one of us has seen the words ``patent pending'' on a product, but in 
the current system, these words do not provide any legal protection.
  Under H.R. 400, small inventors will be given a new property right 
while their patents are pending, so they can punish intellectual 
property thieves who try to steal their ideas.
  Additionally, H.R. 400 gives small inventors longer patent protection 
than they receive under current law. Under the old system, which the 
Rohrabacher substitute seeks to resurrect, patent protection was only 
available for 17 years from the date a patent was granted.
  H.R. 400, however, guarantees good-faith patent applicants a minimum 
of 17 years of patent protection, with most applicants receiving more. 
The bill also provides extended protection for up to 10 years in cases 
where the Patent Office fails to give applicants firm rulings on their 
applications in a timely manner.
  Finally, H.R. 400 gives small inventors a special option to avoid 
publication of their patents. During the application process, some 
inventors may have second thoughts about publishing their applications, 
especially in cases where an initial Patent Office review is not 
favorable.
  Under H.R. 400, inventors may withdraw their applications prior to 
publication and either refile them in the future or seek protection 
under State trade secrecy law.
  Mr. Chairman, the Framers of our Constitution created a system in 
which the Government grants exclusive rights to inventors for a fixed 
period of time, in exchange for the prompt public disclosure of their 
inventions. This exchange allows all of American society to benefit 
from the creation of new ideas.
  H.R. 400 is exactly what our Founding Fathers intended. It promotes 
invention by guaranteeing longer patent terms, prevents fraud and abuse 
by stopping patent submariners from swindling American taxpayers out of 
hundreds of millions of dollars, and protects small inventors by giving 
them new property rights in their pending patent applications.
  I urge my colleagues to vote for H.R. 400 and against the misguided 
Rohrabacher substitute.
  Mr. ROHRABACHER. Mr. Chairman, I yield 1 minute to the gentleman from 
Maryland [Mr. Rosco Bartlett], one Member of Congress who has 20 
patents to his name and who can speak with expertise on the issue of 
patents.
  Mr. BARTLETT of Maryland. Mr. Chairman, as the holder of 20 patents 
myself, I feel compelled to rise today in support of the Rohrabacher 
substitute. For over 200 years, the American patent system has 
empowered inventors to make this country the most innovative in the 
world.
  If H.R. 400 becomes law, small businesses and inventors will be 
forced to publish their patents before receiving a patent. This opens 
the door for every copycat in the world to steal this information and 
begin manufacturing and marketing before the inventor has patent 
protection.
  Ladies and gentlemen, our Founding Fathers had the wisdom to 
recognize the need for a patent system unlike anywhere else in the 
world that promoted the concept of entrepreneurship and protected 
ingenuity.

