[Congressional Record Volume 145, Number 112 (Tuesday, August 3, 1999)]
[House]
[Pages H6929-H6950]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               AMERICAN INVENTORS PROTECTION ACT OF 1999

  Mr. COBLE. Mr. Speaker, I move to suspend the rules and pass the bill 
(H.R. 1907) to amend title 35, United States Code, to provide enhanced 
protection for inventors and innovators, protect patent terms, reduce 
patent litigation, and for other purposes, as amended.
  The Clerk read as follows:

                               H.R. 1907

       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 ``American Inventors 
     Protection Act of 1999''.

     SEC. 2. TABLE OF CONTENTS.

       The table of contents is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.

                       TITLE I--INVENTORS' RIGHTS

Sec. 101. Short title.
Sec. 102. Invention promotion services.
Sec. 103. Effective date.

                    TITLE II--FIRST INVENTOR DEFENSE

Sec. 201. Short title.
Sec. 202. Defense to patent infringement based on earlier inventor.
Sec. 203. Effective date and applicability.

                    TITLE III--PATENT TERM GUARANTEE

Sec. 301. Short title.
Sec. 302. Patent term guarantee authority.
Sec. 303. Continued examination of patent applications.
Sec. 304. Technical clarification.
Sec. 305. Effective date.

 TITLE IV--UNITED STATES PUBLICATION OF PATENT APPLICATIONS PUBLISHED 
                                 ABROAD

Sec. 401. Short title.
Sec. 402. Publication.
Sec. 403. Time for claiming benefit of earlier filing date.
Sec. 404. Provisional rights.
Sec. 405. Prior art effect of published applications.
Sec. 406. Cost recovery for publication.
Sec. 407. Conforming amendments.
Sec. 408. Effective date.

         TITLE V--OPTIONAL INTER PARTES REEXAMINATION PROCEDURE

Sec. 501. Short title.
Sec. 502.  Ex parte reexamination of patents.
Sec. 503. Definitions.
Sec. 504. Optional inter partes reexamination procedures.
Sec. 505. Conforming amendments.
Sec. 506. Report to Congress.
Sec. 507. Estoppel effect of reexamination.
Sec. 508. Effective date.

                 TITLE VI--PATENT AND TRADEMARK OFFICE

Sec. 601. Short title.

         Subtitle A--United States Patent and Trademark Office

Sec. 611. Establishment of Patent and Trademark Office.
Sec. 612. Powers and duties.
Sec. 613. Organization and management.
Sec. 614. Public Advisory Committees.
Sec. 615. Patent and Trademark Office funding.
Sec. 616. Conforming amendments.
Sec. 617. Trademark Trial and Appeal Board.
Sec. 618. Board of Patent Appeals and Interferences.
Sec. 619. Annual report of Director.
Sec. 620. Suspension or exclusion from practice.
Sec. 621. Pay of Director and Deputy Director.
Sec. 622. Study on Alternative Fee Structures.

            Subtitle B--Effective Date; Technical Amendments

Sec. 631. Effective date.
Sec. 632. Technical and conforming amendments.

                  Subtitle C--Miscellaneous Provisions

Sec. 641. References.
Sec. 642. Exercise of authorities.
Sec. 643. Savings provisions.
Sec. 644. Transfer of assets.
Sec. 645. Delegation and assignment.
Sec. 646. Authority of Director of the Office of Management and Budget 
              with respect to functions transferred.
Sec. 647. Certain vesting of functions considered transfers.
Sec. 648. Availability of existing funds.
Sec. 649. Definitions.

               TITLE VII--MISCELLANEOUS PATENT PROVISIONS

Sec. 701. Provisional applications.
Sec. 702. International applications.
Sec. 703. Certain limitations on damages for patent infringement not 
              applicable.
Sec. 704. Electronic filing and publications.
Sec. 705. Study and report on biological deposits in support of 
              biotechnology patents.
Sec. 706. Prior invention.
Sec. 707. Prior art exclusion for certain commonly assigned patents.

                       TITLE I--INVENTORS' RIGHTS

     SEC. 101. SHORT TITLE.

       This title may be cited as the ``Inventors' Rights Act''.

     SEC. 102. INVENTION PROMOTION SERVICES.

       Part I of title 35, United States Code, is amended by 
     adding after chapter 4 the following chapter:

               ``CHAPTER 5--INVENTION PROMOTION 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 promoter.
``59. Rule of construction.

     ``Sec. 51. Definitions

       ``For purposes of this chapter--
       ``(1) the term `contract for invention promotion services' 
     means a contract by which an invention promoter undertakes 
     invention promotion services for a customer;
       ``(2) the term `customer' means any person, firm, 
     partnership, corporation, or other entity who enters into a 
     financial relationship or 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;
       ``(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, except when that 
     person performs any act described in subparagraph (B) or (C) 
     of paragraph (4); or
       ``(D) any person or entity involved in the evaluation to 
     determine commercial potential of, or offering to license or 
     sell, a utility patent or a previously filed nonprovisional 
     utility patent application; and
       ``(4) the term `invention promotion 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, offering to license or sell, 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 promotion services.

     ``Sec. 52. Contracting requirements

       ``(a) In General.--(1) Every contract for invention 
     promotion 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, the identity and address of such party shall be 
     disclosed by such party's agent and such party shall be 
     considered a customer for purposes of this chapter.
       ``(b) Requirements of Invention Promoter.--The invention 
     promoter shall--

[[Page H6930]]

       ``(1) state in a written document, at the time a customer 
     enters into a contract for invention promotion services, 
     whether the usual business practice of the invention promoter 
     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 promoter, 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 invention promoter.
       ``(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 promotion services by sending a written letter to 
     the invention promoter 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 promoter 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 promoter or to a third party for the benefit of the 
     invention promoter, without regard to the date or dates 
     appearing in such instrument, shall be deemed payment 
     received by the invention promoter on the date received for 
     purposes of this section.

     ``Sec. 53. Standard provisions for cover notice

       ``(a) Contents.--Every contract for invention promotion 
     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 
     PROMOTER FOR COMMERCIAL POTENTIAL IN THE PAST FIVE (5) YEARS 
     IS XXXXX. OF THAT NUMBER, XXXXX RECEIVED POSITIVE EVALUATIONS 
     AND XXXXX RECEIVED NEGATIVE EVALUATIONS.
       `IF YOU ASSIGN EVEN A PARTIAL INTEREST IN THE INVENTION TO 
     THE INVENTION PROMOTER, THE INVENTION PROMOTER 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 PROMOTER IN THE PAST FIVE (5) YEARS IS XXXXX. THE 
     TOTAL NUMBER OF CUSTOMERS KNOWN BY THIS INVENTION PROMOTER TO 
     HAVE RECEIVED, BY VIRTUE OF THIS INVENTION PROMOTER'S 
     PERFORMANCE, AN AMOUNT OF MONEY IN EXCESS OF THE AMOUNT PAID 
     BY THE CUSTOMER TO THIS INVENTION PROMOTER IS XXXXXXX. AS A 
     RESULT OF THE EFFORTS OF THIS INVENTION PROMOTER, XXXXX 
     NUMBER OF CUSTOMERS HAVE RECEIVED LICENSE AGREEMENTS FOR 
     THEIR INVENTIONS.
       `THE OFFICERS OF THIS INVENTION PROMOTER HAVE COLLECTIVELY 
     OR INDIVIDUALLY BEEN AFFILIATED IN THE LAST TEN (10) YEARS 
     WITH THE FOLLOWING INVENTION PROMOTION COMPANIES: (LIST THE 
     NAMES AND ADDRESSES OF ALL PREVIOUS INVENTION PROMOTION 
     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 WHICH 
     RESULTED IN REGULATORY SANCTIONS OR OTHER CORRECTIVE ACTIONS.
       `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 promoter, 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 PROMOTER 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 promoter, nor 
     with respect to customers who have defaulted in their payment 
     to the invention promoter.

     ``Sec. 54. Reports to customer required

       ``With respect to every contract for invention promotion 
     services, the invention promoter 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 
     promotion 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 the initial payment to the 
     invention promoter;
       ``(3) a full, clear, and concise description of the 
     specific acts or services that the invention promoter 
     undertakes to perform for the customer;
       ``(4) a statement as to whether the invention promoter 
     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 promoter 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 promoter undertakes to perform for the customer;
       ``(6) if any oral or written representation of estimated or 
     projected customer earnings is given by the invention 
     promoter (or any agent, employee, officer, director, partner, 
     or independent contractor of such invention promoter), 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 
     promotion services, and a statement that the invention 
     promoter is required to maintain all records and 
     correspondence relating to performance of the invention 
     promotion 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 promotion services, including an 
     estimated date in which such performance is expected to be 
     completed.
       ``(b) Invention Promoter as Fiduciary.--To the extent that 
     the description of the specific acts or services affords 
     discretion to the invention promoter with respect to what 
     specific acts or services shall be performed, the invention 
     promoter 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 promoter's premises during 
     normal business hours.

     ``Sec. 56. Remedies

       ``(a) In General.--(1) Any contract for invention promotion 
     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 promotion services entered 
     into in reliance upon any material false, fraudulent, or 
     misleading information, representation, notice, or 
     advertisement of the invention promoter (or any agent, 
     employee, officer, director, partner, or independent 
     contractor of such invention promoter) 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 promotion 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 promoter offers to perform 
     or performs such act through aperson 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 promoter or by any 
     material false or fraudulent statement or representation, or 
     any omission of material fact, by an

[[Page H6931]]

     invention promoter (or any agent, employee, director, 
     officer, partner, or independent contractor of such invention 
     promoter) or by failure of an invention promoter to make all 
     the disclosures required under this chapter, may recover in a 
     civil action against the invention promoter (or the officers, 
     directors, or partners of such invention promoter) 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, taking 
     into account past complaints made against the invention 
     promoter that resulted in regulatory sanctions or other 
     corrective actions based on those record compiled by the 
     Director under section 57.
       ``(c) Rebuttable Presumption of Injury.--For purposes of 
     this section, substantial violation of any provision of this 
     chapter by an invention promoter or execution by the customer 
     of a contract for invention promotion 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 promoters publicly available, 
     together with any response of the invention promoters.
       ``(b) Request for Complaints.--The Director may request 
     complaints relating to invention promotion 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 promoters.

     ``Sec. 58. Fraudulent representation by an invention promoter

       ``Whoever, in providing invention promotion 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. 103. 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 II--FIRST INVENTOR DEFENSE

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``First Inventor Defense 
     Act''.

     SEC. 202. DEFENSE TO PATENT INFRINGEMENT BASED ON EARLIER 
                   INVENTOR.

       (a) Defense.--Chapter 28 of title 35, United States Code, 
     is amended by adding at the end the following new section:

     ``Sec. 273. Defense to infringement based on earlier inventor

       ``(a) Definitions.--For purposes of this section--
       ``(1) the terms `commercially used' and `commercial use' 
     mean use of a method in the United States or the use of a 
     method in the United States, so long as such use is in 
     connection with an internal commercial use or an actual 
     arm's-length sale or other arm's-length commercial transfer 
     of a useful end result, whether or not the subject matter at 
     issue is accessible to or otherwise known to the public, 
     except that the subject matter for which commercial marketing 
     or use is subject to a premarketing regulatory review period 
     during which the safety or efficacy of the subject matter is 
     established, including any period specified in section 
     156(g), shall be deemed `commercially used' and in 
     `commercial use' during such regulatory review period;
       ``(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), except that the use--
       ``(A) may be asserted as a defense under this section only 
     for continued use by and in the laboratory or nonprofit 
     entity; and
       ``(B) may not be asserted as a defense with respect to any 
     subsequent commercialization or use outside such laboratory 
     or nonprofit entity;
       ``(3) the term `method' means a method of doing or 
     conducting business ; 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) In general.--It shall be a defense to an action for 
     infringement under section 271 of this title with respect to 
     any subject matter that would otherwise infringe one or more 
     claims asserting a method in the patent being asserted 
     against a person, if such person had, acting in good faith, 
     actually reduced the subject matter to practice at least one 
     year before the effective filing date of such patent, and 
     commercially used the subject matter before the effective 
     filing date of such patent.
       ``(2) Exhaustion of right.--The sale or other disposition, 
     of a useful end result produced by a patented method, by a 
     person entitled to assert a defense under this section with 
     respect to that useful end result 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.
       ``(3) Limitations and qualifications of defense.--The 
     defense to infringement under this section is subject to the 
     following:
       ``(A) Patent.--A person may not assert the defense under 
     this section unless the invention for which the defense is 
     asserted is for a method.
       ``(B) 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.
       ``(C) 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 
     specific 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.
       ``(4) Burden of proof.--A person asserting the defense 
     under this section shall have the burden of establishing the 
     defense by clear and convincing evidence.
       ``(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 this section with respect to actions taken 
     after the date of such abandonment.
       ``(6) Personal defense.--The defense under this section may 
     be asserted only 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 as an ancillary and subordinate part of a good 
     faith assignment or transfer for other reasons of the entire 
     enterprise or line of business to which the defense relates.
       ``(7) Limitation on sites.--A defense under this section, 
     when acquired as part of a good faith assignment or transfer 
     of an entire enterprise or line of business to which the 
     defense relates, may only be asserted for uses at sites where 
     the subject matter that would otherwise infringe one or more 
     of the claims is in use before the later of the effective 
     filing date of the patent or the date of the assignment or 
     transfer of such enterprise or line of business.
       ``(8) 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.
       ``(9) Invalidity.--A patent shall not be deemed to be 
     invalid under section 102 or 103 of this title solely because 
     a defense is raised or 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. Defense to infringement based on earlier inventor.''.

     SEC. 203. 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 III--PATENT TERM GUARANTEE

     SEC. 301. SHORT TITLE.

       This title may be cited as the ``Patent Term Guarantee 
     Act''.

     SEC. 302. PATENT TERM GUARANTEE AUTHORITY.

       (a) Adjustment of Patent Term.--Section 154(b) of title 35, 
     United States Code, is amended to read as follows:
       ``(b) Adjustment of Patent Term.--
       ``(1) Patent term guarantees.--
       ``(A) Guarantee of prompt patent and trademark office 
     responses.--Subject to the limitations under paragraph (2), 
     if the issue of an original patent is delayed due to the 
     failure of the Patent and Trademark Office to--
       ``(i) make a notification of the rejection of any claim for 
     a patent or any objection or argument under section 132, or 
     give or mail a written notice of allowance under section 151, 
     within 14 months after the date on which the application was 
     filed;
       ``(ii) respond to a reply under section 132, or to an 
     appeal taken under section 134, within 4 months after the 
     date on which the reply was filed or the appeal was taken;
       ``(iii) act on an application within 4 months after the 
     date of a decision by the Board of Patent Appeals and 
     Interferences under section 134 or 135 or a decision by a 
     Federal court under section 141, 145, or 146 in a case in 
     which allowable claims remain in the application; or

[[Page H6932]]

