[Congressional Record Volume 143, Number 46 (Thursday, April 17, 1997)]
[House]
[Pages H1643-H1684]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
Parliamentary Inquiry
Mr. ROHRABACHER. Parliamentary inquiry, Mr. Chairman. If a Member is
referred to by name on the floor and a question is asked, is it out of
order for the Member then to ask if the person wants an answer to the
point?
The CHAIRMAN pro tempore. The Member who controls the time decides if
he wants to relinquish the time.
Ms. KAPTUR. Mr. Chairman, I yield myself the balance of my time.
The CHAIRMAN pro tempore. The gentlewoman from Ohio [Ms. Kaptur] is
recognized for 1\1/4\ minutes.
Ms. KAPTUR. Mr. Chairman, I say to the Members, if they have not read
H.R. 400, I say vote ``no.'' No one will have been able to read it
because it has been changed so much, there is no final bill for Members
to review.
Support the substitute. Remember, the United States leads the world
in intellectual property breakthroughs by 10 times. Why change a system
that is working, for a bill which Members have no final copy of to
review? Why support a bill that takes away the guaranty of secrecy our
patent applicants receive until their patent is granted? Why do that to
them?
Why support H.R. 400, when it puts a greater burden of proof on our
inventors to defend themselves, forcing them to sue, forcing them to
greater re-examination procedures? Why do this to them?
Why support a bill that undermines the objectivity of our patent
examiners, and changes our Patent Office?
This is a battle that goes to the heart of the constitutional rights
of our citizens to invent opportunity in the 21st century. Vote ``no''
on H.R. 400. Support the substitute.
Mr. COBLE. Mr. Chairman, I yield the balance of my time to the
gentleman from Illinois [Mr. Hyde], the distinguished chairman of the
Committee on the Judiciary.
The CHAIRMAN pro tempore. The gentleman from Illinois [Mr. Hyde] is
recognized for 5 minutes.
(Mr. HYDE asked and was given permission to revise and extend his
remarks.)
Mr. HYDE. Mr. Chairman, this is about submarine patenting, and lest
anyone be confused, a submarine patent is an application made by
somebody who does not really want a quick and speedy issuance or grant
of a patent. He wants to keep his application alive below the surface,
hoping that somebody else will come along and start marketing, start
manufacturing, start using an idea which is a part of his application.
Then he surfaces suddenly, periscope up, and sues.
That may sound convoluted, but there are people making millions and
millions of dollars, and the only way to effectively dispel that gaming
of the system is to expose the applicant to publication after a
reasonable length of time. Eighteen months has been determined by the
world and us to be a reasonable length of time.
[[Page H1644]]
The gentleman from California [Mr. Rohrabacher], claims that his
substitute effectively dispels the submarine problem. That is, forgive
me, nonsense. Here is how he dispels the submarine problem.
His amendment provides for publication no sooner than 5 years after
the filing date, but not even then, if the submariner files an appeal,
which may or may not be legitimate.
{time} 1430
That is a way to stretch this thing out. So under his curative
amendment, submarines must surface after 5 years. That is a lifetime in
the computer business. That is a lifetime in the pharmaceutical
business. That is a lifetime in the biotech industry.
It is just no cure. I just think it is a convoluted way to continue
gaming the system.
We have heard about stealing secrets. My God, we Americans are so
brilliant and we invent these things and we clutch them to our bosom
and nobody is going to steal them. Well, the problem is, if you want to
be protected in Japan, if you want to be protected in France or
Germany, you have to file over there. And if you file over there, you
are going to be published in 18 months. On the other hand, 45 percent
of the applications for patents in our country are from foreign
countries, foreign inventors, rather, and they are not published under
our present law, so we cannot see what they are doing; but, boy, they
can see what we are doing.
Now, after publication, which is a healthy, good thing, not a
poisonous thing, publication gives rise to what are called provisional
rights, which means after your idea has been published but before you
get a patent, you have rights which are enforceable in damages should
somebody steal your idea and infringe your patent. So those things have
to be taken into consideration.
This patent law is esoteric. It is difficult. But it is darned
important to our economy and it is critical to our international
competitiveness. I have heard language I expect to hear in the early
1940s about this country can go it alone, we are not involved in an
international trade situation. Oh, yes we are. And this committee, the
Committee on the Judiciary, has been involved in hearings and the study
of this legislation for 3 years. There have been full and open hearings
on this issue, and we have heard from scores of witnesses.
Mr. Chairman, the committee has marked up the bill twice, and both
times key improvements were made to address the reasonable concerns of
the parties involved. I ask that Members consider the fact that the
Committee on the Judiciary has produced a bill that has twice been
unanimously approved by voice vote.
Yes, the United States is the world's largest producer of
intellectual property, but this success is dependent on a rational and
sound and modern system of protection. To stay on top of an ever-
changing technology and ever-changing economy, we have to make a number
of changes in our patent code over the years. And we cannot ignore what
is going on overseas.
First, in an era of unprecedented competition, the intellectual
property industries have emerged as an area of American strength; and,
second, technological innovations, especially in the areas of
biotechnology and computer science, have increased substantially.
Today there are more than 1,300 companies employing more than 100,000
Americans in the biotech industry. That is just one industry that would
not exist if we did not have strong patent protection.
Mr. WELDON of Florida. Mr. Chairman, I rise to express my concerns
about H.R. 400, patent reform legislation. As the bill is currently
drafted, I cannot support this legislation. While I appreciate the
concerns by Members on both sides of this issue, I believe that H.R.
400 has some flaws that I cannot overlook.
For the past 200 years, the U.S. patent system has been the envy of
the world. I believe that H.R. 400 as brought to the House floor would
significantly alter this system which has done so much throughout our
history to make the United States the world's leading source of
innovation. We must carefully guard against any changes that might
adversely impact the United States.
If major issues are not addressed during the debate on this bill, I
will cast a no vote when we take a final vote on H.R. 400.
I thank the chairman for giving me this opportunity to speak on this
matter.
Mr. SPENCE. Mr. Chairman, I rise in support of the manager's
amendment to H.R. 400, the 21st Century Patent System Improvement Act.
Section 202 of this act would require the publication of patent
applications 18 months after they are filed with the Patent and
Trademark Office. This is a significant departure from the current
practice, whereby this information is not published until after the
patent is granted. There is a national security issue here. Under the
current process, before a patent is issued a review of the patent
application is conducted to determine if it contains technical
information that is sensitive from a national security standpoint. If,
after a review by the Department of Defense and the Department of
Energy it is determined that the public release of the information in
the patent application would be detrimental to national security, the
patent application is put under a secrecy order prohibiting its public
release.
In reviewing the original draft of H.R. 400, I was concerned that it
would require the publication of the patent application before the
Defense Department had completed its security review. A historical
review determined that during fiscal years 1994 and 1995 eight of the
patent applications that were eventually placed under secrecy orders
did not have security review completed within 18 months. While that
number is small, in 2 years there would have been eight instances in
which classified technical information would have been publicly
released under the procedures proposed by H.R. 400.
To address this problem, I submitted an amendment on behalf of the
National Security Committee to the Judiciary Committee that would
prevent the publication of patent applications until the secrecy
reviews have been completed and it is found that their publication
would not be detrimental to national security. I am pleased to report
that the chairman of the Courts and Intellectual Property Subcommittee,
Mr. Coble, has agreed to accept this change and thereby fix this
problem.
I want to thank the Judiciary Committee and its staff for their
assistance and for working with us to ensure that sensitive national
security information is not inadvertently released as a consequence of
reforming the patent system.
Mrs. KELLY. Mr. Chairman, I rise in strong support of H.R. 400, the
21st Century Patent System Improvement Act, legislation which might be
more aptly titled the Keep America Competitive Act.
H.R. 400 makes a number of commonsense improvements to our patent
system, but I want to focus on one particular problem inherent in the
current system that this legislation will correct.
I'm talking about the problem of so-called submarine patents,
situations where a patent applicant intentionally delays the issuance
of a patent, sometimes for a decade or more, through repeated
refilings, which has the effect of submerging their original
application from public view.
At the same time, other individuals or companies, without knowledge
of that pending application, develop and market the same new
technology. The original filer then allows his pending application to
issue as a patent--the submarine surfaces--and then proceeds to hit
unknowing businesses with costly royalty claims.
Mr. Chairman, this is not how our patent system was intended to work.
We need a system which encourages innovation and protects legitimate
inventors who develop new ideas with the intention of bringing those
ideas to market--not a system which encourages sham artists who file
patent applications with no intention of developing a product, but
every intention of hitting unsuspecting companies with huge royalties.
This is a very real problem for one of the major employers in my
district--IBM. Time and time again, IBM is hit with royalty claims from
patents that were filed as much as 20 years ago, but only recently
surface as the patent issues. This is not rhetoric, Mr. Chairman, this
is real; it costs the company millions of dollars and it hurts their
ability to compete.
Now let me share with you some additional facts. The information
technology industry is characterized by very short product cycles. A
technology that is developed and goes to market today could be obsolete
less than a year from now. Our patent system has not kept up with the
pace of technology development in today's economy. We need a patent
system that will take us into the 21st century, and yet forcing
companies like IBM to wait 5 years or more before a patent application
is published is totally out of step with the realities of the
information age.
A 5-year publication requirement will accomplish one of two things:
You will either inhibit new technologies from coming to market or you
will ensure that submarine patents remain a problem, or both.
An 18-month publication requirement, as included in H.R. 400, gets
the technology to the
[[Page H1645]]
marketplace quicker and, most importantly, ensures that the inventor
enjoys the royalty proceeds from their invention sooner.
I urge my colleagues to join me in supporting this important
legislation to keep America competitive in the 21st century. Vote for
H.R. 400. Thank you, Mr. Chairman.
The CHAIRMAN. All time for general debate has expired.
Pursuant to the rule, the committee amendment in the nature of a
substitute printed in the bill, modified as specified in section 2 of
House Resolution 116, shall be considered as an original bill for the
purpose of amendment under the 5-minute rule and shall be considered
read.
The text of the committee amendment in the nature of a substitute, as
modified, is as follows:
H.R. 400
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``21st Century Patent System
Improvement Act''.
SEC. 2. TABLE OF CONTENTS.
Sec. 1. Short title.
Sec. 2. Table of contents.
TITLE I--PATENT AND TRADEMARK OFFICE MODERNIZATION
Sec. 101. Short title.
Subtitle A--United States Patent and Trademark Office
Sec. 111. Establishment of Patent and Trademark Office as a Government
corporation.
Sec. 112. Powers and duties.
Sec. 113. Organization and management.
Sec. 114. Management Advisory Board.
Sec. 115. Conforming amendments.
Sec. 116. Trademark Trial and Appeal Board.
Sec. 117. Board of Patent Appeals and Interferences.
Sec. 118. Suits by and against the Office.
Sec. 119. Annual report of Director.
Sec. 120. Suspension or exclusion from practice.
Sec. 121. Funding.
Sec. 122. Extension of surcharges on patent fees.
Sec. 123. Transfers.
Sec. 124. GAO study and report.
Subtitle B--Effective Date; Technical Amendments
Sec. 131. Effective date.
Sec. 132. Technical and conforming amendments.
Subtitle C--Miscellaneous Provisions
Sec. 141. References.
Sec. 142. Exercise of authorities.
Sec. 143. Savings provisions.
Sec. 144. Transfer of assets.
Sec. 145. Delegation and assignment.
Sec. 146. Authority of Director of the Office of Management and Budget
with respect to functions transferred.
Sec. 147. Certain vesting of functions considered transfers.
Sec. 148. Availability of existing funds.
Sec. 149. Definitions.
TITLE II--EXAMINING PROCEDURE IMPROVEMENTS: PUBLICATION WITH
PROVISIONAL ROYALTIES; TERM EXTENSIONS; FURTHER EXAMINATION
Sec. 201. Short title.
Sec. 202. Publication.
Sec. 203. Time for claiming benefit of earlier filing date.
Sec. 204. Provisional rights.
Sec. 205. Prior art effect of published applications.
Sec. 206. Cost recovery for publication.
Sec. 207. Conforming changes.
Sec. 208. Patent term extension authority.
Sec. 209. Further examination of patent applications.
Sec. 210. Last day of pendency of provisional application.
Sec. 211. Reporting requirement.
Sec. 212. Effective date.
TITLE III--PROTECTION FOR PRIOR DOMESTIC USERS OF PATENTED TECHNOLOGIES
Sec. 301. Short title.
Sec. 302. Defense to patent infringement based on prior domestic
commercial or research use.
Sec. 303. Effective date and applicability.
TITLE IV--ENHANCED PROTECTION OF INVENTORS' RIGHTS
Sec. 401. Short title.
Sec. 402. Invention development services.
Sec. 403. Technical and conforming amendment.
Sec. 404. Effective date.
TITLE V--IMPROVED REEXAMINATION PROCEDURES
Sec. 501. Short title.
Sec. 502. Definitions.
Sec. 503. Reexamination procedures.
Sec. 504. Conforming amendments.
Sec. 505. Effective date.
TITLE VI--MISCELLANEOUS IMPROVEMENTS
Sec. 601. Provisional applications.
Sec. 602. International applications.
Sec. 603. Plant patents.
Sec. 604. Electronic filing.
Sec. 605. Divisional applications.
TITLE I--PATENT AND TRADEMARK OFFICE MODERNIZATION
SEC. 101. SHORT TITLE.
This title may be cited as the ``Patent and Trademark
Office Modernization Act''.
Subtitle A--United States Patent and Trademark Office
SEC. 111. ESTABLISHMENT OF PATENT AND TRADEMARK OFFICE AS A
GOVERNMENT CORPORATION.
Section 1 of title 35, United States Code, is amended to
read as follows:
``Sec. 1. Establishment
``(a) Establishment.--The United States Patent and
Trademark Office is established as a wholly owned Government
corporation subject to chapter 91 of title 31, separate from
any department of the United States, and shall be an agency
of the United States under the policy direction of the
Secretary of Commerce. For purposes of internal management,
the United States Patent and Trademark Office shall be a
corporate body not subject to direction or supervision by any
department of the United States, except as otherwise provided
in this title.
``(b) Offices.--The United States Patent and Trademark
Office shall maintain its principal office in the
metropolitan Washington, D.C. area, for the service of
process and papers and for the purpose of carrying out its
functions. The United States Patent and Trademark Office
shall be deemed, for purposes of venue in civil actions, to
be a resident of the district in which its principal office
is located, except where jurisdiction is otherwise provided
by law. The United States Patent and Trademark Office may
establish satellite offices in such other places as it
considers necessary and appropriate in the conduct of its
business.
``(c) Reference.--For purposes of this title, the United
States Patent and Trademark Office shall also be referred to
as the `Office' and the `Patent and Trademark Office'.''.
SEC. 112. POWERS AND DUTIES.
Section 2 of title 35, United States Code, is amended to
read as follows:
``Sec. 2. Powers and duties
``(a) In General.--The United States Patent and Trademark
Office, under the policy direction of the Secretary of
Commerce--
``(1) shall be responsible for the granting and issuing of
patents and the registration of trademarks;
``(2) may conduct studies, programs, or exchanges of items
or services regarding domestic and international law of
patents, trademarks, and other matters, the administration of
the Office, or any function vested in the Office by law,
including programs to recognize, identify, assess, and
forecast the technology of patented inventions and their
utility to industry;
``(3)(A) may authorize or conduct studies and programs
cooperatively with foreign patent and trademark offices and
international organizations, in connection with patents,
trademarks, and other matters; and
``(B) with the concurrence of the Secretary of State, may
authorize the transfer of not to exceed $100,000 in any year
to the Department of State for the purpose of making special
payments to international intergovernmental organizations for
studies and programs for advancing international cooperation
concerning patents, trademarks, and other matters; and
``(4) shall be responsible for disseminating to the public
information with respect to patents and trademarks.
The special payments under paragraph (3)(B) shall be in
addition to any other payments or contributions to
international organizations described in paragraph (3)(B) and
shall not be subject to any limitations imposed by law on the
amounts of such other payments or contributions by the United
States Government.
``(b) Specific Powers.--The Office--
``(1) shall have perpetual succession;
``(2) shall adopt and use a corporate seal, which shall be
judicially noticed and with which letters patent,
certificates of trademark registrations, and papers issued by
the Office shall be authenticated;
``(3) may sue and be sued in its corporate name and be
represented by its own attorneys in all judicial and
administrative proceedings, subject to the provisions of
section 7;
``(4) may indemnify the Director, and other officers,
attorneys, agents, and employees (including members of the
Management Advisory Board established in section 5) of the
Office for liabilities and expenses incurred within the
scope of their employment;
``(5) may adopt, amend, and repeal bylaws, rules,
regulations, and determinations, which--
``(A) shall govern the manner in which its business will be
conducted and the powers granted to it by law will be
exercised;
``(B) shall be made after notice and opportunity for full
participation by interested public and private parties;
``(C) shall facilitate and expedite the processing of
patent applications, particularly those which can be filed,
stored, processed, searched, and retrieved electronically,
subject to the provisions of section 122 relating to the
confidential status of applications;
``(D) may govern the recognition and conduct of agents,
attorneys, or other persons representing applicants or other
parties before the Office, and may require them, before being
recognized as representatives of applicants or other persons,
to show that they are of good moral character and reputation
and are possessed of the necessary qualifications to render
to applicants or other persons valuable service, advice, and
assistance in the presentation or prosecution of their
applications or other business before the Office; and
``(E) recognize the public interest in continuing to
safeguard broad access to the United States patent system
through the reduced fee structure for small entities under
section 41(h)(1) of this title;
``(6) may acquire, construct, purchase, lease, hold,
manage, operate, improve, alter, and renovate any real,
personal, or mixed property, or any interest therein, as it
considers necessary to carry out its functions;
[[Page H1646]]
``(7)(A) may make such purchases, contracts for the
construction, maintenance, or management and operation of
facilities, and contracts for supplies or services, without
regard to the provisions of the Federal Property and
Administrative Services Act of 1949 (40 U.S.C. 471 and
following), the Public Buildings Act (40 U.S.C. 601 and
following), and the Stewart B. McKinney Homeless Assistance
Act (42 U.S.C. 11301 and following); and
``(B) may enter into and perform such purchases and
contracts for printing services, including the process of
composition, platemaking, presswork, silk screen processes,
binding, microform, and the products of such processes, as it
considers necessary to carry out the functions of the Office,
without regard to sections 501 through 517 and 1101 through
1123 of title 44;
``(8) may use, with their consent, services, equipment,
personnel, and facilities of other departments, agencies, and
instrumentalities of the Federal Government, on a
reimbursable basis, and cooperate with such other
departments, agencies, and instrumentalities in the
establishment and use of services, equipment, and facilities
of the Office;
``(9) may obtain from the Administrator of General Services
such services as the Administrator is authorized to provide
to other agencies of the United States, on the same basis as
those services are provided to other agencies of the United
States;
``(10) may, when the Director determines that it is
practicable, efficient, and cost-effective to do so, use,
with the consent of the United States and the agency,
government, or international organization concerned, the
services, records, facilities, or personnel of any State or
local government agency or instrumentality or foreign
government or international organization to perform functions
on its behalf;
``(11) may determine the character of and the necessity for
its obligations and expenditures and the manner in which they
shall be incurred, allowed, and paid, subject to the
provisions of this title and the Act of July 5, 1946
(commonly referred to as the `Trademark Act of 1946');
``(12) may retain and use all of its revenues and receipts,
including revenues from the sale, lease, or disposal of any
real, personal, or mixed property, or any interest therein,
of the Office, including for research and development and
capital investment, subject to the provisions of section
10101 of the Omnibus Budget Reconciliation Act of 1990 (35
U.S.C. 41 note);
``(13) shall have the priority of the United States with
respect to the payment of debts from bankrupt, insolvent, and
decedents' estates;
``(14) may accept monetary gifts or donations of services,
or of real, personal, or mixed property, in order to carry
out the functions of the Office;
``(15) may execute, in accordance with its bylaws, rules,
and regulations, all instruments necessary and appropriate in
the exercise of any of its powers; and
``(16) may provide for liability insurance and insurance
against any loss in connection with its property, other
assets, or operations either by contract or by self-
insurance.
``(c) Construction.--Nothing in this section shall be
construed to nullify, void, cancel, or interrupt any pending
request-for-proposal let or contract issued by the General
Services Administration for the specific purpose of
relocating or leasing space to the United States Patent and
Trademark Office.''.
SEC. 113. ORGANIZATION AND MANAGEMENT.
Section 3 of title 35, United States Code, is amended to
read as follows:
``Sec. 3. Officers and employees
``(a) Director.--
``(1) In general.--The management of the United States
Patent and Trademark Office shall be vested in a Director of
the United States Patent and Trademark Office (in this title
referred to as the `Director'), who shall be a citizen of the
United States and who shall be appointed by the President, by
and with the advice and consent of the Senate. The Director
shall be a person who, by reason of professional background
and experience in patent or trademark law, is especially
qualified to manage the Office.
``(2) Duties.--
``(A) In general.--The Director shall be responsible for
the management and direction of the Office, including the
issuance of patents and the registration of trademarks, and
shall perform these duties in a fair, impartial, and
equitable manner.
``(B) Advising the president.--The Director shall advise
the President, through the Secretary of Commerce, of all
activities of the Office undertaken in response to
obligations of the United States under treaties and executive
agreements, or which relate to cooperative programs with
those authorities of foreign governments that are responsible
for granting patents or registering trademarks. The Director
shall also recommend to the President, through the Secretary
of Commerce, changes in law or policy which may improve the
ability of United States citizens to secure and enforce
patent rights or trademark rights in the United States or in
foreign countries.
``(C) Consulting with the management advisory board.--The
Director shall consult with the Management Advisory Board
established in section 5 on a regular basis on matters
relating to the operation of the Office, and shall consult
with the Advisory Board before submitting budgetary proposals
to the Office of Management and Budget or changing or
proposing to change patent or trademark user fees or patent
or trademark regulations.
``(D) Security clearances.--The Director, in consultation
with the Director of the Office of Personnel Management,
shall maintain a program for identifying national security
positions and providing for appropriate security clearances.
``(3) Term.--The Director shall serve a term of 5 years,
and may continue to serve after the expiration of the
Director's term until a successor is appointed and assumes
office. The Director may be reappointed to subsequent terms.
``(4) Oath.--The Director shall, before taking office, take
an oath to discharge faithfully the duties of the Office.
``(5) Compensation.--The Director shall receive
compensation at a rate not to exceed the rate of pay in
effect for level III of the Executive Schedule under section
5314 of title 5 and, in addition, may receive as a bonus, an
amount which would raise the Director's total compensation to
not more than the equivalent of the level of the rate of pay
in effect for level I of the Executive Schedule under section
5312 of title 5, based upon an evaluation by the Secretary
of Commerce of the Director's performance as defined in an
annual performance agreement between the Director and the
Secretary. The annual performance agreement shall
incorporate measurable goals as delineated in an annual
performance plan agreed to by the Director and the
Secretary.
``(6) Removal.--The Director may be removed from office by
the President. The President shall provide notification of
any such removal to both Houses of Congress.
``(7) Designee of director.--The Director shall designate
an officer of the Office who shall be vested with the
authority to act in the capacity of the Director in the event
of the absence or incapacity of the Director.
``(b) Officers and Employees of the Office.--
``(1) Commissioners.--The Director shall appoint a
Commissioner for Patents and a Commissioner for Trademarks
for terms that shall expire on the date on which the
Director's term expires. The Commissioner for Patents shall
be a person with demonstrated experience in patent law and
the Commissioner for Trademarks shall be a person with
demonstrated experience in trademark law. The Commissioner
for Patents and the Commissioner for Trademarks shall be the
principal policy and management advisers to the Director on
all aspects of the activities of the Office that affect the
administration of patent and trademark operations,
respectively.
``(2) Other officers and employees.--The Director shall--
``(A) appoint such officers, employees (including
attorneys), and agents of the Office as the Director
considers necessary to carry out the functions of the
Office; and
``(B) define the authority and duties of such officers and
employees and delegate to them such of the powers vested in
the Office as the Director may determine.
The Office shall not be subject to any administratively or
statutorily imposed limitation on positions or personnel, and
no positions or personnel of the Office shall be taken into
account for purposes of applying any such limitation.
``(c) Continued Applicability of Title 5.--Officers and
employees of the Office shall be subject to the provisions of
title 5 relating to Federal employees. Section 2302 of title
5 applies to the Office, notwithstanding subsection
(a)(2)(B)(i) of such section.
``(d) Adoption of Existing Labor Agreements.--The Office
shall adopt all labor agreements which are in effect, as of
the day before the effective date of the Patent and Trademark
Office Modernization Act, with respect to such Office (as
then in effect).
``(e) Carryover of Personnel.--
``(1) From pto.--Effective as of the effective date of the
Patent and Trademark Office Modernization Act, all officers
and employees of the Patent and Trademark Office on the day
before such effective date shall become officers and
employees of the Office, without a break in service.
``(2) Other personnel.--Any individual who, on the day
before the effective date of the Patent and Trademark Office
Modernization Act, is an officer or employee of the
Department of Commerce (other than an officer or employee
under paragraph (1)) shall be transferred to the Office if--
``(A) such individual serves in a position for which a
major function is the performance of work reimbursed by the
Patent and Trademark Office, as determined by the Secretary
of Commerce;
``(B) such individual serves in a position that performed
work in support of the Patent and Trademark Office during at
least half of the incumbent's work time, as determined by the
Secretary of Commerce; or
``(C) such transfer would be in the interest of the Office,
as determined by the Secretary of Commerce in consultation
with the Director.
Any transfer under this paragraph shall be effective as of
the same effective date as referred to in paragraph (1), and
shall be made without a break in service.
``(3) Accumulated leave.--The amount of sick and annual
leave and compensatory time accumulated under title 5 before
the effective date described in paragraph (1), by those
becoming officers or employees of the Office pursuant to this
subsection, are obligations of the Office.
``(f) Transition Provisions.--
``(1) Interim appointment of director.--On or after the
effective date of the Patent and Trademark Office
Modernization Act, the President shall appoint an individual
to serve as the Director until the date on which a Director
qualifies under subsection (a). The President shall not make
more than one such appointment under this subsection.
``(2) Continuation in office of certain officers.--(A) The
individual serving as the Assistant Commissioner for Patents
on the day before the effective date of the Patent and
Trademark Office Modernization Act may serve as the
Commissioner for Patents until the date on
[[Page H1647]]
which a Commissioner for Patents is appointed under
subsection (b).
``(B) The individual serving as the Assistant Commissioner
for Trademarks on the day before the effective date of the
Patent and Trademark Office Modernization Act may serve as
the Commissioner for Trademarks until the date on which a
Commissioner for Trademarks is appointed under subsection
(b).''.
SEC. 114. MANAGEMENT ADVISORY BOARD.
Chapter 1 of part I of title 35, United States Code, is
amended by inserting after section 4 the following:
``Sec. 5. Patent and Trademark Office Management Advisory
Board
``(a) Establishment of Management Advisory Board.--
``(1) Appointment.--The United States Patent and Trademark
Office shall have a Management Advisory Board (hereafter in
this title referred to as the `Advisory Board') of 12
members, 4 of whom shall be appointed by the President, 4 of
whom shall be appointed by the Speaker of the House of
Representatives, and 4 of whom shall be appointed by the
majority leader of the Senate. Not more than 3 of the 4
members appointed by each appointing authority shall be
members of the same political party.
``(2) Terms.--Members of the Advisory Board shall be
appointed for a term of 4 years each, except that of the
members first appointed by each appointing authority, 1 shall
be for a term of 1 year, 1 shall be for a term of 2 years,
and 1 shall be for a term of 3 years. No member may serve
more than 1 term.
``(3) Chair.--The President shall designate the chair of
the Advisory Board, whose term as chair shall be for 3 years.
``(4) Timing of appointments.--Initial appointments to the
Advisory Board shall be made within 3 months after the
effective date of the Patent and Trademark Office
Modernization Act, and vacancies shall be filled within 3
months after they occur.
``(5) Vacancies.--Vacancies shall be filled in the manner
in which the original appointment was made under this
subsection. Members appointed to fill a vacancy occurring
before the expiration of the term for which the member's
predecessor was appointed shall be appointed only for the
remainder of that term. A member may serve after the
expiration of that member's term until a successor is
appointed.
``(6) Committees.--The Chair shall designate members of the
Advisory Board to serve on a committee on patent operations
and on a committee on trademark operations to perform the
duties set forth in subsection (e) as they relate
specifically to the Office's patent operations, and the
Office's trademark operations, respectively.
``(b) Basis for Appointments.--Members of the Advisory
Board shall be citizens of the United States who shall be
chosen so as to represent the interests of diverse users of
the United States Patent and Trademark Office, and shall
include individuals with substantial background and
achievement in corporate finance and management.
``(c) Applicability of Certain Ethics Laws.--Members of the
Advisory Board shall be special Government employees within
the meaning of section 202 of title 18.
``(d) Meetings.--The Advisory Board shall meet at the call
of the chair to consider an agenda set by the chair.
``(e) Duties.--The Advisory Board shall--
``(1) review the policies, goals, performance, budget, and
user fees of the United States Patent and Trademark Office,
and advise the Director on these matters; and
``(2) within 60 days after the end of each fiscal year,
prepare an annual report on the matters referred to in
paragraph (1), transmit the report to the President and the
Committees on the Judiciary of the Senate and the House of
Representatives, and publish the report in the Patent and
Trademark Office Official Gazette.
``(f) Compensation.--Members of the Advisory Board shall be
compensated for each day (including travel time) during which
they are attending meetings or conferences of the Advisory
Board or otherwise engaged in the business of the Advisory
Board, at the rate which is the daily equivalent of the
annual rate of basic pay in effect for level III of the
Executive Schedule under section 5314 of title 5, and while
away from their homes or regular places of business they may
be allowed travel expenses, including per diem in lieu of
subsistence, as authorized by section 5703 of title 5.
``(g) Access to Information.--Members of the Advisory Board
shall be provided access to records and information in the
United States Patent and Trademark Office, except for
personnel or other privileged information and information
concerning patent applications required to be kept in
confidence by section 122.''.
SEC. 115. CONFORMING AMENDMENTS.
(a) Duties.--Chapter 1 of title 35, United States Code, is
amended by striking section 6.
(b) Regulations for Agents and Attorneys.--Section 31 of
title 35, United States Code, and the item relating to such
section in the table of sections for chapter 3 of title 35,
United States Code, are repealed.
SEC. 116. TRADEMARK TRIAL AND APPEAL BOARD.
Section 17 of the Act of July 5, 1946 (commonly referred to
as the ``Trademark Act of 1946'') (15 U.S.C. 1067) is amended
to read as follows:
``Sec. 17. (a) In every case of interference, opposition to
registration, application to register as a lawful concurrent
user, or application to cancel the registration of a mark,
the Director shall give notice to all parties and shall
direct a Trademark Trial and Appeal Board to determine and
decide the respective rights of registration.
``(b) The Trademark Trial and Appeal Board shall include
the Director, the Commissioner for Patents, the Commissioner
for Trademarks, and administrative trademark judges who are
appointed by the Director.''.
SEC. 117. BOARD OF PATENT APPEALS AND INTERFERENCES.
Chapter 1 of title 35, United States Code, is amended by
striking section 7 and inserting after section 5 the
following:
``Sec. 6. Board of Patent Appeals and Interferences
``(a) Establishment and Composition.--There shall be in the
United States Patent and Trademark Office a Board of Patent
Appeals and Interferences. The Director, the Commissioner for
Patents, the Commissioner for Trademarks, and the
administrative patent judges shall constitute the Board. The
administrative patent judges shall be persons of competent
legal knowledge and scientific ability who are appointed
by the Director.
``(b) Duties.--The Board of Patent Appeals and
Interferences shall, on written appeal of an applicant,
review adverse decisions of examiners upon applications for
patents and shall determine priority and patentability of
invention in interferences declared under section 135(a).
Each appeal and interference shall be heard by at least 3
members of the Board, who shall be designated by the
Director. Only the Board of Patent Appeals and Interferences
may grant rehearings.''.
SEC. 118. SUITS BY AND AGAINST THE OFFICE.
Chapter 1 of part I of title 35, United States Code, is
amended by inserting after section 6 the following new
section:
``Sec. 7. Suits by and against the Office
``(a) Actions Under United States Law.--Any civil action or
proceeding to which the United States Patent and Trademark
Office is a party is deemed to arise under the laws of the
United States. The Federal courts shall have exclusive
jurisdiction over all civil actions by or against the Office.
``(b) Representation by the Department of Justice.--The
United States Patent and Trademark Office shall be deemed an
agency of the United States for purposes of section 516 of
title 28.
``(c) Prohibition on Attachment, Liens, Etc.--No
attachment, garnishment, lien, or similar process,
intermediate or final, in law or equity, may be issued
against property of the Office.''.
SEC. 119. ANNUAL REPORT OF DIRECTOR.
Section 14 of title 35, United States Code, is amended to
read as follows:
``Sec. 14. Annual report to Congress
``The Director shall report to the Congress, not later than
180 days after the end of each fiscal year, the moneys
received and expended by the Office, the purposes for which
the moneys were spent, the quality and quantity of the work
of the Office, and other information relating to the Office.
The report under this section shall also meet the
requirements of section 9106 of title 31, to the extent that
such requirements are not inconsistent with the preceding
sentence. The report required under this section shall not be
deemed to be the report of the United States Patent and
Trademark Office under section 9106 of title 31, and the
Director shall file a separate report under such section.''.
SEC. 120. SUSPENSION OR EXCLUSION FROM PRACTICE.
Section 32 of title 35, United States Code, is amended by
inserting before the last sentence the following: ``The
Director shall have the discretion to designate any attorney
who is an officer or employee of the United States Patent and
Trademark Office to conduct the hearing required by this
section.''.
SEC. 121. FUNDING.
Section 42 of title 35, United States Code, is amended to
read as follows:
``Sec. 42. Patent and Trademark Office funding
``(a) Fees Payable to the Office.--All fees for services
performed by or materials furnished by the United States
Patent and Trademark Office shall be payable to the Office.
``(b) Use of Moneys.--Moneys from fees shall be available
to the United States Patent and Trademark Office to carry
out, to the extent provided in appropriations Acts, the
functions of the Office. Moneys of the Office not otherwise
used to carry out the functions of the Office shall be kept
in cash on hand or on deposit, or invested in obligations of
the United States or guaranteed by the United States, or in
obligations or other instruments which are lawful investments
for fiduciary, trust, or public funds. Fees available to the
Office under this title shall be used for the processing of
patent applications and for other services and materials
relating to patents. Fees available to the Office under
section 31 of the Act of July 5, 1946 (commonly referred to
as the `Trademark Act of 1946'; 15 U.S.C. 1113), shall be
used only for the processing of trademark registrations and
for other services and materials relating to trademarks.
``(c) Borrowing Authority.--The United States Patent and
Trademark Office is authorized to issue from time to time for
purchase by the Secretary of the Treasury its debentures,
bonds, notes, and other evidences of indebtedness (hereafter
in this subsection referred to as `obligations') to assist in
financing its activities. Borrowing under this subsection
shall be subject to prior approval in appropriations Acts.
Such borrowing shall not exceed amounts approved in
appropriations Acts. Any borrowing under this subsection
shall be repaid only from fees paid to the Office and
surcharges appropriated by the Congress. Such obligations
shall be redeemable at the option of the Office before
maturity in the manner stipulated in such obligations and
shall have such maturity as is determined by the Office
with the approval of the Secretary of the Treasury. Each
such obligation issued to the Treasury shall bear interest
at a rate not less than the current yield on outstanding
marketable obligations of the United States of comparable
maturity during the month preceding
[[Page H1648]]
the issuance of the obligation as determined by the
Secretary of the Treasury. The Secretary of the Treasury
shall purchase any obligations of the Office issued under
this subsection and for such purpose the Secretary of the
Treasury is authorized to use as a public-debt transaction
the proceeds of any securities issued under chapter 31 of
title 31, and the purposes for which securities may be
issued under that chapter are extended to include such
purpose. Payment under this subsection of the purchase
price of such obligations of the United States Patent and
Trademark Office shall be treated as public debt
transactions of the United States.''.
SEC. 122. EXTENSION OF SURCHARGES ON PATENT FEES.
(a) In General.--Section 10101 of the Omnibus Budget
Reconciliation Act of 1990 (35 U.S.C. 41 note) is amended to
read as follows:
``SEC. 10101. PATENT AND TRADEMARK OFFICE USER FEES.
``(a) Surcharges.--There shall be a surcharge on all fees
authorized by subsections (a) and (b) of section 41 of title
35, United States Code, in order to ensure that the amounts
specified in subsection (c) are collected.
``(b) Use of Surcharges.--Notwithstanding section 3302 of
title 31, United States Code, all surcharges collected by the
Patent and Trademark Office--
``(1) shall be credited to a separate account established
in the Treasury and ascribed to the activities of the United
States Patent and Trademark Office as offsetting collections,
``(2) shall be collected by and available to the United
States Patent and Trademark Office for all authorized
activities and operations of the Office, including all direct
and indirect costs of services provided by the office, and
``(3) shall remain available until expended.
``(c) Establishment of Surcharges.--The Director of the
United States Patent and Trademark Office shall establish
surcharges under subsection (a), subject to the provisions of
section 553 of title 5, United States Code, in order to
ensure that $119,000,000, but not more than $119,000,000, are
collected in fiscal year 1999 and each fiscal year
thereafter.
``(d) Appropriations Act Required.--Notwithstanding
subsections (a) through (c), no fee established by subsection
(a) shall be collected nor shall be available for spending
without prior authorization in appropriations Acts.''.
(b) Effective Date.--The amendment made by subsection (a)
shall take effect on October 1, 1998.
SEC. 123. TRANSFERS.
(a) Transfer of Functions.--Except to the extent that such
functions, powers, and duties relate to the direction of
patent or trademark policy, there are transferred to, and
vested in, the United States Patent and Trademark Office all
functions, powers, and duties vested by law in the Secretary
of Commerce or the Department of Commerce or in the officers
or components in the Department of Commerce with respect to
the authority to grant patents and register trademarks, and
in the Patent and Trademark Office, as in effect on the day
before the effective date of this title, and in the officers
and components of such Office.