                              {time}  1345

  Their foresight has resulted in the greatest industrial power this 
world has ever seen. Let us not weaken this protection in the name of 
international harmonization.
  Next week I will hold hearings in the Subcommittee on Government 
Programs of the Committee on Small Business on this issue. I look 
forward to continuing this dialog.
  Mr. COBLE. Mr. Chairman, I have only one speaker remaining. As I have 
the right to close, I will reserve the balance of my time.
  Mr. CONYERS. Mr. Chairman, I yield 3\1/2\ minutes to the gentlewoman 
from California [Ms. Lofgren], in whose district there are an 
incredible number of inventors and biotech people.
  Ms. LOFGREN. Mr. Chairman, I rise in strong support of H.R. 400 and 
urge my colleagues to join me in voting for this important legislation.
  As the gentleman from Michigan [Mr. Conyers] has just indicated, I 
represent Silicon Valley in California. I know well the importance of 
ideas and the value of intellectual property. Our thriving economy back 
home is based on ideas and on technology.
  It is worth pointing out to many Members who do not have exposure to 
high technology in their own districts the origin and history of our 
system of patent law. As my colleagues know, our Founding Fathers 
recognized the value of ideas in American ingenuity, and they put in 
our Constitution the authority of Congress to, ``promote the progress 
of science and useful arts by securing for limited times to authors and 
inventors the exclusive right to their respective writings and 
discoveries.'' That is in section 8, article I of the Constitution. By 
sharing ideas, inventors would advance the body of human knowledge and 
they would avoid the duplication of other scientists and knowledgeable 
people, and in exchange for sharing their ideas to advance human 
knowledge the inventors would receive for a period of time the 
exclusive ownership of that idea; and that really is the gist of patent 
law then and now.
  Obviously the patent system today is different than it was in the 
19th century. The original patent reform legislation was in 1836. We 
had revisions again in 1952. And here we are at the dawn of the 21st 
century once again updating patent law for the information society. 
H.R. 400 does that very well, as many of the speakers have already 
indicated.
  I do, however, want to talk about some of the comments that have been 
made in criticism of the bill because it is important that they be put 
in the context of what is actually part of the law.
  First, I have heard today and elsewhere the issue of gifts. I think 
that is quite a stretch, but it has confused many Members of this House 
because H.R. 400 does not change the current law in any respect 
relative to gifts. In fact, the Patent Trademark Office presently 
enjoys the right to use the authority to accept gifts and bequests 
granted to the Secretary of Commerce, and they are not unique in that 
regard.
  For example, the Library of Congress is able to accept gifts and 
bequests along with the Secretary of Agriculture for the national ag 
lobby. We have taken it out. Unfortunately we have taken it out in the 
manager's amendment only to deal with an issue that did not need to be 
dealt with in reality.
  There has been a lot of discussion that all of the inventors and all 
of the innovators are opposed to H.R. 400. Nothing could be farther 
from the truth. I would like to tell my colleagues that of the really 
thousands and thousands of people who are immersed and employed in 
technology, the overwhelming thrust from Silicon Valley is in favor of 
this reform of our patent bill, and of the high-tech companies who have 
been in communication with me, I would say there have been none, none 
who have opposed H.R. 400. Hewlett-Packard, Intel, and the inventors at 
IBM all beg us to adopt H.R. 400. I must say also they are considerably 
confused by the controversy that has erupted over this and cannot 
understand any of the argument being made in opposition since those 
arguments bear so little relationship to the law, to the facts and to 
the need for this update.
  Mr. ROHRABACHER. Mr. Chairman I yield myself 1 minute.
  So we have heard the submarine patent, that is the reason why we have 
to change the fundamental patent law of the United States that has been 
in place, the protections have been in place since the founding of our 
country. This is the equivalent of saying

[[Page H1640]]