       ``(iv) issue a patent within 4 months after the date on 
     which the issue fee was paid under section 151 and all 
     outstanding requirements were satisfied;
     the term of the patent shall be extended one day for each day 
     after the end of the period specified in clause (i), (ii), 
     (iii), or (iv), as the case may be, until the action 
     described in such clause is taken.
       ``(B) Guarantee of no more than 3-year application 
     pendency.--Subject to the limitations under paragraph (2), if 
     the issue of an original patent is delayed due to the failure 
     of the Patent and Trademark Office to issue a patent within 3 
     years after the actual filing date of the application in the 
     United States, not including--
       ``(i) any time consumed by continued examination of the 
     application requested by the applicant under section 132(b);
       ``(ii) any time consumed by a proceeding under section 
     135(a), any time consumed by the imposition of an order 
     pursuant to section 181, or any time consumed by appellate 
     review by the Board of Patent Appeals and Interferences or by 
     a Federal court; or
       ``(iii) any delay in the processing of the application by 
     the Patent and Trademark Office requested by the applicant 
     except as permitted by paragraph (3)(C),
     the term of the patent shall be extended 1 day for each day 
     after the end of that 3-year period until the patent is 
     issued.
       ``(C) Guarantee or adjustments for delays due to 
     interferences, secrecy orders, and appeals.--Subject to the 
     limitations under paragraph (2), if the issue of an original 
     patent is delayed due to--
       ``(i) a proceeding under section 135(a);
       ``(ii) the imposition of an order pursuant to section 181; 
     or
       ``(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,
     the term of the patent shall be extended one day for each day 
     of the pendency of the proceeding, order, or review, as the 
     case may be.
       ``(2) Limitations.--
       ``(A) In general.--To the extent that periods of delay 
     attributable to grounds specified in paragraph (1) overlap, 
     the period of any adjustment granted under this subsection 
     shall not exceed the actual number of days the issuance of 
     the patent was delayed.
       ``(B) Disclaimed term.--No patent the term of which has 
     been disclaimed beyond a specified date may be adjusted under 
     this section beyond the expiration date specified in the 
     disclaimer.
       ``(C) Reduction of period of adjustment.--
       ``(i) The period of adjustment of the term of a patent 
     under paragraph (1) shall be reduced by a period equal to the 
     period of time during which the applicant failed to engage in 
     reasonable efforts to conclude prosecution of the 
     application.
       ``(ii) With respect to adjustments to patent term made 
     under the authority of paragraph (1)(B), an applicant shall 
     be deemed to have failed to engage in reasonable efforts to 
     conclude processing or examination of an application for the 
     cumulative total of any periods of time in excess of 3 months 
     that are taken to respond to a notice from the Office making 
     any rejection, objection, argument, or other request, 
     measuring such 3-month period from the date the notice was 
     given or mailed to the applicant.
       ``(iii) 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.
       ``(3) Procedures for patent term adjustment 
     determination.--
       ``(A) The Director shall prescribe regulations establishing 
     procedures for the application for and determination of 
     patent term adjustments under this subsection.
       ``(B) Under the procedures established under subparagraph 
     (A), the Director shall--
       ``(i) make a determination of the period of any patent term 
     adjustment under this subsection, and shall transmit a notice 
     of that determination with the written notice of allowance of 
     the application under section 151; and
       ``(ii) provide the applicant one opportunity to request 
     reconsideration of any patent term adjustment determination 
     made by the Director.
       ``(C) The Director shall reinstate all or part of the 
     cumulative period of time of an adjustment under paragraph 
     (2)(C) if the applicant, prior to the issuance of the patent, 
     makes a showing that, in spite of all due care, the applicant 
     was unable to respond within the 3-month period, but in no 
     case shall more than 3 additional months for each such 
     response beyond the original 3-month period be reinstated.
       ``(D) The Director shall proceed to grant the patent after 
     completion of the Director's determination of a patent term 
     adjustment under the procedures established under this 
     subsection, notwithstanding any appeal taken by the applicant 
     of such determination.
       ``(4) Appeal of patent term adjustment determination.--
       ``(A) An applicant dissatisfied with a determination made 
     by the Director under paragraph (3) shall have remedy by a 
     civil action against the Director filed in the United States 
     District Court for the District of Columbia within 180 days 
     after the grant of the patent. Chapter 7 of title 5 shall 
     apply to such action. Any final judgment resulting in a 
     change to the period of adjustment of the patent term shall 
     be served on the Director, and the Director shall thereafter 
     alter the term of the patent to reflect such change.
       ``(B) The determination of a patent term adjustment under 
     this subsection shall not be subject to appeal or challenge 
     by a third party prior to the grant of the patent.''.
       (b) Conforming Amendments.--
       (1) Section 282 of title 35, United States Code, is amended 
     in the fourth paragraph by striking ``156 of this title'' and 
     inserting ``154(b) or 156 of this title''.
       (2) Section 1295(a)(4)(C) of title 28, United States Code, 
     is amended by striking ``145 or 146'' and inserting ``145, 
     146, or 154(b)''.

     SEC. 303. CONTINUED EXAMINATION OF PATENT APPLICATIONS.

       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:
       ``(b) The Director shall prescribe regulations to provide 
     for the continued examination of applications for patent at 
     the request of the applicant. The Commissioner may establish 
     appropriate fees for such continued examination and shall 
     provide a 50 percent reduction on such fees for small 
     entities that qualify for reduced fees under section 41(h)(1) 
     of this title.''.

     SEC. 304. TECHNICAL CLARIFICATION.

       Section 156(a) of title 35, United States Code, is amended 
     in the matter preceding paragraph (1) by inserting ``, which 
     shall include any patent term adjustment granted under 
     section 154(b),'' after ``the original expiration date of the 
     patent''.

     SEC. 305. EFFECTIVE DATE.

       (a) Sections 302 and 304.--The amendments made by sections 
     302 and 304 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 the date of the 
     enactment of this Act.
       (b) Section 303.--The amendments made by section 303 shall 
     take effect 6 months after the date of the enactment of this 
     Act.

 TITLE IV--UNITED STATES PUBLICATION OF PATENT APPLICATIONS PUBLISHED 
                                 ABROAD

     SEC. 401. SHORT TITLE.

       This title may be referred to as the ``Publication of 
     Foreign Filed Applications Act''.

     SEC. 402. PUBLICATION.

       (a) 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 
     any such application 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) United States Publication of Applications Published 
     Abroad.--
       ``(1) In general.--(A) Subject to paragraph (2), each 
     application for patent, except applications for design 
     patents filed under chapter 16 and provisional applications 
     filed under section 111(b), shall be published, in accordance 
     with procedures determined by the Director, promptly upon the 
     expiration of a period of 18 months after 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) Pursuant to this title and 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 
     under section 181 shall not be published.
       ``(C)(i) If an applicant, upon filing, makes a request that 
     an application not be published pursuant to paragraph (1), 
     and states in such request that the invention disclosed in 
     the application has not been the subject of an application 
     filed in another country, or under a multilateral 
     international agreement, that requires publication of 
     applications 18 months after filing, the application shall 
     not be published as provided in paragraph (1).
       ``(ii) An applicant may rescind a request made under clause 
     (i) at any time.
       ``(iii) An applicant who has made a request under clause 
     (i) but who subsequently files, in a foreign country or under 
     a multilateral international agreement specified in clause 
     (i), an application directed to the invention disclosed in 
     the application filed in the Patent and Trademark Office, 
     shall notify the Director of such filing not later than 45 
     days after the date of the filing of such foreign or 
     international application. A failure of the applicant to 
     provide such notice within the prescribed period shall result 
     in the application being regarded as abandoned, unless it

[[Page H6933]]

     is shown to the satisfaction of the Director that the delay 
     in submitting the notice was unintentional.
       ``(iv) If a notice is made pursuant to clause (iii), or the 
     applicant rescinds a request pursuant to clause (ii), the 
     Director shall publish the application on or as soon as is 
     practical after the date that is specified in clause (i).
       ``(v) If an applicant has filed applications in one or more 
     foreign countries, directly or through a multilateral 
     international agreement, and such foreign filed applications 
     corresponding to an application filed in the Patent and 
     Trademark Office or the description of the invention in such 
     foreign filed applications is less extensive than the 
     application or description of the invention in the 
     application filed in the Patent and Trademark Office, the 
     applicant may submit a redacted copy of the application filed 
     in the Patent and Trademark Office eliminating any part or 
     description of the invention in such application that is not 
     also contained in any of the corresponding applications filed 
     in a foreign country. The Director may only publish the 
     redacted copy of the application unless the redacted copy of 
     the application is not received within 16 months after the 
     earliest effective filing date for which a benefit is sought 
     under this title. The provisions of section 154(d) shall not 
     apply to a claim if the description of the invention 
     published in the redacted application filed under this clause 
     with respect to the claim does not enable a person skilled in 
     the art to make and use the subject matter of the claim.
       ``(c) Protest and Pre-Issuance Opposition.--The Director 
     shall establish appropriate procedures to ensure that no 
     protest or other form of pre-issuance opposition to the grant 
     of a patent on an application may be initiated after 
     publication of the application without the express written 
     consent of the applicant.''.
       (b) Study by GAO.--
       (1) In general.--The Comptroller General of the United 
     States shall conduct a study of applicants for patents who 
     file only in the United States during the 3-year period 
     beginning on the effective date of this title.
       (2) Contents.--The study conducted under paragraph (1) 
     shall--
       (A) consider the number of such applicants for patent in 
     relation to the number of applicants who file in the United 
     States and outside the United States;
       (B) examine how many domestic-only filers request at the 
     time of filing not to be published;
       (C) examine how many such filers rescind that request or 
     later choose to file abroad; and
       (D) examine the manner of entity seeking an application and 
     any correlation that may exist between such manner and 
     publication of patent applications.
       (3) Report to judiciary committees.--The Comptroller 
     General shall submit to the Committees on the Judiciary of 
     the House of Representatives and the Senate the results of 
     the study conducted under this subsection.

     SEC. 403. 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, identifying the 
     foreign application by specifying its application number, 
     country, and the day, month, and year of its filing, is filed 
     in the Patent and Trademark Office at such time during the 
     pendency of the application as required by the Director.
       ``(2) The Director may consider the failure of the 
     applicant to file a timely claim for priority as a waiver of 
     any such claim. The Director may establish procedures, 
     including the payment of a surcharge, to accept an 
     unintentionally delayed claim under this section.
       ``(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 foreign intellectual property authority 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: 
     ``The Director may determine the time period during the 
     pendency of the application within which an amendment 
     containing the specific reference to the earlier filed 
     application is submitted. 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 unintentionally late submissions of 
     amendments under this section.''.

     SEC. 404. 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), or in the case of an 
     international application filed under the treaty defined in 
     section 351(a) 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 in a case in which 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.--
       ``(A) Effective date.--The right under paragraph (1) to 
     obtain a reasonable royalty based upon the publication under 
     the treaty defined in section 351(a) of an international 
     application designating the United States shall commence on 
     the date on which the Patent and Trademark Office receives a 
     copy of the publication under the treaty of the international 
     application, or, if the publication under the treaty of the 
     international application is in a language other than 
     English, on the date on which the Patent and Trademark Office 
     receives a translation of the international application in 
     the English language.
       ``(B) Copies.--The Director may require the applicant to 
     provide a copy of the international application and a 
     translation thereof.''.

     SEC. 405. 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)(A) an application for patent, published pursuant to 
     section 122(b), 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) shall have the effect under this subsection of 
     a national application published under section 122(b) only if 
     the international application designating the United States 
     was published under Article 21(2)(a) of such treaty in the 
     English language, or
       ``(B) a patent granted on an application for patent by 
     another filed in the United States before the invention by 
     the applicant for patent, except that a patent shall not be 
     deemed filed in the United States for the purposes of this 
     subsection based on the filing of an international 
     application filed under the treaty defined in section 351(a), 
     or''.

     SEC. 406. 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 402 by charging a separate 
     publication fee after notice of allowance is given pursuant 
     to section 151 of title 35, United States Code.

     SEC. 407. CONFORMING AMENDMENTS.

       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 item relating to section 122 in the table of 
     sections for chapter 11 is amended by inserting ``; 
     publication of patent applications'' after ``applications''.
       (5) The item relating to section 154 in the table of 
     sections for chapter 14 is amended by inserting ``; 
     provisional rights'' after ``patent''.
       (6) Section 181 is amended--
       (A) in the first undesignated 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'';

[[Page H6934]]

       (B) in the second undesignated paragraph by inserting ``by 
     the publication of an application or'' after ``disclosure of 
     an invention'';
       (C) in the third undesignated 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 undesignated paragraph by inserting ``the 
     publication of an application or'' after ``and'' in the first 
     sentence.
       (7) Section 252 is amended in the first undesignated 
     paragraph by inserting ``substantially'' before ``identical'' 
     each place it appears.
       (8) Section 284 is amended by adding at the end of the 
     second undesignated paragraph the following: ``Increased 
     damages under this paragraph shall not apply to provisional 
     rights under section 154(d) of this title.''.
       (9) 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).''.

     SEC. 408. EFFECTIVE DATE.

       This title and the amendments made by this title, shall 
     take effect on the date that is 1 year after the date of the 
     enactment of this Act and shall apply to all applications 
     filed under section 111 of title 35, United States Code, on 
     or after that date, and all applications complying with 
     section 371 of title 35, United States Code, that resulted 
     from international applications filed on or after that date. 
     The amendments made by sections 404 and 405 shall apply to 
     any such application voluntarily published by the applicant 
     under procedures established under this title that is pending 
     on the date that is 1 year after the date of enactment of 
     this Act. The amendment made by section 404 shall also apply 
     to international applications designating the United States 
     that are filed on or after the date that is 1 year after the 
     date of the enactment of this Act.

         TITLE V--OPTIONAL INTER PARTES REEXAMINATION PROCEDURE

     SEC. 501. SHORT TITLE.

       This title may be cited as the ``Optional Inter Partes 
     Reexamination Procedure Act''.

     SEC. 502. EX PARTE REEXAMINATION OF PATENTS.

       Chapter 30 of title 35, United States Code, is amended in 
     the title by inserting ``EX PARTE'' before ``REEXAMINATION OF 
     PATENTS''.

     SEC. 503. 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 ex parte reexamination under section 302 or inter 
     partes reexaminaiton under section 311 who is not the patent 
     owner.''.

     SEC. 504. OPTIONAL INTER PARTES REEXAMINATION PROCEDURES.

       (a) In General.--Part 3 of title 35, United Stats Code, is 
     amended by adding after chapter 30 the following new chapter:

      ``CHAPTER 31--OPTIONAL INTER PARTES REEXAMINATION PROCEDURES

``Sec.
``311. Request for inter partes reexamination.
``312. Determination of issue by Director.
``313. Inter partes reexamination order by Director.
``314. Conduct of inter partes reexamination proceedings.
``315. Appeal.
``316. Certificate of patentability, unpatentability, and claim 
              cancellation.
``317. Inter partes reexamination prohibited.
``318. Stay of litigation.

     ``Sec. 311. Request for inter partes reexamination

       ``(a) In General.--Any person at any time may file a 
     request for inter partes reexamination by the Office of a 
     patent on the basis of any prior art cited under the 
     provisions of section 301.
       ``(b) Requirements.--The request shall--
       ``(1) be in writing, include the identity of the real party 
     in interest, and be accompanied by payment of an inter partes 
     reexamination fee established by the Director under section 
     41; and
       ``(2) set forth the pertinency and manner of applying cited 
     prior art to every claim for which reexamination is 
     requested.
       ``(c) Copy.--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.

     ``Sec. 312. Determination of issue by Director

       ``(a) Reexamination.--Not later than 3 months after the 
     filing of a request for inter partes reexamination under 
     section 311, 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, and any time, the 
     Director may determine whether a substantial new question of 
     patentability is raised by patents and publications.
       ``(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 inter partes reexamination fee required under 
     section 311.

     ``Sec. 313. Inter partes reexamination order by Director

       ``If, in a determination made under section 312(a), 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 inter partes 
     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 inter partes 
     reexamination conducted in accordance with section 314.

     ``Sec. 314. Conduct of inter partes 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, except as provided for under this section. In any 
     inter partes 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 
     inter partes reexamination proceeding in which the order for 
     inter partes reexamination is based upon a request by a 
     third-party requester.
       ``(2) With the exception of the inter partes reexamination 
     request, any document filed by either the patent owner or the 
     third-party requester shall be served on the other party. In 
     addition, the third-party requester shall receive a copy of 
     any communication sent by the Office to the patent owner 
     concerning the patent subject to the inter partes 
     reexamination proceeding.
       ``(3) Each time that the patent owner files a response to 
     an action on the merits from the Patent and Trademark Office, 
     the third-party requester shall have one opportunity to file 
     written comments addressing issues raised by the action of 
     the Office or the patent owner's response thereto, if those 
     written comments are received by the Office within 30 days 
     after the date of service of the patent owner's response.
       ``(c) Special Dispatch.--Unless otherwise provided by the 
     Director for good cause, all inter partes 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.

     ``Sec. 315. Appeal

       ``(a) Patent Owner.--The patent owner involved in an inter 
     partes reexamination proceeding under this chapter--
       ``(1) may appeal under the provisions of section 134, and 
     may appeal under the provisions of sections 141 through 144, 
     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 under subsection (b).
       ``(b) Third-Party Requester.--A third-party requester may--
       ``(1) appeal under the provisions of section 134 with 
     respect to any final decision favorable to the patentability 
     of any original or proposed amended or new claim of the 
     patent; or
       ``(2) be a party to any appeal taken by the patent owner 
     under the provisions of section 134, subject to subsection 
     (c).
       ``(c) Civil Action.--A third-party requester whose request 
     for an inter partes reexamination results in an order under 
     section 313 is estopped from asserting at a later time, in 
     any civil action arising in whole or in part under section 
     1338 of title 28, the invalidity of any claim finally 
     determined to be valid and patentable on any ground which the 
     third-party requester raised or could have raised during the 
     inter partes reexamination proceedings. 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 inter 
     partes reexamination proceedings.