(b) Transfer of Funds and Property.--The Secretary of
Commerce shall transfer to the United States Patent and
Trademark Office, on the effective date of this title, so
much of the assets, liabilities, contracts, property,
records, and unexpended and unobligated balances of
appropriations, authorizations, allocations, and other funds
employed, held, used, arising from, available to, or to be
made available to the Department of Commerce, including funds
set aside for accounts receivable, which are related to
functions, powers, and duties which are vested in the Patent
and Trademark Office by this title.
SEC. 124. GAO STUDY AND REPORT.
The Comptroller General shall conduct a study of and, not
later than the date that is 2 years after the effective date
of this title, submit to the Committee on the Judiciary of
the House of Representatives and the Committee on the
Judiciary of the Senate a report on--
(1) the operations of the Patent and Trademark Office as a
Government corporation; and
(2) the feasibility and desirability of making the
trademark operations of the Patent and Trademark Office a
separate Government corporation or agency.
Subtitle B--Effective Date; Technical Amendments
SEC. 131. EFFECTIVE DATE.
This title and the amendments made by this title shall take
effect 4 months after the date of the enactment of this Act.
SEC. 132. TECHNICAL AND CONFORMING AMENDMENTS.
(a) Amendments to Title 35.--
(1) The item relating to part I in the table of parts for
chapter 35, United States Code, is amended to read as
follows:
``I. United States Patent and Trademark Office...................1''.
(2) The heading for part I of title 35, United States Code,
is amended to read as follows:
``PART I--UNITED STATES PATENT AND TRADEMARK OFFICE''.
(3) The table of chapters for part I of title 35, United
States Code, is amended by amending the item relating to
chapter 1 to read as follows:
``1. Establishment, Officers and Employees, Functions..........1''.....
(4) The table of sections for chapter 1 of title 35, United
States Code, is amended to read as follows:
``CHAPTER 1--ESTABLISHMENT, OFFICERS AND EMPLOYEES, FUNCTIONS
``Sec.
``1. Establishment.
``2. Powers and duties.
``3. Officers and employees.
``4. Restrictions on officers and employees as to interest in patents.
``5. Patent and Trademark Office Management Advisory Board.
``6. Board of Patent Appeals and Interferences.
``7. Suits by and against the Office.
``8. Library.
``9. Classification of patents.
``10. Certified copies of records.
``11. Publications.
``12. Exchange of copies of patents with foreign countries.
``13. Copies of patents for public libraries.
``14. Annual report to Congress.''.
(5) Section 155 of title 35, United States Code, is amended
by striking ``Commissioner of Patents and Trademarks'' and
inserting ``Director''.
(6) Section 155A(c) of title 35, United States Code, is
amended by striking ``Commissioner of Patents and
Trademarks'' and inserting ``Director''.
(7) Section 302 of title 35, United States Code, is amended
by striking ``Commissioner of Patents'' and inserting
``Director''.
(8) Section 303(b) of title 35, United States Code, is
amended by striking ``Commissioner's'' and inserting
``Director's''.
(9) Title 35, United States Code, is amended by striking
``Commissioner'' each place it appears and inserting
``Director''.
(10) Section 41(a)(8)(A) of title 35, United States Code,
is amended by striking ``On'' and inserting ``on''.
(b) Other Provisions of Law.--
(1)(A) Section 45 of the Act of July 5, 1946 (commonly
referred to as the ``Trademark Act of 1946''; 15 U.S.C.
1127), is amended by striking ``The term `Commissioner' means
the Commissioner of Patents and Trademarks.'' and inserting
``The term `Director' means the Director of the United States
Patent and Trademark Office.''.
(B) The Act of July 5, 1946 (commonly referred to as the
``Trademark Act of 1946''; 15 U.S.C. 1051 and following),
except for section 17, as amended by section 116 of this Act,
is amended by striking ``Commissioner'' each place it appears
and inserting ``Director''.
(2) Section 9101(3) of title 31, United States Code, is
amended by adding at the end the following:
``(R) the United States Patent and Trademark Office.''.
(3) Section 500(e) of title 5, United States Code, is
amended by striking ``Patent Office'' and inserting ``United
States Patent and Trademark Office''.
(4) Section 5102(c)(23) of title 5, United States Code, is
amended to read as follows:
``(23) administrative patent judges and designated
administrative patent judges in the United States Patent and
Trademark Office;''.
(5) Section 5316 of title 5, United States Code (5 U.S.C.
5316) is amended by striking ``Commissioner of Patents,
Department of Commerce.'', ``Deputy Commissioner of Patents
and Trademarks.'', ``Assistant Commissioner for Patents.'',
and ``Assistant Commissioner for Trademarks.''.
(6) Section 9(p)(1)(B) of the Small Business Act (15 U.S.C.
638(p)(1)(B)) is amended to read as follows:
``(B) the Director of the United States Patent and
Trademark Office; and''.
(7) Section 12 of the Act of February 14, 1903 (15 U.S.C.
1511) is amended by striking ``(d) Patent and Trademark
Office;'' and redesignating subsections (a) through (g) as
paragraphs (1) through (6), respectively.
(8) Section 19 of the Tennessee Valley Authority Act of
1933 (16 U.S.C. 831r) is amended--
(A) by striking ``Patent Office of the United States'' and
inserting ``United States Patent and Trademark Office''; and
(B) by striking ``Commissioner of Patents'' and inserting
``Director of the United States Patent and Trademark
Office''.
(9) Section 182(b)(2)(A) of the Trade Act of 1974 (19
U.S.C. 2242(b)(2)(A)) is amended by striking ``Commissioner
of Patents and Trademarks'' and inserting ``Director of the
United States Patent and Trademark Office''.
(10) Section 302(b)(2)(D) of the Trade Act of 1974 (19
U.S.C. 2412(b)(2)(D)) is amended by striking ``Commissioner
of Patents and Trademarks'' and inserting ``Director of the
United States Patent and Trademark Office''.
(11) The Act of April 12, 1892 (27 Stat. 395; 20 U.S.C. 91)
is amended by striking ``Patent Office'' and inserting
``United States Patent and Trademark Office''.
(12) Sections 505(m) and 512(o) of the Federal Food, Drug,
and Cosmetic Act (21 U.S.C. 355(m) and 360b(o)) are each
amended by striking ``Patent and Trademark Office of the
Department of Commerce'' and inserting ``United States
Patent and Trademark Office''.
(13) Section 702(d) of the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. 372(d)) is amended by striking ``Commissioner
of Patents'' and inserting ``Director of the United States
Patent and Trademark Office''.
(14) Section 105(e) of the Federal Alcohol Administration
Act (27 U.S.C. 205(e)) is amended by striking ``United States
Patent Office'' and inserting ``United States Patent and
Trademark Office''.
(15) Section 1295(a)(4) of title 28, United States Code, is
amended--
(A) in subparagraph (A) by inserting ``United States''
before ``Patent and Trademark''; and
(B) in subparagraph (B) by striking ``Commissioner of
Patents and Trademarks'' and inserting ``Director of the
United States Patent and Trademark Office''.
(16) Section 1744 of title 28, United States Code is
amended--
(A) by striking ``Patent Office'' each place it appears in
the text and section heading and inserting ``United States
Patent and Trademark Office'';
[[Page H1649]]
(B) by striking ``Commissioner of Patents'' and inserting
``Director of the United States Patent and Trademark
Office''; and
(C) by striking ``Commissioner'' and inserting
``Director''.
(17) Section 1745 of title 28, United States Code, is
amended by striking ``United States Patent Office'' and
inserting ``United States Patent and Trademark Office''.
(18) Section 1928 of title 28, United States Code, is
amended by striking ``Patent Office'' and inserting ``United
States Patent and Trademark Office''.
(19) Section 151 of the Atomic Energy Act of 1954 (42
U.S.C. 2181) is amended in subsections c. and d. by striking
``Commissioner of Patents'' and inserting ``Director of the
United States Patent and Trademark Office''.
(20) Section 152 of the Atomic Energy Act of 1954 (42
U.S.C. 2182) is amended by striking ``Commissioner of
Patents'' each place it appears and inserting ``Director of
the United States Patent and Trademark Office''.
(21) Section 305 of the National Aeronautics and Space Act
of 1958 (42 U.S.C. 2457) is amended--
(A) in subsection (c) by striking ``Commissioner of
Patents'' and inserting ``Director of the United States
Patent and Trademark Office (hereafter in this section
referred to as the `Director')''; and
(B) by striking ``Commissioner'' each subsequent place it
appears and inserting ``Director''.
(22) Section 12(a) of the Solar Heating and Cooling
Demonstration Act of 1974 (42 U.S.C. 5510(a)) is amended by
striking ``Commissioner of the Patent Office'' and inserting
``Director of the United States Patent and Trademark
Office''.
(23) Section 1111 of title 44, United States Code, is
amended by striking ``the Commissioner of Patents,''.
(24) Section 1114 of title 44, United States Code, is
amended by striking ``the Commissioner of Patents,''.
(25) Section 1123 of title 44, United States Code, is
amended by striking ``the Patent Office,''.
(26) Sections 1337 and 1338 of title 44, United States
Code, and the items relating to those sections in the table
of contents for chapter 13 of such title, are repealed.
(27) Section 10(i) of the Trading With the Enemy Act (50
U.S.C. App. 10(i)) is amended by striking ``Commissioner of
Patents'' and inserting ``Director of the United States
Patent and Trademark Office''.
(28) Section 11 of the Inspector General Act of 1978 (5
U.S.C. App.) is amended--
(A) in paragraph (1)--
(i) by striking ``and'' before ``the chief executive
officer of the Resolution Trust Corporation;'';
(ii) by striking ``and'' before ``the Chairperson of the
Federal Deposit Insurance Corporation;'';
(iii) by striking ``or'' before ``the Commissioner of
Social Security,''; and
(iv) by inserting ``or the Director of the United States
Patent and Trademark Office;'' after ``Social Security
Administration;''; and
(B) in paragraph (2)--
(i) by striking ``or'' before ``the Veterans'
Administration,''; and
(ii) by striking ``or the Social Security Administration''
and inserting ``the Social Security Administration, or the
United States Patent and Trademark Office''.
Subtitle C--Miscellaneous Provisions
SEC. 141. REFERENCES.
(a) In General.--Any reference in any other Federal law,
Executive order, rule, regulation, or delegation of
authority, or any document of or pertaining to a department
or office from which a function is transferred by this
title--
(1) to the head of such department or office is deemed to
refer to the head of the department or office to which such
function is transferred; or
(2) to such department or office is deemed to refer to the
department or office to which such function is transferred.
(b) Specific References.--Any reference in any other
Federal law, Executive order, rule, regulation, or delegation
of authority, or any document of or pertaining to the Patent
and Trademark Office--
(1) to the Commissioner of Patents and Trademarks is deemed
to refer to the Director of the United States Patent and
Trademark Office;
(2) to the Assistant Commissioner for Patents is deemed to
refer to the Commissioner for Patents; or
(3) to the Assistant Commissioner for Trademarks is deemed
to refer to the Commissioner for Trademarks.
SEC. 142. EXERCISE OF AUTHORITIES.
Except as otherwise provided by law, a Federal official to
whom a function is transferred by this title may, for
purposes of performing the function, exercise all authorities
under any other provision of law that were available with
respect to the performance of that function to the official
responsible for the performance of the function immediately
before the effective date of the transfer of the function
under this title.
SEC. 143. SAVINGS PROVISIONS.
(a) Legal Documents.--All orders, determinations, rules,
regulations, permits, grants, loans, contracts, agreements,
certificates, licenses, and privileges--
(1) that have been issued, made, granted, or allowed to
become effective by the President, the Secretary of Commerce,
any officer or employee of any office transferred by this
title, or any other Government official, or by a court of
competent jurisdiction, in the performance of any function
that is transferred by this title, and
(2) that are in effect on the effective date of such
transfer (or become effective after such date pursuant to
their terms as in effect on such effective date),
shall continue in effect according to their terms until
modified, terminated, superseded, set aside, or revoked in
accordance with law by the President, any other authorized
official, a court of competent jurisdiction, or operation of
law.
(b) Proceedings.--This title shall not affect any
proceedings or any application for any benefits, service,
license, permit, certificate, or financial assistance pending
on the effective date of this title before an office
transferred by this title, but such proceedings and
applications shall be continued. Orders shall be issued in
such proceedings, appeals shall be taken therefrom, and
payments shall be made pursuant to such orders, as if this
title had not been enacted, and orders issued in any such
proceeding shall continue in effect until modified,
terminated, superseded, or revoked by a duly authorized
official, by a court of competent jurisdiction, or by
operation of law. Nothing in this subsection shall be
considered to prohibit the discontinuance or modification of
any such proceeding under the same terms and conditions and
to the same extent that such proceeding could have been
discontinued or modified if this title had not been enacted.
(c) Suits.--This title shall not affect suits commenced
before the effective date of this title, and in all such
suits, proceedings shall be had, appeals taken, and judgments
rendered in the same manner and with the same effect as if
this title had not been enacted.
(d) Nonabatement of Actions.--No suit, action, or other
proceeding commenced by or against the Department of Commerce
or the Secretary of Commerce, or by or against any individual
in the official capacity of such individual as an officer or
employee of an office transferred by this title, shall abate
by reason of the enactment of this title.
(e) Continuance of Suits.--If any Government officer in the
official capacity of such officer is party to a suit with
respect to a function of the officer, and under this title
such function is transferred to any other officer or office,
then such suit shall be continued with the other officer or
the head of such other office, as applicable, substituted or
added as a party.
(f) Administrative Procedure and Judicial Review.--Except
as otherwise provided by this title, any statutory
requirements relating to notice, hearings, action upon the
record, or administrative or judicial review that apply to
any function transferred by this title shall apply to the
exercise of such function by the head of the Federal
agency, and other officers of the agency, to which such
function is transferred by this title.
SEC. 144. TRANSFER OF ASSETS.
Except as otherwise provided in this title, so much of the
personnel, property, records, and unexpended balances of
appropriations, allocations, and other funds employed, used,
held, available, or to be made available in connection with a
function transferred to an official or agency by this title
shall be available to the official or the head of that
agency, respectively, at such time or times as the Director
of the Office of Management and Budget directs for use in
connection with the functions transferred.
SEC. 145. DELEGATION AND ASSIGNMENT.
Except as otherwise expressly prohibited by law or
otherwise provided in this title, an official to whom
functions are transferred under this title (including the
head of any office to which functions are transferred under
this title) may delegate any of the functions so transferred
to such officers and employees of the office of the official
as the official may designate, and may authorize successive
redelegations of such functions as may be necessary or
appropriate. No delegation of functions under this section or
under any other provision of this title shall relieve the
official to whom a function is transferred under this title
of responsibility for the administration of the function.
SEC. 146. AUTHORITY OF DIRECTOR OF THE OFFICE OF MANAGEMENT
AND BUDGET WITH RESPECT TO FUNCTIONS
TRANSFERRED.
(a) Determinations.--If necessary, the Director of the
Office of Management and Budget shall make any determination
of the functions that are transferred under this title.
(b) Incidental Transfers.--The Director of the Office of
Management and Budget, at such time or times as the Director
shall provide, may make such determinations as may be
necessary with regard to the functions transferred by this
title, and to make such additional incidental dispositions of
personnel, assets, liabilities, grants, contracts, property,
records, and unexpended balances of appropriations,
authorizations, allocations, and other funds held, used,
arising from, available to, or to be made available in
connection with such functions, as may be necessary to carry
out the provisions of this title. The Director shall provide
for the termination of the affairs of all entities terminated
by this title and for such further measures and dispositions
as may be necessary to effectuate the purposes of this title.
SEC. 147. CERTAIN VESTING OF FUNCTIONS CONSIDERED TRANSFERS.
For purposes of this title, the vesting of a function in a
department or office pursuant to reestablishment of an office
shall be considered to be the transfer of the function.
SEC. 148. AVAILABILITY OF EXISTING FUNDS.
Existing appropriations and funds available for the
performance of functions, programs, and activities terminated
pursuant to this title shall remain available, for the
duration of their period of availability, for necessary
expenses in connection with the termination and resolution of
such functions, programs, and 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,
[[Page H1650]]
Justice, and State, the Judiciary, and Related Agencies
Appropriations Act 1997.
SEC. 149. DEFINITIONS.
For purposes of this title--
(1) the term ``function'' includes any duty, obligation,
power, authority, responsibility, right, privilege, activity,
or program; and
(2) the term ``office'' includes any office,
administration, agency, bureau, institute, council, unit,
organizational entity, or component thereof.
TITLE II--EXAMINING PROCEDURE IMPROVEMENTS: PUBLICATION WITH
PROVISIONAL ROYALTIES; TERM EXTENSIONS; FURTHER EXAMINATION
SEC. 201. SHORT TITLE.
This title may be cited as the ``Examining Procedure
Improvements Act''.
SEC. 202. PUBLICATION.
Section 122 of title 35, United States Code, is amended to
read as follows:
``Sec. 122. Confidential status of applications; publication
of patent applications
``(a) Confidentiality.--Except as provided in subsection
(b), applications for patents shall be kept in confidence by
the Patent and Trademark Office and no information concerning
applications for patents shall be given without authority of
the applicant or owner unless necessary to carry out the
provisions of an Act of Congress or in such special
circumstances as may be determined by the Director.
``(b) Publication.--
``(1) In general.--(A) Subject to paragraph (2), each
application for patent, except applications for design
patents filed under chapter 16 of this title and
provisional applications filed under section 111(b) of
this title, shall be published, in accordance with
procedures determined by the Director, promptly after the
expiration of a period of 18 months from the earliest
filing date for which a benefit is sought under this
title. At the request of the applicant, an application may
be published earlier than the end of such 18-month period.
``(B) No information concerning published patent
applications shall be made available to the public except as
the Director determines.
``(C) Notwithstanding any other provision of law, a
determination by the Director to release or not to release
information concerning a published patent application shall
be final and nonreviewable.
``(2) Exceptions.--(A) An application that is no longer
pending shall not be published.
``(B) An application that is subject to a secrecy order
pursuant to section 181 of this title shall not be published.
``(C)(i) Upon the request of the applicant at the time of
filing, the application shall not be published in accordance
with paragraph (1) until 3 months after the Director makes a
notification to the applicant under section 132 of this
title.
``(ii) Applications filed pursuant to section 363 of this
title, applications asserting priority under section 119 or
365(a) of this title, and applications asserting the benefit
of an earlier application under section 120, 121, or 365(c)
of this title shall not be eligible for a request pursuant to
this subparagraph.
``(iii) In a request under this subparagraph, the applicant
shall certify that the invention disclosed in the application
was not and will not be the subject of an application filed
in a foreign country.
``(iv) The Director may establish appropriate procedures
and fees for making a request under this subparagraph.
``(D)(i) In a case in which an applicant, after making a
request under subparagraph (C)(i), determines to file an
application in a foreign country, the applicant shall notify
the Director promptly. The application shall then be
published in accordance with the provisions of paragraph (1).
``(ii) The Director may establish appropriate fees to cover
the costs of processing notifications under clause (i),
including the costs of any special handling of applications
resulting from the initial request under subparagraph (C)(i).
``(c) Pre-Issuance Opposition.--The provisions of this
section shall not operate to create any new opportunity for
pre-issuance opposition. The Director may establish
appropriate procedures to ensure that this section does not
create any new opportunity for pre-issuance opposition.''.
SEC. 203. TIME FOR CLAIMING BENEFIT OF EARLIER FILING DATE.
(a) In a Foreign Country.--Section 119(b) of title 35,
United States Code, is amended to read as follows:
``(b)(1) No application for patent shall be entitled to
this right of priority unless a claim is filed in the Patent
and Trademark Office, at such time during the pendency of the
application as is required by the Director, that identifies
the foreign application by specifying its application number,
the country in or for which the application was filed, and
the date of its filing.
``(2) The Director may consider the failure of the
applicant to file a timely claim for priority as a waiver of
any such claim, and may require the payment of a surcharge as
a condition of accepting an untimely claim during the
pendency of the application.
``(3) The Director may require a certified copy of the
original foreign application, specification, and
drawings upon which it is based, a translation if not in
the English language, and such other information as the
Director considers necessary. Any such certification shall
be made by the intellectual property authority in the
foreign country in which the foreign application was filed
and show the date of the application and of the filing of
the specification and other papers.''.
(b) In the United States.--Section 120 of title 35, United
States Code, is amended by adding at the end the following:
``No application shall be entitled to the benefit of an
earlier filed application under this section unless an
amendment containing the specific reference to the earlier
filed application is submitted at such time during the
pendency of the application as is required by the
Commissioner. The Director may consider the failure to submit
such an amendment within that time period as a waiver of any
benefit under this section. The Director may establish
procedures, including the payment of a surcharge, to accept
unavoidably late submissions of amendments under this
section.''.
SEC. 204. PROVISIONAL RIGHTS.
Section 154 of title 35, United States Code, is amended--
(1) in the section caption by inserting ``; provisional
rights'' after ``patent''; and
(2) by adding at the end the following new subsection:
``(d) Provisional Rights.--
``(1) In general.--In addition to other rights provided by
this section, a patent shall include the right to obtain a
reasonable royalty from any person who, during the period
beginning on the date of publication of the application for
such patent pursuant to section 122(b) of this title, or in
the case of an international application filed under the
treaty defined in section 351(a) of this title designating
the United States under Article 21(2)(a) of such treaty, the
date of publication of the application, and ending on the
date the patent is issued--
``(A)(i) makes, uses, offers for sale, or sells in the
United States the invention as claimed in the published
patent application or imports such an invention into the
United States; or
``(ii) if the invention as claimed in the published patent
application is a process, uses, offers for sale, or sells in
the United States or imports into the United States products
made by that process as claimed in the published patent
application; and
``(B) had actual notice of the published patent application
and, where the right arising under this paragraph is based
upon an international application designating the United
States that is published in a language other than English, a
translation of the international application into the English
language.
``(2) Right based on substantially identical inventions.--
The right under paragraph (1) to obtain a reasonable royalty
shall not be available under this subsection unless the
invention as claimed in the patent is substantially identical
to the invention as claimed in the published patent
application.
``(3) Time limitation on obtaining a reasonable royalty.--
The right under paragraph (1) to obtain a reasonable royalty
shall be available only in an action brought not later than 6
years after the patent is issued. The right under paragraph
(1) to obtain a reasonable royalty shall not be affected by
the duration of the period described in paragraph (1).
``(4) Requirements for international applications.--The
right under paragraph (1) to obtain a reasonable royalty
based upon the publication under the treaty defined in
section 351(a) of this title of an international application
designating the United States shall commence from the date
that the Patent and Trademark Office receives a copy of the
publication under such treaty of the international
application, or, if the publication under the treaty of the
international application is in a language other than
English, from the date that the Patent and Trademark Office
receives a translation of the international application in
the English language. The Director may require the applicant
to provide a copy of the international publication of the
international application and a translation thereof.''.
SEC. 205. PRIOR ART EFFECT OF PUBLISHED APPLICATIONS.
Section 102(e) of title 35, United States Code, is amended
to read as follows:
``(e) the invention was described in--
``(1) an application for patent, published pursuant to
section 122(b) of this title, by another filed in the United
States before the invention by the applicant for patent,
except that an international application filed under the
treaty defined in section 351(a) of this title shall have the
effect under this subsection of a national application
published under section 122(b) of this title only if the
international application designating the United States was
published under Article 21(2)(a) of such treaty in the
English language, or
``(2) a patent granted on an application for patent by
another filed in the United States before the invention by
the applicant for patent, or''.
SEC. 206. COST RECOVERY FOR PUBLICATION.
The Director of the United States Patent and Trademark
Office shall recover the cost of early publication required
by the amendment made by section 202 by adjusting the filing,
issue, and maintenance fees under title 35, United States
Code, by charging a separate publication fee, or by any
combination of these methods.
SEC. 207. CONFORMING CHANGES.
The following provisions of title 35, United States Code,
are amended:
(1) Section 11 is amended in paragraph 1 of subsection (a)
by inserting ``and published applications for patents'' after
``Patents''.
(2) Section 12 is amended--
(A) in the section caption by inserting ``and
applications'' after ``patents''; and
(B) by inserting ``and published applications for patents''
after ``patents''.
(3) Section 13 is amended--
(A) in the section caption by inserting ``and
applications'' after ``patents''; and
(B) by inserting ``and published applications for patents''
after ``patents''.
(4) The items relating to sections 12 and 13 in the table
of sections for chapter 1, as amended
[[Page H1651]]
by section 132(a)(4) of this Act, are each amended by
inserting ``and applications'' after ``patents''.
(5) The item relating to section 122 in the table of
sections for chapter 11 is amended by inserting ``;
publication of patent applications'' after ``applications''.
(6) The item relating to section 154 in the table of
sections for chapter 14 is amended by inserting ``;
provisional rights'' after ``patent''.
(7) Section 181 is amended--
(A) in the first paragraph--
(i) by inserting ``by the publication of an application
or'' after ``disclosure''; and
(ii) by inserting ``the publication of the application or''
after ``withhold'';
(B) in the second paragraph by inserting ``by the
publication of an application or'' after ``disclosure of an
invention'';
(C) in the third paragraph--
(i) by inserting ``by the publication of the application
or'' after ``disclosure of the invention''; and
(ii) by inserting ``the publication of the application or''
after ``withhold''; and
(D) in the fourth paragraph by inserting ``the publication
of an application or'' after ``and'' in the first sentence.
(8) Section 252 is amended in the first paragraph by
inserting ``substantially'' before ``identical'' each place
it appears.
(9) Section 284 is amended by adding at the end of the
second paragraph the following: ``Increased damages under
this paragraph shall not apply to provisional rights under
section 154(d) of this title.''.
(10) Section 374 is amended to read as follows:
``Sec. 374. Publication of international application: Effect
``The publication under the treaty defined in section
351(a) of this title of an international application
designating the United States shall confer the same rights
and shall have the same effect under this title as an
application for patent published under section 122(b), except
as provided in sections 102(e) and 154(d) of this title.''.
(11) Section 135(b) of title 35, United States Code, is
amended--
(A) by inserting ``(1)'' after ``(b)'';
(B) by striking ``from the date on which the patent was
granted'' and inserting ``after the date on which the patent
is granted and the applicant makes a prima facie showing of
prior invention''; and
(C) by adding at the end the following:
``(2) A claim which is the same as, or for the same or
substantially the same subject matter as, a claim of a
published application may be made in an application filed
after the published application is published only if the
claim is made prior to one year after the date on which the
published application is published and the applicant of the
later filed application makes a prime facie showing of prior
invention.''.
SEC. 208. PATENT TERM EXTENSION AUTHORITY.
Section 154(b) of title 35, United States Code, is amended
to read as follows:
``(b) Term Extension.--
``(1) Basis for patent term extension.--
``(A) Delay.--Subject to the limitations set forth in
paragraph (2), if the issue of an original patent is delayed
due to--
``(i) a proceeding under section 135(a) of this title,
including any appeal under section 141, or any civil action
under section 146, of this title,
``(ii) the imposition of an order pursuant to section 181
of this title,
``(iii) appellate review by the Board of Patent Appeals and
Interferences or by a Federal court in a case in which the
patent was issued pursuant to a decision in the review
reversing an adverse determination of patentability, or
``(iv) an unusual administrative delay by the Patent and
Trademark Office in issuing the patent,
the term of the patent shall be extended for the period of
delay.
``(B) Administrative delay.--For purposes of subparagraph
(A)(iv), an unusual administrative delay by the Patent and
Trademark office is the failure to--
``(i) make a notification of the rejection of any claim for
a patent or any objection or argument under section 132 of
this title or give or mail a written notice of allowance
under section 151 of this title not later than 14 months
after the date on which the application was filed;
``(ii) respond to a reply under section 132 of this title
or to an appeal taken under section 134 of this title not
later than 4 months after the date on which the reply was
filed or the appeal was taken;
``(iii) act on an application not later than 4 months after
the date of a decision by the Board of Patent Appeals and
Interferences under section 134 or 135 of this title or a
decision by a Federal court under section 141, 145, or 146 of
this title in a case in which allowable claims remain in an
application;
``(iv) issue a patent not later than 4 months after the
date on which the issue fee was paid under section 151 of
this title and all outstanding requirements were satisfied;
or
``(v) issue a patent within 3 years after the filing date
of the application in the United States, if the applicant--
``(I) has not obtained further limited examination of the
application under section 209 of the Examining Procedure
Improvements Act;
``(II) has responded to all rejections, objections,
arguments, or other requests of the Patent and Trademark
Office within 3 months after the date on which they are made;
``(III) has not benefitted from an extension of patent term
under clause (i), (ii) or (iii) of paragraph (1)(A);
``(IV) has not sought or obtained appellate review by the
Board of Patent Appeals and Interferences or by a Federal
Court other than in a case in which the patent was issued
pursuant to a decision in the review reversing an adverse
determination of patentability; and
``(V) has not requested any delay in the processing of the
application by the Patent and Trademark Office.
``(2) Limitations.--(A) The total duration of any
extensions granted pursuant to either clause (iii) or (iv) of
paragraph (1)(A) or both such clauses shall not exceed 10
years. To the extent that periods of delay attributable to
grounds specified in paragraph (1) overlap, the period of
any extension granted under this subsection shall not
exceed the actual number of days the issuance of the
patent was delayed.
``(B) The period of extension of the term of a patent under
this subsection shall be reduced by a period equal to the
time in which the applicant failed to engage in reasonable
efforts to conclude prosecution of the application. The
Director shall prescribe regulations establishing the
circumstances that constitute a failure of an applicant to
engage in reasonable efforts to conclude processing or
examination of an application in order to ensure that
applicants are appropriately compensated for any delays by
the Patent and Trademark Office in excess of the time periods
specified in paragraph (1)(B).
``(C) No patent the term of which has been disclaimed
beyond a specified date may be extended under this section
beyond the expiration date specified in the disclaimer.
``(3) Procedures.--The Director shall prescribe regulations
establishing procedures for the notification of patent term
extensions under this subsection and procedures for
contesting patent term extensions under this subsection.''.
SEC. 209. FURTHER EXAMINATION OF PATENT APPLICATIONS.
The Director of the United States Patent and Trademark
Office shall prescribe regulations to provide for the further
limited reexamination of applications for patent. The
Director may establish appropriate fees for such further
limited reexamination and shall be authorized to provide a 50
percent reduction on such fees for small entities that
qualify for reduced fees under section 41(h)(1) of title 35,
United States Code.
SEC. 210. LAST DAY OF PENDENCY OF PROVISIONAL APPLICATION.
Section 119(e) of title 35, United States Code, is amended
by adding at the end the following:
``(3) If the day that is 12 months after the filing date of
a provisional application falls on a Saturday, Sunday, or
Federal holiday within the District of Columbia, the period
of pendency of the provisional application shall be extended
to the next succeeding business day.''.
SEC. 211. REPORTING REQUIREMENT.
The Director of the United States Patent and Trademark
Office shall report to the Congress not later than April 1,
2001, and not later than April 1 of each year thereafter,
regarding the impact of publication on the patent
applications filed by an applicant who has been accorded the
status of independent inventor under section 41(h) of title
35, United States Code. The report shall include information
concerning the frequency and number of initial and continuing
patent applications, pendency, interferences, reexaminations,
rejection, abandonment rates, fees, other expenses, and other
relevant information related to the prosecution of patent
applications.
SEC. 212. EFFECTIVE DATE.
(a) Sections 202 Through 207.--Sections 202 through 207,
and the amendments made by such sections, shall take effect
on April 1, 1998, and shall apply to all applications filed
under section 111 of title 35, United States Code, on or
after that date, and all international applications
designating the United States that are filed on or after that
date.
(b) Sections 208 Through 210.--The amendments made by
sections 208 through 210 shall take effect on the date of the
enactment of this Act and, except for a design patent
application filed under chapter 16 of title 35, United States
Code, shall apply to any application filed on or after June
8, 1995.
TITLE III--PROTECTION FOR PRIOR DOMESTIC USERS OF PATENTED TECHNOLOGIES
SEC. 301. SHORT TITLE.
This title may be cited as the ``Protection for Prior
Domestic Commercial and Research Users of Patented
Technologies Act''.
SEC. 302. DEFENSE TO PATENT INFRINGEMENT BASED ON PRIOR
DOMESTIC COMMERCIAL OR RESEARCH USE.
(a) Defense.--Chapter 28 of title 35, United States Code,
is amended by adding at the end the following new section:
``Sec. 273. Prior domestic commercial or research use;
defense to infringement
``(a) Definitions.--For purposes of this section--
``(1) the terms `commercially used', `commercially use',
and `commercial use' mean the use in the United States in
commerce or the use in the design, testing, or production in
the United States of a product or service which is used in
commerce, whether or not the subject matter at issue is
accessible to or otherwise known to the public;
``(2) in the case of activities performed by a nonprofit
research laboratory, or nonprofit entity such as a
university, research center, or hospital, a use for which the
public is the intended beneficiary shall be considered to be
a use described in paragraph (1) if the use is limited to
activity that occurred within the laboratory or nonprofit
entity or by persons in privity with that laboratory or
nonprofit entity before the effective filing date of the
application for patent at issue, except that the use--
``(A) may be asserted as a defense under this section only
by the laboratory or nonprofit entity; and
``(B) may not be asserted as a defense with respect to any
subsequent use by any entity other
[[Page H1652]]
than such laboratory, nonprofit entity, or persons in
privity;
``(3) the terms `used in commerce', and `use in commerce'
mean that there has been an actual sale or other arm's-length
commercial transfer of the subject matter at issue or that
there has been an actual sale or other arm's-length
commercial transfer of a product or service resulting from
the use of the subject matter at issue; and
``(4) the `effective filing date' of a patent is the
earlier of the actual filing date of the application for the
patent or the filing date of any earlier United States,
foreign, or international application to which the subject
matter at issue is entitled under section 119, 120, or 365 of
this title.
``(b) Defense to Infringement.--(1) A person shall not be
liable as an infringer under section 271 of this title with
respect to any subject matter that would otherwise infringe
one or more claims in the patent being asserted against such
person, if such person had, acting in good faith,
commercially used the subject matter before the effective
filing date of such patent.
``(2) The sale or other disposition of the subject matter
of a patent by a person entitled to assert a defense under
this section with respect to that subject matter shall
exhaust the patent owner's rights under the patent to the
extent such rights would have been exhausted had such sale or
other disposition been made by the patent owner.
``(c) Limitations and Qualifications of Defense.--The
defense to infringement under this section is subject to the
following:
``(1) Derivation.--A person may not assert the defense
under this section if the subject matter on which the defense
is based was derived from the patentee or persons in privity
with the patentee.
``(2) Not a general license.--The defense asserted by a
person under this section is not a general license under all
claims of the patent at issue, but extends only to the
subject matter claimed in the patent with respect to which
the person can assert a defense under this chapter, except
that the defense shall also extend to variations in the
quantity or volume of use of the claimed subject matter, and
to improvements in the claimed subject matter that do not
infringe additional specifically claimed subject matter of
the patent.
``(3) Effective and serious preparation.--With respect to
subject matter that cannot be commercialized without a
significant investment of time, money, and effort, a person
shall be deemed to have commercially used the subject matter
if--
``(A) before the effective filing date of the patent, the
person actually reduced the subject matter to practice in the
United States, completed a significant portion of the
total investment necessary to commercially use the subject
matter, and made an arm's-length commercial transaction in
the United States in connection with the preparation to
use the subject matter; and
``(B) thereafter the person diligently completed the
remainder of the activities and investments necessary to
commercially use the subject matter, and promptly began
commercial use of the subject matter, even if such activities
were conducted after the effective filing date of the patent.
``(4) Burden of proof.--A person asserting the defense
under this section shall have the burden of establishing the
defense.
``(5) Abandonment of use.--A person who has abandoned
commercial use of subject matter may not rely on activities
performed before the date of such abandonment in establishing
a defense under subsection (b) with respect to actions taken
after the date of such abandonment.
``(6) Personal defense.--The defense under this section may
only be asserted by the person who performed the acts
necessary to establish the defense and, except for any
transfer to the patent owner, the right to assert the defense
shall not be licensed or assigned or transferred to another
person except in connection with the good faith assignment or
transfer of the entire enterprise or line of business to
which the defense relates.
``(7) One-year limitation.--A person may not assert a
defense under this section unless the subject matter on which
the defense is based had been commercially used or
actually reduced to practice more than one year prior to
the effective filing date of the patent by the person
asserting the defense or someone in privity with that
person.
``(d) Unsuccessful Assertion of Defense.--If the defense
under this section is pleaded by a person who is found to
infringe the patent and who subsequently fails to demonstrate
a reasonable basis for asserting the defense, the court shall
find the case exceptional for the purpose of awarding
attorney's fees under section 285 of this title.
``(e) Invalidity.--A patent shall not be deemed to be
invalid under section 102 or 103 of this title solely because
a defense is established under this section.''.
(b) Conforming Amendment.--The table of sections at the
beginning of chapter 28 of title 35, United States Code, is
amended by adding at the end the following new item:
``273. Prior domestic commercial or research use; defense to
infringement.''.
SEC. 303. EFFECTIVE DATE AND APPLICABILITY.
This title and the amendments made by this title shall take
effect on the date of the enactment of this Act, but shall
not apply to any action for infringement that is pending on
such date of enactment or with respect to any subject matter
for which an adjudication of infringement, including a
consent judgment, has been made before such date of
enactment.
TITLE IV--ENHANCED PROTECTION OF INVENTORS' RIGHTS
SEC. 401. SHORT TITLE.
This title may be cited as the ``Enhanced Protection of
Inventors' Rights Act''.
SEC. 402. INVENTION DEVELOPMENT SERVICES.
Part I of title 35, United States Code, is amended by
adding after chapter 4 the following new chapter:
``CHAPTER 5--INVENTION DEVELOPMENT SERVICES
``Sec.
``51. Definitions.
``52. Contracting requirements.
``53. Standard provisions for cover notice.
``54. Reports to customer required.
``55. Mandatory contract terms.
``56. Remedies.
``57. Records of complaints.
``58. Fraudulent representation by an invention developer.
