I

104TH CONGRESS

1ST SESSION H. R. 2533

To amend title 35, United States Code, to establish the United States

Intellectual Property Organization, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

OCTOBER 25, 1995

Mr. MOORHEAD (both by request) (for himself and Mrs. SCHROEDER) introduced the following bill; which was referred to the Committee on the Judiciary

A BILL

To amend title 35, United States Code, to establish the

United States Intellectual Property Organization, and

for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘United States Intellec5 tual Property Organization Act of 1995’’.

6 SEC. 2. FINDINGS.

7 The Congress of the United States finds that—

8 (a) the granting of patents and the registration

9 of trademarks by the United States have promoted
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1 the useful arts, strengthened the United States econ2 omy, improved interstate and international com3 merce, and benefited consumers by increasing the

4 types of products and services available to the public

5 and by providing the public with the ability to distin6 guish between competing products and services;

7 (b) the Patent and Trademark Office has per8 formed the duties respecting the examination of pat9 ent and trademark applications, the granting of pat10 ents, and the registration of trademarks;

11 (c) the Patent and Trademark Office currently

12 has numerous services and products that the users

13 of those services or products generally pay to re14 ceive;

15 (d) because there are a large number of trans16 actions, the revenues from fees associated with the

17 services and products defray the cost of delivering

18 those services and products;

19 (e) because of the increasing demand for serv20 ices and the changing nature of those services, the

21 Patent and Trademark Office needs to be able to re22 spond quickly to changes in demand or workload;

23 (f) for the above reasons, the Patent and

24 Trademark Office needs flexibility in budgetary, fis25 cal, and other management matters;
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1 (g) a restructured organization would provide

2 the necessary flexibility for the entity to meet its ob3 ligations and ensure that the patent and trademark

4 laws are promptly and efficiently administered; and

5 (h) the United States Intellectual Property Or6 ganization should succeed to the duties of the Patent

7 and Trademark Office respecting the examination of

8 patent and trademark applications.

9 TITLE I—UNITED STATES INTELLECTUAL

10 PROPERTY ORGANIZATION

11 Subtitle A—Establishment; Powers and

12 Duties; Organization and Management

13 SEC. 101. ESTABLISHMENT OF THE ORGANIZATION.

14 Section 1 of title 35, United States Code, is amended

15 to read as follows:

16 ‘‘§ 1. Establishment

17 ‘‘(a) ESTABLISHMENT.—There is hereby established

18 a body corporate to be known as the ‘‘United States Intel19 lectual Property Organization’’ which shall be a unique

20 agency of the Department of Commerce and report to the

21 Secretary of Commerce, subject to the policy direction of

22 the Under Secretary of Commerce for Intellectual Prop23 erty with respect to patents and trademarks, and which

24 is to—
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1 ‘‘(1) perform all duties respecting the examina2 tion of patent applications;

3 ‘‘(2) perform all duties respecting the examina4 tion of trademark applications;

5 ‘‘(3) disseminate patent and trademark infor6 mation to the public; and

7 ‘‘(4) perform all other duties the responsibility

8 for which is established by the Congress or that are

9 necessary for the administration of the Organization.

10 ‘‘(b) OFFICES.—The United States Intellectual Prop11 erty Organization shall maintain an office for the service

12 of process in the District of Columbia or the metropolitan

13 area thereof, and shall be deemed, for purposes of venue

14 in civil actions, to be a resident of the District of Colum15 bia. The Organization may establish offices in such other

16 place or places as it may deem necessary or appropriate

17 in the conduct of its business.

18 ‘‘(c) REFERENCE.—For purposes of this title, the

19 United States Intellectual Property organization shall also

20 be referred to as the ‘Organization’.’’.

21 SEC. 102. POWERS AND DUTIES.

22 Section 2 of title 35, United States Code is amended

23 to read as follows:
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1 § 2. Power and duties

2 ‘‘(a) The Organization, under the policy direction of

3 the Under Secretary of Commerce for Intellectual Prop4 erty with respect to patents and trademarks, shall have

5 the powers to carry out the functions and duties that are

6 authorized by law with respect to—

7 ‘‘(1) the examination of patent and trademark

8 applications;

9 ‘‘(2) carrying on studies, programs, or ex10 changes of items or services regarding domestic and

11 international patent and trademark law or the ad12 ministration of the Organization, or any other mat13 ter included in the organic acts for which the Orga14 nization is responsible; and

15 ‘‘(3) carrying on programs and studies coopera16 tively with foreign patent and trademark offices and

17 international intergovernmental organizations or au18 thorizing such programs and studies to be carried

19 on, in connection with the examination of patent and

20 trademark applications.