     ``Sec. 316. Certificate of patentability, unpatentability, 
       and claim cancellation

       ``(a) In General.--In an inter partes reexamination 
     proceeding under this chapter, when the time for appeal has 
     expired or any appeal proceeding has terminated, the Director 
     shall issue and publish a certificate canceling any claim of 
     the patent finally determined to be unpatentable, confirming 
     any claim of the patent determined to be patentable, and 
     incorporating in the patent any proposed amended or new claim 
     determined to be patentable.
       ``(b) Amended or New Claim.--Any proposed amended or new 
     claim determined to be patentable and incorporated into a 
     patent following an inter partes reexamination proceeding 
     shall have the same effect as that specified in section 252 
     of this title for reissued patents on the right of any person 
     who made, purchased, or used within the

[[Page H6935]]

     United States, or imported into the United States, anything 
     patented by such proposed amended or new claim, or who made 
     substantial preparation for the same, prior to issuance of a 
     certificate under the provisions of subsection (a) of this 
     section.

     ``Sec. 317. Inter partes reexamination prohibited

       ``(a) Order for Reexamination.--Notwithstanding any 
     provision of this chapter, once an order for inter partes 
     reexamination of a patent has been issued under section 313, 
     neither the patent owner nor the third-party requester, if 
     any, nor privies of either, may file a subsequent request for 
     inter partes reexamination of the patent until an inter 
     partes reexamination certificate is issued and published 
     under section 316, unless authorized by the Director.
       ``(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 an inter partes 
     reexamination proceeding instituted by a third-party 
     requester is favorable to the patentability of any original 
     or proposed amended or new claim of the patent then neither 
     that party nor its privies may thereafter request inter 
     partes 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 inter partes reexamination 
     proceeding, and an inter partes reexamination requested by 
     that party or its privies on the basis of such issues may not 
     thereafter be maintained by the Office, notwithstanding any 
     other provision of this chapter. 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 inter partes 
     reexamination proceedings.

     ``Sec. 318. Stay of litigation

       ``Once an order for inter partes reexamination of a patent 
     has been issued under section 313, the patent owner may 
     obtain a stay of any pending litigation which involves an 
     issue of patentability of any claims of the patent which are 
     the subject of the inter partes reexamination order, unless 
     the court before which such litigation is pending determines 
     that a stay would not serve the interests of justice.''.
       (b) Conforming Amendments.--The table of chapters for part 
     III of title 35, United States Code, is amended by striking 
     the item relating to chapter 30 and inserting the following:

``30. Prior Art Citations to Office and Ex Parte Reexamination of 
    Patents...................................................301  ....

``31. Optional Inter Partes Reexamination of Patents.........311''.....

     SEC. 505. CONFORMING AMENDMENTS.

       (a) Patent Fees; Patent 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, $1,210, unless 
     the petition is filed under section 133 or 151 of this title, 
     in which case the fee shall be $110.''.
       (b) 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 any inter partes 
     reexamination proceeding may appeal from the final rejection 
     of any claim by the primary examiner to the Board of Patent 
     Appeals and Interferences, having once paid the fee for such 
     appeal.
       ``(c) Third-Party.--A third-party requester in an inter 
     partes proceeding 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. The third-party requester may not 
     appeal the decision of the Board of Patent Appeals and 
     Interferences.''.
       (c) Appeal to Court of Appeals for the Federal Circuit.--
     Section 141 of title 35, United States Code, is amended by 
     adding the following after the second sentence: ``A patent 
     owner in any reexamination proceeding dissatisfied with the 
     final decision in an appeal to the Board of Patent Appeals 
     and Interferences under section 134 may appeal the decision 
     only to the United States Court of Appeals for the Federal 
     Circuit.''.
       (d) 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 Patent and Trademark Office, addressing 
     all the issues involved in the appeal.''.
       (e) 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. 506. REPORT TO CONGRESS.

       Not later than 5 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 inter partes 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. 507. ESTOPPEL EFFECT OF REEXAMINATION.

       Any party who requests an inter partes reexamination under 
     section 311 of title 35, United States Code, is estopped from 
     challenging at a later time, in any civil action, any fact 
     determined during the process of such reexamination, except 
     with respect to a fact determination later proved to be 
     erroneous based on information unavailable at the time of the 
     inter partes reexamination decision. If this section is held 
     to be unenforceable, the enforceability of the rest of this 
     title or of this Act shall not be denied as a result.

     SEC. 508. EFFECTIVE DATE.

       This title and the amendments made by this title shall take 
     effect on the date that is 1 year after the date of the 
     enactment of this Act and shall apply to inter partes 
     reexamination requests filed on or after such date.

                 TITLE VI--PATENT AND TRADEMARK OFFICE

     SEC. 601. SHORT TITLE.

       This title may be cited as the ``Patent and Trademark 
     Office Efficiency Act''.

         Subtitle A--United States Patent and Trademark Office

     SEC. 611. ESTABLISHMENT OF PATENT AND TRADEMARK OFFICE.

       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 an agency of the United 
     States, within the Department of Commerce. In carrying out 
     its functions, the United States Patent and Trademark Office 
     shall be subject to the policy direction of the Secretary of 
     Commerce, but otherwise shall retain responsibility for 
     decisions regarding the management and administration of its 
     operations and shall exercise independent control of its 
     budget allocations and expenditures, personnel decisions and 
     processes, procurements, and other administrative and 
     management functions in accordance with this title and 
     applicable provisions of law. Those operations designed to 
     grant and issue patents and those operations which are 
     designed to facilitate the registration of trademarks shall 
     be treated as separate operating units within the Office.
       ``(b) Offices.--The United States Patent and Trademark 
     Office shall maintain its principal office in the 
     metropolitan Washington, DC, 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 in the 
     United States 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. 612. 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, subject to the policy direction of the Secretary of 
     Commerce--
       ``(1) shall be responsible for the granting and issuing of 
     patents and the registration of trademarks; and
       ``(2) shall be responsible for disseminating to the public 
     information with respect to patents and trademarks.
       ``(b) Specific Powers.--The Office--
       ``(1) shall adopt and use a seal of the Office, which shall 
     be judicially noticed and with which letters patent, 
     certificates of trademark registrations, and papers issued by 
     the Office shall be authenticated;
       ``(2) may establish regulations, not inconsistent with law, 
     which--
       ``(A) shall govern the conduct of proceedings in the 
     Office;
       ``(B) shall be made in accordance with section 553 of title 
     5;
       ``(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;
       ``(E) shall recognize the public interest in continuing to 
     safeguard broad access to the

[[Page H6936]]

     United States patent system through the reduced fee structure 
     for small entities under section 41(h)(1) of this title; and
       ``(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;
       ``(3) 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;
       ``(4)(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;
       ``(5) 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;
       ``(6) 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, 
     instrumentality, patent and trademark office, or 
     international organization concerned, the services, records, 
     facilities, or personnel of any State or local government 
     agency or instrumentality or foreign patent and trademark 
     office or international organization to perform functions on 
     its behalf;
       ``(7) 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;
       ``(8) shall advise the President, through the Secretary of 
     Commerce, on national and certain international intellectual 
     property policy issues;
       ``(9) shall advise Federal departments and agencies on 
     matters of intellectual property policy in the United States 
     and intellectual property protection in other countries;
       ``(10) shall provide guidance, as appropriate, with respect 
     to proposals by agencies to assist foreign governments and 
     international intergovernmental organizations on matters of 
     intellectual property protection;
       ``(11) may conduct programs, studies, or exchanges of items 
     or services regarding domestic and international intellectual 
     property law and the effectiveness of intellectual property 
     protection domestically and throughout the world;
       ``(12)(A) shall 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 intellectual property offices and 
     international intergovernmental organizations; and
       ``(B) may conduct programs and studies described in 
     subparagraph (A); and
       ``(13)(A) in coordination with the Department of State, may 
     conduct programs and studies cooperatively with foreign 
     intellectual property offices and international 
     intergovernmental organizations; 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.
       ``(c) Clarification of Specific Powers.--(1) The special 
     payments under subsection (b)(13)(B) shall be in addition to 
     any other payments or contributions to international 
     organizations described in subsection (b)(13)(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.
       ``(2) Nothing in subsection (b) shall derogate from the 
     duties of the Secretary of State or 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).
       ``(3) Nothing in subsection (b) shall derogate from the 
     duties and functions of the Register of Copyrights or 
     otherwise alter current authorities relating to copyright 
     matters.
       ``(4) In exercising the Director's powers under paragraphs 
     (3) and (4)(A) of subsection (b), the Director shall consult 
     with the Administrator of General Services.
       ``(d) 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. 613. ORGANIZATION AND MANAGEMENT.

       Section 3 of title 35, United States Code, is amended to 
     read as follows:

     ``Sec. 3. Officers and employees

       ``(a) Under Secretary and Director.--
       ``(1) In general.--The powers and duties of the United 
     States Patent and Trademark Office shall be vested in an 
     Under Secretary of Commerce for Intellectual Property and 
     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 has a professional 
     background and experience in patent or trademark law.
       ``(2) Duties.--
       ``(A) In general.--The Director shall be responsible for 
     providing policy direction and management supervision for the 
     Office and for the issuance of patents and the registration 
     of trademarks. The Director shall perform these duties in a 
     fair, impartial, and equitable manner.
       ``(B) Consulting with the public advisory committees.--The 
     Director shall consult with the Patent Public Advisory 
     Committee established in section 5 on a regular basis on 
     matters relating to the patent operations of the Office, 
     shall consult with the Trademark Public Advisory Committee 
     established in section 5 on a regular basis on matters 
     relating to the trademark operations of the Office, and shall 
     consult with the respective Public Advisory Committee 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 which 
     are subject to the requirement to provide notice and 
     opportunity for public comment pursuant to section 553 of 
     title 5, as the case may be.
       ``(3) Oath.--The Director shall, before taking office, take 
     an oath to discharge faithfully the duties of the Office.
       ``(4) 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.
       ``(b) Officers and Employees of the Office.--
       ``(1) Deputy under secretary and deputy director.--The 
     Secretary of Commerce, upon nomination by the Director, shall 
     appoint a Deputy Under Secretary of Commerce for Intellectual 
     Property and Deputy Director of the United States Patent and 
     Trademark 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. The Deputy Director 
     shall be a citizen of the United States who has a 
     professional background and experience in patent or trademark 
     law.
       ``(2) Commissioners.--
       ``(A) Appointment and duties.--The Secretary of Commerce 
     shall appoint a Commissioner for Patents and a Commissioner 
     for Trademarks, without regard to chapter 33, 51, or 53 of 
     title 5. The Commissioner for Patents shall be a citizen of 
     the United States with demonstrated management ability and 
     professional background and experience in patent law and 
     serve for a term of 5 years. The Commissioner for Trademarks 
     shall be a citizen of the United States with demonstrated 
     management ability and professional background and experience 
     in trademark law and serve for a term of 5 years. The 
     Commissioner for Patents and the Commissioner for Trademarks 
     shall serve as the chief operating officers for the 
     operations of the Office relating to patents and trademarks, 
     respectively, and shall be responsible for the management and 
     direction of all aspects of the activities of the Office that 
     affect the administration of patent and trademark operations, 
     respectively. The Secretary may reappoint a Commissioner to 
     subsequent terms of 5 years as long as the performance of the 
     Commissioner as set forth in the performance agreement in 
     subparagraph (B) is satisfactory.
       ``(B) Salary and performance agreement.--The Commissioners 
     shall be paid an annual rate of basic pay not to exceed the 
     maximum rate of basic pay for 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. The 
     compensation of the Commissioners shall be considered, for 
     purposes of section 207(c)(2)(A) of title 18, to be the 
     equivalent of that described under clause (ii) of section 
     207(c)(2)(A) of title 18. In addition, the Commissioners may 
     receive a bonus in an amount of up to, but not in excess of, 
     50 percent of the Commissioner's annual rate of basic pay, 
     based upon an evaluation by the Secretary of Commerce, acting 
     through the Director, of the Commissioners' performance as 
     defined in an annual performance agreement between the 
     Commissioners and the Secretary. The annual performance 
     agreements shall incorporate measurable organization and 
     individual goals in key operational areas as delineated in an 
     annual performance plan agreed to by the Commissioners and 
     the Secretary. Payment of a bonus under this subparagraph may 
     be made to the Commissioners only to the extent that such 
     payment does not cause the Commissioners' total aggregate 
     compensation in a calendar year to equal or exceed the amount 
     of the salary of the Vice President under section 104 of 
     title 3.
       ``(C) Removal.--The Commissioners may be removed from 
     office by the Secretary for misconduct or nonsatisfactory 
     performance

[[Page H6937]]

     under the performance agreement described in subparagraph 
     (B), without regard to the provisions of title 5. The 
     Secretary shall provide notification of any such removal to 
     both Houses of Congress.
       ``(3) 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 title, 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.
       ``(4) Training of examiners.--The Office shall submit to 
     the Congress a proposal to provide 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.
       ``(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.
       ``(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 Efficiency 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 Efficiency 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 
     Efficiency 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, as 
     necessary to carry out the purposes of this Act, 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.
       ``(f) Transition Provisions.--
       ``(1) Interim appointment of director.--On or after the 
     effective date of the Patent and Trademark Office Efficiency 
     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 Efficiency Act may serve as the Commissioner 
     for Patents until the date on 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 Efficiency Act may serve as the 
     Commissioner for Trademarks until the date on which a 
     Commissioner for Trademarks is appointed under subsection 
     (b).''.

     SEC. 614. PUBLIC ADVISORY COMMITTEES.

       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 Public Advisory 
       Committees

       ``(a) Establishment of Public Advisory Committees.--
       ``(1) Appointment.--The United States Patent and Trademark 
     Office shall have a Patent Public Advisory Committee and a 
     Trademark Public Advisory Committee, each of which shall have 
     9 voting members who shall be appointed by the Secretary of 
     Commerce and serve at the pleasure of the Secretary of 
     Commerce. Members of each Public Advisory Committee shall be 
     appointed for a term of 3 years, except that of the members 
     first appointed, 3 shall be appointed for a term of 1 year, 
     and 3 shall be appointed for a term of 2 years. In making 
     appointments to each Committee, the Secretary of Commerce 
     shall consider the risk of loss of competitive advantage in 
     international commerce or other harm to United States 
     companies as a result of such appointments.
       ``(2) Chair.--The Secretary shall designate a chair of each 
     Advisory Committee, whose term as chair shall be for 3 years.
       ``(3) Timing of appointments.--Initial appointments to each 
     Advisory Committee shall be made within 3 months after the 
     effective date of the Patent and Trademark Office Efficiency 
     Act. Vacancies shall be filled within 3 months after they 
     occur.
       ``(b) Basis for Appointments.--Members of each Advisory 
     Committee--
       ``(1) 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 with respect to 
     patents, in the case of the Patent Public Advisory Committee, 
     and with respect to trademarks, in the case of the Trademark 
     Public Advisory Committee;
       ``(2) shall include members who represent small and large 
     entity applicants located in the United States in proportion 
     to the number of applications filed by such applicants, but 
     in no case shall members who represent small entity patent 
     applicants, including small business concerns, independent 
     inventors, and nonprofit organizations, constitute less than 
     25 percent of the members of the Patent Public Advisory 
     Committee, and such members shall include at least 1 
     independent inventor; and
       ``(3) shall include individuals with substantial background 
     and achievement in finance, management, labor relations, 
     science, technology, and office automation.
     In addition to the voting members, each Advisory Committee 
     shall include a representative of each labor organization 
     recognized by the United States Patent and Trademark Office. 
     Such representatives shall be nonvoting members of the 
     Advisory Committee to which they are appointed.
       ``(c) Meetings.--Each Advisory Committee shall meet at the 
     call of the chair to consider an agenda set by the chair.
       ``(d) Duties.--Each Advisory Committee shall--
       ``(1) review the policies, goals, performance, budget, and 
     user fees of the United States Patent and Trademark Office 
     with respect to patents, in the case of the Patent Public 
     Advisory Committee, and with respect to Trademarks, in the 
     case of the Trademark Public Advisory Committee, and advise 
     the Director on these matters;
       ``(2) within 60 days after the end of each fiscal year--
       ``(A) prepare an annual report on the matters referred to 
     in paragraph (1);
       ``(B) transmit the report to the Secretary of Commerce, the 
     President, and the Committees on the Judiciary of the Senate 
     and the House of Representatives; and
       ``(C) publish the report in the Official Gazette of the 
     United States Patent and Trademark Office.
       ``(e) Compensation.--Each member of each Advisory Committee 
     shall be compensated for each day (including travel time) 
     during which such member is attending meetings or conferences 
     of that Advisory Committee or otherwise engaged in the 
     business of that Advisory Committee, 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. While away from such member's home or regular place 
     of business such member shall be allowed travel expenses, 
     including per diem in lieu of subsistence, as authorized by 
     section 5703 of title 5.
       ``(f) Access to Information.--Members of each Advisory 
     Committee 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.
       ``(g) Applicability of Certain Ethics Laws.--Members of 
     each Advisory Committee shall be special Government employees 
     within the meaning of section 202 of title 18.
       ``(h) Inapplicability of Federal Advisory Committee Act.--
     The Federal Advisory Committee Act (5 U.S.C. App.) shall not 
     apply to each Advisory Committee.
       ``(i) Open Meetings.--The meetings of each Advisory 
     Committee shall be open to the public, except that each 
     Advisory Committee may by majority vote meet in executive 
     session when considering personnel or other confidential 
     information.''.