``59. Rule of construction.
``Sec. 51. Definitions
``For purposes of this chapter--
``(1) the term `contract for invention development
services' means a contract by which an invention developer
undertakes invention development services for a customer;
``(2) the term `customer' means any person, firm,
partnership, corporation, or other entity who is solicited
by, seeks the services of, or enters into a contract with an
invention promoter for invention promotion services;
``(3) the term `invention promoter' means any person, firm,
partnership, corporation, or other entity who offers to
perform or performs for, or on behalf of, a customer any act
described under paragraph (4), but does not include--
``(A) any department or agency of the Federal Government or
of a State or local government;
``(B) any nonprofit, charitable, scientific, or educational
organization, qualified under applicable State law or
described under section 170(b)(1)(A) of the Internal Revenue
Code of 1986; or
``(C) any person duly registered with, and in good standing
before, the United States Patent and Trademark Office acting
within the scope of that person's registration to practice
before the Patent and Trademark Office; and
``(4) the term `invention development services' means, with
respect to an invention by a customer, any act involved in--
``(A) evaluating the invention to determine its
protectability as some form of intellectual property, other
than evaluation by a person licensed by a State to practice
law who is acting solely within the scope of that person's
professional license;
``(B) evaluating the invention to determine its commercial
potential by any person for purposes other than providing
venture capital; or
``(C) marketing, brokering, licensing, selling, or
promoting the invention or a product or service in which the
invention is incorporated or used, except that the display
only of an invention at a trade show or exhibit shall not be
considered to be invention development services.
``Sec. 52. Contracting requirements
``(a) In General.--(1) Every contract for invention
development services shall be in writing and shall be subject
to the provisions of this chapter. A copy of the signed
written contract shall be given to the customer at the time
the customer enters into the contract.
``(2) If a contract is entered into for the benefit of a
third party, such party shall be considered a customer for
purposes of this chapter.
``(b) Requirements of Invention Developer.--The invention
developer shall--
``(1) state in a written document, at the time a customer
enters into a contract for invention development services,
whether the usual business practice of the invention
developer is to--
``(A) seek more than 1 contract in connection with an
invention; or
``(B) seek to perform services in connection with an
invention in 1 or more phases, with the performance of each
phase covered in 1 or more subsequent contracts; and
``(2) supply to the customer a copy of the written document
together with a written summary of the usual business
practices of the invention developer, including--
``(A) the usual business terms of contracts; and
``(B) the approximate amount of the usual fees or other
consideration that may be required from the customer for each
of the services provided by the developer.
``(c) Right of Customer To Cancel Contract.--(1)
Notwithstanding any contractual provision to the contrary, a
customer shall have the right to terminate a contract for
invention development services by sending a written letter to
the invention developer stating the customer's intent to
cancel the contract. The letter of termination must be
deposited with the United States Postal Service on or before
5 business days after the date upon which the customer or the
invention developer executes the contract, whichever is
later.
``(2) Delivery of a promissory note, check, bill of
exchange, or negotiable instrument of any kind to the
invention developer or to a third party for the benefit of
the invention developer, without regard to the date or dates
appearing in such instrument, shall be deemed payment
received by the invention developer on the date received for
purposes of this section.
``Sec. 53. Standard provisions for cover notice
``(a) Contents.--Every contract for invention development
services shall have a conspicuous and legible cover sheet
attached with the following notice imprinted in boldface type
of not less than 12-point size:
`` `YOU HAVE THE RIGHT TO TERMINATE THIS CONTRACT. TO
TERMINATE THIS CONTRACT, YOU MUST SEND A WRITTEN LETTER TO
THE COMPANY STATING YOUR INTENT TO CANCEL THIS CONTRACT. THE
[[Page H1653]]
LETTER OF TERMINATION MUST BE DEPOSITED WITH THE UNITED
STATES POSTAL SERVICE ON OR BEFORE FIVE (5) BUSINESS DAYS
AFTER THE DATE ON WHICH YOU OR THE COMPANY EXECUTE THE
CONTRACT, WHICHEVER IS LATER.
`` `THE TOTAL NUMBER OF INVENTIONS EVALUATED BY THE
INVENTION DEVELOPER FOR COMMERCIAL POTENTIAL IN THE PAST FIVE
(5) YEARS IS __________. OF THAT NUMBER, __________ RECEIVED
POSITIVE EVALUATIONS AND __________ RECEIVED NEGATIVE
EVALUATIONS.
`` `IF YOU ASSIGN EVEN A PARTIAL INTEREST IN THE INVENTION
TO THE INVENTION DEVELOPER, THE INVENTION DEVELOPER MAY HAVE
THE RIGHT TO SELL OR DISPOSE OF THE INVENTION WITHOUT YOUR
CONSENT AND MAY NOT HAVE TO SHARE THE PROFITS WITH YOU.
`` `THE TOTAL NUMBER OF CUSTOMERS WHO HAVE CONTRACTED WITH
THE INVENTION DEVELOPER IN THE PAST FIVE (5) YEARS IS
__________. THE TOTAL NUMBER OF CUSTOMERS KNOWN BY THIS
INVENTION DEVELOPER TO HAVE RECEIVED, BY VIRTUE OF THIS
INVENTION DEVELOPER'S PERFORMANCE, AN AMOUNT OF MONEY IN
EXCESS OF THE AMOUNT PAID BY THE CUSTOMER TO THIS INVENTION
DEVELOPER IS ______________.
`` `THE OFFICERS OF THIS INVENTION DEVELOPER HAVE
COLLECTIVELY OR INDIVIDUALLY BEEN AFFILIATED IN THE LAST TEN
(10) YEARS WITH THE FOLLOWING INVENTION DEVELOPMENT
COMPANIES: (LIST THE NAMES AND ADDRESSES OF ALL PREVIOUS
INVENTION DEVELOPMENT COMPANIES WITH WHICH THE PRINCIPAL
OFFICERS HAVE BEEN AFFILIATED AS OWNERS, AGENTS, OR
EMPLOYEES). YOU ARE ENCOURAGED TO CHECK WITH THE UNITED
STATES PATENT AND TRADEMARK OFFICE, THE FEDERAL TRADE
COMMISSION, YOUR STATE ATTORNEY GENERAL'S OFFICE, AND THE
BETTER BUSINESS BUREAU FOR ANY COMPLAINTS FILED AGAINST ANY
OF THESE COMPANIES.
`` `YOU ARE ENCOURAGED TO CONSULT WITH AN ATTORNEY OF YOUR
OWN CHOOSING BEFORE SIGNING THIS CONTRACT. BY PROCEEDING
WITHOUT THE ADVICE OF AN ATTORNEY REGISTERED TO PRACTICE
BEFORE THE UNITED STATES PATENT AND TRADEMARK OFFICE, YOU
COULD LOSE ANY RIGHTS YOU MIGHT HAVE IN YOUR IDEA OR
INVENTION.'.
``(b) Other Requirements for Cover Notice.--The cover
notice shall contain the items required under subsection (a)
and the name, primary office address, and local office
address of the invention developer, and may contain no other
matter.
``(c) Disclosure of Certain Customers Not Required.--The
requirement in the notice set forth in subsection (a) to
include the `TOTAL NUMBER OF CUSTOMERS WHO HAVE CONTRACTED
WITH THE INVENTION DEVELOPER IN THE PAST FIVE (5) YEARS' need
not include information with respect to customers who have
purchased trade show services, research, advertising, or
other nonmarketing services from the invention developer, nor
with respect to customers who have defaulted in their
payments to the invention developer.
``Sec. 54. Reports to customer required
``With respect to every contract for invention development
services, the invention developer shall deliver to the
customer at the address specified in the contract, at least
once every 3 months throughout the term of the contract, a
written report that identifies the contract and includes--
``(1) a full, clear, and concise description of the
services performed to the date of the report and of the
services yet to be performed and names of all persons who it
is known will perform the services; and
``(2) the name and address of each person, firm,
corporation, or other entity to whom the subject matter of
the contract has been disclosed, the reason for each such
disclosure, the nature of the disclosure, and complete and
accurate summaries of all responses received as a result of
those disclosures.
``Sec. 55. Mandatory contract terms
``(a) Mandatory Terms.--Each contract for invention
development services shall include in boldface type of not
less than 12-point size--
``(1) the terms and conditions of payment and contract
termination rights required under section 52;
``(2) a statement that the customer may avoid entering into
the contract by not making a payment to the invention
developer;
``(3) a full, clear, and concise description of the
specific acts or services that the invention developer
undertakes to perform for the customer;
``(4) a statement as to whether the invention developer
undertakes to construct, sell, or distribute one or more
prototypes, models, or devices embodying the invention of the
customer;
``(5) the full name and principal place of business of the
invention developer and the name and principal place of
business of any parent, subsidiary, agent, independent
contractor, and any affiliated company or person who it is
known will perform any of the services or acts that the
invention developer undertakes to perform for the customer;
``(6) if any oral or written representation of estimated or
projected customer earnings is given by the invention
developer (or any agent, employee, officer, director,
partner, or independent contractor of such invention
developer), a statement of that estimation or projection and
a description of the data upon which such representation is
based;
``(7) the name and address of the custodian of all records
and correspondence relating to the contracted for invention
development services, and a statement that the invention
developer is required to maintain all records and
correspondence relating to performance of the invention
development services for such customer for a period of not
less than 2 years after expiration of the term of such
contract; and
``(8) a statement setting forth a time schedule for
performance of the invention development services, including
an estimated date in which such performance is expected to be
completed.
``(b) Invention Developer as Fiduciary.--To the extent that
the description of the specific acts or services affords
discretion to the invention developer with respect to what
specific acts or services shall be performed, the invention
developer shall be deemed a fiduciary.
``(c) Availability of Information.--Records and
correspondence described under subsection (a)(7) shall be
made available after 7 days written notice to the customer or
the representative of the customer to review and copy at a
reasonable cost on the invention developer's premises during
normal business hours.
``Sec. 56. Remedies
``(a) In General.--(1) Any contract for invention
development services that does not comply with the applicable
provisions of this chapter shall be voidable at the option of
the customer.
``(2) Any contract for invention development services
entered into in reliance upon any material false, fraudulent,
or misleading information, representation, notice,
or advertisement of the invention developer (or any agent,
employee, officer, director, partner, or independent
contractor of such invention developer) shall be voidable
at the option of the customer.
``(3) Any waiver by the customer of any provision of this
chapter shall be deemed contrary to public policy and shall
be void and unenforceable.
``(4) Any contract for invention development services which
provides for filing for and obtaining utility, design, or
plant patent protection shall be voidable at the option of
the customer unless the invention developer offers to perform
or performs such act through a person duly registered to
practice before, and in good standing with, the Patent and
Trademark Office.
``(b) Civil Action.--(1) Any customer who is injured by a
violation of this chapter by an invention developer or by any
material false or fraudulent statement or representation, or
any omission of material fact, by an invention developer (or
any agent, employee, director, officer, partner, or
independent contractor of such invention developer) or by
failure of an invention developer to make all the disclosures
required under this chapter, may recover in a civil action
against the invention developer (or the officers, directors,
or partners of such invention developer) in addition to
reasonable costs and attorneys' fees, the greater of--
``(A) $5,000; or
``(B) the amount of actual damages sustained by the
customer.
``(2) Notwithstanding paragraph (1), the court may increase
damages to not more than 3 times the amount awarded.
``(c) Rebuttable Presumption of Injury.--For purposes of
this section, substantial violation of any provision of this
chapter by an invention developer or execution by the
customer of a contract for invention development services in
reliance on any material false or fraudulent statements or
representations or omissions of material fact shall
establish a rebuttable presumption of injury.
``Sec. 57. Records of complaints
``(a) Release of Complaints.--The Director shall make all
complaints received by the United States Patent and Trademark
Office involving invention developers publicly available,
together with any response of the invention developers.
``(b) Request for Complaints.--The Director may request
complaints relating to invention development services from
any Federal or State agency and include such complaints in
the records maintained under subsection (a), together with
any response of the invention developers.
``Sec. 58. Fraudulent representation by an invention
developer
``Whoever, in providing invention development services,
knowingly provides any false or misleading statement,
representation, or omission of material fact to a customer or
fails to make all the disclosures required under this
chapter, shall be guilty of a misdemeanor and fined not more
than $10,000 for each offense.
``Sec. 59. Rule of construction
``Except as expressly provided in this chapter, no
provision of this chapter shall be construed to affect any
obligation, right, or remedy provided under any other Federal
or State law.''.
SEC. 403. TECHNICAL AND CONFORMING AMENDMENT.
The table of chapters for part I of title 35, United States
Code, is amended by adding after the item relating to chapter
4 the following:
``5. Invention Development Services...........................51''.....
SEC. 404. EFFECTIVE DATE.
This title and the amendments made by this title shall take
effect 60 days after the date of the enactment of this Act.
TITLE V--IMPROVED REEXAMINATION PROCEDURES
SEC. 501. SHORT TITLE.
This title may be cited as the ``Improved Reexamination
Procedures Act''.
SEC. 502. DEFINITIONS.
Section 100 of title 35, United States Code, is amended by
adding at the end the following new subsection:
``(e) The term `third-party requester' means a person
requesting reexamination under section 302 of this title who
is not the patent owner.''.
[[Page H1654]]
SEC. 503. REEXAMINATION PROCEDURES.
(a) Request for Reexamination.--Section 302 of title 35,
United States Code, is amended to read as follows:
``Sec. 302. Request for reexamination
``Any person at any time may file a request for
reexamination by the Office of a patent on the basis of any
prior art cited under the provisions of section 301 of this
title or on the basis of the requirements of section 112 of
this title other than the requirement to set forth the best
mode of carrying out the invention. The request must be in
writing, must include the identity of the real party in
interest, and must be accompanied by payment of a
reexamination fee established by the Director pursuant to the
provisions of section 41 of this title. The request must set
forth the pertinency and manner of applying cited prior art
to every claim for which reexamination is requested or the
manner in which the patent specification or claims fail to
comply with the requirements of section 112 of this title.
Unless the requesting person is the owner of the patent,
the Director promptly shall send a copy of the request to
the owner of record of the patent.''.
(b) Determination of Issue by Director.--Section 303 of
title 35, United States Code, is amended to read as follows:
``Sec. 303. Determination of issue by Director
``(a) Reexamination.--Not later than 3 months after the
filing of a request for reexamination under the provisions of
section 302 of this title, the Director shall determine
whether a substantial new question of patentability affecting
any claim of the patent concerned is raised by the request,
with or without consideration of other patents or printed
publications. On the Director's initiative, at any time, the
Director may determine whether a substantial new question of
patentability is raised by any other patent or publication or
by the failure of the patent specification or claims of a
patent to comply with the requirements of section 112 of this
title other than the best mode requirement described in
section 302.
``(b) Record.--A record of the Director's determination
under subsection (a) shall be placed in the official file of
the patent, and a copy shall be promptly given or mailed to
the owner of record of the patent and to the third-party
requester, if any.
``(c) Final Decision.--A determination by the Director
pursuant to subsection (a) shall be final and nonappealable.
Upon a determination that no substantial new question of
patentability has been raised, the Director may refund a
portion of the reexamination fee required under section 302
of this title.''.
(c) Reexamination Order by Director.--Section 304 of title
35, United States Code, is amended to read as follows:
``Sec. 304. Reexamination order by Director
``If, in a determination made under the provisions of
section 303(a) of this title, the Director finds that a
substantial new question of patentability affecting a claim
of a patent is raised, the determination shall include an
order for reexamination of the patent for resolution of the
question. The order may be accompanied by the initial action
of the Patent and Trademark Office on the merits of the
reexamination conducted in accordance with section 305 of
this title.''.
(d) Conduct of Reexamination Proceedings.--Section 305 of
title 35, United States Code, is amended to read as follows:
``Sec. 305. Conduct of reexamination proceedings
``(a) In General.--Subject to subsection (b), reexamination
shall be conducted according to the procedures established
for initial examination under the provisions of sections 132
and 133 of this title. In any reexamination proceeding under
this chapter, the patent owner shall be permitted to propose
any amendment to the patent and a new claim or claims, except
that no proposed amended or new claim enlarging the scope of
the claims of the patent shall be permitted.
``(b) Response.--(1) This subsection shall apply to any
reexamination proceeding in which the order for reexamination
is based upon a request by a third-party requester.
``(2) With the exception of the reexamination request, any
document filed by either the patent owner or the third-party
requester shall be served on the other party.
``(3) If the patent owner files a response to any action on
the merits by the Patent and Trademark Office, the third-
party requester shall have 1 opportunity to file written
comments within a reasonable period not less than 1 month
after the date of service of the patent owner's response.
Written comments provided under this paragraph shall be
limited to issues covered by action of the Patent and
Trademark Office or the patent owner's response.
``(c) Special Dispatch.--Unless otherwise provided by the
Director for good cause, all reexamination proceedings under
this section, including any appeal to the Board of Patent
Appeals and Interferences, shall be conducted with special
dispatch within the Office.''.
(e) Appeal.--Section 306 of title 35, United States Code,
is amended to read as follows:
``Sec. 306. Appeal
``(a) Patent Owner.--The patent owner involved in a
reexamination proceeding under this chapter--
``(1) may appeal under the provisions of section 134 of
this title, and may appeal under the provisions of sections
141 through 144 of this title, with respect to any decision
adverse to the patentability of any original or proposed
amended or new claim of the patent; and
``(2) may be a party to any appeal taken by a third-party
requester pursuant to subsection (b) of this section.
``(b) Third-Party Requester.--A third-party requester in a
reexamination proceeding--
``(1) may appeal under the provisions of section 134 of
this title, and may appeal under the provisions of sections
141 through 144 of this title, with respect to any final
decision in the reexamination proceeding that is favorable to
the patentability of any original or proposed amended or new
claim of the patent; and
``(2) may be a party to any appeal taken by the patent
owner with respect to a decision in the reexamination
proceeding, subject to subsection (c) of this section.
``(c) Participation as Party.--(1) A third-party requester
who, under the provisions of sections 141 through 144 of this
title, files a notice of appeal, or who participates as a
party to an appeal by the patent owner, with respect to a
reexamination proceeding, is estopped from asserting at a
later time, in any forum, the invalidity of any claim
determined to be patentable on that appeal on any ground
which the third-party requester raised or could have raised
during the reexamination proceeding. This subsection does not
prevent the assertion of invalidity based on newly discovered
prior art unavailable to the third-party requester and the
Patent and Trademark Office at the time of the reexamination
proceeding.
``(2) For purposes of paragraph (1), a third-party
requester is deemed not to have participated as a party to an
appeal by the patent owner unless, not later than 20 days
after the patent owner has filed a notice of appeal, the
third-party requester files notice with the Commissioner
electing to participate.''.
(f) Reexamination Prohibited.--(1) Chapter 30 of title 35,
United States Code, is amended by adding at the end the
following new section:
``Sec. 308. Reexamination prohibited
``(a) Order for Reexamination.--Notwithstanding any
provision of this chapter, once an order for reexamination of
a patent has been issued under section 304 of this title,
neither the patent owner nor the third-party requester, if
any, nor privies of either, may, unless authorized by the
Director, file a subsequent request for reexamination of the
patent until a certificate relating to that reexamination
proceeding is issued and published under section 307 of this
title.
``(b) Final Decision.--Once a final decision has been
entered against a party in a civil action arising in whole or
in part under section 1338 of title 28 that the party has not
sustained its burden of proving the invalidity of any patent
claim in suit, or if a final decision in a reexamination
proceeding instituted by a third-party requester is favorable
to the patentability or any original or proposed amended or
new claim of the patent and such decision is not appealed by
the third-party requester under section 306(b), then neither
that party nor its privies may thereafter request
reexamination of any such patent claim on the basis of issues
which that party or its privies raised or could have raised
in such civil action or reexamination proceeding. This
subsection does not prevent the assertion of invalidity based
on newly discovered prior art unavailable to the party or
privies and the Office at the time of the civil action or
reexamination proceeding, as the case may be.''.
(2) The table of sections for chapter 30 of title 35,
United States Code, is amended by adding at the end the
following:
``308. Reexamination prohibited.''.
(g) Report to Congress.--Within 4 years after the effective
date of this title, the Director of the United States Patent
and Trademark Office shall submit to the Congress a report
evaluating whether the reexamination proceedings established
under the amendments made by this title are inequitable to
any of the parties in interest and, if so, the report shall
contain recommendations for changes to the amendments made by
this title to remove such inequity.
SEC. 504. CONFORMING AMENDMENTS.
(a) Board of Patent Appeals and Interferences.--The first
sentence of section 6(b) of title 35, United States Code, as
amended by section 117 of this Act, is amended to read as
follows: ``The Board of Patent Appeals and Interferences
shall, on written appeal of an applicant, or a patent owner
or a third-party requester in a reexamination proceeding,
review adverse decisions of examiners upon applications
for patents and decisions of examiners in reexamination
proceedings, and shall determine priority and
patentability of invention in interferences declared under
section 135(a) of this title.''.
(b) Patent Fees; Patent and Trademark Search Systems.--
Section 41(a)(7) of title 35, United States Code, is amended
to read as follows:
``(7) On filing each petition for the revival of an
unintentionally abandoned application for a patent, for the
unintentionally delayed payment of the fee for issuing each
patent, or for an unintentionally delayed response by the
patent owner in a reexamination proceeding, $1,250, unless
the petition is filed under section 133 or 151 of this title,
in which case the fee shall be $110.''.
(c) Appeal to the Board of Patent Appeals and
Interferences.--Section 134 of title 35, United States Code,
is amended to read as follows:
``Sec. 134. Appeal to the Board of Patent Appeals and
Interferences
``(a) Patent Applicant.--An applicant for a patent, any of
whose claims has been twice rejected, may appeal from the
decision of the primary examiner to the Board of Patent
Appeals and Interferences, having once paid the fee for such
appeal.
``(b) Patent Owner.--A patent owner in a reexamination
proceeding may appeal from the final rejection of any claim
by the primary examiner to the Board of Patent Appeals and
[[Page H1655]]
Interferences, having once paid the fee for such appeal.
``(c) Third-Party.--A third-party requester may appeal to
the Board of Patent Appeals and Interferences from the final
decision of the primary examiner favorable to the
patentability of any original or proposed amended or new
claim of a patent, having once paid the fee for such
appeal.''.
(d) Appeal to Court of Appeals for the Federal Circuit.--
Section 141 of title 35, United States Code, is amended by
amending the first sentence to read as follows: ``An
applicant, a patent owner, or a third-party requester,
dissatisfied with the final decision in an appeal to the
Board of Patent Appeals and Interferences under section 134
of this title, may appeal the decision to the United States
Court of Appeals for the Federal Circuit.''.
(e) Proceedings on Appeal.--Section 143 of title 35, United
States Code, is amended by amending the third sentence to
read as follows: ``In ex parte and reexamination cases, the
Director shall submit to the court in writing the grounds for
the decision of the United States Patent and Trademark
Office, addressing all the issues involved in the appeal.''.
(f) Civil Action To Obtain Patent.--Section 145 of title
35, United States Code, is amended in the first sentence by
inserting ``(a)'' after ``section 134''.
SEC. 505. EFFECTIVE DATE.
This title and the amendments made by this title shall take
effect on the date that is 6 months after the date of the
enactment of this Act and shall apply to all reexamination
requests filed on or after such date.
TITLE VI--MISCELLANEOUS IMPROVEMENTS
SEC. 601. PROVISIONAL APPLICATIONS.
(a) Abandonment.--Section 111(b)(5) of title 35, United
States Code, is amended to read as follows:
``(5) Abandonment.--Notwithstanding the absence of a claim,
upon timely request and as prescribed by the Director, a
provisional application may be treated as an application
filed under subsection (a). If no such request is made, the
provisional application shall be regarded as abandoned 12
months after the filing date of such application and shall
not be subject to revival thereafter.''.
(b) Effective Date.--The amendment made by subsection (a)
applies to any provisional application filed on or after June
8, 1995.
SEC. 602. INTERNATIONAL APPLICATIONS.
Section 119 of title 35, United States Code, is amended--
(1) in subsection (a), by inserting ``or in a WTO member
country,'' after ``or to citizens of the United States,'';
and
(2) by adding at the end the following new subsections:
``(f) Applications for Plant Breeder's Rights.--
Applications for plant breeder's rights filed in a WTO member
country (or in a UPOV Contracting Party) shall have the same
effect for the purpose of the right of priority under
subsections (a) through (c) of this section as applications
for patents, subject to the same conditions and requirements
of this section as apply to applications for patents.
``(g) Definitions.--As used in this section--
``(1) the term `WTO member country' has the same meaning as
the term is defined in section 104(b)(2) of this title; and
``(2) the term `UPOV Contracting Party' means a member of
the International Convention for the Protection of New
Varieties of Plants.''.
SEC. 603. PLANT PATENTS.
(a) Tuber Propagated Plants.--Section 161 of title 35,
United States Code, is amended by striking ``a tuber
propagated plant or''.
(b) Rights in Plant Patents.--The text of section 163 of
title 35, United States Code, is amended to read as follows:
``In the case of a plant patent, the grant shall include the
right to exclude others from asexually reproducing the plant,
and from using, offering for sale, or selling the plant so
reproduced, or any of its parts, throughout the United
States, or from importing the plant so reproduced, or any
parts thereof, into the United States.''.
(c) Effective Date.--The amendment made by subsection (a)
shall apply on the date of the enactment of this Act. The
amendment made by subsection (b) shall apply to any plant
patent issued on or after the date of the enactment of this
Act.
SEC. 604. ELECTRONIC FILING.
Section 22 of title 35, United States Code, is amended by
striking ``printed or typewritten'' and inserting ``printed,
typewritten, or on an electronic medium''.
SEC. 605. DIVISIONAL APPLICATIONS.
Section 121 of title 35, United States Code, is amended--
(1) in the first sentence by striking ``If'' and inserting
``(a) If''; and
(2) by adding at the end the following new subsections:
``(b) In a case in which restriction is required on the
ground that two or more independent and distinct inventions
are claimed in an application, the applicant shall be
entitled to submit an examination fee and request examination
for each independent and distinct invention in excess of one.
The examination fee shall be equal to the filing fee,
including excess claims fees, that would have applied had the
claims corresponding to the asserted independent and distinct
inventions been presented in a separate application for
patent. For each of the independent and distinct inventions
in excess of one for which the applicant pays an examination
fee within two months after the requirement for restriction,
the Director shall cause an examination to be made and a
notification of rejection or written notice of allowance
provided to the applicant within the time period specified in
section 154(b)(1)(B)(i) of this title for the original
application. Failure to meet this or any other time limit set
forth in section 154(b)(1)(B) of this title shall be treated
as an unusual administrative delay under section
154(b)(1)(A)(iv) of this title.
``(c) An applicant who requests reconsideration of a
requirement for restriction under this section and submits
examination fees pursuant to such requirement shall, if the
requirement is determined to be improper, be entitled to a
refund of any examination fees determined to have been paid
pursuant to the requirement.''.
The CHAIRMAN. During consideration of the bill for amendment, the
Chair may accord priority in recognition to a Member offering an
amendment that he has printed in the designated place in the
Congressional Record. Those amendments will be considered as read.
The Chairman of the Committee of the Whole may postpone until a time
during further consideration in the Committee of the Whole a request
for a recorded vote on any amendment and may reduce to not less than 5
minutes the time for voting by electronic device on any postponed
question that immediately follows another vote by electronic device,
without intervening business, provided that the time for voting by
electronic device on the first in a series of questions shall not be
less than 15 minutes.
Are there any amendments?
Amendment Offered by Mr. Coble
Mr. COBLE. Mr. Chairman, I offer an amendment.
The CHAIRMAN. The Clerk will designate the amendment.
The text of the amendment is as follows:
Amendment offered by Mr. Coble:
Page 3, insert in the table of contents after the item
relating to section 149 the following:
Subtitle D--Under Secretary of Commerce for Intellectual Property
Policy
Sec. 151. Under Secretary of Commerce for Intellectual Property Policy.
Sec. 152. Relationship with existing authorities.
Page 3, in the item relating to section 402, strike
``development'' and insert ``promotion''.
Page 5, line 12, insert ``(1)'' before ``For purposes''.
Page 5, insert after line 15 the following:
``(2) As used in this title, the term `Under Secretary'
means the Under Secretary of Commerce for Intellectual
Property Policy.
Page 5, line 21, strike ``under'' and insert ``subject
to''.
Page 6, line 1, strike ``conduct'' and insert ``, in
support of the Under Secretary, assist with''.
Page 6, line 4, strike ``, the administration'' and all
that follows through line 8 and insert a semicolon.
Page 6, line 9, strike ``authorize or conduct studies and
programs cooperatively'' and insert ``, in support of the
Under Secretary, assist with studies and programs conducted
cooperatively''.
Page 7, strike line 23 and all that follows through page 8,
line 3, and insert the following:
``(5) may establish regulations, not inconsistent with law,
which--
``(A) shall govern the conduct of proceedings in the
Office;
Page 9, line 1, insert ``shall'' after ``(E)''.
Page 9, after line 6, insert the following:
``(F) provide for the development of a performance-based
process that includes quantitative and qualitative measures
and standards for evaluating cost-effectiveness and is
consistent with the principles of impartiality and
competitiveness;
Page 11, strike lines 15 through 17 and redesignate the
succeeding paragraphs accordingly.
Page 11, add the following after line 25:
``In exercising the Director's powers under paragraphs (6)
and (7)(A), the Director shall consult with the Administrator
of General Services when the Director determines that it is
practicable, efficient, and cost-effective to do so.''.
Page 13, strike lines 4 through 18 and redesignate the
succeeding subparagraphs accordingly.
Page 14, strike line 18 and all that follows through page
15, line 7, and insert the following:
``(5) Compensation.--The Director shall be paid an annual
rate of basic pay not to exceed the maximum rate of basic pay
of the Senior Executive Service established under section
5382 of title 5, including any applicable locality-based
comparability payment that may be authorized under section
5304(h)(2)(C) of title 5. In addition, the Director may
receive a bonus in an amount up to, but not in excess of, 50
percent of such annual rate of basic pay, based upon an
evaluation by the Secretary of Commerce of the Director's
performance as defined in an annual performance agreement
between the Director and the Secretary. The annual
performance agreement shall incorporate measurable
organization and individual goals in key operational areas as
delineated in an annual performance plan agreed to by the
Director
[[Page H1656]]
and the Secretary. Payment of a bonus under this paragraph
may be made to the Director only to the extent that such
payment does not cause the Director's total aggregate
compensation in a calendar year to equal or exceed the amount
of the salary of the President under section 102 of title 3.
Page 16, line 2, strike ``policy and''.
Page 16, insert the following after line 20:
``(3) Training of examiners.--The Patent and Trademark
Office shall develop an incentive program to retain as
employees patent and trademark examiners of the primary
examiner grade or higher who are eligible for retirement, for
the sole purpose of training patent and trademark
examiners.''.
Page 21, line 13, insert ``including inventors,'' after
``Office,''.
Page 21, line 20, insert after ``call of the chair'' the
following: ``, not less than every 6 months,''.
Page 27, line 9, insert after the period close quotation
marks and a second period.
Page 27, strike line 10 and all that follows through page
28, line 14.
Page 32, insert the following immediately before line 10
and redesignate the succeeding paragraphs accordingly:
(5) Section 41(h) of title 35, United States Code, is
amended by striking ``Commissioner of Patents and
Trademarks'' and inserting ``Director''.
Page 33, line 7, strike ``Title'' and insert ``(A) Except
as provided in subparagraph (B), title''.
Page 33, insert the following after line 9:
(B) Chapter 17 of title 35, United States Code, is amended
by striking ``Commissioner'' each place it appears and
inserting ``Commissioner of Patents''.
Page 33, insert the following after line 12:
(12) Section 157(d) of title 35, United States Code, is
amended by striking ``Secretary of Commerce'' and inserting
``Director''.
(13) Section 181 of title 35, United States Code, is
amended in the third paragraph by striking ``Secretary of
Commerce under rules prescribed by him'' and inserting
``Director under rules prescribed by the Patent and Trademark
Office''.
(14) Section 188 of title 35, United States Code, is
amended by striking ``Secretary of Commerce'' and inserting
``Patent and Trademark Office''.
(15) Section 202(a) of title 35, United States Code, is
amended by striking ``iv)'' and inserting ``(iv)''.
Page 46, add the following after line 23:
Subtitle D--Under Secretary of Commerce for Intellectual Property
Policy
SEC. 151. UNDER SECRETARY OF COMMERCE FOR INTELLECTUAL
PROPERTY POLICY.
(a) Appointment.--There shall be within the Department of
Commerce an Under Secretary of Commerce for Intellectual
Property Policy, who shall be appointed by the President, by
and with the advice and consent of the Senate. On or after
the effective date of this title, the President may appoint
an individual to serve as the Under Secretary until the date
on which an Under Secretary qualifies under this subsection.
The President shall not make more than 1 appointment under
the preceding sentence.
(b) Duties.--The Under Secretary of Commerce for
Intellectual Property Policy, under the direction of the
Secretary of Commerce, shall perform the following functions
with respect to intellectual property policy:
(1) In coordination with the Under Secretary of Commerce
for International Trade, promote exports of goods and
services of the United States industries that rely on
intellectual property.
(2) Advise the President, through the Secretary of
Commerce, on national and international intellectual property
policy issues.
(3) Advise Federal departments and agencies on matters of
intellectual property protection in other countries.
(4) Provide guidance, as appropriate, with respect to
proposals by agencies to assist foreign governments and
international intergovernmental organizations on matters of
intellectual property protection.
(5) Conduct programs and studies related to the
effectiveness of intellectual property protection throughout
the world.
(6) Advise the Secretary of Commerce on programs and
studies relating to intellectual property policy that are
conducted, or authorized to be conducted, cooperatively with
foreign patent and trademark offices and international
intergovernmental organizations.
(7) In coordination with the Department of State, conduct
programs and studies cooperatively with foreign intellectual
property offices and international intergovernmental
organizations.
(c) Deputy Under Secretaries.--To assist the Under
Secretary of Commerce for Intellectual Property Policy, the
Secretary of Commerce shall appoint a Deputy Under Secretary
for Patent Policy and a Deputy Under Secretary for Trademark
Policy as members of the Senior Executive Service in
accordance with the provisions of title 5, United States
Code. The Deputy Under Secretaries shall perform such duties
and functions as the Under Secretary for Intellectual
Property Policy shall prescribe.
(d) Compensation.--Section 5314 of title 5, United States
Code, is amended by adding at the end the following:
``Under Secretary of Commerce for Intellectual Property
Policy.''.
(e) Funding.--Funds available to the United States Patent
and Trademark Office shall be made available for all expenses
of the office of the Under Secretary for Intellectual
Property Policy, subject to prior approval in appropriations
Acts. Amounts made available under this subsection shall not
exceed 2 percent of the projected annual revenues of the
Patent and Trademark Office from fees for services and goods
of that Office. The Secretary of Commerce shall determine the
budget requirements of the office of the Under Secretary for
Intellectual Property Policy.
SEC. 152. RELATIONSHIP WITH EXISTING AUTHORITIES.
Nothing in section 151 shall derogate from the duties of
the United States Trade Representative as set forth in
section 141 of the Trade Act of 1974 (19 U.S.C. 2171).
Page 48, insert the following after line 18:
``(B) An application that is in the process of being
reviewed by the Atomic Energy Commission, the Department of
Defense, or a defense agency pursuant to section 181 of this
title shall not be published until the Director has been
notified by the Atomic Energy Commission, the Secretary of
Defense, or the chief officer of the defense agency, as the
case may be, that in the opinion of the Atomic Energy
Commission, the Secretary of Defense, or such chief officer,
as the case may be, publication or disclosure of the
invention by the granting of a patent would not be
detrimental to the national security of the United States.''.
Page 48, line 19, strike ``(B)'' and insert ``(C)''.
Page 48, strike line 22 and all that follows through page
49, line 2, and insert the following:
``(D)(i) Upon the request at the time of filing by an
applicant that is a small business concern or an independent
inventor entitled to reduced fees under section 41(h)(1) of
this title, the application shall not be published in
accordance with paragraph (1) until 3 months after the
Director makes a second notification to such applicant on the
merits of the application under section 132 of this title.
The Director may require applicants that no longer have the
status of a small business concern or an independent inventor
to so notify the Director not later than 15 months after the
earliest filing date for which a benefit is sought under this
title.
Page 49, line 7, strike ``, 121,''.
Page 49, insert after line 8 the following:
``(iii) Applications asserting the benefit of an earlier
application under section 121 shall not be eligible for a
request pursuant to this subparagraph unless filed within 2
months after the date on which the Director required the
earlier application to be restricted to 1 of 2 or more
inventions in the earlier application.
Page 49, line 9, strike ``(iii)'' and insert ``(iv)''.
Page 49, line 13, strike ``(iv)'' and insert ``(v)''.
Page 49, line 14, insert ``nominal'' before ``fees''.
Page 49, line 16, strike ``(D)'' and insert ``(E)''.
Page 49, line 17, strike ``(C)'' and insert ``(D)''.
Page 50, line 2, strike ``(C)'' and insert ``(D)''.
Page 50, after line 2, insert the following:
``(F) No fee established under this section shall be
collected nor shall be available for spending without prior
authorization in appropriations Acts.''.
Page 58, strike lines 1 through 17 and insert the
following:
(11) Section 135(b) of title 35, United States Code, is
amended to read as follows:
``(b)(1) A claim which is the same as, or for the same or
substantially the same subject matter as, a claim of an
issued patent may only be made in an application if--
``(A) such a claim is made prior to 1 year after the date
on which the patent was granted; and
``(B) the applicant files evidence which demonstrates that
the applicant is prima facie entitled to a judgment relative
to the patent.
``(2)(A) A claim which is the same as, or for the same or
substantially the same subject matter as, a claim of a
published application may only be made in an application
filed after the date of publication of the published
application if, except in a case to which subparagraph (B)
applies--
``(i) such a claim is made prior to 1 year after the date
of publication of the published application; and
``(ii) the applicant of the application filed after the
date of publication of the published application files
evidence that demonstrates that the applicant is prima facie
entitled to a judgment relative to the published application.