21 ‘‘(b) In order to accomplish the purposes of this Act,

22 the Organization—

23 ‘‘(1) shall have perpetual succession unless dis24 solved by Act of Congress;

25 ‘‘(2) shall adopt and use a corporate seal, which

26 shall be judicially noticed;
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1 ‘‘(3) may sue and be sued in its corporate

2 name;

3 ‘‘(4) may indemnify the Chief Executive Officer,

4 officers, attorneys, agents and employees of the Or5 ganization for liabilities and expenses incurred with6 in the scope of their employment;

7 ‘‘(5) may adopt, amend, and repeal bylaws,

8 rules, and regulations, governing the manner in

9 which its business will be conducted and the power

10 granted to it by law will be exercised;

11 ‘‘(6) if it is determined by the Administrator of

12 General Services and the Secretary of Commerce

13 that the Organization can acquire real property

14 more cost effectively for the Organization than the

15 General Services Administration, may acquire, con16 struct, purchase, lease, hold, manage, operate, and

17 alter any property real, personal, or mixed, or any

18 interest therein, as it deems necessary in the trans19 action of its business, and sell, lease, grant, and dis20 pose of such property, as it deems necessary to ef21 fectuate the purposes of this title, for periods of time

22 or for terms that the Organization deems necessary,

23 without regard to the provisions of the Federal

24 Property and Administrative Services Act of 1949

25 (40 U.S.C. 471 et seq.), as amended, the Public
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1 Buildings Act of 1959, as amended (40 U.S.C. 601

2 et seq.), the McKinney Act (42 U.S.C. 11411–12),

3 and section 759 of title 40 (the ‘‘Brooks Act’’) (40

4 U.S.C. 759, as amended: Provided, That if the Ad5 ministrator undertakes such activities on behalf of

6 the Organization, the Administrator shall have the

7 authority to charge the Organization for the actual

8 cost of undertaking these activities, but the Adminis9 trator shall exempt the Organization from paying

10 the approximate commercial charges provided for in

11 subsection 490(j) of title 40: Provided further, That

12 the Chief Executive Officer shall develop a results13 oriented acquisition and property disposal process

14 that must include quantitative and qualitative meas15 ures and standards for evaluating (1) the cost effec16 tiveness of the acquisition process and (2) the extent

17 to which the acquisition of goods and services cost

18 effectively satisfy the needs for which the items were

19 acquired. The process shall be consistent with the

20 principles of impartiality and competitiveness;

21 ‘‘(7)(A) may make purchases, contracts for the

22 construction, alteration, maintenance, or manage23 ment and operation of facilities and contracts for the

24 supplies or services, except personal services, after

25 advertising, in such manner and at such times suffi-
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1 ciently in advance of opening bids, as the Organiza2 tion shall determine to be adequate to insure notice

3 and an opportunity for competition: Provided, That

4 advertising shall not be required when the Organiza5 tion determines that the making of any such pur6 chase or contract without advertising is necessary in

7 the interest of furthering the purposes of this title,

8 or that advertising is not reasonably practicable;

9 ‘‘(B) may enter into and perform such pur10 chases and contracts for printing services, to include

11 the process of composition, platemaking, presswork,

12 silk screen processes, binding, microform, and the

13 end items of such processes, as it deems necessary

14 to effectuate the functions of the Organization, with15 out regard to sections 501 through 517 and 1101

16 through 1123 of title 44;

17 ‘‘(C) Notwithstanding subparagraphs (A) and

18 (B) above, procurement procedures, including those

19 related to advertising, shall be applied consistent

20 with all obligations under international agreements

21 on government procurement to which the United

22 States is a signatory. The Organization shall issue

23 internal guidelines, as appropriate, to ensure consist24 ency with such obligations;
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1 ‘‘(8) may use, with their consent, services,

