[Congressional Record (Bound Edition), Volume 147 (2001), Part 11]
[House]
[Pages 16396-16397]
[From the U.S. Government Publishing Office, www.gpo.gov]



    DETERMINATION OF SUBSTANTIAL NEW QUESTIONS OF PATENTABILITY IN 
                       REEXAMINATION PROCEEDINGS

  Mr. SENSENBRENNER. Madam Speaker, I move to suspend the rules and 
pass the bill (H.R. 1866) to amend title 35, United States Code, to 
clarify the basis for granting requests for reexamination of patents, 
as amended.
  The Clerk read as follows:

                               H.R. 1866

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

     SECTION 1. DETERMINATION OF SUBSTANTIAL NEW QUESTION OF 
                   PATENTABILITY IN REEXAMINATION PROCEEDINGS.

       Sections 303(a) and 312(a) of title 35, United States Code, 
     are each amended by adding at the end the following: ``The 
     existence of a substantial new question of patentability is 
     not precluded by the fact that a patent or printed 
     publication was previously cited by or to the Office or 
     considered by the Office.''.

     SEC. 2. EFFECTIVE DATE.

       The amendments made by this Act shall apply with respect to 
     any determination of the Director of the United States Patent 
     and Trademark Office that is made under section 303(a) or 
     312(a) of title 35, United States Code, on or after the date 
     of the enactment of this Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Wisconsin (Mr. Sensenbrenner) and the gentleman from California (Mr. 
Berman) each will control 20 minutes.
  The Chair recognizes the gentleman from Wisconsin (Mr. 
Sensenbrenner).


                             General Leave

  Mr. SENSENBRENNER. Madam Speaker, I ask unanimous consent that all 
Members may have 5 legislative days within which to revise and extend 
their remarks and to include extraneous material on H.R. 1866, as 
amended, the bill under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Wisconsin?
  There was no objection.
  Mr. SENSENBRENNER. Madam Speaker, I yield myself such time as I may 
consume.
  Madam Speaker, Congress established the patent reexamination system 
in 1980. The 1980 reexamination statute was enacted with the intent 
reexamination of patents by the Patent and Trademark Office would 
achieve three principal benefits, first, to settle validity disputes 
more quickly and less expensively than litigation; second, to allow 
courts to refer patent validity questions to an agency with expertise 
in both the patent law and technology; and third, to reinforce investor 
confidence in the certainty of patent rights by affording an 
opportunity to review patents of doubtful validity.
  More than 20 years after the original enactment of the reexamination 
statute, the Committee on the Judiciary still endorses these goals and 
encourages third parties to pursue reexamination as an efficient way of 
settling patent disputes.
  Reexamination worked well until recently when it was severely limited 
by a Federal Court of Appeals decision. H.R. 1866 is intended to 
overturn the 1997 In re Portola Packaging case by the United States 
Court of Appeals for the Federal circuit. That decision severely 
impairs the patent reexamination process. Reexamination was intended to 
be an important quality check on defective patents. Unfortunately, this 
decision severely limits its use.
  The Portola case is criticized for establishing an illogical and 
overly strict bar concerning the scope of reexamination requests. The 
bill permits a broader range of cases to be the subject of a request, 
as was the case for the first 16 years since the law was enacted. The 
bill that we consider today preserves the ``substantial new question 
standard'' that is an important safeguard to protect all inventors 
against frivolous action and against harassment, while allowing the 
process to continue as originally intended. It also preserves the 
discretion of the Patent and Trademark Office in evaluating these 
cases.
  The bill has been amended since its introduction by the full 
committee. I wish to take a moment to explain this to my colleagues.
  Since its introduction, we heard from the public members of the bar 
and critics of the Portola decision who have recommended that we make 
an additional change to ensure the result that we seek. The text is 
clarified to permit the use of relevant evidence that was 
``considered'' by the PTO, but not necessarily ``cited.'' Some would 
say this is redundant, but I prefer to clarify precisely when 
reexamination is an available procedure. This will ensure that the 
system is flexible and efficient. While many believe the base text is 
satisfactory to meet that goal, I hope that the amendment removes any 
doubt.
  I believe that adding this one sentence to the Patent Act will help 
prevent the misuse of defective patents in all fields, especially those 
concerning business methods. An efficient patent system is important 
for inventors, investors and consumers. I urge Members to support H.R. 
1866.
  Madam Speaker, I reserve the balance of my time.
  Mr. BERMAN. Madam Speaker, I yield myself such time as I may consume.
  Madam Speaker, I rise in support of H.R. 1866, and I urge my 
colleagues to vote for it.
  The Committee on the Judiciary favorably reported this legislation by 
voice vote on June 20. Prior to that, the Subcommittee on Courts, the 
Internet and Intellectual Property passed the bill by a voice vote on 
May 22. It is a good step forward on the road of making reexamination a 
more attractive and effective option for challenging a patent's 
validity.
  The bill overturns, as the gentleman from Wisconsin mentioned, the 
1997 Federal circuit decision In Re Portola Packaging. In that case, 
the Federal circuit narrowly construed the term ``substantial new 
question of patentability'' to mean prior art that was not

[[Page 16397]]

before the examiner during an earlier examination. Because the PTO 
director can only order a reexamination if a ``substantial new question 
of patentability'' exists, the Federal court's decision in Portola 
effectively bars the PTO from conducting a reexamination based on prior 
art that was cited in the patent application.
  The Portola decision is troublesome because it prevents 
reexaminations from correcting mistakes made by examiners. Ideally, a 
reexamination could be requested based on prior art cited by an 
applicant that the examiner failed to adequately consider. However, 
after Portola, such prior art could not be the basis of the 
reexamination.
  By overturning the Portola decision, H.R. 1866 will allow 
reexamination to correct some examiner errors. Thus, this bill will 
accomplish an important, if narrow, objective.
  Madam Speaker, as far as I know, H.R. 1866 has not engendered any 
controversy, and I urge my colleagues to support it.
  Madam Speaker, I yield back the balance of my time.
  Mr. SENSENBRENNER. Madam Speaker, I yield 3 minutes to the gentleman 
from North Carolina (Mr. Coble), the chairman of the Subcommittee on 
Courts, the Internet and Intellectual Property.
  Mr. COBLE. Madam Speaker, I thank the gentleman for yielding me this 
time. I will be very brief, because the gentleman from Wisconsin has 
thoroughly stated the matter, as has the gentleman from California.
  As the gentleman from Wisconsin has indicated, H.R. 1866, Madam 
Speaker, consists of adding a single sentence to the law in order to 
improve the patent reexamination system. It is based upon testimony 
that was offered before our subcommittee earlier this year. With this 
single sentence, we stab at the heart of defective business method and 
other inappropriately issued patents. At the same time, we protect 
small businesses and small inventors from harassing conduct in these 
proceedings.
  I want to thank the distinguished gentleman from California (Mr. 
Berman), my friend and the ranking member of the subcommittee, for his 
work, as well, on this bill, and for that matter, all of the members of 
the subcommittee.
  In closing, I want to thank the distinguished gentleman from 
Wisconsin (Mr. Sensenbrenner), the chairman of the full committee, for 
having expeditiously moved this legislation along, because it is 
important legislation. I urge my colleagues to support H.R. 1866.
  Mr. SENSENBRENNER. Madam Speaker, I have no further requests for 
time, and I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Wisconsin (Mr. Sensenbrenner) that the House suspend the 
rules and pass the bill, H.R. 1866, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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