``(B) If the applicant of the application filed after the
date of publication of the published application alleges that
the invention claimed in the published application was
derived from that applicant, such a claim may only be made if
that applicant files evidence which demonstrates that the
applicant is prima facie entitled to a judgment relative to
the published application.''.
Page 59, line 7, strike ``appellate''.
Page 61, strike lines 5 through 9 and redesignate
subclauses (III) through (V) as subclauses (II) through (IV),
respectively.
Page 62, insert the following after line 6:
``(B) The period of extension of the term of a patent under
clause (iv) of paragraph (1)(A), which is based on the
failure of the Patent and Trademark Office to meet the
criteria set forth in clause (v) of paragraph (1)(B), shall
be reduced by the cumulative total of any periods of time
that an applicant takes to respond in excess of 3 months
[[Page H1657]]
after the date on which the Patent and Trademark Office makes
any rejection, objection, argument, or other request.
Page 62, line 7, strike ``(B)'' and insert ``(C)''.
Page 62, line 19, strike ``(C)'' and insert ``(D)''.
Page 63, insert the following after line 4:
Section 132 of title 35, United States Code, is amended--
(1) in the first sentence by striking ``Whenever'' and
inserting ``(a) Whenever''; and
(2) by adding at the end the following:
Page 63, strike lines 5 through 7 and insert the following:
``(b) The Director shall prescribe regulations to provide
for the further limited examination of applications for
patent at the request of the applicant.
Page 63, line 9, strike ``reexamination'' and insert
``examination''.
Page 63, strike lines 11 and 12 and insert the following:
qualify for reduced fees under section 41(h)(1) of this
title.''
Page 63, line 21, insert ``secular or'' after
``succeeding''.
Page 64, lines 2 and 3, strike ``an applicant who has been
accorded the status of independent inventor under section
41(h)'' and insert ``applicants who are independent inventors
entitled to reduced fees under section 41(h)(1)''.
Page 71, line 8, strike ``DEVELOPMENT'' and insert
``PROMOTION''.
Page 71, line 11, strike ``DEVELOPMENT'' and insert
``PROMOTION''.
Page 71, in the item relating to section 58 in the matter
after line 12, strike ``developer'' and insert ``promoter''.
Page 71, line 15, strike ``development'' and insert
``promotion''.
Page 71, lines 16 and 17, strike ``developer'' and insert
``promoter''.
Page 71, line 17, strike ``development'' and inserting
``promotion''.
Page 71, strike line 20 and all that follows through page
72, line 1, and insert the following: ``partnership,
corporation, or other entity who enters into a financial
relationship or a contract''.
Page 72, line 22, strike ``development'' and insert
``promotion''.
Pages 73 through 84, strike ``invention developer'' and
``INVENTION DEVELOPER'' each place it appears and insert
``invention promoter'' and ``INVENTION PROMOTER'',
respectively.
Pages 73 through 84, strike ``invention development'' and
``INVENTION DEVELOPMENT'' each place it appears and insert
``invention promotion'' and ``INVENTION PROMOTION'',
respectively.
Page 74, line 1, strike ``Developer'' and insert
``Promoter''.
Page 74, line 22, strike ``developer'' and insert
``invention promoter''.
Page 77, line 1, strike ``DEVELOPER'S'' and insert
``PROMOTER'S''.
Page 81, line 7, strike ``Developer'' and insert
``Promoter''.
Page 81, line 16, strike ``developer's'' and insert
``promoter's.
Page 83, lines 19 and 21, and page 84, line 2, strike
``developers'' and insert ``promoters''.
Page 84, lines 3 and 4, strike ``developer'' and insert
``promoter''.
Page 84, in the matter after line 19, strike
``Development'' and insert ``Promotion''.
Page 85, line 16, strike ``Any'' and insert ``(a) Request
for Reexamination.--''.
Page 85, line 19, strike ``or on the basis of'' and all
that follows through ``invention'' on line 21.
Page 86, line 2, strike ``or the'' and all that follows
through line 4 and insert a period.
Page 86, line 7, strike the quotation marks and second
period and insert the following: ``If multiple requests for
reexamination of a patent are filed, they shall be
consolidated by the Office into a single reexamination, if a
reexamination is ordered.
``(b) Collection and Availability of Fees.--No fee for
reexamination shall be collected nor shall be available for
spending without prior authorization in appropriations
Acts.''.
Page 86, line 21, strike ``or by the failure'' and all that
follows through line 24 and insert a period.
Page 89, line 8, insert before the quotation marks the
following: ``Special dispatch shall not be construed to limit
the patent owner's ability to extend the time for taking
action by payment of the fees set forth in section 41(a)(8)
of this title.''.
Page 95, line 13, strike ``6 months'' and insert ``1
year''.
Page 95, line 15, insert ``effective'' after ``such''.
Page 95, line 25, strike ``If'' and insert ``Subject to
section 119(e)(3) of this title, if''.
Page 98, line 2, strike ``Section'' and insert ``(a) In
General.--Section''.
Page 99, add the following after line 8:
(b) Effective Date.--The amendments made by subsection (a)
shall take effect on the date that is 2 years after the date
of the enactment of this Act and shall apply to applications
for patent filed on or after such effective date.
SEC. 606. PUBLICATIONS.
Section 11 of title 35, United States Code, is amended by
adding at the end the following:
``(c) The Patent and Trademark Office shall make available
for public inspection during regular business hours all
solicitations issued by the Office for contracts for goods or
services, and all contracts entered into by the Office for
goods or services.''.
Amend the table of contents accordingly.
Mr. COBLE. Mr. Chairman, generally on this Hill the Committee on the
Judiciary is not known as the most bipartisan committee here, but there
is an exception which has been struck to that belief on this bill. I
would be remiss prior to putting my oars into the water and commencing
this voyage if I did not recognize a few of my colleagues. Start naming
Members and I will inevitably omit someone who should have been named,
but I want to mention the gentleman from Michigan [Mr. Conyers], the
gentleman from Massachusetts [Mr. Frank], the gentleman from
Massachusetts [Mr. Delahunt], the gentlewoman from California [Ms.
Lofgren], of course, our chairman, the gentleman from Illinois [Mr.
Hyde], the gentleman from Roanoke Valley, VA [Mr. Goodlatte], the
gentleman from Indiana [Mr. Pease] has been helpful, the gentleman from
Utah [Mr. Cannon]; others I am sure, as well. But we have done this in
a bipartisan manner, Mr. Chairman. I think we have crafted a bill,
perfect; no, there is not much perfect done around this town or in this
world, but a good, solid bill that will serve Americans well.
I rise in support of the manager's amendment to H.R. 400, Mr.
Chairman. Some of these amendments are technical. Most of them have
been created for the benefits of small businesses defined as those who
employ under 500 workers, and independent inventors, who are deserving
of some extra protection in our patent system. The manager's amendment
took an extremely long time to develop, and it strikes some very
crucial compromises by granting additional protection while still
preventing abuse.
Inventors have complained that the Patent and Trademark Office has
not been able to spend its valuable resources on the most important
function of the office, that is, granting patents and registering
trademarks with quality review in the shortest time possible. The
manager's amendment separates completely policy functions from
operational functions. Policy functions are left to the Department of
Commerce, giving patent and trademark policy a necessary representative
at the President's table, while management and operational functions,
day to day, if you will, are vested completely in the PTO. This will
allow the PTO to be led by a director who will have only one mission:
to process and adjudicate efficiently and fairly the important
Government functions of granting and issuing patents and registering
trademarks.
As we know, Mr. Chairman, the Committee on the Judiciary has been
working with several groups to reach a compromise on special
protections for small businesses and independent inventors from
publication. We are offering a compromise which will grant protection
while still preventing the practice of submarine patenting. While
publication has many benefits for both independent inventors and small
businesses, the manager's amendment gives these groups a choice over
whether or not they wish to be published. It will effectively exempt
independent inventors and small businesses from publication by
deferring publication until 3 months after the inventor has received at
least two determinations on the merits of each invention claimed, on
whether or not their patent will issue.
At this stage, the applicant knows whether or not he or she will
receive a patent, in which case the patent would be published upon
grant anyway under today's law. If it will not be granted, the
applicant then may withdraw his application and avoid publication and
protect the invention by another means.
Mr. Chairman, this is not a perfect exemption for opponents of this
bill, nor is it a perfect exemption for supporters; rather, it is a
compromise. If the applicant purposely tries to delay an application
between the first and second office action, he or she will,
unfortunately, succeed. If the PTO is slow and does not issue a second
office action within 18 months, publication will still not occur until
3 months after that second action. The PTO has indicated that after two
office actions of those who wish to proceed, 97 percent are granted in
short order and, therefore, published. This should move the date of
publication to almost exactly the time when publication would occur
today.
[[Page H1658]]
However, those who want to purposely procrastinate for long periods
of time and frustrate the prosecution of their patent applications will
be published and, therefore, ultimately unable to submarine.
Another provision concerned the so-called gift provision contained in
the bill. While the provisions contained in the bill did not grant the
PTO any authority it does not already possess, we have deleted it from
the bill. The PTO can accept a gift today.
The CHAIRMAN. The time of the gentleman from North Carolina [Mr.
Coble] has expired.
(By unanimous consent, Mr. Coble was allowed to proceed for 3
additional minutes.)
Mr. COBLE. Mr. Chairman, the manager's amendment also adopts two
measures included in the bill introduced by the gentleman from
California [Mr. Hunter] which provide for an incentive program to
better train examiners. While the current bill ensures that the
advisory board for the new PTO should be composed of diverse users of
the office in order to help Congress conduct more effective oversight,
the manager's amendment expressly requires that inventors be included
as members.
The Committee on Appropriations has expressed concern over the
borrowing authority in the bill, as have some critics, although many
misunderstood how the authority works under the control of Congress.
Much ado has been made about a procedure which would offer a small
possibility for the new PTO to borrow money instead of having to raise
fees on inventors to pay for any high-technology future products.
Accordingly, our amendment strikes the borrowing authority.
In further guaranteeing diligent inventors at least 17 years of
patent term from the time of issuance, the manager's amendment allows
inventors adequate time to respond to inquiries from the PTO regarding
their applications.
Small businesses and independent inventors have been concerned that
the new PTO may not recognize the longstanding reduction in fees
applicable to these constituencies. The manager's amendment requires
that the agency continue to provide that small businesses and
independent inventors pay half price for their patent applications.
Independent inventors have claimed that the scope of the
reexamination provisions contained in H.R. 400 is too broad. This has
been amended to extend greater due process. As we can tell, Mr.
Chairman, the committee has worked hard to accommodate the interests of
our small business community, not just in this amendment but in the
many amendments adopted throughout the process, while maintaining
strong protection for U.S. interests against our foreign competitors. I
strongly urge all of my colleagues to vote ``yes'' on the manager's
amendment.
Mr. CAMPBELL. Mr. Chairman, I move to strike the last word.
Mr. Chairman, I wonder if I could engage my colleague and friend from
North Carolina in a colloquy regarding the manager's amendment.
Mr. Chairman, I will state what I believe is true, and I just want to
know if I have it correct or not. I believe that, even with the
manager's amendment, every filer for a patent in the United States
under the gentleman's bill would have to make public that application
even if the patent has not yet been granted; is that correct?
Mr. COBLE. Mr. Chairman, will the gentleman yield?
Mr. CAMPBELL. I yield to the gentleman from North Carolina.
Mr. COBLE. Mr. Chairman, the applicant can, of course, withdraw if it
is not to be granted.
Mr. CAMPBELL. Mr. Chairman, every applicant for a patent in the
United States who intends to continue in the application process for a
patent, even if he has not yet gotten that patent, must eventually
disclose under the bill; is that correct?
Mr. COBLE. The purpose for that, Mr. Chairman, if I may say so, is to
direct attention to the submariner.
Mr. CAMPBELL. Mr. Chairman, I appreciate the gentleman's
understanding. But I believe his answer is yes; am I correct?
Mr. COBLE. Yes, sir.
Mr. CAMPBELL. I thank the gentleman.
Mr. Chairman, we have, I think, very clearly identified what is wrong
with H.R. 400 and that it is not solved by the manager's amendment.
Every applicant for a patent who wishes to get that patent, even
before they get the patent, is obliged to disclose. Goodbye to the
strategy that you say, ``Well I am trying for a patent but if I do not
get it, I want to keep it secret and try the trade secret route.''
One of the aspects that American patent law has right now is a
tremendous incentive to the inventor because it allows just that
opportunity. I will try for the patent, but if I do not get it, if it
does not look like I am going to, then I am going to try the trade
secret route.
Ms. KAPTUR. Mr. Chairman, will the gentleman yield?
Mr. CAMPBELL. I yield to the gentlewoman from Ohio.
Ms. KAPTUR. Mr. Chairman, I just wanted to ask a question. Assuming
that happened to an inventor and he or she were published and that
information were taken by some other interest in another nation,
knowing some of the inventors that I know, if they had to sue, many of
them do not have deep enough pockets. In fact, 80 percent of the
inventors are small inventors and, if they had to take a case, would it
not be extremely difficult for many inventors to try to protect their
property rights internationally?
Mr. CAMPBELL. Mr. Chairman, my colleague from Ohio is quite right,
but even more right than one might think; because what is the lawsuit
about? Under H.R. 400, it is permitted to disclose. It is required to
disclose. So if a foreigner takes that and uses that, what are you
going to be hiring an attorney for?
Here is a question, Mr. Chairman, if I might instruct my colleagues
to allow me to continue.
{time} 1445
Mr. CAMPBELL. Mr. Chairman, why are we messing with the U.S. patent
system? Why are we messing with it?
We saw the chart of my colleague from California, Mr. Hunter. We have
Nobel prize winners. We have technology advancement second to none in
the world. Why are we messing with it? Do my colleagues not think we
should have a good reason before we change such a system as this that
has produced such success for our country?
What answers have we heard today? We have heard one, submarine
patents. This is what the Congressional Research Service says about the
Rohrabacher substitute and House Resolution 400. It says the patent
disclosure provisions of the Rohrabacher substitute, House Resolution
811, should substantially curtail the practice of submarine patenting.
Both bills seek to curtail submarine patenting and would likely end the
practice. That is on pages 12 and 13 of the CRS report.
Let me repeat that. Both bills seek to curtail submarine patenting
and would likely end the practice.
If we are messing with the U.S. patent system because of the abuse of
the submarine patent, for heaven sakes, let us not go as broad and do
the additional damage as House Resolution 400 would do when we can
solve it with a much narrower solution, which is in the Rohrabacher
substitute.
But let us ask one further question. How large, how deep, how
profound is this problem of the submarine patent? Commissioner Lehman,
in GATT hearings, was reported in the Washington Times of April 15 of
this year to have said that the submarine patent constitutes
approximately 1 percent of 1 percent of all patent filings. The numbers
that he gave worked out to thirteen one-thousandths of 1 percent of all
patent filings.
For that we are going to compel all patent filings, after 18 months,
to be made public, whether or not there has been the patent granted? It
simply is unnecessary for the small problem and it does a tremendous
amount of collateral damage.
Mr. Chairman, I wish to conclude by pointing out that there has been
no other case made for changing this present system that has worked so
well, no other compelling case. If at the very least we do no harm, we
have served our constituents well.
Mr. Chairman, I ask unanimous consent, as my colleague did, for 2
additional minutes.
Mr. GOODLATTE. Mr. Chairman, reserving the right to object, and I
will
[[Page H1659]]
not object, but I would ask that the gentleman from California, if we
are going to conduct this debate under the 5-minute rule, recognize
that he can make unanimous-consent requests for additional time.
No one here wants to do it, but if the gentleman is only going to
recognize folks who agree with his opinion, he is not entering into a
genuine debate, and I think we should have that.
So I will not object, but I would make the point to the gentleman.
The CHAIRMAN. The gentleman withdraws his objection and the gentleman
from California is recognized for 2 additional minutes.
Mr. CAMPBELL. Mr. Chairman, since my colleague from North Carolina
had 3, I would ask unanimous consent for 3 additional minutes.
The CHAIRMAN. Is there objection to the request of the gentleman from
California?
There was no objection.
Mr. CAMPBELL. Mr. Chairman, I will reserve one of those minutes for a
colloquy with my good friend, the gentleman from Virginia [Mr.
Goodlatte].
So we have the submarine patent as rationale for messing with the
system, a small problem and one which is equally solved by the
Rohrabacher substitute.
We have heard that research institutions are holding off. They are.
Is it not troubling to my colleagues that we are going to be changing
the U.S. patent system in a way that the major research universities of
our country have chosen not to embrace?
Let me be very clear. They do not embrace the Rohrabacher substitute;
they do not embrace the bill introduced by the gentleman from North
Carolina. It seems they do not want a change. And I cannot blame them
for that attitude. If we are going to change such a successful system,
does it not cause us concern that the research universities are not
here asking us to do it?
Oh, the commercializers are. And I do not put any negative spin on
that phrase, a commercializer is important, as well as an inventor, but
they are different, and the motive of the commercializer is to get
available as quickly as possible the information and to use it for
commercial purpose as quickly as possible. The inventor loses under
House Resolution 400 in order to achieve that objective.
Last, we have heard the reference to a need to level the playing
field. Well, I do not think we need to rush to equalize when we see the
comparison in the numbers of inventions and Nobel prizes as a signal
measure of the state of our country and others.
I repeat, in closing, reserving the last minute for our colloquy, no
one responded to my point about a prior commercial user. Under the
Coble bill, House Resolution 400, somebody who did not file, but has
made use of this idea, can expand that use, can take what was making
$10 a month and make it $1 million a month, totally eviscerating the
value of the patent and destroying the incentive to invent in the first
place.
Mr. GOODLATTE. Mr. Chairman, will the gentleman yield?
Mr. CAMPBELL. I yield to the gentleman from Virginia.
Mr. GOODLATTE. Mr. Chairman, I thank the gentleman for yielding, and
I wanted to join in the conversation he had with the gentlewoman from
Ohio, and point out the concern expressed by the two of them about
situations in which foreign businesses might steal patent ideas
published after 18 months presumes some important facts:
First, that that inventor did not file for a patent in a number of
other foreign countries. If they do not file for the patent when the
patent is issued, and the average patent is issued in 19 months in this
country, there is nothing to stop that same thing from happening upon
issuance of the patent all over the world.
Mr. CAMPBELL. Mr. Chairman, if I can reclaim my time to respond, the
gentleman's point is quite right. If we file overseas, we put ourselves
into the overseas system. If we file overseas, we put ourselves into
the European system. And if we choose not to, because we prefer the
American system, and for good reason we prefer it, because it has more
incentives for invention and more protections for the inventor, we
should be allowed to proceed under the American system.
The CHAIRMAN. The time of the gentleman from California [Mr.
Campbell] has expired.
The Chair would advise all Members that we will go back and forth and
we will give priority to members of the committee.
Mr. FRANK of Massachusetts. Mr. Chairman, I move to strike the last
word, although I might want to put it back by the time I am through.
I rise in support of the manager's amendment of the bill. I am the
ranking minority member of the relevant subcommittee, so I have
immersed myself to some extent in this. I have had some of my
colleagues say to me that they do not quite understand why there is all
this passion about the bill, and I will say to those who are looking to
me for enlightenment on this that they will go unenlightened.
I think there is a dynamic of rhetoric that keeps arguments going
even when they are not necessarily there anymore. There has been some
convergence here. Originally, I was a cosponsor with the gentleman from
California [Mr. Rohrabacher]. I had heard from the biotechnology people
that they did not like the alternative. That was several years ago.
In the interim, the bills have become less different. I do not expect
the entrenched partisans on either side to acknowledge that, but it
does seem to me we may want to look at it. In fact, the manager's
amendment that came forward further bridges the difference, further
reduces the problem of publication.
One point that should be made clear, and I say this because not every
Member is fully familiar with it, and some Members were puzzled by
publication, people should understand that we do not lose any legal
right by publication.
There are some people who think it will be published before I have my
patent and then I am not protected. No, that is not true. There is
absolutely no diminution of legal right. What people are arguing is
that the practical situation in which we are put to defend our legal
right might be more difficult. But understand that there is no
diminution of our legal right.
Mr. GOODLATTE. Mr. Chairman, will the gentleman yield?
Mr. FRANK of Massachusetts. I yield to the gentleman from Virginia.
Mr. GOODLATTE. Mr. Chairman, the gentleman is correct, and not only
that, but because we improve the patent pending protections, then we
can come back and get royalties during that patent pending term after
we have been published that we cannot get under current law.
And, in addition, we found that the Europeans get that capital
financing. One of the problems they have is the gap between the 18-
month publication, when the patent is actually issued, saying, I am
going to be exposed during that time. But, actually, the capital comes
sooner because they know that since we have been published and no one
else has been published ahead of us, we are the one that has that idea;
and if they want to invest in it, they can do it now rather than wait
until the patent is issued.
Mr. FRANK of Massachusetts. Mr. Chairman, reclaiming my time, I think
the general rule is sentence-yield, sentence-yield. So now it is time
for a sentence, and then I will yield again after I get to say a
sentence.
The sentence is, and it is actually a couple: We made another change
in this. Under prior law, if two people both filed a similar patent,
they were on equal terms before the law and had an equal burden in
terms of proving who had invented first, not who filed first, which is
not relevant.
We added to the bill after the bill was filed and added language that
says, if we have published and someone files subsequent to our
publication, we are no longer on an equal footing. We are now in a
super-legal position. The person who filed subsequent to us has the
burden of proof.
We will indeed, in fact, almost assume that the person copied our
patent from the publication. And that is a very important difference.
It is true under old law we could file, somebody else could file, we
would publish, someone else would file, and we would be at greater
risk. We have further strengthened the hand of the person who files and
is subject to publication.
Ms. KAPTUR. Mr. Chairman, will the gentleman yield?
[[Page H1660]]
Mr. FRANK of Massachusetts. I yield to the gentlewoman from Ohio.
Ms. KAPTUR. Mr. Chairman, I thank the gentleman, because I know he
approaches all these issues with complete objectivity and he tries to
do what is best for the country.
Mr. FRANK of Massachusetts. On these issues. I get worked up on some
others.
Ms. KAPTUR. In this case we disagree. I think that one of my greatest
misgivings about the H.R. 400, and the reason I am supporting the
substitute is because, having met many inventors, in a State like Ohio,
what this bill does is it, and the gentleman says, well, they can
defend their rights, and the gentleman from the other side was saying
the same thing, but this is a real lawyers' field day because the small
inventor, maybe the person who is working on their first patent, will
be forced to take money that many of them do not have.
People can defend themselves if they are representatives of a large
corporation that has a patent or is filing for a patent. They do not
have as much trouble. But the average small inventor under this bill is
seriously compromised by the system the gentleman is setting up where
we publish after 18 months.
Mr. FRANK of Massachusetts. Mr. Chairman, reclaiming my time, I say
to the gentlewoman she has made her point and I want both to affirm it
and then respond to it.
That is what I meant before. The legal right is not diminished. The
gentlewoman is not contesting that. We have the same legal right
whether or not there has been publication. The argument has been that
those who want to intrude on our patent will do so, and if we are not a
person with a lawyer, then we are at a disadvantage.
The CHAIRMAN. The time of the gentleman from Massachusetts [Mr.
Frank] has expired.
(By unanimous consent, Mr. Frank of Massachusetts was allowed to
proceed for 2 additional minutes.)
Mr. FRANK of Massachusetts. That is also true once we have gotten a
patent, Mr. Chairman.
In other words, if there are people out there who are determined to
use their superior resources and their access to lawyers to infringe on
and chip away at and take the benefit from our patent, they can do that
whether it has been published or not once it is patented.
Yes, anybody in this society, I guess, who might be in difficulty is
at more of a disadvantage if they do not have a lawyer handy than if
they do. There might be other cases when people might consider it a
disadvantage to be too near a lawyer, but in the case of a dispute, it
is probably helpful. But that is true whether the patent is issued or
not, whether or not there are people out there after us.
The point I would make is that publication, particularly with the
safeguards we have, does not weaken either our legal position nor the
disadvantage we might be at because of a lack of access to attorneys.
Mr. CAMPBELL. Mr. Chairman, will the gentleman yield?
Mr. FRANK of Massachusetts. I yield to the gentleman from California.
Mr. CAMPBELL. Mr. Chairman, it was for exactly that reason I never
made the argument about the burdensome lawyers. My argument was
different. I wonder what the gentleman's response might be to that.
I understand our legal rights are not changed by H.R. 400 in this
regard, but as a practical matter, publication does destroy the
applicant's opportunity to go the trade secret route and existing
patent law does not. Would the gentleman agree?
Mr. FRANK of Massachusetts. Well, Mr. Chairman, first of all, let me
say I welcome the support of the gentleman from California of my
argument against the gentlewoman from Ohio. Because he just said he did
not like her argument, and I appreciate that. I know they are friends
in general, but I should like to point out that the gentleman from
California----
Ms. KAPTUR. They are both attorneys. It is so interesting the way
this debate goes.
Mr. FRANK of Massachusetts. Yes, but I have never practiced.
I did want to point out that my friend from California has just
joined me in opposing the argument of the gentlewoman from Ohio, and I
would say there may be an argument of his that she may not like, and I
would be glad to have her join in on that one, too.
The next point is that that is true, that we are not forced, except
for this thing. There is an inconsistency in the gentleman's question.
The CHAIRMAN. The time of the gentleman from Massachusetts [Mr.
Frank] has expired.
(By unanimous consent, Mr. Frank of Massachusetts was allowed to
proceed for 2 additional minutes.)
Mr. FRANK of Massachusetts. Mr. Chairman, my understanding is that
the trade secret is what we invoke as an alternative to patent.
The gentleman said if we file and are published, we lose our right to
go for trade secrets. But my understanding is if we go the patent
route, that is the alternative to trade secrets. So, therefore, yes, if
we decide to get a patent, then we have given up our right to go the
trade secret route.
Mr. CAMPBELL. Mr. Chairman, will the gentleman yield?
Mr. FRANK of Massachusetts. I yield to the gentleman from California.
Mr. CAMPBELL. Mr. Chairman, here is the question I was asking, and I
did take the gentleman's answer to my previous question to be ``yes,''
for which I am grateful.
Mr. FRANK of Massachusetts. Mr. Chairman, reclaiming my time, maybe
the gentleman misunderstood me, and I will clarify it.
The question was, if we are published, do we give up our ability to
use trade secrets. My answer was, if that was the question, the answer
is that any time we go for a patent, we give up the right to go trade
secrets.
{time} 1500
I want to finish the one question which was, is there a conflict
between trade secrets and publication? My understanding, as I said, is
that applying for a patent is an alternative to trade secret. If that
was not the question, rather than claiming I answered ``Yes,'' the
gentleman ought to rephrase the question.
Mr. CAMPBELL. It was the question, if the gentleman will yield.
Mr. FRANK of Massachusetts. I tried to respond to the gentleman. He
then frankly, it seemed to me, somewhat distorted what I said. I am not
going to simply allow that to happen, so I want to restate it.
If the question was, does publication take away your right to do
trade secret, I would have to say I am surprised at the question,
because any patent takes away your chance to use trade secret.
Publication is not the operational problem there, it is the desire to
ask for a patent.
Mr. CAMPBELL. Mr. Chairman, will the gentleman yield?
Mr. FRANK of Massachusetts. I yield again to the gentleman from
California.
Mr. CAMPBELL. I thank the gentleman. If somebody under present law
wants to try for a patent and wants to keep that going until they are
fairly sure they will not get it, they can still go the trade secret
route, but under House Resolution 400, come 18 months, they cannot.
That is a difference, is it not?
Mr. FRANK of Massachusetts. I would say this to the gentleman. That
is a circumstance I had not previously thought about. In other words,
what the gentleman is saying is you decide you are not going to get the
patent and you withdraw it. I would be prepared to work on an
amendment, which I suspect would make no difference to the gentleman
overall.
The CHAIRMAN. The time of the gentleman from Massachusetts [Mr.
Frank] has again expired.
Mr. FRANK of Massachusetts. Mr. Chairman, I ask unanimous consent to
proceed for 2 additional minutes.
The CHAIRMAN. Is there objection to the request of the gentleman from
Massachusetts?
Mr. CAMPBELL. Mr. Chairman, I object.
The CHAIRMAN. Objection is heard.
Mr. FRANK of Massachusetts. Mr. Chairman, I ask unanimous consent to
proceed for an additional 30 seconds.
The CHAIRMAN. Is there objection to the request of the gentleman from
Massachusetts?
Mr. CAMPBELL. Mr. Chairman, reserving the right to object, if the
gentleman would split the time with me.
[[Page H1661]]
Mr. FRANK of Massachusetts. No. I do not think the gentleman is
interested in the conversation.
Mr. CAMPBELL. Mr. Chairman, I object.
The CHAIRMAN. Objection is heard.
Mr. GOODLATTE. Mr. Chairman, I move to strike the requisite number of
words,, and I yield to the gentleman from Massachusetts [Mr. Frank].
Mr. FRANK of Massachusetts. I thank my friend from Virginia for
yielding.
Mr. Chairman, the point is this. We are talking about a very, very
limited circumstance. I think to some extent what we may be patenting--
and maybe you cannot patent this, maybe we would copyright it--examples
of horrible and extremist that we can come up with that might possibly
under certain circumstances create a problem. The gentleman from
California has had one. Here is what I think he is positing.
You apply for a patent. Your patent application is published. You
subsequently decide that you are not going to get the patent, so you
withdraw it and have you then lost your right to protect it under trade
secrets?
I do not think it would do any violence to the bill in that
circumstance where no one had previously suggested to say that no, you
would not lose that. I would be glad to do that. I would be glad to
support an amendment in a subsequent part of the process that said if
in fact the only thing that happened was that you were published and
you were not going to get a patent, that that would not destroy your
limited right of trade secrets. That one does not bother me at all. It
is the first I had heard of it in all my conversations with the
gentleman.
Mr. GOODLATTE. Reclaiming my time, I would point out to the gentleman
that there is a provision in the bill already that preserves the right
of anybody to withdraw their patent application prior to the 18-month
publication date and preserve their right to go the trade secret route.
The problem we have here is there is an inherent difference between
trade secrets and patents. Trade secrets are protected by keeping them
secret. The formula for Coca-Cola, that is not patented, that is a
recipe. They keep it locked up in a safe.
On the other hand, if you want to protect something by use of the
patent system, the way we do that is the U.S. Government tells the
whole world that that individual is the first person to come forward
with that patent and they have that protection and that right, and all
publication does is give them that right sooner. It does not in any way
harm them or take away that right. If they want to go the trade secret
route, they can still do it by withdrawing that application.
I would also point out that the average patent in this country takes
19 months, 1 month longer than the 18-month provision. So the fact of
the matter is that we are doing very little to harm people and in fact
publication is a positive thing.
Ms. LOFGREN. Mr. Chairman, will the gentleman yield?
Mr. GOODLATTE. I yield to the gentlewoman from California.
Ms. LOFGREN. Is it not the case that in the bill if you are only
filing in the United States and not abroad and are a small inventor or
small businessperson, you have the ability to delay publication until
after the second Office action, which is an up or down, and then have
the ability to withdraw? So, the issue being raised is really not a
problem because it has been dealt with in the bill.
Mr. GOODLATTE. The gentlewoman is correct.
Mr. FRANK of Massachusetts. Mr. Chairman, will the gentleman yield?
Mr. GOODLATTE. I yield to the gentleman from Massachusetts.
Mr. FRANK of Massachusetts. I would also say I was a little bit
surprised to hear my friend from California worried so much about the
rights of people under trade secrets because I had previously in my
conversations with him and in his amendment understood him to be
somewhat critical of the trade secrets doctrine and to be interested in
narrowing it substantially.
Mr. KIM. Mr. Chairman, will the gentleman yield?
Mr. GOODLATTE. I yield to the gentleman from California.
Mr. KIM. I thank the gentleman for yielding. Mr. Chairman, I would
like to have a colloquy with the gentleman from North Carolina [Mr.
Coble].
I would like to talk about a totally new subject, real estate.
Under section 112 of H.R. 400, the new Government corporation is not
subject to the provisions of the Property Act of 1949, nor the Public
Buildings Act of 1959. The bill would grant to each new corporation the
ability to sign a lease and buy and sell property, construct a facility
without regard to this law that I mentioned.
Indeed, the Patent and Trademark Office [PTO] is currently in the
midst of having a new headquarters acquired by GSA, the landlord of the
Federal Government. The PTO has requested acquisition of 2.3 million
square feet of office space that could cost over $57 million annually,
or even $1 billion over the next 20 years.
In fact, section 112 recognizes this action by stating that the land
does not nullify, void, cancel or interrupt any pending request for
proposal or acquisition by GSA for the express purpose of relocating or
leasing space for the Patent and Trademark Office.
Is that the gentleman's understanding?
Mr. COBLE. If the gentleman will yield, that is my understanding, and
I will be happy and any of the rest of us on the committee will be
happy to work with the gentleman from California [Mr. Kim] on his
committee of jurisdiction with Federal buildings, and I presume that is
what prompts his question.
Mr. CAMPBELL. Mr. Chairman, will the gentleman yield?
Mr. GOODLATTE. I yield to the gentleman from California.
Mr. CAMPBELL. I thank the gentleman for yielding.
Mr. Chairman, I simply wanted to point out this distinction and then
get the benefit of the gentleman's response to it. Many people go into
the patent system hoping to get the patent and they are disappointed,
but they get indications of that disappointment.
The CHAIRMAN. The time of the gentleman from Virginia [Mr. Goodlatte]
has expired.
(By unanimous consent, Mr. Goodlatte was allowed to proceed for 1
additional minute.)
Mr. GOODLATTE. Mr. Chairman, I continue to yield to the gentleman
from California.
Mr. CAMPBELL. So disappointed, they then choose to go the trade
secret route. So that the choice is not only at the beginning but along
the path when it does not look like you are going to get a patent. In
that context the average time of a patent being 19 months means that a
substantial number, more than half, will see the present right held by
a patent applicant being taken away. That is my point. I would be
grateful to hear the gentleman's response.
Mr. GOODLATTE. I would be happy to respond.
The individual who is in the process and is having a lengthier time
processing the patent application than the 19-month average would be
concerned about that. Under those circumstances, they would withdraw
the patent application and if they wanted to try for the patent again,
they are not in any way deprived from having the opportunity to
resubmit the patent application which will then pick up with a lot of
the work already having been done previously and process the patent
through. I doubt there will be very much time lost.
Against that, I want to weigh the benefit of publication. No inventor
wants to spend years of their life working on something to find out
that somebody else had previously already filed, whether they are a
deliberate submarine patenter like some who have kept them submerged
for 30 years or others.
The CHAIRMAN. The time of the gentleman from Virginia [Mr. Goodlatte]
has again expired.
(By unanimous consent, Mr. Goodlatte was allowed to proceed for 1
additional minute.)
Mr. GOODLATTE. Therefore, publication has a number of benefits to
inventors, including knowing that you are not wasting your time doing
something that somebody else is already ahead of you on, and getting
capital investment in your invention sooner because they know that you
are the first out there because you are the first published and
therefore they can invest in you sooner than they can if they have
[[Page H1662]]
to wait until they are sure you are going to get the patent because
they do not know under our current secret process whether or not
somebody else got in there ahead of you. This is a benefit to the small
investor, not a harm.
I yield to the gentleman again.
Mr. CAMPBELL. Mr. Chairman, I would just conclude, and I sure do
appreciate the gentleman yielding, that overwhelmingly the
commercializers are with the gentleman from North Carolina [Mr. Coble],
but overwhelmingly the inventors are with the gentleman from California
[Mr. Rohrabacher].
Mr. GOODLATTE. I have not found that to be the case.
Mr. CAMPBELL. That has been my observation, though I appreciate the
gentleman might have a different one. I think that distinction speaks
volumes to what the inventor sees as a hurt to his or her
entrepreneurial activity.
Mr. GOODLATTE. That has not been the experience in Europe where this
process has been used, and I would suggest that this is very much the
type of change that we need in this country. This committee has
improved the patent system for 200 years. I urge the support of this
bill.
Mr. CONYERS. Mr. Chairman, I move to strike the requisite number of
words.
Mr. Chairman, I rise in support of the manager's amendment offered by
the gentleman from North Carolina [Mr. Coble], the subcommittee
chairman.
Mr. Chairman, I would point out that the two major items in this
amendment is, one, to completely separate the operational function of
the Patent and Trademark Office from the policy responsibilities of the
Patent and Trademark Office, thereby making it most efficient.
I presume that most everybody is for that. I do not recall much
objection to it.
Mr. COBLE. I would say to the gentleman from Michigan, not unlike
many other features about this bill, a lot of it was misunderstood, but
I have heard virtually no complaints about that.
Mr. CONYERS. I did not think so.
I thank the gentleman.
The second most important part of the manager's amendment, from my
point of view, is the exemption of the small inventor from the
necessity of publication if he chooses to do so. And so, here this
exemption from publication for the small inventor is that they do not
have to publish until 3 months after the second patent and trademark
action, which is usually the final decision regarding a patent.
That has great merit because it gives the protection to the small
inventor. Ladies and gentlemen, those who are against GATT and NAFTA,
listen up. This is precisely why I am supporting the bill and the
manager's amendment because we provide additional protection to the
small inventor, we give him the option of publishing 3 months after
what is called the second PTO action, which is almost always the final
decision regarding the issuance of a patent.
There are a number of technical amendments to the Coble manager's
amendment. It is 18 pages long. The provision that I am referring to
that exempts small inventors starts at page 10, line 1. Please read it.
It is not complicated language.
It is not any more complex than anything we handle every day in the
making of laws for the United States of America. It is pretty
straightforward. It should not create any problem to anybody that is
interested in protecting American inventors who are not corporations to
give them the option that they require that they have never had before
which does not subvert the patent process, it makes it stronger and is
why we are here on the floor with this bill after several years.
Mr. TIAHRT. Mr. Chairman, I move to strike the requisite number of
words.
Mr. Chairman, I just went through the manager's amendment, and it is
a little difficult to sort through. I am not a lawyer, and I kind of
think this ought to be approached in more of a pragmatic way. And so,
in weighing this bill, I went back to those who are concerned with it
and I talked to some of the people that deal with patents on a daily
basis and in trying to improve themselves and our lives by taking their
ideas into the patent system.