that because Hustler magazine is out, we have got to eliminate freedom 
of speech and totally restructure the civil liberties concerning 
freedom of speech in our country.
  That is absolutely ridiculous. It is like saying, you got a hang 
nail, thus you got to amputate your whole leg in order to solve that 
problem.
  No, the submarine patent issue is not the issue here. I put it into 
my substitute, I have been willing to end this problem all along. 
Congressional Research Service has found, has a finding, that my 
substitute ends the practice of submarine patenting. This is being used 
as a fig leaf to cover one of the most grotesque power grabs in the 
history of this country.
  Little Roscoe Bartlett, the Roscoe Bartlett's out there who 
discovered the wonderful things that change our lives, are being put at 
risk. It was very simple. We heard him say they are going to publish 
everything that he does so that everybody in the world can steal it and 
then say, ``Sue them,'' to get it back.
  Ms. KAPTUR. Mr. Chairman, I yield 1\1/4\ minutes to the gentleman 
from Cleveland, OH [Mr. Kucinich], our esteemed colleague.
  Mr. KUCINICH. Mr. Chairman, I rise in opposition to H.R. 400.
  The essence of this bill is a hostile takeover of the American patent 
system by private interests. The American patent system is a public 
trust. It is operated by a responsible government organization for the 
benefit of the American people and individual inventors. It exists to 
enhance the capacity of our economy to cultivate and commercialize new 
technologies.
  If H.R. 400 becomes law, the integrity and independence of the patent 
system will be undermined. H.R. 400 would convert the Patent and 
Trademark Office, now part of the Department of Commerce, into a 
``corporate body not subject to direction or supervision by any 
department of the United States.''
  Another disturbing aspect of H.R. 400 is the establishment of a 
management advisory committee composed of corporate and management 
executives who will oversee the policies, goals and performance, 
budget, and user fees of this new government corporation. Even though 
the director of the Patent and Trademark Office would be appointed by 
the President of the United States, the director would be compelled to 
consult with a private sector board on all major decisions. The 
transformation of the PTO into a corporate body combined with the 
influence of the management advisory committee places our Nation on a 
slippery slope to corporate domination of the patent system and the 
destructive undermining of the democratic tradition which has produced 
some of the greatest inventions in the world from the American people.
  Mr. CONYERS. Mr. Chairman, I yield 3 minutes to the gentleman from 
Massachusetts [Mr. Delahunt].
  (Mr. DELAHUNT asked and was given permission to revise and extend his 
remarks.)
  Mr. DELAHUNT. Mr. Chairman, as a member of the committee and a 
cosponsor of House Resolution 400, I rise in support of the manager's 
amendment, and I want to commend our subcommittee chair, the gentleman 
from North Carolina [Mr. Coble], for the fine work and for the patient 
and thoughtful way he has tried to reconcile all interests to perfect 
this legislation.
  The critics have claimed that publication would enable foreign 
competitors to appropriate American ideas. The truth is that 
competitors who appropriate an invention after publication are liable 
for damages to the applicant, just as they would be once a patent is 
granted. The real issue is reciprocity.
  The vast majority of American inventors seek patent protection not 
only at home but in foreign countries as well. To do so, they must 
publish their application in foreign countries 18 months after filing. 
But since America is the only industrialized Nation that does not have 
such a requirement, foreign companies seeking U.S. patent protection 
have no obligation to publish in the United States.
  In other words Americans have to publish abroad while foreigners do 
not have to publish here. This puts U.S. inventors at a serious 
disadvantage which the bill would correct.
  This bill is about protecting American inventors, American businesses 
and American workers, and I urge passage of House Resolution 400.
  Mr. Chairman, as a member of the committee and a cosponsor of H.R. 
400, I rise in support of the manager's amendment and in opposition to 
the amendment in the nature of a substitute which will be offered by 
the gentleman from California.
  I want to commend our subcommittee chairman, Mr. Coble, for the 
patient and thoughtful way in which he has worked with all interested 