     SEC. 615. PATENT AND TRADEMARK OFFICE FUNDING.

       Section 42(c) of title 35, United States Code, is amended 
     in the second sentence--
       (1) by striking ``Fees available'' and inserting ``All fees 
     available''; and
       (2) by striking ``may'' and inserting ``shall''.

     SEC. 616. 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.
       (c) Suspension or Exclusion From Practice.--Section 32 of 
     title 35, United States Code, is amended by striking ``31'' 
     and inserting ``2(b)(2)(D)''.

     SEC. 617. 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.

[[Page H6938]]

       ``(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. 618. BOARD OF PATENT APPEALS AND INTERFERENCES.

       Chapter 1 of title 35, United States Code, is amended--
       (1) by striking section 7 and redesignating sections 8 
     through 14 as sections 7 through 13, respectively; and
       (2) by 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. 619. ANNUAL REPORT OF DIRECTOR.

       Section 13 of title 35, United States Code, as redesignated 
     by section 618 of this Act, is amended to read as follows:

     ``Sec. 13. 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, the nature of training provided to examiners, 
     the evaluation of the Commissioner of Patents and the 
     Commissioner of Trademarks by the Secretary of Commerce, the 
     compensation of the Commissioners, and other information 
     relating to the Office.''.

     SEC. 620. 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. 621. PAY OF DIRECTOR AND DEPUTY DIRECTOR.

       (a) Pay of Director.--Section 5314 of title 5, United 
     States Code, is amended by striking 22  ``Assistant Secretary 
     of Commerce and Commissioner of Patents and Trademarks.''
     and inserting
       ``Under Secretary of Commerce for Intellectual Property and 
     Director of the United States Patent and Trademark Office.''.
       (b) Pay of Deputy Director.--Section 5315 of title 5, 
     United States Code, is amended by adding at the end the 
     following:
       ``Deputy Under Secretary of Commerce for Intellectual 
     Property and Deputy Director of the United States Patent and 
     Trademark Office.''.

     SEC. 622. STUDY ON ALTERNATIVE FEE STRUCTURES.

       The Under Secretary of Commerce for Intellectual Property 
     and Director of the United States Patent and Trademark Office 
     shall conduct a study of alternative fee structures that 
     could be adopted by the United States Patent and Trademark 
     Office to encourage maximum participation by the inventor 
     community in the United States. The Director shall submit to 
     the Committees on the Judiciary of the House of 
     Representatives and the Senate a report on the study not 
     later than 1 year after the date of the enactment of this 
     Act.

            Subtitle B--Effective Date; Technical Amendments

     SEC. 631. 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. 632. 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 Public Advisory Committees.
``6. Board of Patent Appeals and Interferences.
``7. Library.
``8. Classification of patents.
``9. Certified copies of records.
``10. Publications.
``11. Exchange of copies of patents and applications with foreign 
              countries.
``12. Copies of patents and applications for public libraries.
``13. Annual report to Congress.''.
       (5) Section 41(h) of title 35, United States Code, is 
     amended by striking ``Commissioner of Patents and 
     Trademarks'' and inserting ``Director''.
       (6) Section 155 of title 35, United States Code, is amended 
     by striking ``Commissioner of Patents and Trademarks'' and 
     inserting ``Director''.
       (7) Section 155A(c) of title 35, United States Code, is 
     amended by striking ``Commissioner of Patents and 
     Trademarks'' and inserting ``Director''.
       (8) Section 302 of title 35, United States Code, is amended 
     by striking ``Commissioner of Patents'' and inserting 
     ``Director''.
       (9) Section 303(b) of title 35, United States Code, is 
     amended by striking ``Commissioner's'' and inserting 
     ``Director's''.
       (10)(A) Except as provided in subparagraph (B), title 35, 
     United States Code, is amended by striking ``Commissioner'' 
     each place it appears and inserting ``Director''.
       (B) Chapter 17 of title 35, United States Code, is amended 
     by striking ``Commissioner'' each place it appears and 
     inserting ``Commissioner of Patents''.
       (11) Section 157(d) of title 35, United States Code, is 
     amended by striking ``Secretary of Commerce'' and inserting 
     ``Director''.
       (12) Section 202(a) of title 35, United States Code, is 
     amended--
       (A) by striking ``iv)'' and inserting ``(iv)''; and
       (B) by striking the second period after ``Department of 
     Energy'' at the end of the first sentence.
       (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 617 of this Act, 
     is amended by striking ``Commissioner'' each place it appears 
     and inserting ``Director''.
       (2) Section 500(e) of title 5, United States Code, is 
     amended by striking ``Patent Office'' and inserting ``United 
     States Patent and Trademark Office''.
       (3) 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;''.
       (4) 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.''.
       (5) 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''.
       (6) Section 12 of the Act of February 14, 1903 (15 U.S.C. 
     1511) is amended--
       (A) by striking ``(d) Patent and Trademark Office;'' and 
     inserting
       ``(4) United States Patent and Trademark Office; and
       (B) by redesignating subsections (a), (b), (c), (e), (f), 
     and (g) as paragraphs (1), (2), (3), (5), (6), and (7), 
     respectively and indenting the paragraphs as so redesignated 
     2 ems to the right.
       (7) 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''.
       (8) 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''.
       (9) 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''.
       (10) 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''.
       (11) 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

[[Page H6939]]

     ``United States Patent and Trademark Office''.
       (12) 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'' and by striking 
     ``Commissioner'' and inserting ``Director''.
       (13) 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''.
       (14) 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''.
       (15) Chapter 115 of title 28, United States Code, is 
     amended--
       (A) in the item relating to section 1744 in the table of 
     sections by striking ``Patent Office'' and inserting ``United 
     States Patent and Trademark Office'';
       (B) in section 1744--
       (i) by striking ``Patent Office'' each place it appears in 
     the text and section heading and inserting ``United States 
     Patent and Trademark Office'';
       (ii) by striking ``Commissioner of Patents'' and inserting 
     ``Director of the United States Patent and Trademark 
     Office''; and
       (C) by striking ``Commissioner'' and inserting 
     ``Director''.
       (16) Section 1745 of title 28, United States Code, is 
     amended by striking ``United States Patent Office'' and 
     inserting ``United States Patent and Trademark Office''.
       (17) Section 1928 of title 28, United States Code, is 
     amended by striking ``Patent Office'' and inserting ``United 
     States Patent and Trademark Office''.
       (18) 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''.
       (19) 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''.
       (20) 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''.
       (21) 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''.
       (22) Section 1111 of title 44, United States Code, is 
     amended by striking ``the Commissioner of Patents,''.
       (23) Section 1114 of title 44, United States Code, is 
     amended by striking ``the Commissioner of Patents,''.
       (24) Section 1123 of title 44, United States Code, is 
     amended by striking ``the Patent Office,''.
       (25) 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.
       (26) 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''.

                  Subtitle C--Miscellaneous Provisions

     SEC. 641. 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 Under Secretary of Commerce for Intellectual 
     Property and 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. 642. 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. 643. 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. 644. 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. 645. 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. 646. 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

[[Page H6940]]

     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. 647. 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. 648. 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, Justice, 
     and State, the Judiciary, and Related Agencies Appropriations 
     Act, 1999, as contained in Public Law 105-277.

     SEC. 649. 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 VII--MISCELLANEOUS PATENT PROVISIONS

     SEC. 701. 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 Commissioner, a 
     provisional application may be treated as an application 
     filed under subsection (a). Subject to section 119(e)(3) of 
     this title, 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) Technical Amendment Relating to Weekends and 
     Holidays.--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 secular or business day.''.
       (c) Elimination of Copendency Requirement.--Section 
     119(e)(2) of title 35, United States Code, is amended by 
     striking ``and the provisional application was pending on the 
     filing date of the application for patent under section 
     111(a) or section 363 of this title''.
       (d) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act 
     and shall apply to any provisional application filed on or 
     after June 8, 1995, except that the amendments made by 
     subsections (b) and (c) shall have no effect with respect to 
     any patent which is the subject of litigation in an action 
     commenced before such date of enactment.

     SEC. 702. INTERNATIONAL APPLICATIONS.

       Section 119 of title 35, United States Code, is amended--
       (1) in subsection (a)--
       (A) by inserting ``in a WTO member country or'' after 
     ``patent for the same invention''; and
       (B) by inserting ``such WTO member country or'' after 
     ``first filed in'';
       (2) in subsection (c), by inserting ``WTO member country 
     or'' after ``application in the same''; and
       (3) by adding at the end the following:
       ``(f) Applications for plant breeder's rights filed in a 
     WTO member country (or in a foreign 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 patent, subject to the same conditions and 
     requirements of this section as apply to applications for 
     patents.
       ``(g) As used in this section--
       ``(1) the term `WTO member country' has the meaning given 
     that term in section 2(10) of the Uruguay Round Agreements 
     Act; and
       ``(2) the term `UPOV Contracting Party' means a member of 
     the International Convention for the Protection of New 
     Varieties of Plants.''.

     SEC. 703. CERTAIN LIMITATIONS ON DAMAGES FOR PATENT 
                   INFRINGEMENT NOT APPLICABLE.

       Section 287(c)(4) of title 35, United States Code, is 
     amended by striking ``before the date of enactment of this 
     subsection'' and inserting ``based on an application the 
     earliest effective filing date of which is prior to September 
     30, 1996''.

     SEC. 704. ELECTRONIC FILING AND PUBLICATIONS.

       (a) Printing of Papers Filed.--Section 22 of title 35, 
     United States Code, is amended by striking ``printed or 
     typewritten'' and inserting ``printed, typewritten, or on an 
     electronic medium''.
       (b) Publications.--Section 11(a) of title 35, United States 
     Code, is amended by amending the matter preceding paragraph 1 
     to read as follows:
       ``(a) The Director may publish in printed, typewritten, or 
     electronic form, the following:''.
       (c) Copies of Patents for Public Libraries.--Section 13 of 
     title 35, United States Code, is amended by striking ``The 
     Commissioner may supply printed copies of specifications and 
     drawings of patents'' and inserting ``The Director may supply 
     copies of specifications and drawings of patents in printed 
     or electronic form''.
       (d) Maintenance of Collections.--Section 41(i)(1) of title 
     35, United States Code, is amended by striking ``The 
     Commissioner shall maintain, for use by the public, paper or 
     microform'' and inserting ``The Director shall maintain, for 
     use by the public, paper, microform, or electronic''.

     SEC. 705. STUDY AND REPORT ON BIOLOGICAL DEPOSITS IN SUPPORT 
                   OF BIOTECHNOLOGY PATENTS.

       (a) In General.--No later than 6 months after the date of 
     the enactment of this Act, the Comptroller General of the 
     United States, in consultation with the Director of the 
     United States Patent and Trademark Office, shall conduct a 
     study and submit a report to the Congress on the potential 
     risks to the United States biotechnology industry relating to 
     biological deposits in support of biotechnology patents.
       (b) Contents.--The study conducted under this section shall 
     include--
       (1) an examination of the risk of export and the risk of 
     transfers to third parties of biological deposits, and the 
     risks posed by the change to 18-month publication 
     requirements made by this Act;
       (2) an analysis of comparative legal and regulatory 
     regimes; and
       (3) any related recommendations.
       (c) Consideration of Report.--In drafting regulations 
     affecting biological deposits (including any modification of 
     title 37, Code of Federal Regulations, section 1.801 et 
     seq.), the Patent and Trademark Office shall consider the 
     recommendations of the study conducted under this section.

     SEC. 706. PRIOR INVENTION.

       Section 102(g) of title 35, United States Code, is amended 
     to read as follows:
       ``(g)(1) during the course of an interference conducted 
     under section 135 or section 291, another inventor involved 
     therein establishes, to the extent permitted in section 104, 
     that before such person's invention thereof the invention was 
     made by such other inventor and not abandoned, suppressed, or 
     concealed, or (2) before such person's invention thereof, the 
     invention was made in this country by another inventor who 
     had not abandoned, suppressed, or concealed it. In 
     determining priority of invention under this subsection, 
     there shall be considered not only the respective dates of 
     conception and reduction to practice of the invention, but 
     also the reasonable diligence of one who was first to 
     conceive and last to reduce to practice, from a time prior to 
     conception by the other.''.

     SEC. 707. PRIOR ART EXCLUSION FOR CERTAIN COMMONLY ASSIGNED 
                   PATENTS.

       (a) Prior Art Exclusion.--Section 103(c) of title 35, 
     United States Code, is amended by striking ``subsection (f) 
     or (g)'' and inserting ``one or more of subsections (e), (f), 
     and (g)''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to any application for patent filed on or after 
     the date of the enactment of this Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
North Carolina (Mr. Coble) and the gentlewoman from California (Ms. 
Lofgren) each will control 20 minutes.
  Ms. KAPTUR. Mr. Speaker, I would like to ask if the gentlewoman from 
California is opposed to the resolution that will be under 
consideration.
  The SPEAKER pro tempore. Is the gentlewoman from California opposed 
to the bill?
  Ms. LOFGREN. Mr. Speaker, if necessary to claim the time representing 
the Democratic part of the aisle, but I think, pursuant to the rule, I 
have been designated as the member of the minority on the committee to 
represent our side. But I will certainly yield time to the gentlewoman 
from Ohio to express her opinion.
  The SPEAKER pro tempore. Is the gentlewoman from Ohio challenging the 
gentlewoman from California for the right to control the time?
  Ms. KAPTUR. I would like to claim time in opposition, and I would 
like to know if the gentlewoman is opposed to the measure before us.
  The SPEAKER pro tempore. Is the gentlewoman from Ohio opposed to the 
bill?
  Ms. KAPTUR. The gentlewoman from Ohio is opposed.
  The SPEAKER pro tempore. Is the gentlewoman from California opposed 
to the bill?
  Ms. LOFGREN. Mr. Speaker, the gentlewoman from Ohio is not a member 
of the committee of jurisdiction and is not, therefore, eligible to 
manage our time. I would ask for a ruling.
  The SPEAKER pro tempore. The gentlewoman from Ohio is eligible if the 
gentlewoman from California is not opposed.

[[Page H6941]]

  Ms. LOFGREN. Then I will claim opposition.
  The SPEAKER pro tempore. The gentlewoman from California is opposed?
  Ms. LOFGREN. I will claim opposition and the time.
  The SPEAKER pro tempore. Then the gentlewoman from California 
qualifies since the gentlewoman is opposed to the bill.
  The gentlewoman from California will then be recognized for 20 
minutes.


                             Point of Order

  Mr. ROHRABACHER. Point of order, Mr. Speaker. With all fairness here, 
claiming opposition is not what the question is. If the gentlewoman 
from Ohio is indeed opposed to the bill, she deserves to have this time 
as compared to someone who is unwilling to say that they are opposed to 
the bill.
  Ms. LOFGREN. Mr. Speaker, if I may, I have reservations about the 
changes made today. I hope that I can be convinced that they are 
adequately made by the time the debate is over.
  The SPEAKER pro tempore. At this point, the Chair does not question 
the motives of the Member. The Member has stated she is in opposition 
to the bill.
  The Chair recognizes the gentleman from North Carolina (Mr. Coble).
  Mr. ROHRABACHER. Continuing my point of order, Mr. Speaker, does the 
Member not just claiming opposition, does she oppose the bill?
  Ms. LOFGREN. I believe the Chair has ruled.
  Mr. ROHRABACHER. If not, if she cannot state this, I would state as a 
point of order, the gentlewoman from Ohio (Ms. Kaptur), who does say 
she is opposed to the bill, this is not in my interest to do this, this 
is in the interest of fairness, we should make sure the time is 
allotted to someone who opposes the bill.
  The SPEAKER pro tempore. The gentlewoman from California has stated 
that she is in opposition to the bill; is that correct?
  Is the gentlewoman from California in opposition to the bill?
  Ms. LOFGREN. Until convinced about the changes made, yes.
  The SPEAKER pro tempore. At this point the gentlewoman from 
California is in opposition to the bill. The gentlewoman qualifies.