And I just want to tell my colleagues about a guy in Wichita, KS. His
name is Jay Hajeer. He works for Sol Gate, and he has a very simple
idea. This simple idea was to increase the size of a memory for most
computer models even beyond the amount of design capacity that the
computer already has in it.
Jay was able to keep his simple idea quiet enough as it went through
the patent process until he did a little planning as far as production,
a little planning as far as a way of marketing his product; and he was
able to acquire the patent and go ahead and produce this simple
product.
And now that it is out and available on the market, I would like to
explain it. It is simply a clip. You take the memory board out of your
computer, slip this clip in place and slide your memory board in plus
an additional memory board, thereby, in this case, doubling the size of
the memory.
You can do it for additional memory boards, also. But it is just a
very simple idea, just a little plastic clip with a couple of
connectors on it. And so, when he had this idea, he did not have to lay
it out in front of other people.
{time} 1515
I think that having to publish these ideas before they get a patent
on it is kind of like playing cards with a mirror at your back. The
opponent on the other side of the table is able to read your cards, and
he can see what is in your hand. And so in that respect it becomes a
level playing field for your opponent, and I do not think we want to
make a level playing field for our opponents, especially for other
countries.
So let me go back to this simple design. Not only did Jay have time
to develop the concept, get the drawings done, also develop a
manufacturing plan and a marketing plan by the time he got his patent,
once that was achieved, he was able to go right into the marketplace.
Now if he had to publish this and there was a delay in his plans, it
would have made it easier, especially for the companies in Southeast
Asia, to capture this idea and go ahead with manufacturing and push
them out of the market. He is a small investor, does not have a big
company; he just has good ideas. So this open publishing of the idea, I
think, would have made him vulnerable to larger manufacturers even in
foreign governments.
So I am a little concerned about this level playing field concept, I
am a little concerned about forcing someone to lay their cards on the
table, letting them play cards with a mirror to their back. I think
that we want to protect ideas and provide incentives for individuals.
And I guess the second point I would like to make is I am not very
concerned about these alleged submariners, and perhaps I do not quite
have a good grasp of the idea, but what we are trying to do is protect
people who have ideas. That is why we have so many Nobel laureates, and
that is why we have so many people who come up with ideas in America,
is we give them incentives to sit around and dream up ideas.
I rode back to Wichita one time with a guy on the airplane who came
up with an idea of mixing naphtha and water together, and one can burn
it in a gasoline engine; and he has a license with Caterpillar to do
just that. It is an idea that he has come up with that we can use water
as a portion of the fuel. It cuts down emissions, it is a great idea.
But he has to have a way of protecting his ideas so that he cannot lay
his cards on the table and allow someone else to run with the ball
until he gets the capital or gets the needs that he has.
So I guess I am not as concerned about the submariners as everybody
else is because I think it is good to have a bank of ideas, to have
them protected so that you can go on to the next idea while somebody
develops a manufacturing process.
So those are my concerns on H.R. 400 and also in the manager's
amendment, and that is why I will be voting against it, because it
levels the playing field when I do not think it should; it levels it
for the opponents.
Mr. HYDE. Mr. Chairman, I have a unanimous consent request that I
would like to present to the House, but I would like just to say about
those
[[Page H1663]]
Nobel Prize winners, a lot of them have foreign accents, the ones I
have met anyway.
Mr. Chairman, I ask unanimous consent that, when we finish with this
manager's amendment, which I pray will be soon, I pray it is imminent,
that debate on the Rohrabacher amendment and all amendments thereto be
limited to 2 hours equally divided between proponents and opponents,
the time to be controlled by the gentleman from California [Mr.
Rohrabacher] and the gentleman from North Carolina [Mr. Coble] and that
they be permitted to yield blocks of time.
The CHAIRMAN. Is there objection to the request of the gentleman from
Illinois?
Mr. ROHRABACHER. Reserving my right to object, Mr. Chairman, is his
unanimous consent request saying that there would be 2 hours of debate
for my substitute?
Mr. HYDE. Yes, Mr. Chairman.
Mr. ROHRABACHER. Mr. Chairman, but not for my substitute coupled with
all the other amendments?
Mr. HYDE. No, Mr. Chairman. No, the other amendments will stand on
their own, and we will probably get to them next week. It is simply
trying to get the important amendment, if the other offerers will
forgive me for downgrading their amendments, and get it out of the way
and have an idea when we can secure because people would like to leave.
Mr. ROHRABACHER. Mr. Chairman, I withdraw my reservation of
objection.
The CHAIRMAN. Is there objection to the request of the gentleman from
Illinois?
There was no objection.
Mr. FORBES. Mr. Chairman, I move to strike the requisite number of
words.
Mr. Chairman, in all due respect, I have not had a chance, but 1
minute, to speak at various times here, so I would like to make a
couple of points. I know the dialogue has gone on, and I will not try
not to indulge the House too much longer.
I think it is very, very important though in this critical debate to
understand that, while we have spent a lot of time on the submarine
patent idea-- you know, the notion that somebody hides this kind of
prospective patent and it rears its ugly head to challenge somebody
else later in the future, I appreciate that. And I think it has been
well established here in this body this afternoon that either the main
bill, H.R. 400, or the Rohrabacher substitute does deal with the
submarine patent issue.
I think it is important again to stress that of the 2.3 million
patents that were issued from 1971 to 1993, 2.3 million patents, 627 of
those patents were deemed submarine, and almost half of those were by
the U.S. Government. So the problem is not necessarily foreign
interests bearing these submarine, these patents. So I think that is an
important point to understand here, but we have dealt with the
submarine issue, so I will not prolong that.
I think we get back to the essence here, and the essence of all of
this really is again that we have American inventors who have defined
this Nation as a place where somebody with a good American idea could
come to Washington, DC, with that idea and protect that idea and it
would not be made available to the whole world to steal.
I understand the distinction if one files overseas. I am today
talking specifically about our American citizens who come up with good
ideas and want to protect those ideas on American soil. That is what I
am talking about, and I think we need to protect them.
That is why I am asking in a most aggressive manner through my
amendment that we do protect the entrepreneur, the people who are
working extra jobs to protect this idea that they have been working on,
the small business people.
Look, the corporations, the multinational corporations, are well
protected. They will be well protected in this legislation, they will
have the battery of lawyers they need, but the little guys out there
with no resources who have wonderful ideas that have made America great
who have made us the superior Nation on the face of the earth because
of our ideas and our technology, we are going to compromise that away.
We will no longer have Alexander Graham Bells, we will no longer have
first generation Americans coming up with a great ideas like Thomas
Edison, and we will no longer have the Eli Whitneys or all the other
people who have come through generations that have made this country
the greatest Nation because of our people that go out there, come up
with a great idea, send it to Washington and protect it. Now we are
saying, ``Sorry, individuals; sorry, small business people; you are not
going to have the protections because you'll have to share your idea
with the whole world after 18 months or some few months after that
based on the manager's amendment which says, well, we will make a
little alteration there.''
If we are really caring about the individual in this country and not
the corporate interests, we will make an exception for individuals,
small business people, who do not have the resources that this bill
will mandate.
Mr. Chairman, my colleague from Ohio was exactly correct. This will
be a lawyer's field day because we will turn it over to the courts, and
even the presumption that the patent holder is protected will be put in
jeopardy under these changes.
Mr. CONYERS. Mr. Chairman, will the gentleman yield?
Mr. FORBES. I yield to the gentleman from Michigan.
Mr. CONYERS. Mr. Chairman, is the gentleman aware of page 10 of the
Coble manager's amendment starting at line one that exempts the small
independent inventor from publication?
Mr. FORBES. Only if that inventor withdraws their patent application.
It is not exemption.
Mr. CONYERS. It is optional with the small inventor; and if I might
just read the sentence, it might change the gentleman's entire speech,
and here is what it says. Just hear this.
The small, the independent, inventor in small businesses have
expressed concern, and so the manager's amendment will give them a
choice over whether or not they wish to be published. It will
effectively exempt independent inventors by deferring until 3 months.
Mr. FORBES. Reclaiming my time, with all due respect I say to the
gentleman I read it myself. And what it says is if someone is an
individual in this country or a small business, and they do not have
the resources, and they do not want their patent protected; I mean
published, excuse me; then what they can do is they can opt out of
participating in the patent protection system because then they will
not get published.
Mr. CAMPBELL. Mr. Chairman, will the gentleman yield?
Mr. FORBES. I yield to the gentleman from California.
Mr. CAMPBELL. Mr. Chairman, the gentleman is reading from the summary
and not from the actual text. I note that point. But the summary is
correct, and so was my colleague from New York. One can always get out
of the mandatory publication rule.
The CHAIRMAN. The time of the gentleman from New York [Mr. Forbes]
has expired.
(By unanimous consent, Mr. Forbes was allowed to proceed for 2
additional minutes.)
Mr. FORBES. Mr. Chairman, I yield to the gentleman from California
[Mr. Campbell].
Mr. CAMPBELL. Mr. Chairman, I appreciate the gentleman yielding
continuously.
All that speaks to, Mr. Chairman, the gentleman from Michigan's
point, all it speaks to, if one chooses to opt out of the patent
system, then they do not have to disclose. But that is always the case.
One can opt out of the patent system.
Mr. FORBES. Reclaiming my time, if I might, and in my remaining
minute here I think it is just important to stress to my colleagues who
have real problems understanding the technicalities of this issue, and
I can appreciate it, this is very, very important. I am talking about
the little people in this country, the small inventors, the people who
do not have vast sums of money who have made this country great and
changed the face of the economy of this Nation over the last 200 years.
They will be hurt by this change.
Mr. Chairman, this is a harmful piece of legislation. In all due
respect to the folks who have drafted it, this is not
[[Page H1664]]
good for the little people in America, it is not good for small
businesses, and I urge the defeat of H.R. 400.
Ms. LOFGREN. Mr. Chairman, I move to strike the last word.
Mr. Chairman, I doubt that I will use the entire 5 minutes. I just
think it is important to point out a few things. There is an accuracy
deficit here.
Mr. Chairman, in the bill with the exemptions provided for in the
manager's amendment, which I support, publication is at 18 months, and
the inventor is protected from that time forward. So it is not as if we
are asking people to publish their invention without protection.
Mr. Chairman, I would like to complete my sentence. There has been a
lot of discussion that the little guy will not be protected because he
or she does not have access to the fancy lawyers and the legal system
that is necessary to protect themselves. Let me point this out:
If someone obtains a patent--they have an invention, they file for
their patent and their patent is issued--that patent is only as good as
their ability to enforce it. Enforcing the patent requires them to
oftentimes come into contact with the legal profession and to actually
expend fees in pursuit of protecting their patent. And I would point
out that there are many lawyers, if they have a good case, who will
take the case on a contingent fee if the patent holder is being
attacked by a foreign corporation in a patent infringement action.
It is important to talk about the issue of submarine patents. I have
heard a lot about statistics. I do not hear those same sorts of
arguments when we stand here and talk about, for example, product
liability law. It is not our problem because it is only a percentage.
If it is 500 million, it does not matter because it is only one case.
Let me talk about the case of Jerome Lemelson who filed in America
for a bar code and robotic technologies who delayed his patent for 35
years. He collected $500 million in royalties from manufacturers from
the late 1980's until the early 1990's. His patent attorney made $150
million in 1 year, and then later the Federal district court found that
he did not have an enforceable patent.
I do not know Mr. Lemelson, I have nothing against him personally. I
would just say that is nothing to advance the economic interests of
America or of working people or of countries or of innovation. That is
important; do not tell me about percentages. We need to prevent it.
Mr. GOODLATTE. Mr. Chairman, will the gentlewoman yield?
Ms. LOFGREN. I yield to the gentleman from Virginia.
Mr. GOODLATTE. Mr. Chairman, I ask do we know how many hundreds of
millions of dollars the attorney for Mr. Lemelson received in fees thus
far for his submarine patenting?
Ms. LOFGREN. I do not know and I certainly never fault an attorney
for earning an honest living. I would just point out that this issue is
a big deal to those companies that paid those fees and the attorney
fees.
I will tell the gentleman something else, and I do not want to quote
the entire letter, but some of my colleagues have heard of Charles
Trimble, the president and CEO of Trimble Navigation, a brilliant
physicist and an individual who owns many patents and who was a leader
in global positioning systems. Were it not for Dr. Trimble, we may not
have that technology at all. I had the opportunity to talk to Dr.
Trimble just a few short weeks ago. He followed our conversation with a
letter to me. He is the owner of the patents. He is the one who has
designed this system. He is fighting off submarine patents right and
left.
{time} 1530
It is not the right thing for our country to allow.
Mr. GOODLATTE. Mr. Chairman, if the gentlewoman will continue to
yield, I think the point is that this patent reform bill fights against
abuse of and gaming of the current system, which is a great playground
for some lawyers to make huge fees at the expense of the American
consumers and taxpayers, and we are correcting that with this
legislation today, quite to the contrary of those who would allege that
the new laws will help lawyers, quite to the contrary.
Ms. LOFGREN. Mr. Chairman, reclaiming my time, that is correct. The
main point I wanted to make is to have rights that are enforceable one
must seek access to courts, which requires lawyers, whether your rights
attach at publication, whether the rights attach, as used to be the
case, at issuance or the like. Your rights are only as good as what you
stand up for.
Mr. DICKS. Mr. Chairman, will the gentlewoman yield?
Ms. LOFGREN. I yield to the gentleman from Washington.
(Mr. DICKS asked and was given permission to revise and extend his
remarks.)
Mr. DICKS. Mr. Chairman, I rise today to speak in strong support of
H.R. 400, a package of patent reforms that will have significant
positive impact in several key industries in the State of Washington,
namely the information technology, biotech, aerospace, and defense
industries. I believe that this legislation will result in tangible
improvements in our Nation's patent system, and that it strikes a
balance between the need to assure strong patent protection for
inventors while allowing for the free flow of information regarding new
technologies. In this regard, I believe that H.R. 400 will foster the
best of American ingenuity and serve as an important mechanism for
spurring U.S. economic growth and competitiveness.
I regret, Mr. Chairman, that opponents of this legislation have
sought to portray this patent debate as a David versus Goliath fight
when, in fact, the reforms contained in the bill will benefit large and
small companies alike. The committee bill protects the work and
intellectual capital of thousands of Americans, whether working in
basement laboratories or in teams at major U.S. corporations. By
cutting bureaucratic red tape, reducing the operating costs, and
promoting self-funded PTO, all patent filers stand to gain from a more
predictable, efficient, inexpensive, and equitable patent system. H.R.
400 also contains several safeguards to protect independent inventors,
and in this regard I note that nationwide associations representing
30,000 small business members are in support of the legislation we are
debating today.
I also rise in strong opposition today to the amendment offered by
the gentleman from California [Mr. Rohrabacher] who seeks to substitute
his legislation which, in my judgment, will reverse the positive patent
reforms that were achieved through the GATT and would encourage abuse
and manipulation of the patent system. The gentleman from California
has maintained that the issue of the so-called submarine patents
represent only a miniscule problem for our system. But I believe it has
been shown that this gaming of the system has cost inventors, U.S.
companies, and consumers billions of dollars and it would only continue
under the language Mr. Rohrabacher is asking us to adopt.
As a member of the National Security Appropriations Subcommittee and
the House Intelligence Committee, and as a Representative of a State
that depends upon the best of human and intellectual creativity, I can
assure you I would never endorse a proposal that undermines our
national security or undercuts our global competitiveness. In the 2
years prior to the passage of the 1995 GATT law, 300 foreign companies
manipulated the patent system to their advantage, at the expense of
American inventors and consumers. Despite Mr. Rohrabacher's
disingenuous label of H.R. 400 as the ``Steal American Technology
Act,'' I am afraid that the bill he is offering as a substitute would
only worsen that draining of intellectual capital from the United
States.
This is a major issue for all high-technology areas of the United
States, and particularly for the Pacific Northwest, which has become an
intellectual center for software development and biotechnology--two
areas in which the United States leads the rest of the world. The
foundation of the information technology industry in my region and
nationwide is its intellectual capital, and as such, intellectual
property protection is critical to the continued growth and success of
this industry. In 1975, Microsoft was founded on the ideas and hard
work of a handful of people; in just over 20 years, it now has almost
20,000 employees. Hundreds of startup companies have been launched
following Microsoft's success, further contributing to the thriving
high-technology industry in the area. The software industry as a whole
provides high-wage, high-skilled jobs for more than 500,000 American
workers and currently enjoys 70 percent of the world market--a share
that will rapidly diminish if intellectual property protection is
minimized. As R&D spending continues to increase, and while product
cycles are condensing into timeframes of 9 to 12 months, predictability
and full disclosure of existing patent applications becomes
[[Page H1665]]
ever more critical. Due to the complexity of software patents, and a
lack of prior art and expertise in the field, the average patent
pendency for software is 36 months, double the PTO's average processing
time. For this reason, an efficient PTO with highly trained and
experienced examiners is becoming increasingly important.
Passage of the Rohrabacher substitute, H.R. 811, and a return to the
previous system enabling the practice of submarine patents, also
threatens the biotechnology industry which is thriving in the State of
Washington. Patents are critical to the research of the biotechnology
industry into cures and therapies for deadly and costly diseases like
cancer, AIDS, Alzheimer's, cystic fibrosis, multiple selerosis, heart
disease, and 5,000 genetic diseases. Any law which undermines the
ability of biotechnology companies to secure patents with a full term
undermines funding for research on deadly, disabling and costly
diseases. Capital will not be invested in biotechnology companies if
they are not able to secure intellectual property protection ensuring
that they have a full term for a patent in which to recoup the
substantial investments they must make in developing a product for
market. Today, the United States remains preeminent in the field of
biotechnology but has become a target of other country's industrial
policies. Only by maintaining strong intellectual property protection,
and preventing the gaming of the patent systems by foreign companies
can the U.S. biotech industry continue to remain dominant.
I am convinced Mr. Chairman, that intellectual property is rapidly
becoming the critical national resource of the next century's world
economies, and I urge my colleagues to move forward with the
improvements to our current patent system contained in the H.R. 400,
which I have cosponsored, not backward with the substitute offered by
Mr. Rohrabacher. An efficient and predictable patent system encourages
both job creation and the research and development activities that have
made the United States the global leader in many high-technology
sectors. This is precisely what H.R. 400 seeks to do.
Mr. HUNTER. Mr. Chairman, I move to strike the requisite number of
words.
Mr. Chairman, I want to reiterate what I said at the start of this
good, robust debate, and that is that I have great respect for the
gentleman from Illinois [Mr. Hyde], the chairman of the full committee
and my great friend, and the gentleman from North Carolina [Mr. Coble],
the chairman of the subcommittee, my other great friend. I want to
thank both of them for all of the great work that they have done.
I think one thing that we have proved to the world over the last
several hours is that this is a fairly complex subject. I think that
the area that the gentlewoman from California [Ms. Lofgren] just spoke
to is a huge area. It is an area of great importance, because we keep
getting up on our side and saying that there is publication after 18
months, that all of these inventors have their secrecy ripped away from
them, and then people can come in and unscrupulously flood around them
with patents, which the practice of flooding is used in Europe and
Japan where that 18-month publication system exists, and then the other
side gets up and says, no, we have fixed that, there is an exception
for small inventors. They do not have to publish.
Let us walk through that. Right now you do not have to publish until
some 20 years after you have applied for your patent, and that gives
you a long time, especially if you have a very complex piece of
technology, to go out and get the money, get the running room that
these Nobel laureates who support the Rohrabacher bill apparently want
to keep. They do not like the new bill. But under the new bill, you
jerk that veil of privacy away from them after 18 months.
Now, they do have a choice under the committee bill, but the choice
for small businesses is not to be published. They do not have that
choice. They either have to publish after 18 months or get out. They
have to get out of the patent system and give up their attempt to get a
patent and give up forever the chance to get that very important
protection.
Now, it is true, and I want to hold up this list of people, very
bright people who do not want this protection that the committee wants
to give them. The gentleman, Nobel laureate, Franco Modigliani who
developed management systems; Kary Mullis, Nobel laureate, polymerase
chain reactor; Gertrude Elion, Nobel laureate, transplant anti-
rejection drugs; the guy who invented the neonatal respirator; the guy
who invented the MRI machine. Lots of these very bright people do not
want to be published early under the system that exists in Japan.
Now, this chart tells you maybe why they do not want to be published.
Why are there so few Nobel laureates in the sciences in Japan? Only
five. There are 175 in the United States. The reason is very clear.
These people get their privacy ripped away after 18 months. That means
they do not have the running room to go out and get capital, to get a
start-up company, to go out and line up the support that it takes to
get a technology into production.
In the United States we have a ton of Nobel laureates because we give
them protection, we give them some running room. So let us get this
straight once and for all. The committee bill says that after you have
had two office actions in the Patent Office, that at least a third of
the patents go way beyond two office actions, but after you have two
office actions, you have 3 months to decide whether to publish to the
world or get out of the patent system.
Now, let us go to submarine patents for just 1 minute. Submarine
patents have been the subject of almost three-quarters of the argument
time spent by the proponents of this bill. I am told by the testimony
that I read, or the summary of the testimony, by the Patent
Commissioner was that over the last 20 years of 2.3 million patents
issued, 370 of those patents were submarine patents. That is less than
one-tenth of 1 percent.
So a lot of these Nobel laureates would probably say, you know what
we would go along with? We are not a bunch of phoney submariners, we
have good stuff, we just want to protect it. What we would go along
with is a provision from the bill that would say, if you do not use due
diligence, then the Patent Office should publish you.
That will take care of that problem. That takes care of those 370
submariners. That is in the Rohrabacher bill. If you do not use due
diligence, you get published. So the guy that hides for years and years
and years gets brought out into the open and published.
I think one reason these Nobel laureates do not like this is they are
saying why do you expose 2.3 million patent holders early, early in the
game and let people take advantage of them because of what 370 guys
did? It does not make sense.
So once again, I want to thank the chairman of the subcommittee, the
gentleman from North Carolina [Mr. Coble], and the full committee
chairman, the gentleman from Illinois [Mr. Hyde], for bringing this
very important bill forward, but I go back to the beginning of the
debate when the gentleman from Florida [Mr. Goss] said first do no
harm. Folks, we are doing harm with this bill.
Mr. KENNEDY of Massachusetts. Mr. Chairman, I move to strike the
requisite number of words.
First of all, I want to acknowledge the leadership that my good
friend from California, [Mr. Rohrabacher], has shown on this issue, and
I think that the gentleman has taken up the interests of how we are
going to be able to compete in the high-technology environment and in a
global economy in a way that I was very supportive of in the last
Congress. I commend the gentleman from California [Mr. Rohrabacher] for
the initiative that he has shown on this issue.
My feeling, after having listened to this debate and recognizing that
I come from a district that represents universities such as
Massachusetts Institute of Technology and Harvard University, I have
more universities than any other Member of Congress, over 48 different
universities come from the eighth district of Massachusetts. There is
more research and development money spent in my congressional district
than any other congressional district in the United States of America.
I should not tell my colleagues all this because they will cut it all.
So anyway, I have to skip that part of the speech and get into the
fact that what we have is an enormous concern over patent law and
patent law deficiencies that have occurred during the course of the
last few years. We have seen this most particularly with regard to the
last few years in direct result of some of the GATT agreement that
ended up as a result of a long negotiation providing protections for
some of
[[Page H1666]]
our inventors and some of our patent applicants here in the United
States, but only after a very difficult set of negotiations. As a
result of my involvement in that issue, I was happy to support the
efforts of the gentleman from California [Mr. Rohrabacher] in the last
Congress.
My understanding, and I would be open to hearing from the gentleman
from California [Mr. Rohrabacher], is that the gentleman from North
Carolina [Mr. Coble] has, in fact, tried to take up some of the
concerns.
We just heard the gentleman from California [Mr. Hunter] talk about
the fact that there is an issue pertaining to the small businessman or
the small inventor that comes up with a particular idea and the fact
that, as I understand it, in the legislation of the gentleman from
North Carolina [Mr. Coble], there would be, in fact, an 18-month
protection, that there would be an opt-in for a total trade secret
protection.
Now, that might not be fully protective of all of the interests of
the small inventor, because at some point someone might go around him
and try to steal the patent and then he is into a big lawsuit with a
larger company. But it does seem to me that the gentleman from North
Carolina [Mr. Coble] has tried to come up with a reasonable compromise
for us to be able to support.
So I would like to entertain just a discussion with the gentleman
from California [Mr. Rohrabacher], who, as I say, I did support in the
last Congress. My inclination was to support the gentleman from North
Carolina [Mr. Coble] today. So I would like to hear what the
gentleman's concern is.
Mr. ROHRABACHER. Mr. Chairman, will the gentleman yield?
Mr. KENNEDY of Massachusetts. I yield to the gentleman from
California.
Mr. ROHRABACHER. Mr. Chairman, no. I would say the efforts of the
gentleman from North Carolina [Mr. Coble] have not in any way met my
concerns and, in fact, have raised more concerns the more I look into
the legislation.
In fact, if the gentleman will notice from the universities that are
in his district, none of them, none of them support H.R. 400. Had the
gentleman from North Carolina [Mr. Coble] actually gone and moved
forward, trying to take those concerns that we all had last year into
consideration, they would be here. Instead, the central issue, and the
central issue which remains, as everyone can see, is whether or not our
information that we have developed during a research and development
process, so important to our colleges and universities, whether or not
that information is going to be forcibly published so that everyone
else in the world will be able to steal it.
Mr. KENNEDY of Massachusetts. Mr. Chairman, reclaiming my time
briefly, I have been in touch with the universities of my district.
While they are not perhaps as actively supportive as the gentleman from
North Carolina [Mr. Coble] would like, they do not oppose this
amendment.
Mr. FRANK of Massachusetts. Mr. Chairman, will the gentleman yield?
Mr. KENNEDY of Massachusetts. I yield to the gentleman from
Massachusetts.
Mr. FRANK of Massachusetts. Mr. Chairman, I would think we could
state this very clearly. No, the universities are not supporting the
committee bill, they are not supporting the bill of the gentleman from
California. He is being unusually reticent. My friend from California
is being unusually reticent in leaving his own bill out of this
conversation. He is not ordinarily so modest about it.
I have worked with the universities, with Harvard, and MIT and some
others. My understanding of their position is that while they were
originally opposed to H.R. 400, the changes we have made have brought
them to a position of neutrality as between the two bills. I do believe
they want to see a bill passed, but the fact is it seems rather odd for
the proponents of one bill to be citing the universities' neutrality
when the universities are neutral as between the two bills.
Mr. CAMPBELL. Mr. Chairman, will the gentleman yield?
Mr. KENNEDY of Massachusetts. I yield to the gentleman from
California.
Mr. CAMPBELL. Mr. Chairman, I think the correct point is that the
universities have chosen to stay on the sidelines, and my colleague
from Massachusetts, and I have both been in contact with them.
I believe this is very significant, because if one asks them, and
this is my guess, I am not saying anyone told me precisely, though one
actually did, they would prefer neither. They would prefer we do not
mess with the system.
So the burden of proof should be on somebody who is proposing a major
change in the patent bill. Research universities prefer no change, and
that is what I think we should do.
The CHAIRMAN. The time of the gentleman from Massachusetts [Mr.
Kennedy] has expired.
(By unanimous consent, Mr. Kennedy of Massachusetts was allowed to
proceed for 2 additional minutes.)
Mr. FRANK of Massachusetts. Mr. Chairman, will the gentleman yield?
Mr. KENNEDY of Massachusetts. I yield to the gentleman from
Massachusetts.
Mr. FRANK of Massachusetts. Mr. Chairman, that is the oddest
invocation of the burden of proof I have heard. The burden of proof is
somehow on those who would support one bill, but not on those who would
support one equally important.
The gentleman said the burden of proof is on one. As a matter of
fact, what is clear to me from working with the universities is this:
They had some objections. We have improved the bill from their
standpoint to the point where they do not now object to it. They are
not choosing between the two bills. But I would differ. At least with
the universities I have talked to, there are elements in this bill,
including, for instance, blocking the diversion of patent fees from the
Patent Office, which makes them want some bill, and there are others
who believe that some action in light of what is going on
internationally is important.
The key point is this: People who are the proponents of one position
versus another should not come in and simply say, oh, the universities
do not like your position, when they have a neutral position. I think
some Members got the impression that they have taken sides.
Mr. KENNEDY of Massachusetts. Mr. Chairman, reclaiming my time, let
me yield to the gentleman from California. If the Chairman would just
let me know when I have about 30 seconds left so I might close.
Mr. CAMPBELL. Mr. Chairman, there were things in the bill, however,
that the universities do not like, like the reexamination procedure.
They think they have a patent and then suddenly under this bill it can
be opened up for reexamination in ways and in processes not under
existing law.
I agree with my colleague, the gentleman from Massachusetts [Mr.
Frank]. The burden of proof is on anyone who wants to change the status
quo, and that is true of the gentleman from California [Mr.
Rohrabacher] and it is true of the gentleman from North Carolina [Mr.
Coble]. But if you ask the universities, their bottom line is leave it
alone, and that is what we should do today.
Mr. KENNEDY of Massachusetts. Mr. Chairman, I would just like to
close.
I have come into this debate with an open mind. My sense is that
there has been, in fact, significant advancements made on where the
Moorhead bill was 2 years ago to where the Coble bill is today.
My inclination, after having talked with the various universities and
a lot of the small businesses, as well as other companies within my own
district, that I think the gentleman from North Carolina [Mr. Coble] is
making a significant effort forward, and I look forward to supporting
his bill.
{time} 1545
Mr. PEASE. Mr. Chairman, I move to strike the requisite number of
words.
Mr. Chairman, I just wish to follow up the comments of my colleague,
the gentleman from Massachusetts [Mr. Frank], who has been in personal
conversation with a number of the universities in the Northeast. Our
staff, at the request of the chairman, the gentleman from North
Carolina [Mr. Coble], together with his staff have spent a lot of time
in conversation with associations which represent universities of all
sizes, both public and private, across the country.
My assessment of those conversations is that the representation of
the
[[Page H1667]]
gentleman from Massachusetts [Mr. Frank] is in fact accurate; that
while there were concerns about some portions of the initial
legislation, those concerns have been addressed, and while no piece of
legislation may be perfect, that what we have before us with the
manager's amendment does meet the great majority of those concerns from
what is a very diverse audience that includes public and private
schools, small and large schools, individual professors working alone,
and professors working together and in cooperation with major
corporations.
I think it would be as difficult to get consensus in higher education
on this subject as it would be in this body to get consensus. But my
assessment of the view of the associations with which we have worked is
that the bill that we will have before us, after the manager's
amendment, does address their major concerns.
Mr. CAMPBELL. Mr. Chairman, will the gentleman yield?
Mr. PEASE. I yield to the gentleman from California.
Mr. CAMPBELL. I am grateful for the gentleman's yielding.
Mr. Chairman, it is my understanding that there are four universities
who have expressed an opinion, and if this is wrong I am asking the
gentleman to correct it.
It is my understanding that the State University of New York at Stony
Brook supports Rohrabacher; that Louisiana State University supports
Rohrabacher; that the University of Delaware supports Coble; that Rice
University supports Coble; and that every other university has chosen
not to take sides in this debate.
If that is incorrect, I would most welcome the correction. But if it
is correct, I would suggest that the burden of my remarks that I made,
that the universities would really prefer that we not mess with this
system, is more accurate.
Mr. PEASE. Mr. Chairman, I cannot speak for the four universities
individually to which the gentleman has made reference because we spoke
only with associations, those who represent groups of universities, and
not with individual universities. We did have conversations with
individual universities, a number of them in the Midwest. In each case
they referred us to the associations of which they were members.
Mr. CAMPBELL. If the gentleman will continue to yield, Mr. Chairman,
does the gentleman know, since he has been in touch with the university
associations, does any association of universities support either of
these two bills, to the gentleman's knowledge?
Mr. PEASE. To my knowledge, none of the major associations has taken
a position on either bill.
Mr. FRANK of Massachusetts. Mr. Chairman, will the gentleman yield?
Mr. PEASE. I yield to the gentleman from Massachusetts.
Mr. FRANK of Massachusetts. Mr. Chairman, I think we may be back in
the Subcommittee on the Constitution of the Committee on the Judiciary,
apparently. It sounds like some of my friends are about to create a
third house of Congress, which is the universities, and only if they
vote positively can we pass a bill.
Mr. Chairman, I differ with the implicit imputation of great
inarticulateness to the university sector. The gentleman from
California says it is true they have said they do not support or oppose
either bill. They do not oppose it. But the gentleman says that he
infers from the fact that they do not support or oppose either bill the
fact that they oppose any bill at all.
In my experience, universities are not reticent. When universities
have positions, they tell us. The fact that the universities have not
said they were opposed to this would lead me to the conclusion, perhaps
it is going out on a limb, but when the universities tell me they are
not opposed to a bill, I infer they are not opposed to a bill. Perhaps
there are subtleties unbeknownst to me.
I worked with universities when they were opposed, and when they were
they have said so. So we have made some changes, and they are not now
opposed to this, they are neutral. It does not seem to me we have to
absolutely do whatever they say, anyway. But neutrality is not
opposition.
Mr. CAMPBELL. Mr. Chairman, if the gentleman will yield further, I
believe that the gentleman from Massachusetts and I agree that there is
a burden of proof in debate, there is a burden of proof in those who
would change the status quo, and the university community is not a
third house of Congress, nor have I set it up to be so.
But they are important. And they are not reticent in letting us know
things they want, like major assistance with research, particularly in
the times of a shrinking budget. That they have not done so is to me a
very important point. That they have chosen to be silent regarding this
bill is to me quite significant, if we start from the premise that
there is a burden of proof on anyone who wants to change the status
quo.
What we are left with, and I appreciate the gentleman's yielding, is
that there are those who commercialize, like the Coble bill, those who
invent, like the Rohrabacher bill, and universities have one foot in
each camp, they both commercialize and invent, and it seems to me for
that reason they are staying out.
Ms. KAPTUR. Mr. Chairman, I move to strike the requisite number of
words.
(Ms. KAPTUR asked and was given permission to revise and extend her
remarks.)
Ms. KAPTUR. Mr. Chairman, I rise in support of the Rohrabacher
substitute and against H.R. 400. Mr. Chairman, I wanted to read into
the Record some of the organizations that are opposing H.R. 400 and
supporting the Rohrabacher substitute, organizations like the Alliance
for American Innovation, the American College of Physician Inventors,
the American Small Business Association, the National Association for
the Self-employed, the National Association of Women Business Owners,
the National Congress of Inventor Organizations, the National Patent
Association, the National Small Business United. These are not
insignificant organizations.
The Patent Office Professional Association, the Ohio State Bar
Association, from my home State. This is a very small, partial list.
The Small Business Legislative Council, the Small Business Technology
Coalition, the Small Entity Patent Owners Association, United Inventors
of America. One of the great scholars of our time, Franklin Modigliani
at MIT, a Nobel laureate.
These are not insignificant organizations, nor individuals; inventors
like Dr. Paul Burstein, the inventor of rocket motor inspection
systems, or Gertrude Elion, the inventor of leukemia-fighting and
transplant rejection drugs.
There are people here who recognize what is being proposed in the
base bill is in fact a significant departure from current practice.
They are not satisfied with the so-called changes that are being made
actually every moment, from what I can tell from this position here, in
order to accommodate the flaws that exist in the base bill.
So I would say to the Members, Mr. Chairman, that it is very
important to recognize that we not tamper with a system that is
working, that has worked for centuries, and certainly for the last
several decades as the United States in this century became the
preeminent industrial and agricultural leader of the world.
H.R. 400, in contrast to the substitute, is actually taking us back,
not forward. Why we would want to subject our inventors to divulge the
contents of their patent application before it is granted is beyond me.
I do not know why we want to take that secret protection away and
involve them in litigation. Why would we want to do that? Why would we
want to do that domestically, and certainly why would we want to
subject them to cases internationally, which are so expensive that most
of the smaller inventors cannot even afford to defend their interests?
The average American knows it is hard for them to go to court and pay
the court costs in this country. Can Members imagine what it is going
to be like to deal with international infringements on their patent
applications if they have to function under this proposed base bill?
Mr. ROHRABACHER. Mr. Chairman, will the gentlewoman yield?
Ms. KAPTUR. I yield to the gentleman from California.
Mr. ROHRABACHER. Mr. Chairman, this is, after all, the ultimate
bipartisan issue that we have been discussing
[[Page H1668]]
today, and who supports the little guy. That is what we are trying to
do with the Rohrabacher substitute.
Most people know there are a lot of conservative Republicans who have
spoken today, and the gentlewoman has been here as well. Are there not
many people on the gentlewoman's side of the aisle who are very
concerned about this? Perhaps the gentlewoman would like to talk about
some of the others who are supporting the Rohrabacher substitute,
because I am proud to have many, many, liberal Democrats on our side
protecting the little guy.
Ms. KAPTUR. Mr. Chairman, that is right. Actually, the gentlewoman
from California, Ms. Maxine Waters, was down here earlier and had to go
back to a markup. She is supporting this legislation.
The gentleman from Missouri, Mr. Dick Gephardt, our minority leader,
will be supporting the Rohrabacher substitute.
The gentleman from Michigan, Mr. David Bonior, on our side of the
aisle will be supporting the substitute. So frankly, I think this issue
goes down to the point of who has actually read the legislation and who
has not, and most Members do not serve on the Subcommittee on Courts
and Intellectual Property of the Committee on the Judiciary. Therefore,
they have not had an opportunity to follow some of the machinations.
I respect the gentlewoman's work on this measure. I know how hard she
has worked on it, I know she has been accommodating to many of the
changes we have been trying to make.
Mr. Chairman, the bill is not where we would like it to be yet, and
therefore I remain supporting the Rohrabacher substitute, but we have
broad bipartisan support on our side of the issue, and I look forward
to the vote.
Ms. LOFGREN. Mr. Chairman, will the gentlewoman yield?
Ms. KAPTUR. I yield to the gentlewoman from California.
Ms. LOFGREN. Mr. Chairman, I just wanted to point out that that
leaves only right-wing Democrats such as the gentleman from
Massachusetts [Mr. Frank] and myself in support of the manager's
amendment.