parties to refine and perfect this legislation over the past 3 years. I 
also wish to thank the ranking member, Mr. Frank, and the chairman and 
ranking member of the full committee, Mr. Hyde and Mr. Conyers, for 
their efforts on behalf of this legislation.
  As a new member of the Subcommittee on Courts and Intellectual 
Property, I can sympathize with those of my colleagues who may feel 
intimidated by this complex and arcane subject. Unfortunately, that 
feeling has been compounded by a well-orchestrated campaign waged by 
opponents of this legislation to convince independent inventors and 
small businesses that this bill would benefit large international 
corporations at their expense.
  I am proud to have many independent scientists, inventors, and 
startup companies in my district, and was appalled at what I was 
hearing from some of them about this bill. If what they were saying was 
true, this was David against Goliath, and I was not about to side with 
the Philistine. Frankly, I was ready to get out my slingshot too, until 
I learned the facts.
  And the facts told a different story. I listened carefully to the 
testimony and studied the language of the bill, and found that this 
legislation had been totally mischaracterized by its opponents. The 
truth is that this bill benefits not only the major corporations and 
universities in my region who enthusiastically support it. It benefits 
every inventor and developer of advanced technology, whether large or 
small--from software developers and biotechnology companies on the 
South Shore to marine biologists at Woods Hole.
  H.R. 400 creates a level playing field between U.S. patent applicants 
and their international competitors. It modernizes the patent office 
and reduces administrative delays. It protects inventors even before a 
patent is granted through publication of patent applications, and 
creates a ``prior user'' defense against claims of infringement for 
those who have independently developed and used inventions that are 
subsequently patented. These reforms will help ensure that the U.S. 
patent system keeps pace with the demands of the 21st century.
  But what will all this mean for the independent inventor? Critics of 
the bill have claimed that requiring patent applicants to publish their 
application 18 months after filing would enable others to rob them of 
their work. The truth is that by publishing the application, the 
inventor gains a form of provisional protection not available under 
current law. Today, an inventor has no protection against a third party 
who exploits the inventor's idea while the application is pending. The 
phrase ``patent pending'' announces to the world that an application 
has been filed but affords no legal protection. By publishing the 
application, the inventor stakes a claim that entitles him or her to 
compensation for infringement from any third party that makes use of 
the idea between the date of publication and the date the patent 
issues.
  Perhaps even more important for a small business or an independent 
inventor is the fact that other applicants must publish, too. Under 
current law, an applicant has no way of knowing whether another has 
filed first until one of them receives a patent. By then, the losing 
party may have invested everything it has in an idea that belongs to 
someone else. Under H.R. 400, an applicant will know if a patent has 
already been applied for.
  The critics have claimed that publication would enable foreign 
competitors to appropriate American ideas. The truth is that 
competitors who appropriate an invention after publication are liable 
for damages to the applicant, just as they would be once a patent is 
granted. The real issue is reciprocity: The vast majority of American 
inventors seek patent protection not only at home but in foreign 
countries as well. To do so, they must publish their application in the 
foreign country 18 months after filing. But since America is the only 
industrialized nation that does not have such a requirement, foreign 
companies seeking U.S. patent protection have no obligation to publish 
in the United States. In other words, Americans have to publish abroad, 
while foreigners do not have to publish here. This puts U.S. inventors 
at a serious disadvantage which the bill would correct.
  But what about inventors who have no intention of applying for a 
patent overseas? The critics have claimed that they have no recourse. 
The truth is that the bill will allow inventors applying for a patent 
exclusively in the United States to delay publication until 3 months 
after the Patent and Trademark Office