2 equipment, personnel, and facilities of other civilian

3 or military agencies and instrumentalities of the

4 Federal Government, on a reimbursable basis, and,

5 on a similar basis, to cooperate with such other

6 agencies and instrumentalities in the establishment

7 and use of services, equipment, and facilities of the

8 Organization;

9 ‘‘(9) may obtain from the Administrator of the

10 General Services Administration such services as he

11 or she is authorized to provide to agencies of the

12 United States, on the same basis as those services

13 are provided to other agencies of the United States;

14 ‘‘(10) may use, with the consent of the agency,

15 government, or organization concerned, the services,

16 records, facilities, or personnel of any State or local

17 government agency or instrumentality or foreign

18 government or international organization to perform

19 necessary functions on the Organization’s behalf;

20 ‘‘(11) may enter into and perform such con21 tracts, leases, cooperative agreements, or other

22 transactions with international, foreign and domestic

23 public agencies and private organizations and per24 sons as needed in the conduct of its business and on
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1 such terms as it deems appropriate, subject only to

2 applicable laws;

3 ‘‘(12) except as otherwise provided in section

4 10101 of the Omnibus Budget Reconciliation Act of

5 1990, as amended (35 U.S.C. 41 note) may, as a fi6 nancially self-sustaining Federal organization with7 out reliance upon general taxpayer revenues, retain

8 and utilize all of its revenues and receipts, including

9 revenues from the sale, lease, or disposal of any

10 property, real, personal or mixed, or any interest

11 therein, of the Organization, including research and

12 development and capital investment;

13 ‘‘(13) shall have the priority of the United

14 States with respect to the payment of debts out of

15 bankrupt, insolvent, and decedents’ estates;

16 ‘‘(14) may accept monetary gifts or donations

17 of services, or of property, real, personal, mixed, tan18 gible or intangible, in aid of any purposes herein au19 thorized. The Chief Executive Officer shall establish

20 written rules setting forth the criteria to be used in

21 determining whether or not the acceptance of con22 tributions of monetary gifts or donations or services,

23 or of property, real, personal, mixed, tangible or in24 tangible under this subsection would reflect unfavor25 ably upon the ability of the Organization, or any em-
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1 ployee of the Organization, to carry out its respon2 sibilities of official duties in a fair and objective

3 manner, or would compromise the integrity or the

4 appearance of the integrity of its programs or any

5 official involved in those programs;

6 ‘‘(15) may execute, in accordance with its by7 laws, rules and regulations, all instruments nec8 essary and appropriate in the exercise of any of its

9 powers;

10 ‘‘(16) may provide for liability insurance and

11 insurance against any loss in connection with its

12 property, other assets or operations either by con13 tract or by self-insurance; and

14 ‘‘(17) shall pay any settlement or judgment en15 tered against it or arising from the act or omission

16 of any officer or employee of the Organization from

17 the funds of the Organization and not from amounts

18 available under section 1304 of title 31.’’.

19 SEC. 103. ORGANIZATION AND MANAGEMENT.

20 Section 3 of title 35, United States Code, is amended

21 to read as follows:

22 ‘‘§ 3. Officers, employees, and Inspector General

23 ‘‘(a) OFFICERS.—

24 ‘‘(1) CHIEF EXECUTIVE OFFICER.—The man25 agement of the Organization shall be vested in a
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1 Chief Executive Officer who shall be a citizen of the

2 United States and who shall be appointed by the

3 Secretary of Commerce. The Chief Executive Officer

4 shall be a person who, by reason of professional ex5 perience regarding patents or trademarks and of

6 management experience, is especially qualified to

7 manage the Organization: Provided, however, That

8 the office of Chief Executive Officer becomes vacant

9 or the Chief Executive Officer becomes incapaci10 tated, the Secretary may appoint an existing officer

11 of the Organization to act in such office until the of12 fice is filled.

13 ‘‘(2) OTHER OFFICERS.—The Secretary shall

14 appoint an officer principally responsible for the ex15 amination of patent applications, who shall be the

16 principal adviser to the Chief Executive Officer on

17 all issues affecting the Organization’s patent exam18 ining operations, and an officer principally respon19 sible for the examination of trademark applications,

20 who shall be the principal advisor to the Chief Exec21 utive Officer on all issues affecting the Organiza22 tion’s trademark examining operations.