Mr. ROHRABACHER. Mr. Chairman, I move to strike the requisite number
of words.
Mr. Chairman, it seems that the debate on submarine patenting has
calmed down a bit, seeing the fact that we have stated over and over
and over again, and used the Congressional Research Service finding, to
prove beyond anyone's reasonable doubt that we have taken care of any
potential submarine patenting problem.
I have with me the Congressional Research Service report that says
that our alternative, basically the Rohrabacher substitute, will end
the practice of submarine patenting. So that is the only substantial
argument that the other side has to say that we should fundamentally
change our patent system. They are proposing, in the name of stopping
submarine patenting, because it is the only way to stop it is to change
the fundamental law that has protected American technology for 225
years.
No, I have an alternative. The alternative was found by an
independent reading by the Congressional Research Service to end
submarine patenting. So what do we have? We have a proposal here to gut
fundamental protections for American inventors, giving our technology
away in order to end the submarine patenting problem, which we say we
found another way to solve.
No, we do not have to cut our leg off in order to cure a hangnail or
an infected toe. We do not have to destroy all freedom of speech
because someone wants to publish Hustler magazine. In this particular
case, people are moving forward to change the fundamentals, the
fundamentals in our system that have served our country well, that have
made us the leader in technology and ensured our people the highest
standard of living, ensured our country the security we have because we
have had the technological edge.
We have had the technological edge because the fundamentals have been
right. This bill would change those fundamentals. One fundamental is a
guaranteed patent term of 17 years. Their bill would go along with the
elimination of that which took place 3 years ago when someone, in an
underhanded maneuver, snuck that change into the GATT implementation
legislation, although it was not required by GATT; the most underhanded
move that I have seen since I have been here in Congress. Our bill
would restore that guaranteed 17-year patent term that has served
America well for 225 years.
The second element that my substitute restores and guarantees, the
confidentiality; the right of our citizens, that when they apply for a
patent, that until that patent is issued it is going to be secret. We
are not going to give away all the secrets to foreign multinational
corporations to steal until the patent is issued.
What do we hear here? We have effectively exempted small business. We
can put that argument to rest, too. What does ``effectively'' mean? We
know what that means. That is a weasel word. The public knows what it
means, too. It means that someone is trying to project that a change
has happened and the change has not happened. That is what effectively
means.
No, small business has not been exempt, individuals have not been
exempt. As the gentleman from California, Mr. Tom Campbell, brought out
with his colloquy, no; they are not. They are still going to be
published. The whole world will see every one of our secrets.
Please do not tell us that the Chinese Liberation Army is going to be
deterred from using our secrets, going into manufacturing, making
profit from those secrets, using those secrets in their technology
against us, and then 5 years later or 10 years later, when the inventor
is finally issued the patent, he gets to sue the Peoples Liberation
Army?
They have taken care of the problem? That is a joke, and it is a sick
joke that opens up all of our people to the worst kind of theft. Yes,
the Chinese Army, I can hear them now, or Mitsubishi Corp: ``I am using
your technology? So, sue me.'' Yes, great. That is going to really
protect our people and protect our country. This is an escalator down
for our leadership in American technology.
By the way, something else I have heard today, yes, we have heard
today that they have taken the provision out that permits this new
corporatized Patent Office, where the Patent Office is part of the
Government, making it a corporate entity; but they did manage to take
out that part that says this corporate organization can accept gifts.
Why? Because the gentleman from North Carolina [Mr. Coble] has
explained, because they were permitted to accept gifts anyway. But what
was not explained was that yes, they are able to accept gifts like
anybody else, but this bill waives restrictions, because now it is a
corporate entity, and they will not have the same restrictions that
other Government agencies have when they accept gifts.
{time} 1600
The GSA, the Commerce Department are no longer going to be in control
of how those gifts are used. So what we have got is a Patent Office
that can accept foreign gifts, and the controls over how those gifts
are used are being taken away.
The CHAIRMAN. The time of the gentleman from California [Mr.
Rohrabacher] has expired.
(By unanimous consent, Mr. ROHRABACHER was allowed to proceed for 2
additional minutes.)
Mr. ROHRABACHER. Mr. Chairman, the patent examiners who work so hard
in this country, these are people who make decisions that are worth
billions and billions of dollars and whether our country will enjoy
them, who will benefit from them, these patent examiners work hard and
they have been totally insulated from outside influences because they
have been part of the U.S. Government. They are opposed to H.R. 400.
They are pleading with us, do not do this to us, because they have no
idea what outside influences will come to play. No one knows.
We change something so fundamentally as making it a corporate
structure rather than part of our Government, who knows what pressures
will be put on these stalwart Government employees who are trying to do
their job.
Finally let me say, my substitute has taken everything that has been
done
[[Page H1669]]
that is of benefit, that is a good thing for America out of the work of
the gentleman from North Carolina [Mr. Coble] and out of H.R. 400, and
we have incorporated it into the substitute.
What we do not have is the publication that will make available to
everyone to steal our technology after 18 months. We do not have the
corporatization that will open up our patent examiners to outside
influences, and what we do is we protect the fundamental system of
American patent law that has made America the greatest country in the
world. That is why we have so many Nobel laureates and all the Nobel
laureates are on our side.
Do not be fooled with the idea that you to have cut your leg off to
cure the hangnail of submarine patenting. We need to protect this
American system that has done so much wonder for our people and created
such a wondrous land. Those people in the small businesses, those Nobel
laureates, those inventors, they are on our side. The big corporations
are on the other side, and they put a lot of pressure on the
universities and a lot of pressure on other people.
But we still have a democracy. The people still rule here. This bill
protects the fundamental rights of Americans. That is why we do not
want to harmonize with Japan. We do not want to harmonize with Europe.
We want to have a better system where the individual rights of our
citizens are protected.
The CHAIRMAN. The question is on the amendment offered by the
gentleman from North Carolina [Mr. Coble].
The amendment was agreed to.
Amendment in the Nature of a Substitute Offered by Mr. Rohrabacher
Mr. ROHRABACHER. Mr. Speaker, I offer an amendment in the nature of a
substitute.
The CHAIRMAN. The Clerk will designate the amendment in the nature of
a substitute.
The text of the amendment in the nature of a substitute is as
follows:
Amendment in the nature of a substitute offered by Mr.
Rohrabacher:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Patent Rights and
Sovereignty Act of 1997''.
SEC. 2. FINDINGS.
The Congress finds that--
(1) the right of an inventor to secure a patent is assured
through the authorization powers of the Congress contained in
Article I, section 8 of the Constitution, has been
consistently upheld by the Congress, and has been the
stimulus to the unique technological innovativeness of the
United States;
(2) the right must be assured for a guaranteed length of
time in the term of the issued patent and be further secured
by maintaining absolute confidentiality of all patent
application data until the patent is granted if the applicant
is timely prosecuting the patent;
(3) the quality of United States patents is also an
essential stimulus for preserving the technological lead and
economic well-being of the United States in the next century;
(4) the process of examining and issuing patents is an
inherently governmental function that must be performed by
Federal employees acting in their quasi-judicial roles under
regular executive and legislative oversight; and
(5) the quality of United States patents is inextricably
linked to the professionalism of patent examiners and the
quality of the training of patent examiners as well as to the
resources supplied to the Patent and Trademark Office in the
way of adequate manpower, appropriately maintained search
files, and other needed professional tools.
SEC. 3. SECURE PATENT EXAMINATION.
Section 3 of title 35, United States Code, is amended by
adding at the end thereof the following:
``(f) All examination and search duties for the grant of
United States patents are sovereign functions which shall be
performed within the United States by United States citizens
who are employees of the United States Government.''.
SEC. 4. MAINTENANCE OF EXAMINERS' SEARCH FILES.
Section 9 of title 35, United States Code, is amended--
(1) by striking ``may revise and maintain'' and inserting
``shall maintain and revise''; and
(2) by adding at the end thereof the following: ``United
States patents, and all such other patents and printed
publications shall be maintained in the examiners' search
files under the United States Patent Classification
System.''.
SEC. 5. PATENT EXAMINER TRAINING.
(a) In General.--Chapter 1 of title 35, United States Code,
is amended by adding at the end the following new section:
``Sec. 15. Patent examiner training
``(a) In General.--All patent examiners shall spend at
least 5 percent of their duty time per annum in training to
maintain and develop the legal and technological skills
useful for patent examination.
``(b) Trainers of Examiners.--The Patent and Trademark
Office shall develop an incentive program to retain as
employees patent examiners of the primary examiner grade or
higher who are eligible for retirement, for the sole purpose
of training patent examiners who have not achieved the grade
of primary examiner.''.
(b) Conforming Amendment.--The table of sections for
chapter 1 is amended by adding at the end the following:
``15. Patent examiner training.''
SEC. 6. ADMINISTRATIVE MATTERS.
(a) Limitations on Personnel.--Section 3(a) of title 35,
United States Code, is amended by adding at the end thereof
the following: ``The Office shall not be subject to any
administratively or statutorily imposed limitation on
positions or personnel, and no positions or personnel of the
Office shall be taken into account for purposes of applying
any such limitation.''.
(b) Retention of Fees.--(1) Section 255(g)(1)(A) of the
Balanced Budget and Emergency Deficit Control Act of 1985 (2
U.S.C. 905(g)(1)(A)) is amended by inserting after the item
relating to the National Credit Union Administration, credit
union share insurance fund, the following new item:
``Patent and Trademark Office''.
(2) Section 10101(b)(2)(B) of the Omnibus Budget
Reconciliation Act of 1990 (35 U.S.C. 41 note) is amended by
striking ``, to the extent provided in appropriation Acts,''
and inserting ``without appropriation''.
(3) Section 42(c) of title 35, United States Code, is
amended by striking the first sentence and inserting the
following: ``Revenues from fees shall be available to the
Commissioner to carry out the activities of the Patent and
Trademark Office, in such allocations as are approved by Act
of Congress. Such revenues shall not be made available for
any purpose other than that authorized for the Patent and
Trademark Office.''.
(c) Use of Fees.--Section 42(c) of title 35, United States
Code, is amended by adding at the end thereof the following:
``All patent application fees collected under paragraphs (1),
(3)(A), (3)(B), and (4) through (8) of section 41(a), and all
other fees collected under section 41 for services or the
extension of services to be provided by patent examiners
shall be used only for the pay and training of patent
examiners.''.
(d) Publications.--Section 11 of title 35, United States
Code, is amended by adding at the end thereof the following:
``(c) The Patent and Trademark Office shall make available
for public inspection during regular business hours all
solicitations issued by the Office for contracts for goods or
services and all contracts for goods or services entered into
by the Office.
``(d) Notice of a proposal to change United States patent
law that will be made on behalf of the United States to a
foreign country or international body shall be published in
the Federal Register before, or at the same time as, the
proposal is transmitted.''.
SEC. 7. GAO STUDY AND REPORT.
(a) In General.--The Comptroller General shall conduct a
study of--
(1) the total number of patents applied for, issued,
abandoned, and pending in the period of the study;
(2) the classification of the applicants for patents in
terms of the country they are a citizen of and whether they
are an individual inventor, small entity, or other:
(3) the pendency time for applications for patents and such
other time and tracking data as may indicate the
effectiveness of the amendments made by this Act;
(4) the number of applicants for patents who also file for
a patent in a foreign country, the number of foreign
countries in which such filings occur and which publish data
from patent applications in English and make it available to
citizens of the United States through governmental or
commercial sources;
(5) a summary of the fees collected by the Patent and
Trademark Office for services related to patents and a
comparison of such fees with the fully allocated costs of
providing such services; and
(6) recommendations regarding--
(A) a revision of the organization of the Patent and
Trademark Office with respect to its patent functions, and
(B) improved operating procedures in carrying out such
functions,
and a cost analysis of the fees for such procedures and the
impact of the fees.
(b) Additional Study Matter.--The Committees on
Appropriations, Judiciary, and Small Business of the House of
Representatives and the Senate may, no later than 12 months
after the beginning of the study under subsection (a), direct
the Comptroller General to include other matters relating to
patents and the Patent and Trademark Office in the study
conducted under subsection (a).
(c) Report.--Upon the expiration of 36 months after the
beginning of the study under subsection (a), the Comptroller
General shall report the results of the study to the
Congress.
SEC. 8. PATENT TERMS.
(a) Amendment of Title.--Effective on the date of the
enactment of this Act, section 154 of title 35, United States
Code, as amended by the Uruguay Round Agreements Act, is
amended--
[[Page H1670]]
(1) in paragraph (2) of subsection (a), by striking ``and
ending'' and all that follows in that paragraph and inserting
``and ending--
``(A) 17 years from the date of the grant of the patent, or
``(B) 20 years from the date on which the application for
the patent was filed in the United States, except that if the
application contains a specific reference to an earlier filed
application or applications under section 120, 121, or 365(c)
of this title, 20 years from the date on which the earliest
such patent application was filed,
whichever is later.''.
(2) in subsection (c)(1), by striking ``shall be the
greater of the 20-year term as provided in subsection (a), or
17 years from grant'' and inserting ``shall be the term
provided in subsection (a)''.
(b) Technical Amendment.--Section 534(b) of the Uruguay
Round Agreements Act is amended by striking paragraph (3).
SEC. 9. DEFINITION OF SPECIAL CIRCUMSTANCES TO PROTECT THE
CONFIDENTIALITY STATUS OF APPLICATIONS.
Section 122 of title 35, United States Code, is amended by
striking ``as may be determined by the Commissioner'' and
inserting ``as in any of the following:
``(1) In the case of an application under section 111(a)
for a patent for an invention for which the applicant intends
to file or has filed an application for a patent in a foreign
country, the Commissioner may publish, at the discretion of
the Commissioner and by means determined suitable for the
purpose, no more than that data from such application under
section 111(a) which will be made or has been made public in
such foreign country. Such a publication shall be made only
after the date of the publication in such foreign country and
shall be made only if the data is not available, or cannot be
made readily available, in the English language through
commercial services.
``(2)(A) If the Commissioner determines that a patent
application which is filed after the date of the enactment of
this paragraph--
``(i) has been pending more than 5 years from the effective
filing date of the application,
``(ii) has not been previously published by the Patent and
Trademark Office,
``(iii) is not under any appellate review by the Board of
Patent Appeals and Interferences,
``(iv) is not under interference proceedings in accordance
with section 135(a),
``(v) is not under any secrecy order pursuant to section
181,
``(vi) is not being diligently pursued by the applicant in
accordance with this title, and
``(vii) is not in abandonment,
the Commissioner shall notify the applicant of such
determination.
``(B) An applicant which received notice of a determination
described in subparagraph (A) may, within 30 days of
receiving such notice, petition the Commissioner to review
the determination to verify that subclauses (i) through (vii)
are all applicable to the applicant's application. If the
applicant makes such a petition, the Commissioner shall not
publish the applicant's application before the Commissioner's
review of the petition is completed. If the applicant does
not submit a petition, the Commissioner may publish the
applicant's application no earlier than 90 days after giving
such a notice.
``(3) If after the date of the enactment of this paragraph
a continuing application has been filed more than 6 months
after the date of the initial filing of an application, the
Commissioner shall notify the applicant under such
application. The Commissioner shall establish a procedure for
an applicant which receives such a notice to demonstrate that
the purpose of the continuing application was for reasons
other than to achieve a delay in the time of publication of
the application. If the Commissioner agrees with such a
demonstration by the applicant, the Commissioner shall not
publish the applicant's application. If the Commissioner does
not agree with such a demonstration by the applicant or if
the applicant does not make an attempt at such a
demonstration within a reasonable period of time as
determined by the Commissioner, the Commissioner shall
publish the applicant's application.
The Commissioner shall ensure that publications under
paragraph (1), (2), or (3) will not result in third-party
pre-issuance oppositions which will delay or interfere with
the issuance of the patents whose applications' data will be
published.''.
SEC. 10. INVENTION DEVELOPMENT SERVICES.
(a) Invention Development Services.--Part I of title 35,
United States Code, is amended by adding after chapter 4 the
following new chapter:
``CHAPTER 5--INVENTION DEVELOPMENT SERVICES
``Sec.
``51. Definitions.
``52. Contracting requirements.
``53. Standard provisions for cover notice.
``54. Reports to customer required.
``55. Mandatory contract terms.
``56. Remedies.
``57. Records of complaints.
``58. Fraudulent representation by an invention developer.
``59. Rule of construction.
``Sec. 51. Definitions
``For purposes of this chapter--
``(1) the term `contract for invention development
services' means a contract by which an invention developer
undertakes invention development services for a customer;
``(2) the term `customer' means any person, firm,
partnership, corporation, or other entity who is solicited
by, seeks the services of, or enters into a contract with an
invention promoter for invention promotion services;
``(3) the term `invention promoter' means any person, firm,
partnership, corporation, or other entity who offers to
perform or performs for, or on behalf of, a customer any act
described under paragraph (4), but does not include--
``(A) any department or agency of the Federal Government or
of a State or local government;
``(B) any nonprofit, charitable, scientific, or educational
organization, qualified under applicable State law or
described under section 170(b)(1)(A) of the Internal Revenue
Code of 1986; or
``(C) any person duly registered with, and in good standing
before, the United States Patent and Trademark Office acting
within the scope of that person's registration to practice
before the Patent and Trademark Office; and
``(4) the term `invention development services' means, with
respect to an invention by a customer, any act involved in--
``(A) evaluating the invention to determine its
protectability as some form of intellectual property, other
than evaluation by a person licensed by a State to practice
law who is acting solely within the scope of that person's
professional license;
``(B) evaluating the invention to determine its commercial
potential by any person for purposes other than providing
venture capital; or
``(C) marketing, brokering, licensing, selling, or
promoting the invention or a product or service in which the
invention is incorporated or used, except that the display
only of an invention at a trade show or exhibit shall not be
considered to be invention development services.
``Sec. 52. Contracting requirements
``(a) In General.--(1) Every contract for invention
development services shall be in writing and shall be subject
to the provisions of this chapter. A copy of the signed
written contract shall be given to the customer at the time
the customer enters into the contract.
``(2) If a contract is entered into for the benefit of a
third party, such party shall be considered a customer for
purposes of this chapter.
``(b) Requirements of Invention Developer.--The invention
developer shall--
``(1) state in a written document, at the time a customer
enters into a contract for invention development services,
whether the usual business practice of the invention
developer is to--
``(A) seek more than 1 contract in connection with an
invention; or
``(B) seek to perform services in connection with an
invention in 1 or more phases, with the performance of each
phase covered in 1 or more subsequent contracts; and
``(2) supply to the customer a copy of the written document
together with a written summary of the usual business
practices of the invention developer, including--
``(A) the usual business terms of contracts; and
``(B) the approximate amount of the usual fees or other
consideration that may be required from the customer for each
of the services provided by the developer.
``(c) Right of Customer To Cancel Contract.--(1)
Notwithstanding any contractual provision to the contrary, a
customer shall have the right to terminate a contract for
invention development services by sending a written letter to
the invention developer stating the customer's intent to
cancel the contract. The letter of termination must be
deposited with the United States Postal Service on or before
5 business days after the date upon which the customer or the
invention developer executes the contract, whichever is
later.
``(2) Delivery of a promissory note, check, bill of
exchange, or negotiable instrument of any kind to the
invention developer or to a third party for the benefit of
the invention developer, without regard to the date or dates
appearing in such instrument, shall be deemed payment
received by the invention developer on the date received for
purposes of this section.
``Sec. 53. Standard provisions for cover notice
``(a) Contents.--Every contract for invention development
services shall have a conspicuous and legible cover sheet
attached with the following notice imprinted in boldface type
of not less than 12-point size:
`` `YOU HAVE THE RIGHT TO TERMINATE THIS CONTRACT. TO
TERMINATE THIS CONTRACT, YOU MUST SEND A WRITTEN LETTER TO
THE COMPANY STATING YOUR INTENT TO CANCEL THIS CONTRACT. THE
LETTER OF TERMINATION MUST BE DEPOSITED WITH THE UNITED
STATES POSTAL SERVICE ON OR BEFORE FIVE (5) BUSINESS DAYS
AFTER THE DATE ON WHICH YOU OR THE COMPANY EXECUTE THE
CONTRACT, WHICHEVER IS LATER.
`` `THE TOTAL NUMBER OF INVENTIONS EVALUATED BY THE
INVENTION DEVELOPER FOR COMMERCIAL POTENTIAL IN THE PAST FIVE
(5) YEARS IS __________. OF THAT NUMBER, __________ RECEIVED
POSITIVE EVALUATIONS AND __________ RECEIVED NEGATIVE
EVALUATIONS.
[[Page H1671]]
`` `IF YOU ASSIGN EVEN A PARTIAL INTEREST IN THE INVENTION
TO THE INVENTION DEVELOPER, THE INVENTION DEVELOPER MAY HAVE
THE RIGHT TO SELL OR DISPOSE OF THE INVENTION WITHOUT YOUR
CONSENT AND MAY NOT HAVE TO SHARE THE PROFITS WITH YOU.
`` `THE TOTAL NUMBER OF CUSTOMERS WHO HAVE CONTRACTED WITH
THE INVENTION DEVELOPER IN THE PAST FIVE (5) YEARS IS
__________. THE TOTAL NUMBER OF CUSTOMERS KNOWN BY THIS
INVENTION DEVELOPER TO HAVE RECEIVED, BY VIRTUE OF THIS
INVENTION DEVELOPER'S PERFORMANCE, AN AMOUNT OF MONEY IN
EXCESS OF THE AMOUNT PAID BY THE CUSTOMER TO THIS INVENTION
DEVELOPER IS ______________.
`` `THE OFFICERS OF THIS INVENTION DEVELOPER HAVE
COLLECTIVELY OR INDIVIDUALLY BEEN AFFILIATED IN THE LAST TEN
(10) YEARS WITH THE FOLLOWING INVENTION DEVELOPMENT
COMPANIES: (LIST THE NAMES AND ADDRESSES OF ALL PREVIOUS
INVENTION DEVELOPMENT COMPANIES WITH WHICH THE PRINCIPAL
OFFICERS HAVE BEEN AFFILIATED AS OWNERS, AGENTS, OR
EMPLOYEES). YOU ARE ENCOURAGED TO CHECK WITH THE UNITED
STATES PATENT AND TRADEMARK OFFICE, THE FEDERAL TRADE
COMMISSION, YOUR STATE ATTORNEY GENERAL'S OFFICE, AND THE
BETTER BUSINESS BUREAU FOR ANY COMPLAINTS FILED AGAINST ANY
OF THESE COMPANIES.
`` `YOU ARE ENCOURAGED TO CONSULT WITH AN ATTORNEY OF YOUR
OWN CHOOSING BEFORE SIGNING THIS CONTRACT. BY PROCEEDING
WITHOUT THE ADVICE OF AN ATTORNEY REGISTERED TO PRACTICE
BEFORE THE UNITED STATES PATENT AND TRADEMARK OFFICE, YOU
COULD LOSE ANY RIGHTS YOU MIGHT HAVE IN YOUR IDEA OR
INVENTION.'.
``(b) Other Requirements for Cover Notice.--The cover
notice shall contain the items required under subsection (a)
and the name, primary office address, and local office
address of the invention developer, and may contain no other
matter.
``(c) Disclosure of Certain Customers Not Required.--The
requirement in the notice set forth in subsection (a) to
include the `TOTAL NUMBER OF CUSTOMERS WHO HAVE CONTRACTED
WITH THE INVENTION DEVELOPER IN THE PAST FIVE (5) YEARS' need
not include information with respect to customers who have
purchased trade show services, research, advertising, or
other nonmarketing services from the invention developer, nor
with respect to customers who have defaulted in their
payments to the invention developer.
``Sec. 54. Reports to customer required
``With respect to every contract for invention development
services, the invention developer shall deliver to the
customer at the address specified in the contract, at least
once every 3 months throughout the term of the contract, a
written report that identifies the contract and includes--
``(1) a full, clear, and concise description of the
services performed to the date of the report and of the
services yet to be performed and names of all persons who it
is known will perform the services; and
``(2) the name and address of each person, firm,
corporation, or other entity to whom the subject matter of
the contract has been disclosed, the reason for each such
disclosure, the nature of the disclosure, and complete and
accurate summaries of all responses received as a result of
those disclosures.
``Sec. 55. Mandatory contract terms
``(a) Mandatory Terms.--Each contract for invention
development services shall include in boldface type of not
less than 12-point size--
``(1) the terms and conditions of payment and contract
termination rights required under section 52;
``(2) a statement that the customer may avoid entering into
the contract by not making a payment to the invention
developer;
``(3) a full, clear, and concise description of the
specific acts or services that the invention developer
undertakes to perform for the customer;
``(4) a statement as to whether the invention developer
undertakes to construct, sell, or distribute one or more
prototypes, models, or devices embodying the invention of the
customer;
``(5) the full name and principal place of business of the
invention developer and the name and principal place of
business of any parent, subsidiary, agent, independent
contractor, and any affiliated company or person who it is
known will perform any of the services or acts that the
invention developer undertakes to perform for the customer;
``(6) if any oral or written representation of estimated or
projected customer earnings is given by the invention
developer (or any agent, employee, officer, director,
partner, or independent contractor of such invention
developer), a statement of that estimation or projection and
a description of the data upon which such representation is
based;
``(7) the name and address of the custodian of all records
and correspondence relating to the contracted for invention
development services, and a statement that the invention
developer is required to maintain all records and
correspondence relating to performance of the invention
development services for such customer for a period of not
less than 2 years after expiration of the term of such
contract; and
``(8) a statement setting forth a time schedule for
performance of the invention development services, including
an estimated date in which such performance is expected to be
completed.
``(b) Invention Developer as Fiduciary.--To the extent that
the description of the specific acts or services affords
discretion to the invention developer with respect to what
specific acts or services shall be performed, the invention
developer shall be deemed a fiduciary.
``(c) Availability of Information.--Records and
correspondence described under subsection (a)(7) shall be
made available after 7 days written notice to the customer or
the representative of the customer to review and copy at a
reasonable cost on the invention developer's premises during
normal business hours.
``Sec. 56. Remedies
``(a) In General.--
``(1) Voidable contract.--Any contract for invention
development services that does not comply with the applicable
provisions of this chapter shall be voidable at the option of
the customer.
``(2) Reliance on false, fraudulent, or misleading
information.--Any contract for invention development services
entered into in reliance upon any material false, fraudulent,
or misleading information, representation, notice, or
advertisement of the invention developer (or any agent,
employee, officer, director, partner, or independent
contractor of such invention developer) shall be voidable at
the option of the customer.
``(3) Waiver.--Any waiver by the customer of any provision
of this chapter shall be deemed contrary to public policy and
shall be void and unenforceable.
``(4) Action by developer.--Any contract for invention
development services which provides for filing for and
obtaining utility, design, or plant patent protection shall
be voidable at the option of the customer unless the
invention developer offers to perform or performs such act
through a person duly registered to practice before, and in
good standing with, the Patent and Trademark Office.
``(b) Civil Action.--
``(1) In general.--Any customer who is injured by a
violation of this chapter by an invention developer or by any
material false or fraudulent statement or representation, or
any omission of material fact, by an invention developer (or
any agent, employee, director, officer, partner, or
independent contractor of such invention developer) or by
failure of an invention developer to make all the disclosures
required under this chapter, may recover in a civil action
against the invention developer (or the officers, directors,
or partners of such invention developer) in addition to
reasonable costs and attorneys' fees, the greater of--
``(A) $5,000; or
``(B) the amount of actual damages sustained by the
customer.
``(2) Damage increase.--Notwithstanding paragraph (1), the
court may increase damages to not more than 3 times the
amount awarded.
``(c) Rebuttable Presumption of Injury.--For purposes of
this section, substantial violation of any provision of this
chapter by an invention developer or execution by the
customer of a contract for invention development services in
reliance on any material false or fraudulent statements or
representations or omissions of material fact shall establish
a rebuttable presumption of injury.
``Sec. 57. Records of complaints
``(a) Release of Complaints.--The Director shall make all
complaints received by the United States Patent and Trademark
Office involving invention developers publicly available,
together with any response of the invention developers.
``(b) Request for Complaints.--The Director may request
complaints relating to invention development services from
any Federal or State agency and include such complaints in
the records maintained under subsection (a), together with
any response of the invention developers.
``Sec. 58. Fraudulent representation by an invention
developer
``Whoever, in providing invention development services,
knowingly provides any false or misleading statement,
representation, or omission of material fact to a customer or
fails to make all the disclosures required under this
chapter, shall be guilty of a misdemeanor and fined not more
than $10,000 for each offense.
``Sec. 59. Rule of construction
``Except as expressly provided in this chapter, no
provision of this chapter shall be construed to affect any
obligation, right, or remedy provided under any other Federal
or State law.''.
(b) Technical and Conforming Amendment.--The table of
chapters for part I of title 35, United States Code, is
amended by adding after the item relating to chapter 4 the
following:
``5. Invention Development Services...........................51''.....
SEC. 11. PROVISIONAL APPLICATIONS, PLANT BREEDER'S RIGHTS,
DIVISIONAL APPLICATIONS.
(a) Abandonment.--Section 111(b)(5) of title 35, United
States Code, is amended to read as follows:
``(5) Abandonment.--Notwithstanding the absence of a claim,
upon timely request and
[[Page H1672]]
as prescribed by the Director, a provisional application may
be treated as an application filed under subsection (a). If
no such request is made, the provisional application shall be
regarded as abandoned 12 months after the filing date of such
application and shall not be subject to revival
thereafter.''.
(b) Effective Date.--The amendment made by subsection (a)
applies to any provisional application filed on or after June
8, 1995.
(c) International Applications.--Section 119 of title 35,
United States Code, is amended--
(1) in subsection (a), by inserting ``or in a WTO member
country'' after ``the United States'' the first place it
appears; and
(2) by adding at the end the following new subsections:
``(f) Applications for Plant Breeder's Rights.--
Applications for plant breeder's rights filed in a WTO member
country (or in a UPOV Contracting Party) shall have the same
effect for the purpose of the right of priority under
subsections (a) through (c) of this section as applications
for patents, subject to the same conditions and requirements
of this section as apply to applications for patents.
``(g) Definitions.--As used in this section--
``(1) the term `WTO member country' has the same meaning as
the term is defined in section 104(b)(2) of this title; and
``(2) the term `UPOV Contracting Party' means a member of
the International Convention for the Protection of New
Varieties of Plants.''.
(d) Plant Patents.--
(1) Tuber propagated plants.--Section 161 of title 35,
United States Code, is amended by striking ``a tuber
propagated plant or''.
(2) Rights in plant patents.--The text of section 163 of
title 35, United States Code, is amended to read as follows:
``In the case of a plant patent, the grant shall include the
right to exclude others from asexually reproducing the plant,
and from using, offering for sale, or selling the plant so
reproduced, or any of its parts, throughout the United
States, or from importing the plant so reproduced, or any
parts thereof, into the United States.''.
(3) Effective date.--The amendment made by paragraph (1)
shall apply on the date of the enactment of this Act. The
amendment made by paragraph (2) shall apply to any plant
patent issued on or after the date of the enactment of this
Act.
(e) Electronic Filing.--Section 22 of title 35, United
States Code, is amended by striking ``printed or
typewritten'' and inserting ``printed, typewritten, or on an
electronic medium''.
(f) Divisional Applications.--Section 121 of title 35,
United States Code, is amended--
(1) in the first sentence by striking ``If'' and inserting
``(a) If''; and
(2) by adding at the end the following new subsections:
``(b) In a case in which restriction is required on the
ground that two or more independent and distinct inventions
are claimed in an application, the applicant shall be
entitled to submit an examination fee and request examination
for each independent and distinct invention in excess of one.
The examination fee shall be equal to the filing fee,
including excess claims fees, that would have applied had the
claims corresponding to the asserted independent and distinct
inventions been presented in a separate application for
patent. For each of the independent and distinct inventions
in excess of one for which the applicant pays an examination
fee within two months after the requirement for restriction,
the Director shall cause an examination to be made and a
notification of rejection or written notice of allowance
provided to the applicant within the time period specified in
section 154(b)(1)(B)(i) of this title for the original
application. Failure to meet this or any other time limit set
forth in section 154(b)(1)(B) of this title shall be treated
as an unusual administrative delay under section
154(b)(1)(A)(iv) of this title.
``(c) An applicant who requests reconsideration of a
requirement for restriction under this section and submits
examination fees pursuant to such requirement shall, if the
requirement is determined to be improper, be entitled to a
refund of any examination fees determined to have been paid
pursuant to the requirement.''.
SEC. 12. PROVISIONAL RIGHTS.
Section 154 of title 35, United States Code, is amended--
(1) in the section caption by inserting ``; provisional
rights'' after ``patent''; and
(2) by adding at the end the following new subsection:
``(d) Provisional Rights.--
``(1) In general.--In addition to other rights provided by
this section, a patent shall include the right to obtain a
reasonable royalty from any person who, during the period
beginning on the date of publication of the application for
such patent pursuant to the voluntary disclosure provisions
of section 122 or the publication provisions of section
122(1) or 122(2) of this title, or in the case of an
international application filed under the treaty defined in
section 351(a) of this title designating the United States
under Article 21(2)(a) of such treaty, the date of
publication of the application, and ending on the date the
patent is issued--
``(A)(i) makes, uses, offers for sale, or sells in the
United States the invention as claimed in the published
patent application or imports such an invention into the
United States; or
``(ii) if the invention as claimed in the published patent
application is a process, uses, offers for sale, or sells in
the United States or imports into the United States products
made by that process as claimed in the published patent
application; and
``(B) had actual notice of the published patent application
and, where the right arising under this paragraph is based
upon an international application designating the United
States that is published in a language other than English, a
translation of the international application into the English
language.
``(2) Right based on substantially identical inventions.--
The right under paragraph (1) to obtain a reasonable royalty
shall not be available under this subsection unless the
invention as claimed in the patent is substantially identical
to the invention as claimed in the published patent
application.
``(3) Time limitation on obtaining a reasonable royalty.--
The right under paragraph (1) to obtain a reasonable royalty
shall be available only in an action brought not later than 6
years after the patent is issued. The right under paragraph
(1) to obtain a reasonable royalty shall not be affected by
the duration of the period described in paragraph (1).
``(4) Requirements for international applications.--The
right under paragraph (1) to obtain a reasonable royalty
based upon the publication under the treaty defined in
section 351(a) of this title of an international application
designating the United States shall commence from the date
that the Patent and Trademark Office receives a copy of the
publication under such treaty of the international
application, or, if the publication under the treaty of the
international application is in a language other than
English, from the date that the Patent and Trademark Office
receives a translation of the international application in
the English language. The Director may require the applicant
to provide a copy of the international publication of the
international application and a translation thereof.''.
SEC. 13. EFFECTIVE DATE.
Except as otherwise provided, this Act and the amendments
made by this Act shall take effect 60 days after the date of
the enactment of this Act.
The CHAIRMAN. Under the previous unanimous consent agreement, the
gentleman from California [Mr. Rohrabacher] will be recognized for 1
hour, and a Member opposed will also be recognized for 1 hour.
Mr. COBLE. Mr. Chairman, I rise in opposition to the amendment.
The CHAIRMAN. The gentleman from North Carolina [Mr. Coble] will be
recognized for 1 hour.
Mr. ROHRABACHER. Mr. Chairman, I yield 30 minutes to the gentlewoman
from Ohio [Ms. Kaptur], and I ask unanimous consent that she be allowed
to control the time.
The CHAIRMAN. Is there objection to the request of the gentleman from
California?
There was no objection.
The CHAIRMAN. The gentlewoman from Ohio [Ms. Kaptur] will be
recognized for 30 minutes.
Mr. COBLE. Mr. Chairman, I yield 30 minutes to the gentlewoman from
California [Ms. Lofgren], and I ask unanimous consent that she be
allowed to control the time.
The CHAIRMAN. Is there objection to the request of the gentleman from
North Carolina?
There was no objection.
The CHAIRMAN. The gentlewoman from California [Ms. Lofgren] will be
recognized for 30 minutes.
The Chair recognizes the gentleman from California [Mr. Rohrabacher].
Mr. ROHRABACHER. Mr. Chairman, I yield myself 5 minutes.
Mr. Chairman, what the House is now considering is the Rohrabacher
substitute. The Rohrabacher substitute has taken on many shapes and
designs over these last few weeks, because we have tried our best to
incorporate the very best aspects of H.R. 400 into our substitute. All
of the good reforms that have been worked out by the gentleman from
North Carolina [Mr. Coble] and others on the committee have been
incorporated into my substitute.
In fact, where we keep the fees of the Patent Office right there at
the Patent Office so that people can make that Office more effective,
we have done that. And we have made sure that all the hard work of this
committee has not gone for naught.
In fact, I would like to compliment Mr. Coble and I would like to say
at this time that I have nothing but respect for the opposition here.
Mr. Coble and the gentleman from Virginia [Mr. Goodlatte] and the
gentleman from Illinois [Mr. Hyde] and others who, right now, we have
such a heated debate going on, we have a great deal of mutual respect
for one another. I have no doubt that their motives are good. It is
just that we have
[[Page H1673]]
a really fundamental disagreement on this piece of legislation, and we
will likely be the best of allies 1 week from now on another piece of
legislation.
So with that said, let me go into the fundamentals of how we differ
on this. It comes down to three or four basic points. Unfortunately,
those basic points are right at the heart of what America's patent
system is all about.
What has differentiated us from other patent systems of the world,
why we have had some economic progress here, why has our military been
secure and actually one step ahead of our adversaries when we went into
conflicts? Because we have a strong patent system that nurtured the
creative genius of our people.
The two elements of that patent system that differentiated us from
the Japanese and from the Europeans was a guaranteed 17-year patent
term, which means no matter how long it takes you to get your patent
issued, you are going to have that 17 years of a guaranteed protection
time to earn that money back and to make a profit from it. That is why
we have so many people willing to invest here in the United States in
the creation of new technology. Otherwise, the Government would have to
do it because there would be no guaranteed time that we could have a
return on our investment.
The second end of it, the second part of our system was that when
someone applied for a patent, it was absolutely confidential, the right
of confidentiality until that patent was issued. What that did is it
prevented the big guys from stealing from the little guys.