[[Page H1641]]

has taken a second action with respect to the application. Since, in 
most cases, the second Office action is the issuance of the patent 
itself, this provision effectively exempts independent inventors and 
small businesses from the publication requirements. On the other hand, 
if the second Office action is a determination that a patent is 
unlikely to be issued, the applicant may withdraw the application and 
seek protection under the trade secret and unfair competition laws.
  The other major claim made by critics of the bill is that the 
proposed term of 20 years from the date the application is filed would 
give inventors less protection than the current term of 17 years from 
the date the patent is granted. The truth is that those who apply in 
good faith and do not attempt to delay their applications are 
guaranteed a minimum of 17 years under the bill. Most applicants will 
receive more than 17 years of protection, since most applications are 
processed within less than 2 years. A diligent applicant who is forced 
to wait more than 3 years would be granted an extra day of patent 
protection for each day of delay.
  I do not mean to suggest that all of the concerns that have been 
raised about this legislation are illegitimate. What I do believe is 
that the legitimate concerns raised by the gentleman from California 
and other critics of the legislation as originally drafted have been 
addressed. H.R. 400 includes numerous amendments that effectively 
respond to these and many other concerns raised over the 3 years that 
this legislation has been on the drawing board.
  Those are the facts. It is unfortunate that the truth has been 
obscured by misinformation and demagoguery. But the loudest voices are 
not always right, and the constant repetition of a falsehood does not 
make it true. H.R. 400 is good for inventors, both large and small. It 
is good for our Nation as a whole. I urge my colleagues to reject the 
Rohrabacher amendment and pass the bill.
  Mr. ROHRABACHER. Mr. Chairman, I yield myself 1 minute.
  Mr. Chairman, it should be apparent by now that there are some 
fundamental issues at play here between two people over a disagreement, 
an honest disagreement. Let me note this: that everything that has been 
said that is good about H.R. 400 has been included in my alternative 
bill which will be offered as a substitute on the floor.
  What we have now are several issues that differentiate us, and one 
is, of course, after 18 months all of our technological information 
will be made public to the world. Why is this? Why are they insisting 
on publication? They say it is to handle the submarine patent issue, 
although we have already solved that according to the Congressional 
Research Service. It is because there has been an agreement made with 
Japan that I have put in the Congressional Record, time and time again, 
to harmonize our law; in other words, make American law like Japan's.
  Mr. Chairman, if our colleagues listen very carefully to the 
arguments we have heard today that is what is being said. We have got 
to have a law like they have in Japan and in Europe. How has it worked 
in Japan? The little guy gets kicked and smothered and beaten down. We 
do not want a system like that here.
  Mr. COBLE. Mr. Chairman, as I said previously. I only have one 
speaker left, and I have the right to close.
  Mr. Chairman. I reserve the balance of my time.
  Mr. ROHRABACHER. Mr. Chairman, how much time is remaining?
  The CHAIRMAN. The gentleman from California [Mr. Rohrabacher] has 
4\1/2\ minutes remaining, the gentleman from North Carolina [Mr. Coble] 
has 5 minutes remaining, the gentleman from Michigan [Mr. Conyers] has 
16\1/2\ minutes remaining, and the gentlewoman from Ohio [Ms. Kaptur] 
has 1\1/4\ minutes remaining.
  Mr. CONYERS. Mr. Chairman, I yield myself as much time as I may 
consume.
  (Mr. CONYERS asked and was given permission to revise and extend his 
remarks.)
  Mr. CONYERS. Mr. Chairman, we are gathered here under unique 
circumstances. We have a manager's amendment which I think will clear 
up many of the problems, I hope, that the gentleman from California 
[Mr. Rohrabacher] has posed. I do not know if he is familiar with the 
manager's amendment. Apparently he is not.
  Mr. ROHRABACHER. It would be very difficult because it did not come 
on the floor or was available to us until just a few hours ago.
  Mr. CONYERS. Then the gentleman from California is not familiar with 
it.
  Just a moment; I have not yielded.
  Mr. ROHRABACHER. I thought the gentleman from Michigan was asking me 
a question. I am sorry.
  Mr. CONYERS. No, I will handle this. The gentleman is not familiar 
with it, and it just came on the floor. It was brought forward at the 
Committee on Rules hearing yesterday that the gentleman attended with 
myself and the chairman of the Committee on the Judiciary.
  Mr. ROHRABACHER. If the gentleman would yield, I am sorry I was not.
  Mr. CONYERS. Mr. Chairman, I did not yield to the gentleman from 
California. Please. I know this is an anxious moment which the 
gentleman awaited a long time, and we have granted him time, but he 
cannot interrupt me.