                             Point of Order

  Ms. KAPTUR. Point of order, Mr. Speaker.
  Mr. Speaker, do I take it, then, that under your ruling, I, as 
someone who is opposed to this measure, will not be allowed my own time 
during debate this evening?
  The SPEAKER pro tempore. Under a motion to suspend the rules, only 
two Members may control the time. The gentlewoman from California has 
qualified to claim the time in opposition. She will, of course, be able 
to yield time if she is so inclined.
  Ms. LOFGREN. Mr. Chairman, if I may, I plan to expansively yield time 
to the gentlewoman from Ohio.
  Ms. KAPTUR. I wanted to ask, Mr. Speaker, how much time would that be 
of the total time allotted, then?
  The SPEAKER pro tempore. Each side has 20 minutes. The gentlewoman 
from California will control 20 minutes.


                         Parliamentary Inquiry

  Mr. HOYER. Mr. Speaker, I have a parliamentary inquiry.
  The SPEAKER pro tempore. The gentleman will state it.
  Mr. HOYER. Am I correct that under the rules as they now exist, that 
if in fact the gentlewoman from Ohio (Ms. Kaptur) were recognized in 
opposition, she would receive half of the time allotted to the minority 
side of 20 minutes? Is that correct?
  The SPEAKER pro tempore. Only one Member may control time in 
opposition. The gentlewoman from California, a member of the committee, 
controls the time because she is opposed.
  Mr. HOYER. So if she were in opposition, she would receive the entire 
20 minutes?
  The SPEAKER pro tempore. If the gentlewoman from California were not 
in opposition, someone else could seek that time.
  Mr. HOYER. Further parliamentary inquiry. If that in fact occurred, 
could the gentlewoman from Ohio (Ms. Kaptur) yield to the gentlewoman 
from California (Ms. Lofgren) 10 minutes?
  The SPEAKER pro tempore. Any Member in control of time can yield time 
to anyone else.
  Mr. HOYER. In other words, there would be nothing to preclude her 
from doing so?
  The SPEAKER pro tempore. Repeat your question, please.
  Mr. HOYER. The Speaker's response was, as I take it, if the 
gentlewoman from Ohio (Ms. Kaptur) were recognized as an opponent to 
the legislation, she could yield such time as she desired to the 
gentlewoman from California (Ms. Lofgren) who obviously has been asked 
by the committee to represent the minority side of the committee in 
this action.
  The SPEAKER pro tempore. That would be possible. But the gentlewoman 
from California, a member of the committee, has claimed the time 
because in opposition and will have the 20 minutes and will be able to 
yield that time as she so desires.
  Mr. HOYER. I understand.
  Ms. KAPTUR. Mr. Speaker, could I ask unanimous consent to control my 
own 10 minutes?
  The SPEAKER pro tempore. Is there objection to the request of the 
gentlewoman from Ohio?
  Ms. LOFGREN. Mr. Speaker, I object.
  The SPEAKER pro tempore. Objection is heard.
  The gentlewoman from California (Ms. Lofgren) controls the time.


                             Point of Order

  Mr. ROHRABACHER. Mr. Speaker, I have a point of order.
  The SPEAKER pro tempore. The gentleman will state his point of order.
  Mr. ROHRABACHER. Mr. Speaker, the point of order is such that it 
seems to me that by being a little heavy-handed here, we are 
undermining this process.
  Ms. LOFGREN. Will the gentleman yield?
  The CHAIRMAN. The gentleman will state his point of order first.
  Mr. ROHRABACHER. I withdraw my point of order.
  Ms. LOFGREN. Mr. Speaker, I ask unanimous consent to make a 10-second 
statement that will save us all a lot of time.
  After I make my opening statement, it is my intention to yield 10 
minutes to the gentlewoman from Ohio.
  The SPEAKER pro tempore. The gentlewoman may take 10 seconds of her 
time and solve the problem.
  Ms. LOFGREN. I think we just solved it, Mr. Speaker.
  The SPEAKER pro tempore. Very well.
  The Chair recognizes the gentleman from North Carolina (Mr. Coble).


                             General Leave

  Mr. COBLE. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days to revise and extend their remarks and include 
extraneous material on the bill under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from North Carolina?
  There was no objection.
  Mr. COBLE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I want to say to my friend from California and to my 
friend from Ohio, the gentlewoman from California's comments, I think, 
make it clear that no one is trying to roll anyone. I think that has 
been made clear by the gentlewoman from California's comment subsequent 
to the beginning of the debate.
  I rise tonight, Mr. Speaker, in support of H.R. 1907, the American 
Inventors Protection Act, and urge the House to adopt the measure.
  Mr. Speaker, a coalition of Members, staff, administration officials 
and other contributors have negotiated in good faith into the early 
evening to clarify what few outstanding issues remain in this 100-plus-
page bill. I now anticipate overwhelming support for this complex, 
important and often misunderstood measure which will bring our patent 
and trademark system into the 21st century to the benefit of American 
inventors and American consumers.
  Mr. Speaker, H.R. 1907 is a product of compromise and negotiation. It 
is comprised of several provisions that have been suggested by the 
gentleman from California (Mr. Rohrabacher), the gentleman from 
California (Mr. Campbell), each of whom opposed this the last session, 
the gentleman from Illinois (Mr. Manzullo) and the gentleman from 
Indiana (Mr. Burton), in addition to other administration and industry 
officials.

[[Page H6942]]

  The gentlewoman from California (Ms. Lofgren), the gentleman from 
California (Mr. Berman), the ranking member of the subcommittee, among 
others, have been very helpful in this process. I want to thank all the 
participants and others too numerous to name for their patience and 
insight as we have labored to bring this bill finally to the floor.
  Mr. Speaker, with a bill this complex and lengthy, no one who 
participates in its construction can get everything he or she wants. I 
think we have all done a good job, however, of addressing those 
legitimate concerns registered by independent inventors while retaining 
the core protections of the legislation. There is no doubt in my mind 
that H.R. 1907 will make our patent and trademark system, already the 
world's best, even better in the new millennium.
  Mr. Speaker, I place an exchange of letters in the Record concerning 
committee jurisdiction on the bill H.R. 1907 between Chairman Burton 
and Chairman Hyde.

                                    U.S. House of Representatives,


                               Committee on Government Reform,

                                   Washington, DC, August 3, 1999.
     Hon. Henry J. Hyde,
     Chairman, Committee on the Judiciary,
     Washington, DC.
       Dear Mr. Chairman: I am writing with regard to H.R. 1907, 
     the American Inventors Protection Act of 1999.
       As you know, under House Rule X of the Committee on 
     Government Reform and Oversight has jurisdiction over the 
     federal civil service and the overall economy, efficiency, 
     and management of government operations and activities. 
     Sections 612, 613, 614, and 621 of the amended bill address 
     matters that are within the jurisdiction of this Committee.
       In the interest of expediting floor consideration for this 
     measure, the Committee on Government Reform will agree not to 
     exercise its jurisdiction over those sections on the 
     understanding that you have agreed to amend the bill as 
     follows:
       1. Section 613 will be revised to provide that the total 
     compensation of the Commissioner for Patents and the 
     Commissioner for Trademarks may not exceed the salary of the 
     Vice President. (It is our understanding that the Under 
     Secretary of Commerce for Intellectual Property and Director 
     of the United States Patent and Trademark Office and the 
     Deputy Under Secretary of Commerce for Intellectual Property 
     and Deputy Director of the United States Patent and Trademark 
     Office will not be eligible for bonuses under a revised 
     version of the bill that your committee has already agreed 
     to.)
       2. Section 614 will be further revised to require the 
     Patent and Trademark Office to submit to Congress a 
     legislative proposal to retain patent and trademark examiners 
     for the purpose of training other patent and trademark 
     examiners rather than allow the Office to develop and 
     implement such program without congressional intervention.
       Our decision not to exercise our jurisdiction over this 
     measure is not intended or designed to waive or limit our 
     jurisdiction over any future consideration of related 
     matters.
           Sincerely,
                                                       Dan Burton,
     Chairman.
                                  ____

                                    U.S. House of Representatives,


                                   Committee on the Judiciary,

                                   Washington, DC, August 3, 1999.
     Hon. Dan Burton,
     Chairman, Committee on Government Reform,
     Washington, DC.
       Dear Mr. Chairman: Thank you for your letter regarding H.R. 
     1907, the ``American Inventors Protection Act.'' This letter 
     will serve to acknowledge your jurisdiction over sections 
     612, 613, 614, and 621 of the amended bill, and to confirm 
     our understanding that we have agreed to amend the bill as 
     follows:
       1. Section 613 will be revised to provide that the total 
     compensation of the Commissioner for Patents and the 
     Commissioner for Trademarks may not exceed the salary of the 
     Vice President. (You are correct in your understanding that 
     the Under Secretary of Commerce for Intellectual Property and 
     Director of the United States Patent and Trademark Office, 
     and the Deputy Under Secretary of Commerce for Intellectual 
     Property and Deputy Director of the United States Patent and 
     Trademark Office will not be eligible for bonuses under the 
     amendment.)
       2. Section 614 will be further revised to require the 
     Patent and Trademark Office to submit to Congress a 
     legislative proposal to retain certain patent and trademark 
     examiners for the purpose of training other patent and 
     trademark examiners rather than allow the Office to develop 
     and implement such a program without congressional 
     intervention.
       I understand that your decision not to conduct a markup 
     over the provisions over which you have jurisdiction does not 
     serve to waive your jurisdiction over these provisions or 
     over any future consideration of related matters.
           Sincerely,
                                                       Henry Hyde,
                                                         Chairman.

  Mr. Speaker, I reserve the balance of my time.
  Ms. LOFGREN. Mr. Speaker, I yield myself such time as I may consume.
  I would like to inquire of the chairman of the committee, rising in 
opposition to the bill, I need to explore the changes that have been 
made to this bill to understand why it is worthy of my support.

                              {time}  2145

  In title II there is a first inventor defense that is limited to 
methods of doing or conducting business, and I need to understand why, 
what the impact of that would be and why it merits our support.
  Mr. COBLE. Mr. Speaker, will the gentlewoman yield?
  Ms. LOFGREN. I yield to the gentleman from North Carolina.
  Mr. COBLE. Mr. Speaker, it is limited, I say to the gentlewoman from 
California, to the State Street Bank case. There was some discussion 
early on that. Perhaps the first inventive defense should apply to 
processes as well as methods. But we finally concluded that we would 
restrict it to methods only, and that, by having done that, we were 
able to satisfy some folks who were opposed to the bill otherwise.
  Ms. LOFGREN. All right. So that is an accommodation that we have 
done, given that legislation is sausage making, to move this whole 
process forward.
  On title IV there is a provision permitting applicants to request the 
issuance of a patent as soon as one claim was allowed with the 
remaining claims to be added later, and that was deleted. I am 
concerned that this would change the bill as passed by the Committee on 
the Judiciary, but there may be some good reason that I am not aware of 
for the change that is proposed.
  Can the gentleman convince me as to why this should be supported?
  Mr. COBLE. Mr. Speaker, will the gentlewoman yield?
  Ms. LOFGREN. I yield to the gentleman from North Carolina.
  Mr. COBLE. This deletion was done at the request of the Patent and 
Trademark Office, and the reason given by PTO was that it considered it 
a constitution of an additional administrative burden, and for that 
reason that change was made.
  Ms. LOFGREN. On title V, and this is something of actual considerable 
concern to me, the bill was amended to retain existing law for ex parte 
reexaminations. For inter parte's reexamination the basic framework in 
the bill was retained under title V but with the limitation that a 
third party requestor cannot appeal an adverse decision to the court of 
appeals for the Federal circuit court.
  I am wondering if the gentleman can convince us why this change made 
after the bill was reported from the committee was necessary and why it 
should compel our support.
  Mr. COBLE. If the gentlewoman from California would continue to 
yield?
  Ms. LOFGREN. I yield to the gentleman from North Carolina.
  Mr. COBLE. Primarily this was done for the benefit of the independent 
inventors to balance the interest of a third party with those of a 
patent need, patentee, by allowing a third party to pursue 
reexamination under the existing system or opting for a strictly 
limited ex parte reexamination while assuring that a patentee would not 
be subject to harassment in such proceedings.
  Ms. LOFGREN. Mr. Speaker, under title VI the Public Advisory 
Committee for Patents has been altered to provide a quarter of the 
representation to independents, so-called independent inventors. There 
is concern that institutional inventors, including universities, might 
be disadvantaged by this change. Can the gentleman advise us as to the 
wisdom of this proposal?
  Mr. COBLE. If the gentlewoman would yield?
  Ms. LOFGREN. I yield to the gentleman from North Carolina.
  Mr. COBLE. This title VI, as the gentlewoman knows, came in for much 
discussion. It was part of the cause for the delay. The distinguished 
gentleman from Indiana (Mr. Burton) chairs a committee that has 
jurisdiction over this title. He asserted that jurisdiction, and we 
were in exchange with him since May, to be specific, for the desired 
language that he preferred; and we finally were able to get that 
language handed to us late today, and the

[[Page H6943]]