In Japan, where they have the system that I am afraid H.R. 400 is
trying to impose on us, that system has worked to create a class of
economic shoguns that beat down the average person, that over in Japan,
where it may be a democracy but it is not a free country like ours in
the sense that people have a right to challenge the economic elite, the
economic elite in those countries can beat down any inventor who wants
to create something.
In Japan that system permits, where you have, after 18 months, you
have publication, the reason why the economic powers that be have
sufficient leverage, they come immediately into the process when they
find out that someone is developing a new technology, something that
will create new wealth, and they have what they call patent flooding.
They will form a circle around the little inventor and the little guy,
the small businessman, and beat him down until he has agreed to give up
all of his rights.
That is what will happen right here if we change our law. They can
come right over to our system and do exactly the same thing. What makes
us think they will not do that? That is what has happened there.
In fact, that is one of probably the worst flaws of H.R. 400, because
now we are publishing. What are the consequences of that publishing?
Very wealthy and powerful interests will get involved in the process
where they have not done it before to try to thwart the issuance of
that person's patent until he would agree to give up certain rights.
This is not the formula for a strong America. This is an escalator
clause for America going downhill. Twenty years from now Americans will
not know what hit them. It is Pearl Harbor in slow motion.
I will say, I have a copy and I have held it up several times. The
reason why we are pushing on this, and you have heard it in the debate,
we have to be like those other countries, we should not be like other
countries, but yet we signed an agreement, a subterranean agreement 5
years ago to harmonize our law with Japan. Now they are seeking to try
to push it through the system like when they tried to sneak that change
through in the GATT implementation legislation.
We are going to thwart this power grab. We are going to thwart it,
and we are going to make sure in doing so we protect America's future.
If we lose our technological edge, if the individual inventor loses his
rights and becomes vulnerable to these outside influences, if our
patent examiners become vulnerable to all sorts of interferences and
outside influences, America will cease to be a great country in decades
ahead, and they will never know what hit them. It will be Pearl Harbor
in slow motion, and we are going to stop that.
Ms. KAPTUR. Mr. Chairman, I yield myself such time as I may consume.
(Ms. KAPTUR asked and was given permission to revise and extend her
remarks.)
Ms. KAPTUR. Mr. Chairman, the base bill that this substitute would
replace essentially, as Mr. Rohrabacher, who has led such a good fight
on this and so many Members who have supported him, calls for a massive
change in the way that we protect the secrecy of those who file patents
in our country.
Now, to me, to move from a system that basically says when you file a
patent your ideas can be protected for up to 17 years, up to the point
that that patent is granted, and if the review office takes longer than
2 years, if it takes 4 years or 5 years for whatever reason, that your
ideas are protected, why would we want to take away the property rights
of our inventors by saying after 18 months, and where did the 18-month
magic come from anyway, that after that point their ideas could be made
available to whomever might want them?
To go from 17 years to 18 months to me is a massive change in the way
the current system functions. I have never had an inventor in my
district come up to me and ask for this change, so I wonder who it is
that is proposing the change that is in the base bill.
I want to compliment Mr. Rohrabacher for helping to expose this issue
in detail so that we can better protect our inventors' technologies in
this country.
From the inventors I have talked to, they have some pretty big
problems, once they involve themselves in this whole idea of patenting
their inventions. Number one is the cost. The fact that a really small
person does have to put a lot forward in the first place just to patent
their idea.
If you are a big company, that does not affect you as much. You have
great wholeness in the system. You have the ability to float. But for
the small people that are out there in their garages and their
basements where wonderful ideas have come from, it is much more
difficult for them to do that even in the existing system.
Once they do, one of the challenges they have as an inventor is that
big companies, if they try to commercialize the technology, often try
to buy their idea out before it is even applied in the manufacturing
sector, because an inventor does not control the manufacturing process.
They are not into the commercialization side. Under the current system,
it is even difficult for many of these inventors to get someone to buy
their idea.
Also we have a situation under the current system where inventors
find that their ideas are counterfeited. In fact, we have had dumping
of computer terminals that have come over from China and other places.
I wish the committee would have given a little more attention to the
real problems that inventors are having out there, trying to work in
this current system. But they have never complained to me about the
protections they receive in this country for their property rights.
They have never complained about the time period.
They are complaining to me now. The Ohio State Bar Association is
very aware of what this bill does and has made its views known to us.
And many, many other inventors throughout the State of Ohio.
But I say to myself, what could have propelled this committee into
proposing this kind of change? I looked down the list of multinational
corporations that want this particular right. They already function on
the international front. They are the very same firms that try to buy
out these small inventors and do not permit them to commercialize their
technology, if they do not have deep pockets. They are the very same
interests that are able to float in their little boats in international
waters when the average inventor is not. They are the very ones that
have no problems with existing fees. And it just seems to me that they
got the red carpet rolled out for them when they went before the
respective institutions of this House.
On the other hand, the small inventors of my community have not been
afforded the opportunity to come before the committee. The small
inventors of my community have not been allowed to come before the
Committee on Small Business.
[[Page H1674]]
I heard one of the Members, the gentleman from Maryland [Mr.
Bartlett], say that the hearings would be held next week. My friends,
the horse is already out of the barn. Next week? This bill is being
heard today. So it seems to me that we have a responsibility to
represent the majority of inventors in this country, most of whom do
not have deep pockets.
Our job is not just to represent the multinationals who have lots of
good ideas and they have a great ability to float their boats, but they
are not the only ones out there in the ocean.
I would certainly say to those who would want to bend over backwards
to other countries who do not give us market access, we have a $50 to
$60 billion trade deficit with Japan, a $40 billion trade deficit with
China, and it is growing. The situation we have with Mexico is
abominable post-NAFTA. A lot of these other countries are going to be
advantaged through this agreement. Why?
{time} 1615
Why are we doing this to our inventors when in fact our country has
10 times more intellectual property breakthrough technologies than any
other country in the world? We protect these property rights. It is
inherent in the Constitution of this Nation. Why would we want to do
this to the people of our Nation?
Now, let us take a look at the burden of proof and the fact that
people say here, well, they can sue. If people do not like this new
bill, H.R. 400, and they fail to vote for the Rohrabacher substitute,
well, gosh, we will give them a chance to go to court.
A lot of these inventors out there do not have the money. They worry
about paying their maintenance fees under the existing system, under
the existing system. So why force them into cases where the burden is
on them to prove that what they are doing in OK? Under the current
system, it is.
Why place that burden on them? Why force them to go into these
reexamination procedures? Why would we want to do that to our own
people?
Frankly, for a lot of these nations or companies that function
offshore, my own view is unless they give us market access, why give
them anything? Why give them any advantage into this Nation's most
precious seed corn, which is our patented inventors' property rights?
The whole idea of corporatizing the patent office, it is interesting
that the people who work over there do not want this to happen. They
are civil servants. They objectively can review, regardless of what
type of inventor comes in there with an invention.
None of us really understand the gentleman's proposal of what this
guasi-government corporation or new entity, this PTO, what that is
going to be. We have not had a chance to fully digest what that means
down the road. How objective will these examiners be allowed to be?
What will the CEO of that corporation, what rights will that individual
have over those individual decisions? How objective and judiciallike
will those decisions be able to be?
It seems to me there are a lot of issues in H.R. 400 that no Member
here, including the people on the committee, can fully appreciate. Why
do we not have an opportunity to clean this bill up? Let us adopt the
Rohrabacher substitute, let us keep the system clean, the way it is,
and then work through some of the issues that are of deep concern to
Members here who want to represent not just those with deep pockets,
but small inventors around our country who are really creating the
future of us.
It was mentioned earlier there are some people concerned about jobs
in our country and our trade policy who have engaged in this debate.
Certainly we have, because we understand what it is like to negotiate
against a country that uses every kind of barrier to disallow our
product into their market.
But the inventions, the ideas, the intellectual property is the heart
of our system. To allow them into the door when we have all sorts of
other problems out there and we do not fully appreciate the long-term
consequences of what is being proposed here, is a very dangerous
position in which to place our country for the next century.
There is no question that patents are the primary source of job
creation in this country. It goes to the heart of how we develop as an
economy. When I see people like Nobel Laureates opposing the changes in
H.R. 400, and I see the gentleman from California [Mr. Rohrabacher] and
our own minority leader, the gentleman from Missouri [Mr. Gephardt],
and the gentleman from Maryland [Mr. Hoyer], and others in this body,
the gentleman from California [Mr. Hunter], people on both sides of the
aisle who have respect for members of the committee, but feel that we
have not had our concerns solved, we have no choice but to
wholeheartedly support the Rohrabacher substitute.
So I want to urge the membership, please, that if they have not read
the bill, if they have not followed this debate, to support the
Rohrabacher substitute. Do not fix a system that is not broken. Let us
work hard, as this Congress progresses, in order to fix the current
system if there are problems, but do not completely turn it upside down
and take away the property rights of our inventors, especially the
small inventors whose canoes are very small to row in the oceans of the
international marketplace.
Mr. Chairman, I reserve the balance of my time.
Mr. COBLE. Mr. Chairman, I yield 7 minutes to the gentleman from
Utah, [Mr. Cannon].
(Mr. CANNON asked and was given permission to revise and extend his
remarks.)
Mr. CANNON. Mr. Chairman, I take the podium at the far right, the
farthest right we can go here in the room as a Republican and a
conservative.
And may I be the first Republican to welcome my colleague, the
gentlewoman from California, [Ms. Lofgren], and at her suggestion, also
our colleague from Massachusetts, [Mr. Frank], into the conservative
wing of the party of the House.
Ms. LOFGREN. Mr. Chairman, will the gentleman yield?
Mr. CANNON. I yield to the gentlewoman from California.
Ms. LOFGREN. Mr. Chairman, I want to thank the gentleman for the
compliment, and acknowledge that it was certainly made in jest. I had
to do that for my district, to clarify that.
Mr. CANNON. Mr. Chairman, reclaiming my time, I say to the
gentlewoman she is always welcome over here.
I do want to speak to those conservatives in the House, Mr. Chairman,
about why I support H.R. 400. Before I do so, I want to establish my
credentials on this issue.
I am a businessman and have invested in numerous companies, some
large, mostly small. I have also funded several high-tech new ventures
and my district is a high-tech center. We have biomedical companies,
software companies, computer hardware companies and a host of
innovative start-ups, start-ups based on innovative ideas, some of
which have been patented, some which have not. Many of them have been
commercial successes and many of those people who have been successful
have, in fact, helped out in the commercialization of other
technologies. But I do not know, in my district at least, of a
distinction between commercializers and inventors.
The heart of my district, Utah County, has been compared to Silicon
Valley, with Route 128 in Boston, with North Carolina's Research
Triangle. The small town of Provo always shows up on these maps of
where the technological centers in America are.
I am also a member of the Subcommittee on Courts and Intellectual
Property. As many know, in the last Congress there was vigorous debate
on patent reform, and as a new member, my staff and I took time
carefully to review the arguments. After that review, I chose to
cosponsor H.R. 400, and I want to detail why.
First, we conservatives support the use of a reasoned, thoughtful
process of public policy. The development of H.R. 400 easily passes
that test. Over the past couple of years the provisions of H.R. 400
have been subject to 8 full hearings over 10 days, involving 80
witnesses. The gentleman from California, [Mr. Rohrabacher], has
testified four times. Every side of every view has had the chance to be
heard, not once but many times on this issue.
Second, conservatives, in particular Republican conservatives, hate
bureaucracy. H.R. 400 takes the Patent Office out of the Commerce
Department and gives it the flexibility to
[[Page H1675]]
serve those seeking patent and trademark protection.
Third, conservatives support property rights. H.R. 400 expands the
scope of protection afforded patent seekers. H.R. 400 guarantees
diligent patent owners at least, let me emphasize at least, 17 years of
patent term. But that is not all. In many cases, under H.R. 400, patent
owners will receive even more than 17 years of patent term, in many
cases about 18\1/2\ years of patent protection. This is both more
protection than is available currently and more than available under
Mr. Rohrabacher's alternative.
Fourth, conservatives oppose giving individuals, corporations or
foreign interests the ability to play games with our legal system. We
believe in a system of laws. H.R. 400 is the only bill that drives a
stake in the heart of submarine patents, an expensive, manipulative
patent-seeking technique. While there is some debate over the number of
submarine patents, the evidence is clear that submarine patents hurt
both American industry and consumers. Submarine patents deserve to be
permanently sunk, and H.R. 400 does the job.
Fifth, conservatives want U.S. companies to have a level playing
field with their foreign competitors. That brings me to one of the most
controversial provisions of the bill, the concept of publication.
Frankly, this is a provision that is little understood and is easily
misunderstood.
Let me provide some context by talking about what happens today to
U.S. inventors who seek patent protection around the world.
The three primary places most inventors seek protection are Japan,
the United States and Europe. A U.S. inventor who files in all three
areas is published in 18 months in Japan and in Europe in a variety of
European languages and in Japanese. Of course, that makes it easy for
U.S. inventors' foreign competitors to read the American inventors'
patent application in their own language and in their own country.
The U.S. inventor lacks the same advantage. Because the United States
does not publish patent applications, an American inventor must go to
Japan or Europe to find out about the activities of his or her foreign
competitors. This hurts small American businesses which cannot afford
travel or translation. Publication in the United States simply helps
our own people keep an eye on their oversees competitors.
Some have argued that publication is great for big U.S. companies,
but it might hurt small U.S. inventors. That brings me to my sixth
point. Conservatives should argue about real issues. The fact is, the
current version of H.R. 400, based upon concerns previously raised by
small inventors, effectively exempts small inventors from publication.
My last point is that conservatives should respect fellow
conservatives. The driving forces behind this bill are conservatives,
particularly the gentleman from North Carolina, [Mr. Coble], and the
gentleman from Illinois, [Mr. Hyde]. These are men of great integrity,
great thoughtfulness and great judgment and should be accorded due
deference.
Mr. Chairman, I encourage Members to pause before they vote today. I
know patent law seems like a black art, but our decisions today are
important. As a conservative, my considered opinion is that H.R. 400 is
a balanced, rational package that strengthens our patent system,
encourages high-tech innovation, and protects U.S. economic interests,
including my favorite sector, the small business sector.
Ms. LOFGREN. Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, a number of the speakers, and especially the last
speaker, have addressed important issues for Members examining this
whole issue. But I do want to address the matter that has been raised
by a number of speakers, and that is the position of employees of the
Patent Office regarding the bill, H.R. 400, as well as the Rohrabacher
substitute.
I have here in my hand, and I include for the Record, dated April 16,
a letter from the National Treasury Employees Union.
The National Treasury
Employees Union,
Washington, DC, April 16, 1997.
Hon. Zoe Lofgren,
U.S. House of Representatives,
Washington, DC.
Dear Representative Lofgren: As the full House of
Representatives prepares to consider important intellectual
property reform legislation later this week, I am writing to
bring your attention to an issue of great importance to
members of the National Treasury Employees Union.
H.R. 400, the ``21st Century Patent System Improvement
Act'' is scheduled for floor consideration on April 17, 1997.
It has come to my attention that Rep. Dana Rohrabacher (R-CA)
is expected to offer H.R. 811 and H.R. 812--two patent bills
introduced earlier this year--as a substitute to this
legislation.
While H.R. 811 deals primarily with patent term and
publication issues, H.R. 812 includes a number of provisions
that would exclusively benefit the PTO's patent examiners.
NTEU supports improving the training and benefits of all of
the PTO's employees, and we therefore believe that it would
be grossly unfair for such benefits to accrue only to patent
examiners and not to their counterparts in the Trademark
Office.
For this reason, I urge you to oppose the Rohrabacher
substitute if it includes these provisions when intellectual
property reform is considered by the full House.
H.R. 400 includes several important elements of H.R. 811
and H.R. 812, including a provision allowing for the above
referenced training and benefits for patent examiners and
trademark examiners. Although NTEU has remaining concerns
about the labor-relations provisions in H.R. 400, and would
prefer to see the labor-relations language approved last year
by the House Judiciary Committee adopted as this issue goes
forward, this bill is a better alternative to the proposed
Rohrabacher substitute.
Sincerely,
Robert M. Tobias,
National President.
Mr. Chairman, I will not read it all, but I will say, and this is a
quote, ``I urge you to oppose the Rohrabacher substitute.''
And the final paragraph says, and this is again from Mr. Robert
Tobias, the national president of the National Treasury Employees
Union, ``H.R. 400 includes several important elements. Although NTEU
does have remaining concerns about the labor relations provisions in
H.R. 400, and would prefer to see the labor relations language approved
last year by the House Committee on the Judiciary adopted as this issue
goes forward, this bill is a better alternative to the proposed
Rohrabacher substitute.''
I think it is important to note, and perhaps the Chairman and ranking
member can address the issue raised as to the remaining labor-
management relations issue that the Treasury Employees Union wants
addressed, and I, for one, would pledge to work with them on that
issue, but it is important to note that even without that issue being
resolved, the Treasury Union employees prefer H.R. 400 and they oppose
the Rohrabacher substitute. I think that is an important issue for
Members to know.
Second, I have heard a lot of discussion in this Chamber today, and
people discussing it at large, about a variety of issues that have
absolutely nothing to do with the issues before us. We have heard about
GATT, we have heard about NAFTA, we have heard about the Red Chinese
Army, we have heard about multinational businesses. That is not what
this bill is about. It has nothing to do with the patent bill.
What this bill is about is not deferring foreign countries or
conforming our law to theirs. What H.R. 400 is about is to advantage
Americans who are presently being disadvantaged by our patent law.
I have heard people say, well, why would we want to dumb down our
patent law? Why would we expect the rest of the world to change, to
conform with us? My response is because they are taking advantage of us
right now.
{time} 1630
Why should they change when they are taking advantage of us? Why
should we expect them to willingly give up the advantage that they
currently have? It is up to this Congress to stand up for America by
rejecting the Rohrabacher substitute and supporting H.R. 400.
Finally, I would like to thank the gentleman from Utah [Mr. Cannon]
for his eloquent comments about why a conservative would support H.R.
400 and oppose the Rohrabacher amendment. I think it is also important
to note that the high-techology sector has accounted for 40 percent of
the growth in the gross domestic product in the last several years.
These companies are not all multinational corporations. Some of them
[[Page H1676]]
are. I am not opposed to that. In fact, I think Intel Corp. is a great
citizen. They just made a decision to give stock options to every
single employee in their company down to the janitor. They do a great
business. They have many patents, they are innovative, they are
successful, and they support H.R. 400. I am proud that they do.
But I would like to point out that the Biotechnology Industry
Organization also supports H.R. 400, and also opposes the Rohrabacher
substitute, and 95 percent of the membership of the Biotechnology
Industry Organization is made up of companies with 500 employees or
less.
Mr. Chairman, I reserve the balance of my time.
Mr. ROHRABACHER. Mr. Chairman, I yield 5 minutes to the gentleman
from the Silicon Valley area of California [Mr. Campbell].
(Mr. CAMPBELL asked and was given permission to revise and extend his
remarks.)
Mr. CAMPBELL. Mr. Chairman, what is a compelling need to change the
patent system of the United States that has served us so well? The case
has not been made on the floor today.
I have one additional reason to suggest that H.R. 400 actually does
more harm than has previously been brought forward in this debate, but
before I do that I do wish to identify and draw some very clear focus
on the fact that the only argument that has been made for the need to
change is the submarine patent. That issue is taken off the table once
we realize that the Rohrabacher bill also deals with the submarine
patent. I believe that issue is no longer in debate. For those who are
in doubt, those Members perhaps who are watching the debate, do check
the Congressional Research Service, page 12 and 13, the quotation that
I gave before. Both bills seek to curtail submarine patenting and would
likely end the practice.
So what is the compelling need? Does it make sense that there is some
benefit to be gained by those large firms who wish to have earlier and
more ready access to information that would otherwise be patented? Yes,
it is in their interest. But insofar as it enhances their interest, it
takes from the inventor. The inventor cannot be substituted for. There
can be commercializers, there can be developers. Japan of course is the
key commercializer probably in the world of somebody else's ideas. But
America is unique as being the key inventor. So in the absence of a
compelling need, I would think the logic would be, let us let it be,
let us not change this system that has worked so well.
But let me now draw attention to the one additional problem that I
believe H.R. 400 introduces that is of great seriousness. Do my
colleagues realize that under H.R. 400, but not under the Rohrabacher
substitute, anybody who was using the subject matter that eventually
gets patented, who is using that subject matter commercially, before
the grant of the patent, is exempted. That such a person can continue
commercialization of that idea without ever having to pay a royalty to
the person who invented and filed, followed the rules, in other words,
of our patent system? And this is not in the existing law.
So what H.R. 400 does is to say, ``Inventor, today you know that you
have the right to your invention and if anybody else has been using it,
they have got to pay you royalties.'' That is a whale of an incentive
to go through the sweat and the hard work to invent. But after H.R.
400, if it becomes law, that right is substantially cut back. Any prior
commercial user can continue that use, and not just in the scope of
maybe a ma and pa who might have had one or two units made.
Let me read from the bill itself, from title 3:
The defense, the prior commercial user defense, shall also
extend to variations in the quantity or volume of use of the
claimed subject matter.
This is remarkable. We have spent a lot of time on the floor this
afternoon speaking about the requirement of early disclosure, but look
what this does. Any prior commercial user can expand the use and
utterly undermine the commercial value of the invention that was filed
and that was patented. The harm is not even done there. Because if it
is in the financial interest of this firm, this commercializer that has
used the idea before the inventor patented it, if that commercializer
wishes to sell it, well, so long as it is part of the sale of a general
company, he or she may do so.
And I quote from the bill:
The defense under this section may only be asserted by the
person who performed the acts necessary to establish the
defense . . . except in connection with the good faith
assignment or transfer of the entire enterprise or line of
business to which the defense relates.
So here is the situation. Today a person who does the hard work to
get an idea has the protection of 17 years from the grant of that
patent. After H.R. 400 it will not be 17 years from the grant of the
patent. It will be something that could very well be less because it is
20 years from the date you applied. And if the Patent Office takes 3
years or longer, that is your risk, the time of your protection is
less.
No. 2, today you are allowed to keep your idea as you are going
toward a patent. After H.R. 400, you cannot, you have to disclose it,
after 18 months.
No. 3, today if you are the first person to go into the patent system
and to get your patent, no prior user can take that away from you.
Under H.R. 400, it can be.
Ms. LOFGREN. Mr. Chairman, I yield myself such time as I may consume,
just to simply say I do not want to address every single issue raised
by the gentleman from California [Mr. Campbell] because Members are
getting restive. I just would point out that in H.R. 400, if the patent
issuance is delayed through no fault of the applicant, the term is
extended and added on to remainder of the 20-year term.
Mr. CAMPBELL. Mr. Chairman, will the gentlewoman yield?
Ms. LOFGREN. I yield to the gentleman from California.
Mr. CAMPBELL. I understand that, but the burden is to show by the
patent applicant that the fault was the Patent Office's. If that burden
has not been met, if things just chug along in their dear sweet time
and it takes longer than 3 years, it is the patent applicant who
suffers.
Ms. LOFGREN. Mr. Chairman, reclaiming my time, if the applicant does
not take action to delay it, the term is extended and added on to the
20-year term.
Mr. CAMPBELL. And if the gentlewoman will continue to yield, but the
burden of proving that is upon the applicant. So in order to get the
benefit of the tacked-on time, I have to show that it was not my fault.
Ms. LOFGREN. You have to show that you did not continually amend your
application.
Mr. CAMPBELL. Then our understanding is the same.
Ms. LOFGREN. Reclaiming my time, not an enormous burden, I might add.
Mr. Chairman, I reserve the balance of my time.
Parliamentary Inquiry
Mr. COBLE. Mr. Chairman, I have a parliamentary inquiry.
The CHAIRMAN. The gentleman will state it.
Mr. COBLE. Mr. Chairman, am I correct in concluding that we have the
right to close?
The CHAIRMAN. The gentleman from North Carolina is correct.
Mr. COBLE. Mr. Chairman, I yield myself such time as I may consume.
We have heard a lot of talk this afternoon about secrecy, how
important secrecy is. Mr. Chairman, if I may paraphrase the
Constitution, what the Constitution conveyed to all of us Americans and
patent applicants in particular is this: You get a limited monopoly
with protection in exchange for society being able to see your secret.
Illumination, light on the subject. I am told, Mr. Chairman, that
mushrooms thrive in dark cellars. Submariners thrive in high weeds and
below the water.
We have been told today, the gentleman from Illinois [Mr. Hyde]
mentioned as have others, and the answer was, oh, this is not about
submarine patenting. Mr. Chairman, to say that is not unlike saying
that war is not about killing. I was born in the morning, but not
yesterday morning. You all sell that submarine story to somebody else.
Let me review that with my colleagues.
Under the Rohrabacher substitute, applications filed in the United
States only may not be published sooner than 5 years after they are
filed, and then
[[Page H1677]]
not if the application is under appellate review. One of the many ways
a submariner delays its own application is to file spurious appeals.
In addition, and most importantly, under the Rohrabacher substitute,
the director of the Patent and Trademark Office must find that the
application is not being diligently pursued by an applicant before
publication can occur.
As my colleagues can imagine, it is virtually impossible to identify
maneuvers by patent lawyers to delay the processing of their
applications. This is a sham provision that is impossible to enforce.
Can you imagine telling a judge that he or she can only allow the
public to see court documents relating to a case when a finding was
made as to whether the merits were diligently pursued?
All judges, including patent judges, must give the benefit of the
doubt to the filers that they are proceeding in good faith and they are
pursuing their claims legitimately or our whole system would collapse.
The Rohrabacher substitute demands a presumption of guilt in order to
require publishing. This presumption probably could never be
established. The Rohrabacher substitute further provides for
publication of any amendment to an application, called a continuing
application, which is filed more than 6 months after the application it
amends, unless the applicant can demonstrate that the amendment was
filed for any reason other than to achieve a delay in the time of
publication.
What does this mean? Any lawyer wanting to delay can claim that the
amendment is necessary to reflect the full richness of further
developments of the invention in the application. While this may be
totally spurious, it would be virtually impossible to prove. This is
the way it works in real patent law practice.
Here is another way to gain the system under the Rohrabacher
substitute: An applicant can file appeals to the Board of Patent
Appeals, which, while unlikely to succeed, are not so frivolous as to
draw sanctions. There are many ways to delay which simply cannot be
uncovered.
Submarine patenting, my colleague, is serious. And the Rohrabacher
substitute, in my opinion, goes out of its way to create smoking
mirrors around this burgeoning business of litigation.
The real question is: Why does the Rohrabacher substitute go out of
its way to protect submariners? I want someone to answer that question
for me before the end of this session.
The claim of the gentleman from California [Mr. Rohrabacher] that his
bill puts a stop to the practice of submarining in the real world is
false. Just ask one of the lawyers mentioned on the front page of the
Wall Street Journal last week who are joining the new, currently legal,
cottage industry of suing those who invest in our economy.
I ask my colleagues to vote no on the Rohrabacher substitute and to
support the bipartisan Judiciary Committee bill, H.R. 400.
I reserve the balance of my time, Mr. Chairman.
Mr. ROHRABACHER. Mr. Chairman, I yield myself 5 minutes.
We knew we would hear a lot of talk about submarine patenting because
there has to be some excuse that people would use in order to justify
gutting the American patent system that has been in place for 225
years, there has to be some excuse for these fundamental changes.
What we got is what is called in debate school as the scarecrow
argument. We just create a scarecrow there and we fill it full of hay
and we claim that that is a real big threat.
Submarine patents, there is some problem. It is a minor problem I
believe. The opposition claims it is a major problem.
In fact, however, my colleagues have not used one example of any
submarine patent since the late 1970's. And I might add, in the 1970's,
there was a system established in the Patent Office called the palm
system; and it was established specifically to prevent people from
delaying their patent intentionally, in other words, to deal with the
submarine patent system issue.
Since that time there has not been any example, and that has been
instituted already, there has not been one example of any submarine
patent since the palm system was instituted in the Patent Office.
{time} 1645
Now we are being told submarine patents are so bad that we have to
destroy the current patent system, we have got to corporatize our
patent office, taking patent examiners that are basically insulated
from outside influences, and we got to corporatize that office, and who
knows what type of outside influences are going to be brought to bear
in this new system? We do not know. All we have got is the word of our
friends. It does not say in our bill that they are going to be able to
be any outside influences. Well, thanks. There are a lot of unintended
consequences when one makes such radical changes as this. But, of
course, the radical change is really necessary. It is the only way to
deal with a submarine patent issue.
Well that is just not the case, my colleagues. The only way to deal
with a hangnail is not to amputate the leg. The way to deal with
magazines, obscene magazines, is not to destroy freedom of speech or
freedom to publish and freedom of the press for everybody in the
country. There are ways we deal with it legally that can bring the law
to bear. My bill did that, and for 2 years I have been begging all of
my colleagues and begging every organization that came to see me about
patent law, give me the language of how we can stop submarine patenting
and I will put it in my bill as long as it does not destroy the
guaranteed patent term. And do my colleagues know what? We put the very
strongest language we could.
Now we can read portions of anything and try to make it sound like it
does not cover it, but the fact is we put in the strongest language we
could. I in fact had the No. 1, one of the No. 1, legal minds in the
House of Representatives, the gentleman from California [Tom Campbell]
who represents Silicon Valley, to consult with me and say, come up with
the language that we can once and for all end submarine patenting but
does not destroy the guaranteed patent term. We put that into my
substitute, and guess what? It is not a sham. It may be a sham to the
opposition who wants to destroy the patent system as we know it today,
but it is not a sham to people who have an independent look at what we
put in the substitute, the people independently who have no axe to
grind who looked at my bill said that my bill and their bill would
effectively end submarine patenting, say that Congressional Research
Service has basically decided that that day they did their very best
job to analyze it. They do not have an axe to grind. We are going to
end submarine patenting.
Oh, no. Now we cannot accept that. That is just a sham. It is a sham
when somebody who is independent makes that analysis. Why is that a
sham? Because that is the only excuse people have for the radical
changes that they are proposing for the Patent Office. They are
proposing that we make fundamental changes in the technological legal
system that protected technological development in the United States of
America. In the past that system provided the United States of America
with the highest standard of living, with a technological edge that
kept us prosperous, kept us free, kept us secure, and of course these
multinational corporations which they have lists of many, and many of
them have been active out in hither and yon, trying to support
proposition--H.R. 400 I should say--that these corporations do have an
axe to grind as well. They are going to make a big profit if they can
get all the secrets from the little guy after 18 months.
My job was to try to put together a bill that ended submarine
patenting because I knew it would come up as an issue. We did our very
best. Tom Campbell and I did our very, very best. The Congressional
Research Service said we succeeded. So that issue should be out of the
way. So what excuse do my colleagues have of having this radical
reform? What excuse do my colleagues have?
Mr. Chairman, what other excuse is there for exposing? As my
colleagues know, it is very easy for the American people to understand
what is happening here. As my colleagues know, the fog that comes off
the Potomac may blind some of the Members who come here to vote on the
floor of the House of Representatives but it certainly does not blind
the people back at home. The
[[Page H1678]]
fundamental issue we are deciding today, I put all of the good stuff
that is in H.R. 400, all the real reforms into my substitute, we have
ended submarine patenting.
The real issue is what? There are two fundamenatal issues--
publication, publication--and that issue is very easy for people to
understand. The American people know that before--throughout our
country's history, if someone applied for a patent, that Goddard from
the Goddard Rocket Center who developed rocket fuel, that was secret,
and the Germans then could not get ahold of it, see, because it was
secret and our competitors cannot get ahold of things. People who hate
America cannot get that information because it has been secret. They
want to change that. They want our worst enemies to have all of our
secrets and to be able to use them against us.
They say, ``Ah, but we have taken care so that if somebody does steal
that, we'll show you a way to deal with that. We're going to let you
sue them.'' My colleagues, 10 years later or 5 years later when the
patent is issued, they now are given the right by this H.R. 400 to sue
the People's Liberation Army in China if they decide to manufacture
things and use them against us that violate our patent laws. Mitsubishi
Corp., Sony, name it, all these huge corporations overseas, even our
own corporations, do my colleagues think that really is going to deter
anybody from stealing--any of these gangsters from stealing--our
technology and using it against us?
This is an invitation, it is an invitation to steal American
technology. I have heard nothing in this debate, nothing in this debate
that has changed my mind, nor have I heard nothing in this debate that
has convinced me that my rhetoric has been out of line, and I think the
American people are listening really hard, and when they see these
maneuvers like saying it virtually exempts small business, and then
during colloquies understand that, well, no they really are not exempt,
people understand that there is a power play going on in Washington,
DC. It is a power play that will not work to the benefit of the people
of the United States. It changes the fundamental rules and rights and
freedoms that we have had for 225 years that have served us well.
The patent owners, the people who have--the inventors, the Nobel
laureates, the great creators of our society, are against H.R. 400 and
for the Rohrabacher substitute. There is a reason for that. The big
corporations, the multinational corporations that use technology and
also have all sorts of connections overseas, I might add; yes, they are
opposed to the Rohrabacher substitute and support H.R. 400. There is a
reason for that too.
So it comes down to corporatization; do we want to change the
fundamental system that has been set up that makes these decisions as
to who owns what, making our patent examiners, as my colleagues know,
open to who knows what kind of pressures? And do we want to publish all
of our secrets in exchange for the right of our citizens to sue some
huge multinational corporation years later, years later once they get
their patent? No, that is not a good deal. I do not think the American
people think it is a good deal, and I do not think the American people
are fooled by the argument that we got to cut our leg off in order to
cure the submarine patent infected toe. They are not buying that, they
are not buying that at all, and I would suggest that we have a system
that served us well, we should not rush into these dramatic changes to
harmonize our law with Japan.
What is pushing this all along is an agreement that was made with
Japan, and I have held it up several times right here, to harmonize
American patent law with Japan. We do not want to be like them. We want
to have rights that are protected.
Ms. LOFGREN. Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, I just want to make a couple of clarifications
statements for those Members who are listening to this debate.
First, I think it is important to emphasize that any matter that is
sensitive from a national security point of view that is a secure
matter may be held confidentially under the past law before it was
changed last year under current law, under H.R. 400 and under the
Rohrabacher substitute. So there is no question that none of the
alternatives would allow national security matters to be published, and
I think that is important.
Second, I want to address the issue of the Congressional Research
Service. Now I am a relatively new Member but I have found CRS to be a
useful office here, and I from time to time get their publications and
read them, and I do not know the author of the report that has been
quoted here. I will say, however, that in my experience in reading
through Congressional Research Service publications, they are not
always the only person with a viewpoint nor are they always the most
expert person in the world with a viewpoint. And I think it is worth
pointing out that the intellectual property section of the American Bar
Association, lawyers of whom represent both patent defenders and those
who might attack patents who do not have--they are not for one side or
the other. The intellectual property section of the California Bar
Association where most of the high-tech industry in the country is
located and most of the patents issued in the country I believe emanate
from California, as well as the American Intellectual Property Law
Association, as well as the Intellectual Property Owners Association,
all oppose the Rohrabacher substitute, all support H.R. 400.
Mr. Chairman, I reserve the balance of my time.
Mr. CAMPBELL. Mr. Chairman, will the gentlewoman yield?
Ms. LOFGREN. I yield to the gentleman from California.
Mr. CAMPBELL. Mr. Chairman, I am so grateful to the gentlewoman.
I do just wish to clarify that whereas the CRS said that both
Chairman Coble and Congressman Rohrabacher's bill reflected in fixing
the submarine patent, the additional sources the gentlewoman cited did
not speak to that issue. They favored Chairman Coble's bill or she
would not have been citing them, but they were not rebutting CRS's
conclusion that--is that correct?
Ms. LOFGREN. Actually that is incorrect. In fact, the President of
the American Intellectual Property Law Association, and I have spoken
as recently as 2 days ago indicating it was his judgment the
Rohrabacher substitute does not solve the submarine patent association,
and, if I may conclude this, does not resolve the submarine patent
issue, whereas H.R. 400 in his judgment would.
Mr. CAMPBELL. If the gentlewoman will yield further on that point, I
would be very interested in having that reduced to writing so that I
could look at it. I do have the CRS report reduced to writing.
Ms. LOFGREN. Reclaiming my time, I will see if I can get that done.
Mr. CAMPBELL. I have one additional point which I might put to the
gentlewoman if she continues to yield.
Ms. LOFGREN. I will.
Mr. CAMPBELL. As to the lawyers' associations which support H.R. 400,
could one not interpret that that is a natural response to the fact
that the bill will create much more opportunity for their employment?
Ms. LOFGREN. I do not believe that is correct and the gentleman and I
are both from California, we both taught law and we are both--I think
the gentleman was formerly on the Committee on the Judiciary, and
perhaps I am wrong on that. I am currently serving on the Subcommittee
on Courts and Intellectual Property. Certainly people can have
divergences of opinion. But I do not believe that and I doubt very much
that that would be the motivation for the intellectual property
section.
Mr. CAMPBELL. Would the gentlewoman find it shocking if a group of
lawyers in finding a bill beneficial saw some opportunity for
enhanced--call upon their own services. That is all.
Mr. GOODLATTE. Mr. Chairman, will the gentlewoman yield?
Ms. LOFGREN. I yield to the gentleman from Virginia.
Mr. GOODLATTE. The lawyers that the gentleman suggests will benefit
by this work for the many, many, many American businesses who strongly
support this legislation. And would the gentleman suggest, and I am
sure the gentlewoman would not suggest, that those businesses are
interested in legislation because it will give them the opportunity to
pay more in legal fees? Of
[[Page H1679]]
course not. They are interested in this legislation because it stops
submarine patenting where one lawyer, one lawyer got $150 million in
contingent fees. And do my colleagues know where that money came from?
It came from American business. And do my colleagues know what it gets
paid for? American business passes their costs on to the consumers and
taxpayers in this country, and that is what this legislation is all
about. It is not to help lawyers.
Ms. LOFGREN. Reclaiming my time, I would concur with the gentleman's
comments, noting that the National Association of Manufacturers, the
Pharmaceutical Research and Manufacturers of America, the Semiconductor
Industry Association, the Software Publishers Association and the like
have rarely been in favor of more litigation.