                              {time}  1400

  Now, the manager's amendment might help bridge the difference between 
the unanimous conclusions of every Democrat and Republican on the 
Committee on the Judiciary and the distinguished gentleman from 
California. Manager's amendments have a way of coming up at Committee 
on Rules hearings. If it had been prepared earlier, we would have 
brought it out with the bill.
  So I would propose that myself and the chairman of this committee 
make available to the gentleman from California [Mr. Rohrabacher] the 
amendment, if the gentleman has not seen it, to see if it actually 
bridges any of the differences that we have, or if it fails, because if 
it does not, it limits what we are doing.
  Now, according to the gentleman from California [Mr. Rohrabacher] and 
the document the gentleman has held on the floor, the submarine issue 
is resolved. We resolved it, the gentleman resolved it, it is not in 
contention from the gentleman's position. The manager's amendment also 
might help resolve some more issues. I am just trying to reach some 
resolution here. So hopefully, that will happen.
  Now, the vast majority of patents are filed both in the United States 
and abroad simultaneously, 80 percent of them. Abroad they are required 
to be published. So this requirement will not affect 80 percent of the 
patents. There is an exemption from the publications requirement for 
small businesses, and for the small inventor there is an exemption. 
This is relatively fundamental. It is in our bill.
  Mr. HUNTER. Mr. Chairman, will the gentleman yield?
  Mr. CONYERS. I yield to the gentleman from California.
  Mr. HUNTER. Mr. Chairman, it is not in the bill, and I would like to 
ask a question about that. As I read the manager's amendment, there is 
the opportunity for a small business to opt, if they have had two 
office actions, to either opt out of the patent system or to delay 
publication for 3 months, but they still have the publication mandate 
after 18 months, from the way I read the manager's amendment, and I ran 
that by the inventors.
  Mr. CONYERS. Mr. Chairman, as far as the Rohrabacher group goes then, 
we do not solve that.
  Then let me try the prior-use doctrine. The prior-use doctrine here 
protects the first to invent, not the person who steals the 
intellectual property, and we are attempting to give that protection, 
which does not exist now, and that is why publication in the end, I say 
to my colleagues, is so important. It stops the process whereby foreign 
competitors can game our patent system process by filing incomplete 
patent applications and extend their legal monopoly rights up to 40 
years.
  Now, the Wall Street Journal is not for or against H.R. 400 or the 
Rohrabacher substitute, but they are writing about Americans who are 
gaming the system. That is what we are trying to stop. Hence, the bill.
  So there is something missing here in this debate. After years of 
working with both sides, inventors, lawyers, former patent 
commissioners, the administration, we finally come to closure with a 
unanimous vote in this Congress, and the last, and now the gentleman is 
telling us that this thing really was not cured. And I am stunned to 
find the Wall Street Journal pointing out that these kinds of fellows 
are