purpose for his insisting upon that, and probably a good idea, was to 
ensure that independent inventors are not without a voice in the 
oversight of the operation of the PTO as far as sitting on one of the 
boards is concerned.
  Ms. LOFGREN. Finally at this point, Mr. Speaker, I note that one 
change that I think I support but I have some concerns about is that 
the Patent and Trademark Office would be authorized to publish 
documents electronically. That makes sense, but because of the lack of 
vigorous encryption involved in the world and in government offices, I 
do have concerns as to the security of such publication. I do not know 
whether that can be addressed in the bill, but I do want to raise the 
issue, and my 5 minutes is expired. I want to reserve the time for the 
gentlewoman from Ohio (Ms. Kaptur), so I will leave that out for a 
later answer.
  Mr. COBLE. We will get to that substantively.
  Mr. Speaker, I yield 5 minutes to the gentleman from California (Mr. 
Rohrabacher).
  Mr. ROHRABACHER. Mr. Speaker, I rise in strong support of H.R. 1907, 
as amended. This bill is the culmination of a long process of 
negotiations that followed floor battles in the last Congress between 
the leadership of the Committee on the Judiciary and a group of Members 
led by myself. It was far more than sausage making because we have 
people with honest beliefs on both sides, and I certainly can see where 
people can have honest differences on something as complicated as 
patent law.
  I began this fight in 1994 when I fought against provisions that were 
inserted into the GATT trade agreement implementation bill to eliminate 
our Nation's traditional guarantee of a 17-year patent term in an 
attempt to harmonize our patent law with those of other nations with a 
20-year-from-filing limit that was imposed through that legislation, 
thus taking away a guaranteed patent term that had been the right of 
every American inventor. This change, by the way, would have resulted 
in decreasing the patent term of every application held in the Patent 
Office for more than 3 years, which is a common occurrence with 
breakthrough technologies.
  I was further energized in this fight when additional changes in our 
patent system were proposed, including the publishing of all patent 
applications 18 months after filing, even when no patent had been 
issued, and establishing prior user rights for all inventions, opening 
up new opportunities to challenge already-granted patents through 
reexamination and the turning of the Patent Office into a government 
corporation. These things caused me great pain and concern.
  The battles we had ultimately resulted in a standoff in the Senate in 
which no patent legislation was adopted, and I am pleased to note that 
the negotiations I referred to earlier have resulted in a bill that is 
very much different than the patent bills that went through the 
Committee on the Judiciary last year and the fights we have had in the 
last 4 years.
  Instead of making minor, tenuous extensions in the patent term, H.R. 
1907 goes most of the way in reversing the 1994 patent term reduction 
by extending patent term completely to compensate for delays in the 
processing of the Patent and Trademark Office or any other delay 
resulting from actions taken by anyone else other than the patent 
applicant. Instead of publishing all patent applications after 18 
months, 1907 publishes only, only the pending applications that have 
been published abroad, and thus they are already published and already 
known to the people and only to the extent that they are published 
abroad.
  Instead of a prior user defense that applies to all inventions which 
we just heard a question about a moment ago, H.R. 1907 contains a very 
limited prior user defense that applies only to those business methods 
which have only been considered patentable in the last few years, and 
this, of course, flows from an adverse case before the court that 
changed patent law.
  We want to have our say in what is going on here, and we are 
correcting it in this legislation; and instead of corporatizing the 
Patent Office and removing civil service protection from patent 
examiners, H.R. 1907 leaves the PTO as an agency within the Department 
of Commerce while including valuable provisions keeping patent revenue 
within the Patent Office and providing for enhanced training and 
professional development for patent examiners and retaining their civil 
service status.
  Mr. Speaker, although as in all compromises both sides have to give 
up something, maybe a little, I would say that my Committee on the 
Judiciary colleagues will not mind that I am stating for the Record 
that I believe that H.R. 1907 represents a major victory for the 
independent inventor whose interests I have vigorously defended these 
past 5 years.
  I ask my colleagues to give H.R. 1907 their overwhelming support and 
to join me in urging the other body to take up this compromise as is 
and send it to the President for his signature without change.
  Mr. Speaker, I have some more detailed comments, and I will be 
inserting them at this point in the Record, but I would not want to let 
this moment go by without thanking the gentleman from North Carolina 
(Mr. Coble) who has, as my colleagues know, stepped forward in a spirit 
of compromise, and we have worked really hard on this; the gentleman 
from Illinois (Mr. Hyde) who also played an important role in this. 
Their spirit of goodwill and the negotiations we have had have resulted 
in a superior bill that is going to do great things for America and to 
keep us technologically ahead.
  I also thank the gentleman from Illinois (Mr. Manzullo). In his late-
breaking contributions to this fight he has greatly improved this 
legislation, and he can be justly proud he has done a good job for 
America in doing so. Finally, I would like to thank the gentleman from 
California (Mr. Campbell) and the gentlewoman from Ohio (Ms. Kaptur), 
and Ms. Kaptur has been deeply involved in these negotiations from the 
beginning.
  Ms. Kaptur has been very deeply involved in this whole fight from the 
very beginning, and over the last 4 years she stood firm with us, and 
in fact in the last month we have had meetings in her office trying to 
negotiate these details out. We have been working with her staff, and I 
do not know, it sounds like we have not satisfied all of her concerns, 
but she has certainly played an important role in this process, and the 
gentleman from Ohio (Mr. Kucinich) and the gentleman from California 
(Mr. Hunter).
  All of these people played such a significant role along with, of 
course, the gentleman from North Carolina (Mr. Coble) and the gentleman 
from Illinois (Mr. Hyde) in giving us this incredible piece of 
legislation that I believe is going to do great things for America. 
Also, my staff members Rick Dykema and Wayne Paugh and other science 
fellows who worked with me, Paul Crilly, John Morgan, Biff Kramer, Dick 
Backe and Richard Cowan, for all the hard work they have put in on this 
piece of legislation.
  I urge my colleagues to support it.
  Mr. Speaker, for the last several years, this is a day I had hoped 
would come. I have fought long and hard to protect the products of our 
nation's independent inventors. I have fought diligently to strengthen 
our patent system and to prevent changes in the name of harmonization. 
Now, after the continued competition and polarization of the past, this 
was finally a time for cooperation. Chairman Coble and I have both 
spent many hours of individual effort pursuing our respective goals for 
patent reform the past several years, and indeed the time was ripe to 
work together toward a unified effort. It was time to have an open-
ended process in which everyone had an opportunity to come to the 
table.
  With that, I am proud to say that after a long and successful 
negotiation period with my friend from North Carolina, Chairman Coble, 
and with the invaluable help of my fellow colleague from California, 
Mr. Campbell and with late-breaking help from my friend from Illinois, 
Mr. Manzullo, we were finally able to reach agreement on the issues. As 
was always the case, the devil has been in the details. Therefore, this 
has been a carefully crafted effort, but has resulted in a resounding 
victory for the United States patent system and the American inventor.


                 title ii--first to invent defense act

  With regard to Title II, the First Inventor Defense, I have always 
held that we simply cannot champion trade secret protection over patent 
protection for clearly patentable subject matter. We cannot betray our 
Founding Fathers by abandoning the foundation upon which our patent 
system is based. We cannot

[[Page H6944]]

openly advocate secrecy when our patent system calls for us to 
vigorously promote the progress of science through the sharing of 
critical technology.
  In the patent bill that passed the House last year, all patents were 
subjected to prior user rights. This Congress, we were initially able 
to limit this title to processes and methods only. More recently, 
however, we were able to even further limit this section to business 
methods only. This is an important limitation in scope to take note of 
because now Title II will not affect the vast majority of independent 
inventors and small businesses.
  A first inventor defense that is strictly limited to business methods 
will severely reduce its applicability. Furthermore, the defense 
applies only to business methods that have been reduced to practice at 
least one year prior to the effective filing date of the patent in 
question. Even further, to successfully use this defense a litigant 
must satisfy a clear and convincing evidentiary standard and risk being 
subjected to paying reasonable attorney fees to the prevailing party. 
Bottom line, the best defense to a charge of patent infringement will 
remain the successful assertion of invalidity, and not a first inventor 
defense.


                  title iii--patent term guarantee act

  My goal all along has been to assure a minimum patent term of 17 
years from the date a patent is granted. Failing that, I have insisted 
on a guarantee that the PTO will extend the patent term as necessary to 
assure a term of 17 years from filing for non-dilatory applicants. The 
language of this bill clearly codifies this approach.
  As everyone is aware, the current law governing patent term is 20 
years from the date of file. Since June 8, 1995, when the 17-years-
from-grant was changed, patents have been losing precious time under 
the current law. Inventors can no longer rely on a guaranteed term of 
protection. In some cases, several years of effective post-grant 
protection is lost due to Patent and Trademark Office (PTO) 
administrative delay. This title represents an opportunity to recapture 
some of the reliance of pre-GATT standards.
  By codifying what constitutes PTO delay, this title can compensate 
the patent applicant for lost time on a day-for-day basis without time 
limitation. Furthermore, if the PTO does not issue a patent within 3 
years from the date of original file, the patent term will be 
compensated day-for-day until the patent issues, minus any time the 
applicant has delayed prosecution by engaging in dilatory behavior.
  This approach effectively eliminates the claimed submarine patent 
dilemma while providing a specific framework from which the Patent and 
Trademark Office must monitor and compensate the loss of any patent 
term due to delay for which the applicant has no responsibility.
  This approach essentially gives back to the non-dilatory patent 
holder what I have fought so hard for--a guaranteed 17 year patent 
term. The patentee once again will have the right to exclude the public 
from using his invention for a limited time--a time that is guaranteed 
and clearly defined. This Title essentially regains what GATT gave 
away. It has been my core initiative and now I am proud to say that it 
is my most significant success in this bill.


           title iv--publication of foreign applications act

  As I supported last year, this bill includes a provision similar in 
spirit to the amendment successfully offered last year to H.R. 400 by 
my friend from Ohio, Marcy Kaptur. Essentially, this year's effort only 
permits early publication of U.S. patent applications that are filed 
abroad in a country that also publishes early. Additionally, the U.S. 
application will not be published before the foreign application, and 
in no greater content.
  Curiously, this title has generated an abundance of controversy, 
although its provisions are of a positive nature. There are over 170 
patent systems that currently exist globally. Our nation cannot control 
foreign policies on early publication. A majority of foreign nations 
choose to publish patent applications prior to granting a patent. The 
published patent application is also normally printed in the home 
language of each respective foreign patent system.

  Generally, this title will affect large corporations, because they 
are more likely to file abroad than the independent inventor community. 
Since American patent applications filed abroad are indeed published 
early and are in a foreign language, foreign nations have a chance to 
view them at their leisure. This is the reality and the argument from 
the other side in the last Congress that was the hardest to counter.
  Thus we have agreed to permit the PTO to publish after 18 months only 
those applications that are filed internationally. If an applicant 
files an application only domestically, he will have the unqualified 
right to maintain confidentiality of his patent application. If an 
applicant files abroad and domestically, he will have the right to 
limit the content of early domestic publication to that content which 
the foreign entity has published. In no event will America publish 
prior to the actual publication date in a foreign patent system. It's 
that simple.
  Also included, for those applications published early, is a 
provisional right which allows the patent holder to recover royalties 
for infringement activity during the pre-issuance period. There will 
also be no pre-issuance 3rd party opposition to the patent application 
permitted. Finally, the costs derived from early publication will be 
applied only to those applicants who are actually subjected to 
publication.
  Essentially, this title is reactive to circumstances beyond our 
control already present in many foreign patent systems, while going to 
lengths to protect the American inventor community.


                title v--patent litigation reduction act

  Considering both the patent holder and third party, reexamination is 
a seldom used process in proportion to the number of patent 
applications filed each year. Yet, when Congress originally enacted the 
reexamination statute it had an important public purpose in mind: to 
restore confidence in the validity of patents issued by the PTO.
  Specifically, three principal benefits were noted: 1. Resolve patent 
validity disputes more quickly and less expensively than litigation; 2. 
Permit courts to defer issues of patent validity to the expertise of 
the PTO; and 3. Reinforce investor confidence in the certainty of 
patents.
  Reexamination was enacted as an important step to permitting the PTO 
to better serve the public interest. As the Supreme Court stated in 
Graham v. Deere, ``it must be remembered that the primary 
responsibility for sifting out unpatentable material lies in the Patent 
Office. To await litigation is--for all practical purposes--to 
debilitate the patent system.''
  The current statute permits any patent holder or third party to 
submit prior art in the form of prior patents and printed publications 
throughout the term of the patent for the PTO to determine whether a 
substantial new question of patentability exists. Reexam procedures 
currently limit a third party's participation to arguing why there is a 
substantial new question of patentability.
  This title was an attempt to provide an alternative to existing law 
and to further encourage potential litigants to use the PTO as a avenue 
to resolve patentability issues without expanding the process into one 
resembling courtroom proceedings. Fundamentally, in addition to the 
reexam process in law today, this title creates an additional reexam 
option that permits a 3rd party requestor to file additional written 
briefs. The price paid by those who would challenge a patent, however, 
is that the 3rd party requestor is barred from any appeals outside of 
the PTO and from subsequently litigating the same issues in a district 
court or making a second reexam request. This estoppel is the 
insulation that effectively protects patent holders.
  Ultimately, the expanded reexam option does not subject the patent to 
any greater challenge in scope than currently exists today. It merely 
allows a reexam requestor the option to further explain why a 
particular patent should not have been granted.
  Mr. Speaker, this bill does not create new opportunities to pursue 
litigation and does not create additional ways to invalidate patents. 
In fact, the bill seeks to provide even further ways to reduce the 
incentive for litigation in the courts and to protect against the 
needless wasting of dollars independent inventors don't have.


                               conclusion

  Certainly, last year's bill was an exercise in harmonization brought 
about by the interests of large corporations. In contrast, this year's 
bill, H.R. 1907, is designed to protect the products of our nation's 
inventors and to help sustain our unprecedented technological 
leadership. I saw to that through many intense negotiations with my 
colleagues. Unfortunately, there are still those who cannot recognize 
victory even when it stares them in the face.
  I assure you, Mr. Speaker, that if H.R. 1907 was similar to either 
H.R. 400 or S. 507 last Congress, my views would not have changed this 
Congress. But that is not the case. H.R. 1907 is a brand new effort 
reached through an open-ended and fair debate, and it is a bill I am 
unequivocally supporting today. It is also a bill that I will stand 
firmly behind as it moves through the Senate.
  I know it is up to Congress to carry on the tradition of Thomas 
Jefferson, Benjamin Franklin, and the will of our Founding Fathers. It 
was they who provided our newly formed nation with a foundation for 
freedom and the power to protect the achievements of our inventors.
  I have been intimately involved in these issues because I want to 
ensure that our patent system continues to respect the fundamentals of 
our Founding Fathers while at the same time enhancing its operability 
in modern society. We have a chance this Congress to enhance a system 
that better provides a stronger protection for our nation's inventors.

[[Page H6945]]

  Our patent system always has--and always will--stimulate the creation 
of jobs, advance our technological leadership, and help sustain our 
standard of living. It has helped to fortify our economic success, 
strengthen our national defense, and reinforce our global leadership.
  I look forward to passing this bill with the resounding support of my 
colleagues on the House side and I look forward to the unshakeable 
support for its text when it is reported in the Senate.
  I want to make sure that we will firmly stand behind the text of this 
bill in the event of contrary action by the Senate. But I am confident 
that the other noble body of this Congress will accept the House's 
efforts in patent reform and will move our version of the bill forward 
without delay.
  Mr. Speaker, I applaud my colleagues who have endured a labor-
intensive process to reach the final accord we have today. I know it 
was not an easy thing to do and that it was a long time coming, but it 
is the American people who will ultimately benefit.
  This body can rest assured knowing we faithfully served American 
technology. Mr. Speaker, although I know there is much work left to do 
by way of vigilance and continued involvement, I am pleased looking 
back and realizing all the good work that has been accomplished so far.
  Ms. LOFGREN. Mr. Speaker, I yield 10 minutes to the gentlewoman from 
Ohio (Ms. Kaptur), and I ask unanimous consent that she be permitted to 
further yield time.
  The SPEAKER pro tempore (Mr. Miller of Florida). Is there objection 
to the request of the gentlewoman from California?
  There was no objection.
  The SPEAKER pro tempore. The gentlewoman from Ohio (Ms. Kaptur) will 
now control 10 minutes of time.
  Ms. KAPTUR. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I must say I find it very interesting here close to 10 
p.m. Washington time that we have had walked to the floor less than a 
half an hour ago the bill that we are going to be asked to vote on 
tomorrow. This is likely to be the last item of business tonight. This 
bill is 105 pages long, and I must say I am extremely disappointed that 
I could not even get 20 minutes to talk about a measure that has been 
worked on in this Congress for several years, and now under the 
unusual, unusual procedure of bringing up a major bill like this with 
constitutional implications it is brought up under suspension, and I, 
as the only person in opposition here with perhaps the exception of one 
other are allowed 10 minutes. Mr. Speaker, I will not yield time at 
this point, having so few minutes myself.
  Mr. Speaker, any reasonable person would ask why the silence. Why are 
we being silenced and not allowed to explore some of the questions that 
have troubled us over several years?
  I listened very carefully to those that have been involved in these 
negotiations: the gentleman from Indiana (Mr. Burton), the gentleman 
from Illinois (Mr. Manzullo), the gentleman from California (Mr. 
Rohrabacher), the gentleman from California (Mr. Campbell).
  Frankly I was not involved in the negotiations that have been 
occurring here over the last several weeks. There were two meetings I 
think in my office where we tried to gain clarification of language 
that never came back, and I would like to ask the chairman of the full 
committee, if I might, my good friend, the gentleman from North 
Carolina (Mr. Coble), if this bill before us, H.R. 1907, is the same 
bill that was voted out of the Committee on the Judiciary on May 24 of 
this year, 1999.
  Is this the same bill?
  Mr. COBLE. Mr. Speaker, will the gentlewoman yield?
  Ms. KAPTUR. I yield to the gentleman from North Carolina.
  Mr. COBLE. It has been amended many times for the benefit of 
independent inventors, many of the people the gentlewoman from Ohio 
(Ms. Kaptur) represents, and that is one of the reasons why it has 
taken awhile for it to get here, because there have been countless 
hours that have been put into this.
  Ms. KAPTUR. Excuse me, on that point where the gentleman says it has 
been amended, in what formal process on the record has it been amended?
  Mr. COBLE. There is a manager's amendment now.
  Ms. KAPTUR. There is a manager's amendment now which was walked to 
the floor at 9:17 p.m., which I could only get up to Page 54 reading 
very quickly here this evening. There are 105 pages in the bill.
  So the manager's amendment is the bill that was walked to the floor 
tonight, so it has not come through any subcommittee; it has not come 
through any full committee. It is going to be offered here and then 
voted on tomorrow; is that correct?
  Mr. COBLE. That is correct, and if the gentlewoman would yield, for 
the people, for the very people she represents, we have done this for 
them.
  Ms. KAPTUR. I would say to the gentleman I have many fewer minutes 
than he does here this evening, and I hate to reclaim my time, but I am 
going to do that and say to the gentleman that for me, and again I have 
not had to study this bill every single word as the gentleman has over 
the last several weeks, but the reason for my objection is this:

                              {time}  2200

  The Constitution of the United States sets up a very precious right 
of property. I am going to read it. It is only 32 words. It says in 
article I, section 8, ``The Congress shall have power to promote the 
progress of science and useful arts by securing for limited times to 
authors and inventors the exclusive right''--exclusive right--``to 
their respective writings and discoveries.''
  Now, this is not some little amendment that is part of a manager's 
effort. This is the Constitution of the United States. Therefore, when 
a 105-page bill comes before us on suspension, those of us who value 
this document and devote much of our lives to preserving it under the 
oath that we take are very suspicious of any bill of such consequence 
that comes before us on suspension when we are allowed only 10 minutes 
to debate.
  I also would say that with all due respect to the excellent minds 
that were involved in crafting this manager's amendment, it is only a 
handful of Members of this institution. This bill is not up on the web. 
I cannot ask the inventors I represent back home to go to any site to 
look at it so I can be advised on how to vote tomorrow morning.
  I know a fast ball when I see one. I have been here long enough to 
know that. I am offended by this, simply because I think the 
constitutional issues are so very important. I am not afraid of 
sunshine on this issue or any other issue, and I would say to my good 
friends from California, some of whom are on the floor tonight, I 
understand a little bit about industry differences, and I know that 
there are some industries that will benefit more than others from the 
publication in foreign locales of some of these patents.
  I would say, and I have only marked one paragraph that I will read 
here, because the public will know nothing of this bill before it is 
voted on tomorrow, but on page 33 there is this section that is called 
``United States publications of applications published abroad.'' It 
says, ``Subject to paragraph (2), each application for patent except 
applications for design patents filed under chapter 16 and provisional 
applications filed under section 111(b) shall be filed in accordance 
with procedures determined by the Director, promptly upon the 
expiration of a period of 18 months after the earliest filing date for 
which a benefit is sought under this title.''
  Now, that is an interesting set of words there, but I guess I would 
want to take sections like that and let the sun shine in, let those 
back home whose livelihoods and futures, and, frankly, the future of 
this country depend on, have an opportunity to think and comment before 
this particular vote.
  I agree with the chairman; this is complex, it is very important, and 
it is often misunderstood. I would have to say as a Member, I take some 
offense that some professor from MIT, and I attended MIT, had more 
influence with the committee and more ability to review these sections 
than Members like myself. You must understand this frustration.
  So I do really feel that we are being closed out. That means that 
some interests are being looped in, and it means that we are not to be 
given the chance to review this extremely important measure with 
constitutional consequences before we are asked to vote on it tomorrow.

[[Page H6946]]

  Mr. Speaker, I yield 2 minutes to my good friend, the gentleman from 
Maryland (Mr. Hoyer), who has fought so hard trying to get reform that 
is fair to all concerned.
  Mr. HOYER. Mr. Speaker, I thank the gentlewoman for yielding, and I 
want to join her in her expressions of concern about the process.
  The gentleman from California, myself, and others as well as the 
gentlewoman from Ohio (Ms. Kaptur) throughout the process of 
consideration of legislation, the history of which Mr. Rohrabacher gave 
a little earlier, have raised very significant concerns. Those concerns 
were raised not for those who can lobby this House very effectively, 
but for those small inventors whose lifeblood relies on the integrity 
of their patent application.
  Because of that concern we have raised repeatedly the reservations, I 
do not even want to say opposition, but reservations to this bill that 
were expressed to us by hundreds of small inventors, perhaps thousands 
of small inventors, represented by them around this country.
  My concern tonight is that the gentleman from California (Mr. 
Rohrabacher), for whom I have a great deal of respect, the gentleman 
from Illinois (Mr. Manzullo), for whom I have a great deal of respect, 
who signed a letter with me, with the gentlewoman from Ohio (Ms. 
Kaptur) and the gentleman from California (Mr. Hunter) with reference 
to the bill in its previous form, we did not want it to move quickly.
  We have now had changes in the bill which the gentlewoman from Ohio 
(Ms. Kaptur) has referred to which, frankly, I have not had the 
opportunity to review fully, and I have a sense that maybe I am with 
the 430 people in this House. There perhaps have been four or five who 
have reviewed this legislation. But I am very concerned that we are 
moving this tonight on suspension. We are not going to vote until 
tomorrow, I understand that, without having the opportunity to fully 
review, debate, the provisions of this bill.
  The gentleman from California made a very good statement, I thought, 
going through various provisions in the bill about which we had 
concerns. I regret I do not have more time to speak.
  Ms. KAPTUR. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I regret the gentleman does not have more time as well. 
I wish to say to the gentleman, thank you very much for being here this 
evening, and to say thanks to our colleagues who have also labored on 
this bill.
  There is regular order here. We should have regular order, especially 
on a bill of constitutional magnitude. We all recognize it is.
  Let me say for those of us who may question why do we need to change 
anything about this patent system which protects the seed corn of our 
country, the lifeblood of our ideas, what is so bad about the current 
system we have today, when we are the leading industrial-military-arts-
power in the world? Everyone else wants to file their patents here 
because of the very successful system that we have. If we do it wrong, 
we jeopardize our own leadership.
  So why are we so afraid to take the time to let Members read these 
provisions? If the bill is so good, then it will go through on its own 
merits, but not through clamping down on regular order in the debate 
that should precede on a measure with constitutional consequences.
  Frankly, if it is a bad bill, it is going to end up in the courts and 
it is not going to go anywhere. So we owe it to the American people to 
do it right the first time.
  Mr. Speaker, I thank the gentlewoman for yielding me the 10 minutes, 
but I truly wish at a minimum 20 minutes for a constitutional question, 
is that really asking too much?
  Ms. LOFGREN. Mr. Speaker, I yield 1 minute to the gentlewoman from 
California (Ms. Sanchez).
  Ms. SANCHEZ. Mr. Speaker, I thank my colleague from California for 
generously yielding me time tonight on this subject.
  Mr. Speaker, I rise today in support of H.R. 2654, the American 
Inventors Protection Act. The bill improves current patent law and it 
is in our national interests. The United States is currently the only 
industrial nation without a first invention defense, and this bill will 
close that gap.
  The first invention defense allows a company who is using a 
manufacturing process, if someone patents that process after the 
company has been using it, to continue to use it. This is in the best 
interests of competitive growth and our industrial technology. The bill 
also makes the Patent and Trademark Office better equipped to deal with 
the flood of patent applications that come in every day.
  Clearly this is a bill that is good for American business, and it 
therefore will also be good for the American consumer. I urge my 
colleagues to vote for H.R. 2654.
  Mr. COBLE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, the gentlewoman from Ohio said she was offended. Well, I 
am becoming offended too, when I think of all the time that we have put 
in listening to every person who wanted to be heard. The gentlewoman 
from Ohio (Ms. Kaptur) submitted a PTO fees for study for small 
businesses. It is in the bill. Her own study is in the bill, section 
622.
  The Alliance for American Innovation, a group known to the 
gentlewoman from Ohio (Ms. Kaptur) and adamantly opposed to our bill, I 
invited them not once, but twice to send a witness to a public hearing. 
On each occasion, Mr. Speaker, my invitation was declined. So, yes, I 
am becoming a little bit impatient as well, because I think we have 
indeed turned the other cheek, and I am proud of it.
  My friend the gentlewoman from Ohio (Ms. Kaptur), when she was 
reading earlier the provision that she read, of course, it is subject 
to paragraph 2, exceptions for independent inventors who file only in 
the United States. That is covered.
  I apologize, Mr. Speaker, if I am becoming a little wrought, but I am 
a little wrought, and I am normally an easy dog with which to hunt. But 
when I think about all we have done, and then I see the gentleman from 
California.
  Mr. ROHRABACHER. Mr. Speaker, will the gentleman yield?
  Mr. COBLE. I yield to the gentleman from California.
  Mr. ROHRABACHER. Mr. Speaker, let me just note that the section of 
the bill that the gentlewoman from Ohio (Ms. Kaptur) read and said, my 
gosh, we need to look at this more, and why just foist it on us, the 
gentlewoman from Ohio (Ms. Kaptur), that portion of the bill has not 
been changed and has been available for 3 or 4 months now.
  This is not something that somebody is moving through, trying to 
slide through the system. The gentlewoman is complaining about the 
section of the bill dealing with the 18-month publication. That has not 
changed. The gentlewoman has had that in her possession ever since it 
went through committee a couple months ago.
  Let me make one or two more points. We have in the last few days, 
most of what has been talked about, the gentlewoman did not get this 
100-something page bill and never had a chance to read it. Most of that 
bill is exactly the same, and the changes that have taken place are 
small changes that were done in order, as the gentleman from North 
Carolina (Chairman Coble) said, to accommodate the very people that we 
have been trying to protect. Those changes are not so dramatic that it 
takes very long to digest them. It is not a 118 page bill that is 
shoved in your lap that is totally new. Almost all of that has been in 
your possession all of this time.
  Mr. COBLE. Mr. Speaker, reclaiming my time, I want to address a 
question that the gentlewoman from California (Ms. Lofgren) asked 
earlier, and I want to do it before I forget it. When the gentlewoman 
talked about the PTO authorizing the publishing of documents 
electronically, it was done to ensure that the users of the Patent and 
Trademark Office may have a more expeditious and thorough access to 
patent-related information. I think I know from where the gentlewoman 
from California (Ms. Lofgren) is coming from, and I will be happy to 
discuss the security aspect with her at a subsequent time.
  Ms. LOFGREN. Mr. Speaker, will the gentleman yield?
  Mr. COBLE. I yield to the gentlewoman from California.
  Ms. LOFGREN. Mr. Speaker, I do not believe we need to specify the 
security issues in this bill, but I accept the

[[Page H6947]]

chairman's commitment to work with me, and I am sure with the gentleman 
from Virginia (Mr. Goodlatte), to ensure the encrypted security of 
these measures.
  Mr. COBLE. I thank the gentlewoman.
  Mr. Speaker, I yield 5 minutes to the gentleman from Illinois (Mr. 
Manzullo).
  Mr. MANZULLO. Mr. Speaker, these past 2 days have been perhaps the 
most challenging in my life as a United States Congressman. I, first of 
all, want to thank the gentleman from North Carolina (Chairman Coble) 
for his patience, his understanding, his wisdom, and his knowledge of 
this subject. I come to this gentleman's defense not only because of 
the scholarship and the reputation he has for honesty in this country, 
but also for the fact that many people have attacked the gentleman from 
North Carolina (Mr. Coble) personally because of this bill. I believe 
that if there is any attack, it should be to the legislative language, 
and not to an individual's integrity.
  These have been challenging days. In addition to the gentleman from 
North Carolina (Mr. Coble), I want to thank the gentleman from 
California (Mr. Rohrabacher), the gentleman from Indiana (Mr. Burton) 
and the gentleman from Illinois (Mr. Hyde), the chairman of the 
Committee on the Judiciary.
  We have labored endlessly in these past 2 days to come up with a bill 
that protects the integrity of the patent system of this country, while 
giving fair and open access to it by large corporations and by 
individual inventors.
  The bill is not a compromise in that parties give up or gain any 
rights. Rather, it is a coming together of all interests in forging a 
bill that represents openly and fairly the interests of everybody, 
especially and including the American people.
  I worked in two areas of the bill, first with regard to title II of 
the first inventor defense. Before the State Street Bank and Trust case 
as to which in 1998 the U.S. Supreme Court upheld the Court of Appeals 
for the Federal court, it was universally thought that methods of doing 
or conducting business were not patentable items.

                              {time}  2215

  Before that case, everybody would keep that secret and never tried to 
patent it. In recognition of this pioneer clarification in the law by 
that case, we felt that those who kept their business practices secret 
had an equitable cause not to be stopped by someone who subsequently 
reinvented the method of doing or conducting the business or obtaining 
a patent. We, therefore, limited the first inventor defense solely to 
that class of rights dealing with methods of doing or conducting 
business.
  It is succinctly to be understood that we do not intend to create by 
legislative fiat the first inventor defense or any prior user rights 
for any other process, method, or product or other statutorily 
recognized class of patentable rights.
  Second, with regard to title V, Optional Inter Partes Reexamination 
Procedure, what we did in that was, in addition to keeping the present 
law of ex parte reexamination procedure, which gave certain rights to 
the inventor and to the challenger, we came up with an additional 
section, the inter partes reexamination which, if selected by the third 
party requester, would entitle that person to participate further by 
filing written documents within the Patent Office.
  In exchange for that, there would be a complete estoppel or 
prohibition to contest the decision. The purposes of our making those 
changes was to stop any additional litigation that may come as a result 
of this law.
  This means fairness for everybody. For the inventor who has a request 
for reexamination filed against him, in the present ex parte 
reexamination process, he still has the same rights he does under the 
present law; that is, the third party has to rely on his initial 
written documents. The third party has no right to appeal in the event 
that he loses a challenge. If the inventor loses, he still may obtain 
his right to appeal to the Court of Appeals.
  To the third party, he may proceed under the present law or the 
option to file the inter partes reexamination.
  So it is a matter of fairness to everybody in maintaining the 
integrity of the Patent Office. Sure, we have had a lot of people help 
us on this in addition to the Members and Bob Rines who founded the 
Franklin Pierce Law Center at MIT, founder of the Academy of Applied 
Science, an inductee of the Investors' Hall of Fame, an inductee of the 
Army Signal Corps Wall of Fame, a Lecturer at the MIT since 1933, a 
former lecturer of patent law at Harvard, the inventor of the sonogram, 
a person who has practiced patent law for 55 years and has no interest 
other than to maintain the rule of law and the integrity of the patent 
system. He came and helped everybody out.
  But, Mr. Speaker, this bill is a good bill because it protects 
everybody. But most of all, it protects the integrity of the patent 
system. I would ask that when the Senate takes it up that the bill 
would be unchanged in its present form.
  Mr. Speaker, these past two days have been two of the most 
challenging I have had as a Member of Congress. I have had the 
opportunity to work with my good friends and colleagues, Congressmen 
Henry Hyde, chairman of the Judiciary Committee, Howard Coble, chairman 
of the Judiciary Subcommittee on Intellectual Property, and Dana 
Rohrabacher. We have labored endlessly these past 2 days to come up 
with a bill that protects the integrity of the patent system in the 
country, while giving fair and open access to it by large corporations 
and individual inventors. The bill is not a compromise in that parties 
``give up'' or ``gain'' any rights; rather, it is a coming together of 
all interests in forging a bill that represents openly and fairly the 
interests of everybody--including and especially the American people.
  I have had a hand in working in the following areas of the bills.
  First, with regard to title II--First Inventor Defense: Before the 
State Street Bank and Trust case, as to which in 1998 the U.S. Supreme 
Court denied certiorari and thereby upheld the Court of Appeals for the 
Federal Circuit, it was universally thought that methods of doing or 
conducting business were not among the statutory items that could be 
patented. Before that case, everybody would keep their methods of doing 
or conducting business as secret as they could and never tried to 
patent them. In recognition of this pioneer clarification in the law, 
we felt that those who kept their business practices secret had an 
equitable cause not to be stopped by someone who subsequently 
reinvented the method of doing or conducting business and obtained a 
patent. We, therefore, limited the first inventor defense solely to 
that class of rights dealing with ``methods of doing or conducting 
business.'' It is distinctly to be understood that we do not intend to 
create first inventor defense or prior user rights for any other 
process, method, or product, or other statutorily recognized class of 
patentable rights, which in fact had been included in the original 
draft of this legislation, but which was stricken upon agreement of all 
the parties on this legislation.