Mr. Chairman, I reserve the balance of my time.
Mr. COBLE. Mr. Chairman, I yield 5 minutes to the gentleman from the
Roanoke Valley in Virginia [Mr. Goodlatte].
Mr. GOODLATTE. Mr. Chairman, I thank the gentleman for yielding this
time to me, and I rise in strong opposition to the Rohrabacher
substitute which would be a disastrous turn to take in American patent
law.
First I want to address some of the comments being made by some of
the supporters of this substitute and the opponents of the bill. The
gentlewoman from Ohio [Ms. Kaptur] said that we had not been fair and
open in this process; and by the way, I will not yield to the
gentlewoman because she refused to yield to me earlier, but I want to
make this point.
This bill has been more carefully studied and worked in this Congress
in very public open hearings than any other legislation considered in
this Congress this year. Hearings have been held in the Committee on
Science, hearings have been held in the Committee on Small Business,
hearings have been held in the Committee on International Relations,
and eight public hearings have been held in the Committee on the
Judiciary on this legislation. So there is absolutely no possibility
that this legislation is not something that has been very fairly and
openly debated throughout the process.
{time} 1700
Second, the gentlewoman made the point, which is totally inaccurate,
that we were going from a 17-year protection for inventors down to 18
months. Well, that is hardly the case at all.
Under our bill, any inventor gets a minimum of 17 years' protection,
provided that they themselves do not cause a delay in the issuance of
the patent. So they are going to get an increase.
Ms. KAPTUR. Mr. Chairman, will the gentleman yield on that point?
Mr. GOODLATTE. Mr. Chairman, no, I will not yield.
Ms. KAPTUR. Just to clarify, Mr. Chairman.
Mr. GOODLATTE. Mr. Chairman, I would ask for order.
The CHAIRMAN. The House will be in order, and the gentleman from
Virginia [Mr. Goodlatte] may proceed.
Mr. GOODLATTE. I thank the Chairman.
The fact of the matter is the gentlewoman had 30 minutes of time, I
have much less, and unfortunately, we have not had the opportunity to
have that colloquy.
But the fact of the matter is, under our legislation, they have that
same amount of time, they have that time under the new legislation, and
they will have, in most cases, more time than they have under current
law.
Furthermore, the average patent in this country today is issued after
19 months. This calls for publication after 18 months. So most patents
are not going to experience any significant difference in how quickly
they are published. But here is the important fact about this, and this
is what is wrong about this entire debate by the opponents.
We are not talking about trade secrets here, we are talking about
publication of patents. Patents have always been protected in this
country by publication. That is how we say to the world that an
American inventor has put forward an idea that is entitled to be
protected under our laws.
We do not tell them to hide it under a rock. We do not tell them to
lock it up in a safe. We tell them that the U.S. Government will
publish their patent and say they were the first with that idea and
they are entitled to 17-years-plus protection.
That is what they get under this bill as well, only they get it
better, because now they are going to be published sooner. When they
are published sooner the world knows sooner that they were the first
with that idea, and the capitalists who wanted to invest in that small
inventor's opportunity to bring that unique idea that is so uniquely
American, as the opponents have pointed out, that we lead the world in
developing ideas, but we do not lead the world in getting those ideas
to market, and one of the reasons why is because we do not get the
capital to the inventor quickly enough.
If we change the law so that we have the opportunity to publish after
18 months, and not yours published after 18 months, but anybody who
might be competing with you, that is important, because if you do not
know that somebody else is in the patent system with something hidden,
something called a submarine patent, ready to surface up and take your
claim and try to get royalties from you, what you wind up with is a
system where the capitalist does not know when to put the money in
until you get the patent.
Under this change in the law, which has worked so well in Europe and
other places, the money gets to the inventor from the entrepreneurial
investor sooner because they know sooner that that person has the idea,
and that is the one that is going to have the protection for 17 years.
Now, the gentleman from California claims that submarine patents are
eliminated by his substitute. Nothing could be further from the truth.
While I have great respect for the CRS, they say both bills seek to
curtail submarine patenting. But there is often ``many a slip twixt the
wrist and the lip,'' and that is exactly what is true of the
gentleman's substitute. It may seek to eliminate submarine patenting,
but it certainly does not succeed, because it eliminates one form of
delaying the patent process, and that is amending the application.
But there are hundreds of ways that a good patent lawyer, who under
the current laws makes a very good living with abusing our current
system, there are hundreds of ways that one can delay the processing of
a patent application that will not be covered by the gentleman's
substitute.
As a result, what we have is a situation where the only way to cure
this very serious problem that costs American consumers and taxpayers
hundreds of millions of dollars a year is to have publication, which,
as I indicated earlier, is not bad, it is not detrimental to the small
inventor, it is good for the small inventor, because publication is
what tells the world that that small inventor was the first one out of
the box.
We also protect them by giving patent pending, a protection that it
does not have now. That small inventor who has that idea that he turns
into a product and puts on the shelf in the store and says patent
pending, under the new law, they can get protection during the time
that the patent is pending. If somebody wants to steal it and rip it
off, they can get royalties for the entire time. Under the current law,
they get no royalties except for the time that the patent is actually
issued.
The result of all of this is a vast improvement of our patent system.
As we have on numerous occasions over the 200-plus years of our
history, this committee and this Congress is what has created the
wonderful patent system we have in this country, and no one should ever
suggest that it has never been changed in the 200 years since we
originally wrote our Constitution recognizing that patent system.
We have to constantly look at it and improve it. When you do not,
that is when you fall behind. If you want to look for examples of
people who have said in the past that we are the best in the world and
we do not have to worry about anybody outside, go talk to the big-three
automobile makers and ask them what they thought back in the 1960's and
1970's about their superiority over the Japanese. They learned very
quickly that if they did not change the way they do things to keep up
with the times, they would fall behind.
If you want to look for a place where there is strong, strong support
for these patent reforms to protect American business, American jobs,
and
[[Page H1680]]
American technology, go to the big-three automakers, because all three
of them support H.R. 400 because they want to make sure that our patent
system remains the best in the world, and that is what this legislation
does.
Oppose Rohrabacher, support H.R. 400.
Mr. ROHRABACHER. Mr. Chairman, I yield myself 1 minute.
Just so my friend from Virginia, Mr. Goodlatte, will understand, if I
could quote from the report here, the Congressional Research Service,
it says, yes, it does, as he stated, both bills seek, and it did, said
seek to curtail, but you did not finish the sentence, and would likely
end the practice.
So I mean this is very similar to what we have heard in other parts
of the debate where something will effectively permit small business
and the little guy to be exempted, but ``effectively'' is not really an
accurate description.
The Congressional Research Service, which is an independent body, and
people who do not have an ax to grind, have determined, and I have gone
out of my way, and my colleague, the gentleman from California [Mr.
Campbell] has gone out of his way, to put the strongest language we
could in, and an independent body is agreeing with us, that we would
likely end the practice. We have done our very best. This fig leaf
could not be used to justify radical changes in our system.
Mr. Chairman, I reserve the balance of my time.
The CHAIRMAN. The Chair would advise all Members that the gentleman
from California [Mr. Rohrabacher] has 10 minutes remaining; the
gentleman from North Carolina [Mr. Coble] has 12\1/2\ minutes
remaining; the gentlewoman from Ohio [Ms. Kaptur] has 20 minutes
remaining; and the gentlewoman from California [Ms. Lofgren] has 19
minutes remaining.
The Chair recognizes the gentlewoman from Ohio [Ms. KAPTUR].
Ms. KAPTUR. Mr. Chairman, I yield myself such time as I may consume.
I will yield time to the gentleman from Maryland [Mr. Hoyer] in just a
second, but I wanted to answer the gentleman from Virginia [Mr.
Goodlatte], since he referenced me at least three times in his remarks.
Mr. Chairman, I see a big difference between 18 months, 17 years, and
20 years. Under the bill the gentleman supports, the gentleman requires
that there be publishing of all patent applications 18 months after
they have been filed, whether or not the patent has been issued.
Eighteen months is less than 2 years.
The GAO says it takes at least 4 years, the Patent Office says it
takes 2 years, average application time, but whatever the time is, some
patents take 10 years, 12 years. The gentleman is saying 18 months.
That information is made available under the gentleman's radical
proposal. It is a radical departure from the current system which says
that once a patent is issued, an inventor has protection for 17 years,
almost 2 decades.
The gentleman said, oh, but I give you 20 years, 20 years is better
than 17 years. No, your 20 years does not begin when the patent is
issued, it begins when the patent is filed. I was courteous to the
gentleman when he was talking to me. I would certainly appreciate a
little eye contact here while I am talking to him.
So there is a big difference, numerical difference to the protection
of the inventors of this country. I feel bad the gentleman from
Virginia [Mr. Goodlatte] did not yield to me, but I wanted to clarify
for the Record, there is a whole lot at stake. Every single day of a
patenter's life of his invention is important. They have a lot on the
line. Some of them have their whole future on the line. For America, we
have America's future on the line.
So the difference between 17 years of guaranteed covered and 18
months when you have to divulge the secrecy of your information is a
pretty big difference.
Mr. Chairman, I yield 8 minutes to the distinguished gentleman from
Maryland [Mr. Hoyer].
Mr. HOYER. Mr. Chairman, I thank the gentlewoman for yielding me this
time, and I thank my friend from California for letting me proceed.
I want to say that those of us who are not expert in the field of
patents, and I dare say that is probably 100 percent of us, some of us
know more than others, that is for sure, but I would presume, unless
there is a patent lawyer among us, obviously Mr. Campbell, a law
professor, a distinguished law professor, has done a lot of work on
this. I am a lawyer, but I want to have a disclaimer at the front that
I do not know a lot about this issue from a technical standpoint.
So like most Members, I come from the standpoint of what is best for
the people I represent? What is best for the country? What is best for
competitiveness, both domestically and internationally, and what best
protects the people that I represent?
Now, very frankly, I have heard from numerous people, individuals who
are very concerned about this bill. I have read in The New York Times,
for instance, articles of inventors, small business, associations who
are very concerned at the exposure that this bill brings. The
gentlewoman from Ohio [Ms. Kaptur] referred to the time of 18 months or
17 years or 20 years or whatever the time frame might be.
I have heard the debate back and forth. I would say to my friends
that, at the outset, I do accept the premise of the CRS report, that
both bills not only seek, as has been pointed out, but do, in fact,
accomplish the objective of getting at the problem, to the extent it
exists, of the submarine patents.
The gentleman from California [Mr. Hunter] who spoke earlier pointed
out that there were some 300 submarine patents that could be described
out of the millions of patents. So the percentage of submarine patents,
if they exist, and obviously they do, is as the gentleman from
California [Mr. Hunter] pointed out, incredibly small.
In pursuit of that objective, we are placing at risk the 99.9 percent
of inventors, innovators, entrepreneurs who have an idea that they want
to protect so that they can justifiably profit in a free enterprise
system from the integrity and protection of that idea.
It is for that reason, my friends, that I rise, convinced not of the
technical merits one way or the other, because as I said at the outset,
I am not an expert, but that there is so much concern in the small
business community.
I believe this bill would harm small business and independent
inventors. We must remember that small business, as all of us know,
represents the fastest growing sector of the economy and are truly
America's greatest source of job creation and technology development.
I am not opposed to everything in H.R. 400, as I am sure most are
not. In fact, I know my friend [Mr. Rohrabacher], the principal sponsor
of the alternative, which I support, is not an opponent of all. I
support the inventor protection electronic filing sections of the bill.
However, despite the rhetoric surrounding the manager's amendment, the
publication time still poses a threat to America's small business.
Too many small business organizations have voiced their concerns and
opposition to H.R. 400. I am not going to go through the list, but my
colleagues have seen, I think most of our colleagues have seen, the
list of 2 or 3 pages, small-type, of small inventors, small investors,
small businessmen and entrepreneurs who are concerned and have said, do
not move on this bill.
{time} 1715
In fact, the Chamber of Commerce itself has held itself aloof from
this bill. The Chamber of Commerce itself has held itself aloof from
this bill because they believe there is a risk.
Mr. Chairman, it is a strange alliance that we see on this floor on
this bill, on both sides, perhaps because some come from a more
involved process with this bill and some a less involved, and are,
frankly, looking not so much at the technical aspects of this bill but
at the risks that it will pose to the people from whom we are hearing.
Mr. Chairman, the U.S. Chamber of Commerce, as I said, has been
conspicuously silent on this bill, and the National Association for the
Self-Employed, an organization of 325,000 members, is not only silent,
they are strongly opposed to H.R. 400, because they believe it places
their small business people at risk. This is a very important issue. We
must not rush to judgment. In fact, we are not rushing to judgment, as
the gentleman from Alabama is pointing out to me.
The proponents of H.R. 400 claim that there are remedies and
processes set up
[[Page H1681]]
to protect small business. If that is the case, why have the Chamber
and the NFIB and small business and small inventors not come forward
and said that they have achieved protection? They have not. In fact,
they have done the opposite, as I said. Three hundred twenty-five
thousand strong have said, we are strongly opposed to this bill.
We all know that small businesses have neither the attorneys nor the
resources. The gentleman from California [Mr. Campbell] has spoken to
this, the gentleman from California [Mr. Rohrabacher], the gentlewoman
from Ohio [Ms. Kaptur] have all spoken to it. It is fine to say, yes,
if they learn your information very early on you get protection,
because you were published. That is great.
That is great, and if you have $1 million or $5 million, like some of
the egregious people, I understand, and let us not hoist on the petard
of one or two or three multimillionaires who are gaming the system,
thousands of folks who are not only not gaming the system but it is the
only protection that they have.
Mr. Chairman, in closing, because my time is coming to a close, let
me say that I am also concerned, as someone who is deeply involved in
governmental organization issues, deeply involved in Federal employee
issues, I understand that my friends in the NTU believe that H.R. 400,
my good friend, the gentlewoman from California [Ms. Lofgren] who has
fought so fervently for this bill, she and I disagree on the substance,
but she is an able advocate of this bill, and they have talked about
the NTU.
Let me say, as so many have said on this floor, I am concerned about
this critically important process, which must be insulated from outside
influence, being altered in the way that H.R. 400 alters it; that it is
not a Federal employee, insulated from outside pressure and influence
and involvement, who will make decisions critical to the economic
welfare not only of small business and inventors and innovators, but
also of this country.
So I would ask my colleagues to vote for the amendment offered by the
gentleman from California [Mr. Rohrabacher], incorporating the
amendment of the gentleman from California [Mr. Hunter] as well, and to
vote against H.R. 400.
Ms. LOFGREN. Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, I would say there has been much discussion of the
Congressional Research Service. I would like to note that the
commissioner of patents and trademarks, who actually is an expert in
this whole subject area, has noted that the Rohrabacher amendment, in
his words, would allow the patent system to continue to be misused by
those who are not interested in obtaining patent protection early, and
goes on to further detail the submarine patent provisions that would
remain.
Mr. Chairman, I yield 2 minutes to the gentleman from California [Mr.
Dooley].
(Mr. DOOLEY of California asked and was given permission to revise
and extend his remarks.)
Mr. DOOLEY of California. Mr. Chairman, like the gentleman from
Maryland [Mr. Hoyer], I do not come to the well of the House as an
expert on patent law either. But unlike the gentleman from Maryland, I
come to complete disagreement in terms of what is the proper policy
that we should institute in order to create a fiscal and financial
environment that is going to ensure that our economy and in fact small
businesses will prosper.
When we look at what has happened in just the last decade when we
have seen 40 percent of the growth in our economy has occurred
primarily in the high-technology industry, we have to ask ourselves,
how did that happen? It happened in a large way because we had a lot of
small businesses that were able to attract capital, that were able to
make the appropriate investments. That created jobs, it created
products, it allowed us to become the leader in the information
services and computer services and software services and the
biotechnology industry throughout the world today.
The changes we are considering making in our patent laws I am
convinced are even going to do more to enhance that regulatory
environment to ensure that a lot of our inventors that are out seeking
capital will have greater access to it, because we will be able to find
the investment community, and they will be much more willing to take a
risk, to make a gamble on investing on the person who has an idea or an
invention, if they have greater assurances that there is not somebody
that is holding back a secret patent that could create financial
jeopardy down the road.
I guess that is where it comes to the fundamental disagreement in the
discussion that we have had on the floor today, was whether or not the
Rohrabacher amendment provides a level of protection on the submarine
patents as does H.R. 400 offered by the gentleman from North Carolina
[Mr. Coble]. I have come to the conclusion that it does not.
Part of that is based just strictly on the language, in that you can
have an extension of the publication of a patent, if the office of
director of patents and trademarks does not make a determination that
there was not an effort being engaged by the individual that could
demonstrate that they were diligently pursuing the publication of their
patent.
They furthermore go on to say that if you can have an amendment, and
again, you have to have a determination made by the regulatory body
that this amendment was not done so simply to prevent the publication
of the patent. These are determinations that have to be made that are
going to be very difficult.
I am concerned that with those provisions in, we will not deal with
the fundamental issue of dealing with the submarine patents, and that
is what is impeding, I think, the flow of capital which is so important
to U.S. inventors, people that have a good idea that can build products
in this country, that can create jobs and be such a benefit to our
economy.
Mr. Chairman, I urge people to vote no on the Rohrabacher substitute,
and support the bill offered by the gentleman from North Carolina [Mr.
Coble].
Mr. ROHRABACHER. Mr. Chairman, I yield 3 minutes to the gentleman
from Maryland, Mr. Roscoe Bartlett, one of the only inventors in the
U.S. Congress, who is also a professor, a technologist, who shares the
Committee on Science with me.
Mr. BARTLETT of Maryland. Mr. Chairman, I would just like to speak to
the Members for a few moments from the heart. I am not an expert in
patents, but maybe I have some credibility. I hold 20 patents. I was in
the academic world for 24 years, and during a part of that I was an
inventor. I was a small business man with an R&D company, and my
intellectual creations were the basis of that small business.
Mr. Chairman, there is just no reason, no defensible justification
for publishing these patents 18 months after they are filed. The only
possible reason could be to prevent submarine patents, but CRS has
said, and we can see it here by me, both bills seek to curtail
submarine patenting and would likely end the practice.
If the Rohrabacher bill is not perfect, let us make it perfect. But
let us not undermine the protection that countless thousands of small
inventors like myself have with the present system. We do not need to
change this system.
I have had a lot of mail on this. I have not had a single telephone
call, a single fax, or a single letter that said ``Support H.R. 400;''
not a one of them, and not all of these small people out there can be
wrong. I had the notion when I came to Congress that maybe the great
wisdom of the country was not inside the Beltway. The longer I am here,
the surer I am that that is true. These people from outside the Beltway
have called me and faxed me and written letters to me, and every one of
them who have done it, and there have been a large number, have said,
please do not vote for H.R. 400, vote for the Rohrabacher bill.
We do not need to bring down our patent system to the level of the
Japanese, to harmonize under our GATT agreement. Let them come up to
our level of excellence. If we pass H.R. 400, it will cost us jobs. It
will cost us jobs because of the lack of protection that our
entrepreneurs now have. We are the greatest economic force this world
has seen. It is largely because of the protection of our entrepreneur
system.
It is true that to at least some degree, America's future is on the
line in
[[Page H1682]]
this vote. Please do the right thing for the little guy that I
represented so many years out there. Do not vote to give away our
secrets to every copycat around the world. Protect our entrepreneurs.
Vote for the Rohrabacher amendment.
Ms. KAPTUR. Mr. Chairman, I yield 2 minutes to the gentlewoman from
Texas [Ms. Jackson-Lee].
(Ms. JACKSON-LEE of Texas asked and was given permission to revise
and extend her remarks.)
Ms. JACKSON-LEE of Texas. Mr. Chairman, I do not want to leave anyone
behind on this issue. I, too, though a member of the Committee on the
Judiciary, am not going to pretend to be a longstanding expert on this
issue.
But I want to raise two points. I hope that maybe we will be able to
respond to the concerns. First, this substitute addresses the question
that I have heard throughout my district, and that is on small
businesses, and how they are protected. I do not think we can go
forward without acknowledging and responding to those concerns. We have
the time.
Second, I would like to speak to the issue that now I am told is not
outsourcing the patent staff, but corporatizing. I would simply say
that the concern is that if you have had an independent civil body,
then that civil body needs to be and remain independent. The substitute
addresses that question.
I would imagine that even in spite of having just met with members of
the European Commission who have asked that we have a patent system
which they can relate to, even with trying to relate on the
international system, there does not seem a reason why we cannot
protect small businesses and why we cannot protect the civil servants
who are part of the Patent Office who have for years been able to
provide good service to our inventors, our scientists, those who have
knowledge, and bring knowledge to this country.
This substitute responds to those concerns. If there is reason to
repair the substitute and the larger bill, then I would offer to say
that we should stand in support of small businesses and, of course,
those longstanding civil servants who have done the job in the Patent
Office for years and years and years.
Ms. LOFGREN. Mr. Chairman, I yield 2\1/2\ minutes to the
distinguished gentlewoman from California [Mrs. Tauscher].
{time} 1730
Mrs. TAUSCHER. Mr. Chairman, I rise today in strong support of H.R.
400, because I am the granddaughter of one of the little guys.
My mother, who I talked to on the phone just a few minutes ago, has
been confused about the debate she has watched today. But I strongly
support H.R. 400 because I also strongly support our Nation's
businesses and the small and independent inventors. I believe this
important and needed legislation will improve our competitiveness,
reduce the loss of wasted and precious R&D dollars and eliminate the
real and dangerous scourge of submarine patents.
Many have valid concerns about the publication of patent information
18 months after filing. But H.R. 400 contains an exemption for all
small businesses and independent inventors, allowing them to withhold
publication until 3 months after the second meritorious PTO action.
Furthermore, upon publication, inventors receive the constitutional
monopoly over their invention.
Others mention that the patent term will now be cut below the
traditional 17-year term. Nothing could be further from the truth. The
fact is that H.R. 400 allows a diligent patent applicant to receive
extensions of term for many reasons, including appellate review,
administrative delays caused by PTO actions or inactions, the
imposition of a secrecy order, or in the case of interference from a
competing claim or infringement. Many of these extensions are unlimited
to ensure that inventors will not lose any patent term.
Mr. Chairman, nearly 45 percent of all patent applications filed with
the PTO are from foreign companies and inventors who have manipulated
our patent system to their advantage while U.S. inventors filing abroad
are subjected to open examination. H.R. 400 levels the playing field in
favor of U.S. businesses while providing additional protection for
American inventors. I urge my colleagues to oppose the Rohrabacher
amendment and support H.R. 400.
Mr. ROHRABACHER. Mr. Chairman, I yield myself 2 minutes.
Mr. Chairman, these are my concluding remarks. I would like first of
all to thank the gentleman from North Carolina [Mr. Coble], the
gentleman from Illinois [Mr. Hyde] and the other Members who have put
up with me for the last months in my opposition, and I happen to have
very strong beliefs about this. I appreciate the gentleman from
Michigan [Mr. Conyers] for putting up with me.
The bottom line is, when you have strong disagreements in this
democratic body, sometimes people get mad at one another, but the fact
is we are all friends. We will be working on other issues and working
together, and we are all people of integrity.
Mr. Chairman, I also wanted to thank the gentlewoman from Ohio [Ms.
Kaptur] and the gentleman from Maryland [Mr. Hoyer] and the gentleman
from California [Mr. Campbell], the gentleman from Maryland [Mr.
Bartlett], and of course, the gentleman from New York [Mr. Forbes], who
has been so articulate as well.
A lot of Members have put a lot of time and effort into this because
this is a really important issue. It is something that will make the
difference in the future of our country. We all believe that. Twenty
years from now America will be a different kind of place because of the
decision we are making today.
We are trying today to make a decision as to whether or not we will
fundamentally veer from the system that has protected the technological
development of the United States of America for 225 years, a system
that has assured the American people of the highest standard of living,
the greatest degree of freedom and security for our country of any
system in the world.
We do not want to be like the Japanese. We do not want to harmonize
our law to a Japanese model. We do not want the European model. People
came here because this is where people's individual rights were
protected. Again, what has been our rights, our rights have been we can
invent and it will be kept confidential, our patent application, until
that patent is issued and we own that technology. It has protected us.
That has been such an important part of the development of technology
in our country. Now it is just being cast away saying, we will exchange
it for a system where you can sue somebody if they steel it from you.
That somebody may be a huge corporation in Japan or China, but then
that will replace it with that system. That is no protection at all.
I ask my colleagues to support my substitute. We have included the
good stuff and left out the bad stuff.
Ms. LOFGREN. Mr. Chairman, I yield myself such time as I may consume.
I wanted to make just a few remarks before the gentleman from
Illinois [Mr. Hyde] concludes, I believe, the debate for today. As a
relatively new Member, I have found this entire process to be a
fascinating one, unfortunately, I think sometimes a confused one.
We have heard and I have heard debates, late-hour radio talk show
discussions about patents for the first time in my life. We have heard
about patents on talk shows, people thinking it had something to do
with foreign governments or trade agreements or the Red Army. In fact,
as Mr. Hyde knows, and the gentleman from Michigan, Mr. Conyers, knows,
it does not. And then people becoming concerned and alarmed and afraid
and communicating to their Members of Congress, including myself, that
they do not want the wrong thing for their country. Of course not. None
of us do. None of us do.
Then we get here today with, unfortunately and not unusually, most
people in the country, I would venture and it has been said here today,
most Members of the House not being experts in patent law, not having
had a chance to take the courses in patent law or to practice patent
law and to really familiarize themselves with it and then doubt and
concern.
Mr. Chairman, it is my hope that Members have found this debated
useful so that they can sort through the conflicting and occasionally
extravagant claims to do what is right for our
[[Page H1683]]
country because this is not a freebie vote. This is an enormously
important vote for America. When I think about the companies and the
inventors and the innovators in Silicon Valley and the role that they
now play and will play in making sure our country advances
technologically and has a wonderful quality of life, that we have high
employment, that we have a bright future, that is dependent on this
body going beyond its confusion and doing the right thing by defeating
the Rohrabacher substitute and supporting H.R. 400. The bill that was
crafted by Chairman Hyde and Ranking Member Conyers, that was supported
and nurtured by the gentleman from North Carolina, Mr. Coble, the
chairman, and the gentleman from Massachusetts, Mr. Frank, the ranking
member, these are unlikely allies who have come together in the best
interest of the Nation on a bipartisan basis.
I will close simply by saying this. The White House conference on
small business technology chairs have analyzed the debate, analyzed the
talk show allegations and have found that the misinformation, they say
misinformation, is part of an intense campaign of fear and xenophobia.
They say the information being promulgated is simply wrong. They point
out that legislation based on bad data is bad legislation. They urge
defeat of the Rohrabacher amendment and they urge support of H.R. 400.
Mr. COBLE. Mr. Chairman, I want to express appreciation to all who
participated in today's debate and to thank the Chair as well.
Mr. Chairman, I yield the balance of my time to the gentleman from
Illinois [Mr. Hyde], chairman of the House Committee on the Judiciary.
Mr. HYDE. Mr. Chairman, I thank the gentleman for yielding me the
time. I will not spend time congratulating everybody, but I do in a
blanket way because everybody connected with this issue and this debate
on both sides, even the gentleman from California [Mr. Campbell],
Professor Campbell, I congratulate.
If my colleagues do not think submarine patenting is a serious
problem, and it has been diminuendo by some on the other side, let me
quote from a witness before the subcommittee of the gentleman from
California [Mr. Rohrabacher], a gentleman named Bill Budinger, an
independent single inventor who had his own little company, Rodel
Company, and here is what he said to Mr. Rohrabacher's committee:
``I have heard people say there is no such thing as submarine
patents, and to borrow a phrase from earlier, I think the folks that
say that are either naive or disingenuous. Here is a list of 300
patents that were issued in the 2-year period before the law changed,''
that is 1994. ``Each of these patents will monopolize a segment of
American technology for a period of 25 years or more. They are going to
provide a minimum of 25-year monopolies and some of the monopolies here
are 40 years. Every one of these patents is issued to and owned by a
foreign corporation. So these folks learned how to game the system.''
Now, submarine patents are not the only reason we are here with this
bill. Do you not understand that we need access to foreign inventors'
ideas? They come over and register and file their applications in our
Patent Office, and we do not get to read them. We do not get to see
them in English. Whereas our patents, our applications are filed in
Japan, filed in France, filed in Germany, and after 18 months, they are
published there. So we ought to have parity with foreign inventors; 45
percent of the applications for patents are filed by foreigners in this
country.
We saw a rather embarrassing list of Nobel Prize winners but they may
not have the technologists. They have the inventors, 45 percent of
them. Small business is protected. Small business can opt out. Small
business cannot be published until after two office actions. That means
you are going to get your patent. Then you have 3 more months when you
are not published. That is a different treatment from a so-called big
business.
Let us dispel the notion that publication is a betrayal of our
secrets. Publication is protection.
There is an animal called provisional rights that arises as soon as
your publication occurs. It is the same as though you had a patent and,
once your idea has been published, it is yours. It is notice to the
world, I thought of it. I thought of it first, do not tread on me. And
not only that, but if anybody tries it, they are liable in damages for
infringement. So there are provisional rights. Do not tread on me, and
it also is an advertisement to investors who might say, hey, this guy
has got an idea. I might want to invest in this.
Every patent commissioner except one who is working for the other
side has come out for H.R. 400. The Nixon, Ford, Reagan, Bush have all
signed a letter saying we like 400. The Clinton administration says, we
like 400. And so if it is good enough for them, it ought to give us
pause if we do not think we want to support it.
The gentleman from California, [Mr. Rohrabacher], God love him, says
his bill, and he has a CRS report. If I were the teacher, I would give
that about a D minus because it misses the mark horribly, horribly. The
gentleman from California, Mr. Tom Campbell, a fine lawyer, I just want
to ask if he really thinks this eliminates the submarine patent. Under
the Rohrabacher amendment, you cannot publish for 5 years. Let me put
the question this way: Have you ever spent 5 years in a submarine?
Mr. CAMPBELL. Mr. Chairman, will the gentleman yield?
Mr. HYDE. I yield to the gentleman from California.
Mr. CAMPBELL. Mr. Chairman, under the Rohrabacher amendment, you must
publish, there is no 5-year delay if you are a gamester, if you are a
submariner as determined and applied for a continuation. No 5-year
delay.
Mr. HYDE. Mr. Chairman, the gentleman is asking that the patent
examiner have an astrological gift to be able to tell whether or not
what one is doing is gaming the system.
There is much more to say, I sense an impatience in the Chamber. And
not wishing to dull my antennae any more than they are, I hope my
colleagues will support 400. I hope my colleagues will tell the
gentleman from California, [Mr. Rohrabacher], he is a swell guy but has
a lousy bill.
The CHAIRMAN. The question is on the amendment in the nature of a
substitute offered by the gentleman from California [Mr. Rohrabacher].
The question was taken; and the Chairman announced that the noes
appeared to have it.
Recorded Vote
Mr. ROHRABACHER. Mr. Chairman, I demand a recorded vote.
A recorded vote was ordered.
The vote was taken by electronic device, and there were--ayes 178,
noes 227, not voting 28, as follows:
[Roll No. 85]
AYES--178
Abercrombie
Bachus
Baldacci
Ballenger
Barcia
Barr
Barrett (WI)
Bartlett
Bereuter
Bilirakis
Bonilla
Bonior
Bono
Brown (OH)
Burton
Calvert
Campbell
Cardin
Chambliss
Chenoweth
Christensen
Clayton
Coburn
Collins
Combest
Condit
Cook
Cooksey
Cox
Coyne
Cramer
Crapo
Cubin
Cunningham
Danner
Deal
DeFazio
Dellums
Diaz-Balart
Dixon
Doolittle
Doyle
Duncan
Emerson
English
Ensign
Everett
Filner
Foley
Forbes
Fowler
Gallegly
Gephardt
Gibbons
Gillmor
Goode
Goodling
Goss
Graham
Hansen
Hastings (WA)
Hayworth
Hefley
Herger
Hill
Hilleary
Hostettler
Hoyer
Hulshof
Hunter
Hutchinson
Istook
Jackson (IL)
Jackson-Lee (TX)
Jones
Kaptur
Kildee
Kim
King (NY)
Kingston
Kleczka
Klink
Kucinich
LaHood
Largent
LaTourette
Lazio
Leach
Lewis (CA)
Lewis (KY)
Lipinski
Livingston
LoBiondo
Lucas
Maloney (CT)
Manzullo
Martinez
Mascara
McCarthy (NY)
McDade
McHugh
McInnis
McIntosh
McIntyre
McKeon
McKinney
McNulty
Menendez
Metcalf
Mica
Miller (CA)
Miller (FL)
Mink
Molinari
Moran (KS)
Murtha
Myrick
Neumann
Ney
Norwood
Oberstar
Obey
Olver
Ortiz
Pallone
Pappas
Parker
Pascrell
Paul
Payne
Petri
Pickering
Pombo
Poshard
Radanovich
Regula
Riggs
Riley
Rivers
Rohrabacher
Ros-Lehtinen
Royce
Ryun
Salmon
Sanders
Sanford
Saxton
Scarborough
Schaffer, Bob
Sessions
Shadegg
Sherman
Smith (MI)
Smith (NJ)
Smith, Linda
Snowbarger
Snyder
Solomon
Souder
Spence
Stearns
Strickland
Stump
Sununu
Talent
Taylor (NC)
Thomas
[[Page H1684]]
Thornberry
Thune
Tiahrt
Traficant
Walsh
Wamp
Waters
Watts (OK)
Weygand
Whitfield
Young (AK)
NOES--227
Ackerman
Aderholt
Allen
Archer
Armey
Baesler
Bass
Bateman
Becerra
Bentsen
Berman
Berry
Bilbray
Bishop
Blagojevich
Bliley
Blunt
Boehlert
Boehner
Boswell
Boucher
Boyd
Brady
Brown (CA)
Brown (FL)
Bryant
Burr
Buyer
Camp
Canady
Cannon
Capps
Carson
Castle
Chabot
Clement
Clyburn
Coble
Conyers
Cummings
Davis (FL)
Davis (IL)
Davis (VA)
Delahunt
DeLauro
DeLay
Deutsch
Dickey
Dingell
Doggett
Dooley
Edwards
Ehlers
Ehrlich
Engel
Eshoo
Evans
Ewing
Farr
Fattah
Fawell
Fazio
Ford
Fox
Frank (MA)
Franks (NJ)
Frelinghuysen
Frost
Furse
Ganske
Gejdenson
Gekas
Gilchrest
Gilman
Gonzalez
Goodlatte
Gordon
Granger
Green
Greenwood
Gutierrez
Gutknecht
Hall (OH)
Hall (TX)
Hamilton
Hastert
Hastings (FL)
Hefner
Hilliard
Hinojosa
Hobson
Hoekstra
Holden
Hooley
Horn
Houghton
Hyde
Inglis
Jefferson
Jenkins
John
Johnson (CT)
Johnson (WI)
Johnson, E. B.
Kanjorski
Kasich
Kelly
Kennedy (MA)
Kennedy (RI)
Kennelly
Kilpatrick
Kind (WI)
Knollenberg
Kolbe
LaFalce
Lampson
Lantos
Latham
Levin
Lewis (GA)
Linder
Lofgren
Lowey
Luther
Maloney (NY)
Manton
Markey
Matsui
McCarthy (MO)
McCollum
McDermott
McGovern
McHale
Meehan
Meek
Minge
Moakley
Mollohan
Moran (VA)
Morella
Nadler
Neal
Nethercutt
Northup
Nussle
Owens
Oxley
Packard
Pastor
Paxon
Pease
Pelosi
Peterson (MN)
Peterson (PA)
Pickett
Pitts
Pomeroy
Porter
Portman
Price (NC)
Pryce (OH)
Quinn
Rahall
Ramstad
Rangel
Reyes
Rodriguez
Roemer
Rogan
Rogers
Rothman
Roukema
Roybal-Allard
Rush
Sabo
Sanchez
Sandlin
Sawyer
Schumer
Scott
Serrano
Shaw
Shays
Shimkus
Shuster
Sisisky
Skaggs
Skeen
Skelton
Slaughter
Smith (OR)
Smith (TX)
Smith, Adam
Spratt
Stabenow
Stark
Stenholm
Stokes
Stupak
Tanner
Tauscher
Tauzin
Taylor (MS)
Thompson
Thurman
Tierney
Torres
Turner
Upton
Velazquez
Vento
Visclosky
Watkins
Watt (NC)
Waxman
Weldon (FL)
Weldon (PA)
Weller
Wexler
White
Wicker
Wise
Wolf
Woolsey
Wynn
Yates
Young (FL)
NOT VOTING--28
Andrews
Baker
Barrett (NE)
Barton
Blumenauer
Borski
Bunning
Callahan
Clay
Costello
Crane
DeGette
Dicks
Dreier
Dunn
Etheridge
Flake
Foglietta
Harman
Hinchey
Johnson, Sam
Klug
McCrery
Millender-McDonald
Schaefer, Dan
Schiff
Sensenbrenner
Towns
{time} 1804
The Clerk announced the following pair:
On this vote:
Mr. Dan Schaefer of Colorado, for with Ms. Dunn against.
Ms. EDDIE BERNICE JOHNSON of Texas and Messrs. DAVIS of Illinois,
FAWELL, SERRANO, EDWARDS, and GUTIERREZ changed their vote from ``aye''
to ``no.''
Mr. PAYNE changed his vote from ``no'' to ``aye.''
So the amendment in the nature of a substitute was rejected.
The result of the vote was announced as above recorded.
personal explanation
Mr. BARRETT of Nebraska. Mr. Chairman, I was unable to be present for
the vote on the Rohrabacher substitute amendment to H.R. 400. Had I
been present, I would have voted ``no.''
Mr. COBLE. Mr. Chairman, I move that the Committee do now rise.
The motion was agreed to.
Accordingly the Committee rose; and the Speaker pro tempore (Mr.
Upton) having assumed the chair, Mr. LaHood, Chairman of the Committee
of the Whole House on the State of the Union, reported that that
Committee, having had under consideration the bill (H.R. 400) to amend
title 35, United States Code, with respect to patents, and for other
purposes, had come to no resolution thereon.
____________________