[[Page H1642]]

the ones that we are trying to stop with this H.R. 400 and that we are 
not undermining the American patent process, we are really undergirding 
it and bringing the protection to small inventors.
  That is why this Member supports the bill. I am not a shill for big 
corporations or any other kind of association, but the fact of the 
matter is, we are making this a better patent law by improving the 
defects that have existed for a considerable number of years. I urge 
Members to think of these arguments.
  We will have the 5-minute rule in effect, and I hope that we can take 
care of every one of the reservations that my dear friend from Ohio 
[Ms. Kaptur] has so articulately put forward in this debate, because 
that is what we are here for. We want to do the right thing, and I hope 
that my colleagues will move our debate along in that spirit.
  Mr. Chairman, I reserve the balance of my time.
  Mr. ROHRABACHER. Mr. Chairman, I yield 1 minute to the gentleman from 
California [Mr. Campbell] who represents the Silicon Valley area.
  (Mr. CAMPBELL asked and was given permission to revise and extend his 
remarks.)
  Mr. CAMPBELL. Mr. Chairman, I wish to speak on the question of who is 
on which side. I think that is a useful way to analyze the factors in 
these bills.
  The inventors want to keep the rights that they have when they invent 
and do not want to be forced to disclose. The commercializers want to 
have as much disclosure as possible so that they can make use of those 
inventions.
  I am not condemning either side, but by identifying them, I think we 
see that if we can achieve the commercializers' legitimate interests 
without undercutting the inventors, then we have achieved something. 
That is what is in the Rohrabacher bill.
  Some of my colleagues on the other side have spoken about the high-
tech companies who support H.R. 400, and I agree they do. But it is 
very interesting to me that the university community has been silent 
and has not rushed to support H.R. 400. In fact, I have had extensive 
dealings with the university community and they are staying off, 
because they are worried about what this might do to the inventive 
process.
  Mr. Chairman, I would conclude with one last observation, and that is 
that people speak of a level playing field with Europe. I say to my 
colleagues, I do not want a level playing field. We are better.
  Mr. ROHRABACHER. Mr. Chairman, I yield 1 minute to the gentleman from 
New York [Mr. Forbes].
  Mr. FORBES. Mr. Chairman, much has been made about previous 
administrations supporting this kind of initiative. Well, I have in my 
hand a Commerce Department news release which shows clearly what this 
is really about. It is not about submarines. It is about gaining access 
to foreign markets.
  In this news release it says, quite specifically, that in exchange 
for loosening up U.S. patent protections that we will make concessions 
to other nations, and that clearly is what it is about, access to 
foreign markets. It is no secret why the political appointees want this 
for access to greater markets overseas, but let us talk about why we 
need to protect American ideas, American patents within America's 
borders. That is the key here.
  Patent examiners, their association, oppose this bill. They find it 
horrendous. And it will hurt the small business people and the 
entrepreneurs, and if we care about small business and the 
entrepreneurs, the little guy, then my colleagues will support my 
amendment to this legislation.
  Mr. CONYERS. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, our hearings have revealed, and this is why we support 
the bill, it showed that 300 foreign companies were able to come into 
this country and game the process, so the previous speaker who says 
that this is all just about domestic, well, it is about foreign 
companies coming onto our turf, sir, and taking our patents. That is 
what we are trying to stop.
  So to say that it does not involve foreign companies, it involves 300 
foreign companies, according to our hearings. In one case, a British 
pharmaceutical company was so effective at the submarining game that 
the United States competitor had to relocate its operations abroad to 
be able to produce a competing project.
  So we have our companies going out of the United States to come back 
in because of the submarine system, and some say this is just a 
domestic problem. It is not. It is a national, international problem.
  Now, the submarine patents which we claim are now corrected on both 
sides, I would point out that there was one American, and this is not a 
foreign entrepreneur, was able to get $500 million in royalties. For 
doing what? For simply delaying for 35 years in some instances, the 
prosecution of a patent, and then suing other manufacturers who, in the 
meantime, not knowing about it, started using the process. Gilbert 
Hyatt submarined his patent for 20 years and extracted $70 million from 
Texas Instruments, who started using the same computer chip technology, 
totally unaware of Hyatt's submarine patent.
  If the Rohrabacher bill cures it and the bill discussed by all of the 
members of the Committee on the Judiciary and two Congresses, what is 
wrong with H.R. 400? As a matter of fact, the gentleman from California 
[Mr. Rohrabacher] came before the committee, and his ideas and 
discussion were taken into consideration, and we thought that we 
treated him very kindly.
  So this is a big problem we are curing. It is not overturning the 
patent system; it is not undermining the American process which we have 
put together; it is really taking care of a problem that has to be 
addressed and is being addressed in the committee bill. Mr. Chairman, I 
urge its continued support.
  Mr. Chairman, I reserve the balance of my time.
  Mr. ROHRABACHER. Mr. Chairman, I yield 1\1/2\ minutes to the 
gentleman from California [Mr. Hunter].
  Mr. HUNTER. Mr. Chairman, I thank the gentleman for yielding.
  We were told in some previous statements, I think the gentleman from 
Virginia [Mr. Goodlatte] pointed to Japan and Europe and said, why can 
we not be like them? This poster shows the number of Noble Laureates in 
science and technology from the United States as opposed to the number 
from Japan. There are 175 from the United States, that is our broken 
system; and there are 5 from Japan, that is the good system.
  Now, why are there so many from the United States and why are there 
so few from Japan? And I think my colleagues would see exactly the same 
numbers with Europe. Why are there almost no high-technology startup 
businesses in Japan and Europe and lots of them in the United States? 
Secrecy. Being able to keep one's idea under a cloak while one lines up 
the money and the power to get it into production.