  Second, with regard to title V--Optional Inter Partes Reexamination 
Procedure: We clearly retain the present existing ex parte 
reexamination rules without change, Chapter 30 of title 35, United 
States Code. In addition we added an optional inter partes 
reexamination procedure, which, if selected by a third party requestor, 
would entitle that requestor to participate by filing written documents 
within the Patent Office only, and would bar the requestor from 
appealing to the Federal Court of Appeals of the Federal Circuit if the 
Patent Office decided the patent reexamination in favor of the 
inventor. In selecting this optional inter partes procedure, however, 
the requestor would be bound by the decision of the Patent Office and 
estopped (or prohibited) to contest the decision in any other civil 
action outside the Patent Office.
  This means fairness for everybody. For the inventor who has a request 
for reexamination filed against him in the present ex parte 
reexamination process, he still has the same rights as he does under 
the present law: (a) the third party has to rely on his initial written 
documents and cannot participate in the discussion between the inventor 
and the patent office; (b) the third party has no right to appeal in 
the event he loses his challenge; and (c) if the inventor loses, he 
still maintains his right to appeal to the Court of Appeals.
  For the third party, he may either proceed under the present law, as 
outlined above, or have the option to filed under the inter partes 
reexamination procedure, and file further documents (as opposed to just 
the initial document) and thus participate in the proceedings in the 
patent office, but with no right to a court appeal if the Patent Office 
decides against him, and with an estoppel (prohibition) against his 
challenging the Patent Office decision in any forum.
  With regard to title VI--Patent and Trademark Office, we are proud to 
say that the sole

[[Page H6948]]

mission of the Patent Office is to protect intellectual property of the 
inventor and to that end, the title lets the Patent Office retain and 
use for its purposes all the revenues and receipts. This means the 
Patent Office will have additional funds to retain professional staff, 
provide increase training and facilities, and make the patent system as 
affordable as possible to the inventors.
  Ms. LOFGREN. Mr. Speaker, how much time is remaining?
  The SPEAKER pro tempore (Mr. Miller of Florida). The gentlewoman from 
California (Ms. Lofgren) has 4 minutes remaining. The gentleman from 
North Carolina (Mr. Coble) has 3 minutes remaining.
  Ms. LOFGREN. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, the American Inventors Protection Act of 1999 revamps 
our patent system so it is ready to meet the challenge of our Nation's 
high-tech industry and the global economy.
  We had a spirited debate in the last Congress on our predecessor 
bill, H.R. 400. While H.R. 400 did pass the House, it died in the 
Senate. This year I believe we made the changes that meet the concerns 
raised during the floor debate in committee.
  The bill was first published as a committee print so everyone could 
make known their objections and so final details could be carefully 
considered before the bill's formal introduction.
  Now that the Subcommittee on Courts and Intellectual Property has 
favorably reported the result of all that effort, as has the full 
committee, I encourage support of the bill.
  It requires early publication of our foreign competitors' technology, 
it protects American investors from unscrupulous invention promotors, 
it protects domestic manufacturers and jobs from late-filed and issuing 
patents, half of which are foreign owned, it provides an inexpensive 
and efficient system for challenging improvidently granted patents, and 
it gives the Patent and Trademark Office operational flexibility that 
it needs.
  Under this bill, no U.S. inventor who seeks patent protection only in 
the United States will have to publish their patent application, that 
is, if they wish to maintain their invention's secrecy.
  But a U.S. inventor will get to see what foreign competitors are 
seeking to patent here more than a full year earlier than is the case 
under current law.
  While the administrative procedure for testing patents in the PTO by 
expert examiners will be made fairer, thus enhancing its utility, a 
number of safeguards have been added to ensure that patentees, 
especially those of limited financial means, will not be harassed or 
otherwise subject to predatory tactics.
  In addition to the PTO's being reorganized into a performance-based 
organization, the creation of the statutory advisory committee will be 
of value both to the Congress, the President, and the public.
  This Act will strengthen our Nation's technological leadership, 
protect American workers, and reduce the cost of obtaining and 
enforcing patents in the United States.
  When I stood earlier this evening, I expressed reservations about the 
changes that were made in the bill between reporting, I would say 
unanimously by the full committee, and receipt of the bill today.
  As I mentioned, legislating is like making sausage. There are many 
aspects that are not delightful. But I would note that the changes that 
have been made as explained by the chairman are really discrete ones.
  As the gentleman from California (Mr. Rohrabacher) pointed out, the 
bulk of this bill is exactly what was reported by the committee. It has 
been available to every Member of the public and this House for many 
months.
  The five changes that have been made, although not what I necessarily 
would have crafted, are those that I can tolerate, that I think 
American inventors can tolerate. I understand that they are necessary 
in order to garner the kind of broad consensus that is required in 
order to move this bill forward.
  We know that the intellectual property is the coin of the realm in an 
information-based economy that ours has become. Without strong 
protection of intellectual property, including patent law, we put at 
risk the tremendous prosperity that we have created here in America, 
our wonderful country.
  This bill will go a long ways towards enhancing the protection that 
we need for our intellectual property. Therefore, I can now, 
understanding the five discrete changes, support the bill. I urge that 
my colleagues would support the bill. I hope that the Senate will act 
swiftly to get this long overdue measure enacted into law.
  Mr. COBLE. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I say to the gentlewoman from Ohio (Ms. Kaptur) I did 
not yield to her earlier because I did not have the time; and the 
gentlewoman from California (Ms. Lofgren) did yield 10 minutes, so I do 
not think anybody was cutting anybody off.
  Much has been said about coming here tonight. Last night, this bill 
was on the calendar. But in an effort to make yet more changes for the 
independent inventors, we are here tonight, almost at the bewitching 
hour. Fifty-five cosponsors, Mr. Speaker, nine hearings have been 
conducted, 90 witnesses have been before three sessions of the 
Congress.
  No, this is not a Johnny-come-lately. This is not a guy who came to 
the party at midnight. We know this visitor. This visitor is well known 
to all of us.
  Let me tell my colleagues, Mr. Speaker, who sponsors it, who supports 
the bill: Inventors Digest and independent inventor Robert Rines. I 
mentioned the gentleman from California (Mr. Rohrabacher), the 
gentleman from California (Mr. Campbell), the gentleman from Illinois 
(Mr. Manzullo), and the gentleman from Indiana (Mr. Burton) because 
they opposed this last year.
  The gentlewoman from Ohio (Ms. Kaptur) said, well, there is only four 
or five. Well, this is representative government. We cannot have 435 
out here. This is representative. If we get a sampling of a dozen 
people, we have gotten a good input.
  The gentleman from Missouri (Mr. Gephardt), the minority leader. Both 
parties, Republican and Democrat, have high-tech agendas, and this 
matter is on both those agendas. Patent Coalition, major associations 
involved in intellectual property. Bipartisan and unanimous support of 
members of the Subcommittee on Courts and Intellectual Property and the 
Committee on the Judiciary.
  I think the significant feature here, Mr. Speaker, is that 
intellectual property is so obviously important to the well-being of 
our economy, and it should not be casually dismissed.
  I want to thank the gentlewoman from California (Ms. Lofgren) for her 
effort tonight. I want to thank the gentleman from Illinois (Chairman 
Hyde), the gentleman from Michigan (Mr. Conyers), the ranking member, 
the Democrats and Republicans alike who sat on our subcommittee.
  I am proud of what we have done. I am happy to have our converts over 
from last year who opposed us. We embrace one another now. I think we 
are on our way. Even the Whip appears to be smiling as if he is in our 
corner.
  I want to echo what the gentlewoman from California (Ms. Lofgren) 
said. Let us send this to the Senate. Let the Senate, the other body, 
act with dispatch, and let us get this into law for the benefit of 
America generally and the inventing community specifically.
  Mr. ROHRABACHER. Mr. Speaker, will the gentleman yield?
  Mr. COBLE. I yield to the gentleman from California.
  Mr. ROHRABACHER. Mr. Speaker, I think we should pay tribute also to 
the gentlewoman from Ohio (Ms. Kaptur) who has put a lot work in on 
this. When she reads all of this, she is going to be so happy with this 
bill.
  The gentleman from North Carolina (Chairman Coble) has done a great 
job, and the gentlewoman from Ohio (Ms. Kaptur) is going to be happy 
with it.
  Mr. COBLE. Mr. Speaker, I say to the gentleman, I hope she will be 
happy because her study report is in the bill. Most of what the 
gentlewoman wanted is in here, so I would be amazed if she was not 
happy.
  Mrs. KELLY. Mr. Speaker, I rise in strong support of H.R. 1907, the 
American Inventors Protection Act, legislation which might be more 
aptly titled the ``Keep America Competitive Act.''
  H.R. 1907 comes before us as a consensus bill. In the last Congress 
we had a battle on the floor when we debated this issue. Now we

[[Page H6949]]

have a bill before us that, while, as we have heard, there is very 
limited opposition, I believe almost all of us can support. A manager's 
amendment contains the core provisions of H.R. 1907 which enjoys 56 
cosponsors nearly equally represented by both sides of the aisle.
  H.R. 1907 makes a number of common-sense improvements to our patent 
system. It is the culmination of over 4 years of extensive hearings and 
debate among Members of differing views on patent reform who have had 
many opportunities to refine the legislation to what we will be voting 
upon today.
  Members have agreed upon these provisions because they recognize that 
we in Congress cannot continue to postpone action on this critical 
topic of how our patent system works. Those of you who are businessmen 
and women know that to be successful, you must constantly refine how 
your organizations operate in order to remain competitive in the face 
of a changing environment. The same is true to our patent system.
  We are facing an economic environment that is changing more rapidly 
than ever, and we must give our inventors, entrepreneurs, and patent 
system the tools they need to address these changes.
  H.R. 1907 provides significant benefits and additional protection for 
all those with the inventive and entrepreneurial spirit, while 
addressing some of the abuses in the patent system, that we have 
witnessed in the past. Among the attractions of H.R. 1907 are:
  The opportunity for inventors to collect royalties from the time a 
patent application is published;
  Assurance that diligent inventors will get a minimum patent term of 
17 years;
  Protection for small businesses who are first to invent and use 
processes, so that they do not have to pay others who later usurp their 
technology and patent it;
  Publication of U.S. patent applications which are also filed abroad, 
thus eliminating an advantage our patent system gives to foreign 
companies;
  Reducing costly patent litigation by improving the Patent Trademark 
Office reexamination process for patents which may have been issued 
inappropriately.
  We are all working hard to make sure that U.S. inventors and 
entrepreneurs are positioned to take advantage of the significant 
transformations underway in our economy, transformations that are 
unsurpassed in increasing new jobs. These transformations, many of 
which can rightly be labeled electronic commerce, are generating 
significant innovations. However, not all innovations are patented. We 
must make sure that true innovators have the incentives and protection 
they need to continue the process of invention, whether or not they 
elect to patent their inventions. However, nothing in H.R. 1907 
eliminates a patentee's exclusive right to collect royalties on his or 
her invention. At the same time, we must continue to provide new 
incentives for our patentees, and to make sure that a U.S. letter 
patent remains a thing of quality and value.
  H.R. 1907 does all these things, and I urge its passage by this Body 
and its enactment at the earliest opportunity. In short, I hope my 
colleagues will join me in supporting this important legislation to 
keep America competitive in the 21st century. I thank you, Mr. Coble, 
Chairman Hyde and all others in making this bill a reality.
  Mr. GOODLATTE. Mr. Speaker, I rise today in strong support of this 
important legislation, and I want to congratulate those who worked so 
hard to reach this agreement. This is a very good bill and a very, very 
important bill to protect the competitiveness of American business and 
American inventors, large and small.
  I commend the gentleman from North Carolina, my good conservative 
friend, and the gentleman from California, Mr. Rohrabacher, for pushing 
this legislation forward. Both gentlemen know how important this 
legislation is for the American people.
  Mr. Speaker, we are currently dealing with a situation where we have 
got to act and act now to protect American inventors from a situation 
where that technology is being stolen under current law.
  Under current law, every single patent that is filed in the other 
major industrial countries around the world is published after 18-
months, in Japanese, in German, in French, for those inventors and 
those countries to see. Forty-five percent of all the patents filed 
with the U.S. Patent Office are filed by foreign inventors, and U.S. 
inventors do not get to see that technology filed here in the United 
States.
  This bill provides greater protection for the small inventor by 
improving the patent pending provisions of the law. This bill protects 
the small inventor in this country by giving them the opportunity to 
get capital behind those inventions much sooner than they get under 
current law.
  Mr. Speaker, this is a good bill. It is a good bill for the little 
guy, and we should vote for the bill and get this major improvement to 
competitiveness in the United States against our foreign competition 
done.
  Mr. BERMAN. Mr. Speaker, I rise in strong support of H.R. 1907. As 
ranking member of the Subcommittee on Courts and Intellectual Property, 
I can attest to the longstanding efforts of my colleagues and 
predecessors on the Subcommittee, Carlos Moorehead, Pat Schroeder, and 
Barney Frank, on behalf of this legislation. Now thanks to the very 
hard work of the gentleman from North Carolina and his staff, with the 
assistance of the gentlelady from California, we now move one step 
closer to enactment of reforms that will more effectively protect the 
creativity and investments of American inventors, entrepreneurs, and 
businesses.
  A voluminous record has been complied by our subcommittee in support 
of this legislation, comprising many days of hearings over several 
Congresses. As a result of that record, I am convinced that this bill 
is unquestionably in the national interest. I embrace the conclusions 
of the 21st Century Patent Coalition that the bill will improve the 
quality of patents, reduce the costs of resolving patent disputes, put 
an end to rules favoring foreign applicants over American companies, 
protect American businesses and jobs, and not least of all, strengthen 
the rights of inventors who now suffer from delays at PTO that are not 
their fault.
  In view of the strong support of a wide range of associations and 
interests, including a very large number of Fortune 500 companies, the 
Biotechnology Industry Association, the Computer and Communications 
Industry Association, the Pharmaceutical Research and Manufacturers 
Association, the Business Software Alliance, the National Association 
of Manufacturers--why even the Indiana Manufacturers Association--the 
obstacles that have been thrown up to our efforts to get this bill 
scheduled for consideration are very hard to understand.
  While I supported earlier versions of this legislation, including 
H.R. 400 as approved by our Committee last year, I am always loathe to 
make the best enemy of the good. Today's legislation has won broader 
support than previous versions of this legislation, and I salute my 
colleague from North Carolina and his staff for their patience and 
persistence in bringing us a giant step closer today to our mutual goal 
of patent reform.
  I strongly support this bill, and urge my colleagues to do so as 
well.
  Mr. DOOLEY of California. Mr. Speaker, I rise today in support of 
H.R. 1907, the American Inventors Protection Act. The bill, introduced 
by Representatives Coble and Berman, and now cosponsored by a 
bipartisan coalition, will provide much needed patent protection to 
American inventors. This bill also makes the Patent and Trademark 
Office (PTO) more accountable to its customers, and allows customers to 
recoup patent term lost during the patent process at the PTO. Without a 
doubt, H.R. 1907 is a pro-growth bill that would foster technological 
advancements without leaving the small businessperson behind.
  The United States is by far the world's largest producer of 
intellectual property. Many other nations have learned from our 
success, and have enacted laws targeted to protecting intellectual 
property developed by small businesses, inventors and industries. Major 
changes are needed in U.S. patent law to ensure that American inventors 
and businesses that are largely dependent on the development of 
intellectual property have the opportunity to compete and win in the 
global marketplace.
  Enactment of this legislation is crucial to promoting growth in the 
New Economy and to ensuring that the competitiveness of the U.S. high-
tech sector, including biotechnology will be enhanced by this bill.
  The bill would require the publication of patent applications at 
eighteen months--a requirement that would make U.S. patent law 
consistent with the laws of our leading foreign competitors. Under the 
current two-tiered system almost 80 percent of all patent applications 
pending in the United States are also filed and published in other 
countries and printed in the language of the host country. This 
publication requirement means that foreign competitors may review the 
U.S. patent application. But because the U.S. system does not require 
patent publication prior to issuance, foreign competitors are not 
required to reveal the subject of their applications until after a U.S. 
patent is issued.
  Patent reform legislation also targets a practice known as 
``submarine patenting,'' in which a patent applicant deliberately files 
a very broad application and then delays the issuance of a patent for 
several years until someone else, who is unaware of the hidden patent 
application, invests in research and technology to develop a new 
consumer product. When the product is developed, the holder of the 
``submarine patent'' rises above the surface to sue those who have 
developed the technology.
  Submarine patent filings have risen sharply since the early 1980's. 
One of these submarine patents cost one company more than

[[Page H6950]]

$500 million, not including court costs, taking R&D dollars out of the 
system. Reform is needed to prevent individuals from manipulating the 
system at great costs to others who are investing in research and 
innovation.
  The U.S. should promote industries and sectors of our economy that 
provide the U.S. with the greatest relative competitive advantage in 
the global marketplace. The U.S. is a leader in research, innovation, 
and the development of intellectual property, but this advantage could 
be jeopardized if U.S. patent law is not reformed to create a level 
playing field with our competitors. U.S. patent law should be reformed 
to ensure that our businesses and researchers are well positioned to 
compete in the global economy today and into the future.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from North Carolina (Mr. Coble) that the House suspend the 
rules and pass the bill, H.R. 1907, as amended.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. COBLE. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceeding on this motion will be 
postponed.

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