                              {time}  1415

  You can do that in the United States. You cannot do it in Japan, you 
cannot do it in Europe. There is no running room.
  We want to give our innovators running room. Do Members know 
something? We give it to them. They have some secrecy. There is no 
substitute for that secrecy, because after two of these office actions, 
we still are going to publish under the main bill, we are going to 
publish those folks. That is what we have said. The Patent Office tell 
us that clearly, more than 30 percent of the patents that are 
ultimately issued go past two office actions. So that means those folks 
are going to be exposed.
  Submarine patents, do Members know how many submarine patents there 
have been in the last 2.3 million patents that have been issued? Three 
hundred and seventy. We do not need to expose all of our people to cut 
out 370.
  Mr. COBLE. Mr. Chairman, will the gentleman from Michigan [Mr. 
Conyers] yield 2 minutes to me?
  Mr. CONYERS. I yield 2 minutes to the gentleman from North Carolina 
[Mr. Coble].
  Mr. COBLE. Mr. Chairman, I had not planned to, but it is tough to 
remain silent here. As my friend, the gentleman from Michigan, said, 
there has probably been more excitement surrounding the law of patents 
than has happened in the last 15 years. But the gentleman from New York 
stood in the

[[Page H1643]]

well and said, this is not about submarine patenting. Mr. Chairman, it 
is about submarine patenting.
  I direct the gentleman's attention to the front page of the Wall 
Street Journal, to which the gentleman from Michigan previously 
alluded, indicating in broad print that it is a big-time problem, 
submarine patenting. For the benefit of the uninformed, the last time I 
checked, the Wall Street Journal is not a yellow journalistic sheet, so 
I think there is some authenticity behind that.
  I say to my good friend, the gentleman from California [Mr. 
Campbell], one of the most learned people in this body, he mentioned 
the university system. He will recall that in the dialog in which he 
and I engaged we made amendments in order, and the manager's amendment 
reflects some of that, that satisfies the university community. They 
came back to me, and perhaps to others on the committee, telling us 
that it is far better than it was earlier. I think they are taking no 
position on either bill. So we did do some good work on that.
  Mr. ROHRABACHER. Mr. Chairman, I yield myself the balance of my time.
  The CHAIRMAN pro tempore. The gentleman from California [Mr. 
Rohrabacher] is recognized for his remaining 1 minute.
  Mr. ROHRABACHER. Mr. Chairman, that is why this is not about 
submarine patents, because the Congressional Research Service has found 
that my bill, as well as the bill we are talking about, H.R. 400, deals 
with submarine patents. What we are talking about is a subterranean 
agreement with Japan, which I have held up, put in the Congressional 
Record, no one wants to comment on it, to harmonize our law with 
Japan's; Japan, where economic shoguns beat their people into 
submission because all of the secrets of the average person are made 
vulnerable to the big guys coming in and stealing it legally.
  It does not make me feel any better that you have given the rights to 
the American people, after exposing them to theft, to sue Mitsubishi 
Corp. or the People's Liberation Army if they come over here and start 
stealing from our people.
  This is about exposing the gentleman from Maryland [Mr. Roscoe 
Bartlett] and every other inventor in this country, and the five Nobel 
laureates who support my substitute bill, to grand theft and the 
lowering of the American standard of living because we have lost our 
technological edge, because we have given it away.
  We have exposed it to theft, and if we pass this bill, a bill that 
opens up all of our secrets for our enemies to steal, we deserve it.
  Mr. CONYERS. Mr. Chairman, I yield myself such time as I may consume.
  Mr. Chairman, we heard about a secret agreement with Japan that no 
one speaks about. I am happy to find out about it. I presume that the 
gentleman from California is referring to a part of the GATT 
conference?
  At any rate, I will be happy to deal with that in the 5 minutes.
  Mr. Chairman, could I just review a few circumstances that may come 
out as the debate goes on. The substitute of the gentleman from 
California [Mr. Rohrabacher] provides that applications filed in this 
country may not be published sooner than 5 years after they are filed, 
and then, not if the application is under appellate review.
  This is one of the ways a submariner delays its own application, is 
to file spurious law claims and appeals. In addition, the director of 
the PTO must find that the application is not being pursued by an 
applicant before the publication can occur. I think we have some 
problems, because as anyone can imagine, it is almost impossible to 
identify maneuvers by patent lawyers to delay the processing of their 
applications.
  So this provision is not very helpful in eliminating submarining, and 
is almost impossible to enforce, from my perspective. Imagine telling a 
judge that he can only allow the public to see the court documents 
relating to a case when a finding was made as to whether the merits 
were diligently pursued.
  All judges, patent judges included, must give the benefit of the 
doubt to the filers that they are proceeding in good faith, and that 
they are legitimately pursuing their claims, or the whole system goes 
down.
  The Rohrabacher substitute, as I understand it, demands a presumption 
of guilt in order to require publishing. This is a presumption that 
almost never can be established, and therein lies a serious grievance 
between the substitute and the bill, H.R. 400.
  Mr. Chairman, what we are saying here is that we have a little 
submarining going on here on the floor. We have one bill that corrects 
submarining, a substitute that says, but we do, too, and then when we 
look at it a little more carefully there are a number of questions. And 
they may be drafting problems, or they may just not have been as 
tightly drawn, but they certainly cannot equally be said to deal with 
the problem of submarining. I do not think that is the case.
  There is another way to game the system, under the Rohrabacher 
substitute. An applicant could file appeals, and listen carefully to 
this, an applicant under the Rohrabacher substitute could file an 
appeal to the Board of Patent Appeals which, while unlikely to succeed, 
are not so frivolous as to draw sanctions. That is what submariners 
love, new ways to game the system.
  I am not saying this is done in bad faith. I am sure he is trying to 
cure it. But it simply does not cure it. That is why 37 members on the 
Committee on the Judiciary took this approach in H.R. 400.

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