23 ‘‘(b) DUTIES.—The Chief Executive Officer—

24 ‘‘(1) shall be responsible for the management

25 and direction of the Organization, including the ex-
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1 amination of patent and trademark applications, and

2 may delegate these responsibilities to the officers

3 and employees of the Organization whose perform4 ance of these duties shall be subject to the Chief Ex5 ecutive Officer’s review;

6 ‘‘(2) shall be subject to the direction of the

7 Under Secretary of Commerce for Intellectual Prop8 erty on patent and trademark policy matters;

9 ‘‘(3) shall receive as basic compensation for a

10 calendar year an amount not to exceed the equiva11 lent of the annual rate of basic pay for level I of the

12 Executive Schedule under section 5312 of title 5

13 and, in addition, may receive as a bonus awarded by

14 the Secretary, an amount up to the equivalent of the

15 annual rate of basic pay for level I, based upon the

16 Secretary’s evaluation of the Chief Executive Offi17 cer’s performance—

18 ‘‘(A) as defined in an annual performance

19 agreement between the Chief Executive Officer

20 and the Secretary incorporating measurable

21 goals in such specific areas as productivity,

22 cycle times, efficiency, cost-reduction, innovative

23 ways of delivering patent and trademark serv24 ices, and customer satisfaction, as delineated in

25 an annual performance plan, and
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1 ‘‘(B) as reflected in an annual report on

2 the results of the Organization’s performance, a

3 copy of which shall be provided to the Office of

4 Management and Budget and the Congress:

5 Provided, however, That the Secretary shall provide

6 the Director of the Office of Management and Budg7 et the opportunity to review, before any bonus is

8 awarded, the annual performance standards, the

9 level of the proposed bonus, and any information

10 that the Secretary forwards regarding the bonus;

11 ‘‘(4) shall serve on the basis of a six-year con12 tract with the Secretary, so long as performance, as

13 set forth in the annual performance agreement, is

14 satisfactory, and

15 ‘‘(5) shall, before taking office, take an oath to

16 discharge faithfully the duties thereof.

17 ‘‘(c) STATUS OF OFFICERS AND EMPLOYEES.—Offi18 cers and employees of the Organization shall be officers

19 and employees of the United States as defined by sections

20 2104 and 2105, title 5. Except as otherwise provided in

21 this section, officers and employees of the Organization

22 shall be subject to the provisions of title 5 relating to Fed23 eral employees.

24 ‘‘(d) The Chief Executive Officer shall affix the com25 pensation and number of, appoint, and direct all employ-
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1 ees of the Organization that he deems necessary to effect

2 the provisions of this title, consistent with chapter 23, title

3 5, United States Code; such determination of number, ap4 pointment, and compensation (including any awards) to

5 be made without regard to any other of the provisions of

6 title 5, United States Code, except that the principle of

7 veteran’s preference shall apply with regard to appoint8 ment.

9 ‘‘(e) LIMIT ON COMPENSATION.—Except as otherwise

10 provided by law, no officer or employee of the Organiza11 tion other than the Chief Executive Officer shall receive

12 basic compensation for a calendar year that exceeds the

13 equivalent of the basic rate of pay for the Senior Executive

14 Service ES–6 (5 U.S.C. 5382). Total compensation, in15 cluding compensation based on performance (but not in16 cluding benefits or contribution to retirement systems),

17 may not exceed the equivalent of the basic rate of pay

18 for level I of the Executive Schedule under section 5312

19 of title 5.

20 ‘‘(f) ESTABLISHMENT OF CLASSIFICATION, APPOINT21 MENT, AND COMPENSATION SYSTEMS.—Notwithstanding

22 the provisions of title 5, United States Code, the Chief

23 Executive Officer shall have sole and exclusive discretion:

24 ‘‘(1) over the establishment, amendment, or re25 peal of any position classification system, any system
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1 to determine the qualifications and procedures for

2 appointment; any compensation and award system

3 except gainsharing, including wages and compensa4 tion based on performance, and over any supplement

5 to contributions of the Organization to the retire6 ment and benefits programs; and

7 ‘‘(2) to fix and adjust rates of pay without re8 gard to the provisions of chapter 53 of title 5, Unit9 ed States Code and abolish positions and layoff em10 ployees without regard to the provisions of chapter

11 35 of title 5, except that the principle of veteran’s

12 preference shall apply in any layoff system.

13 ‘‘(g) SPECIFIC EXEMPTIONS FROM TITLE 5.—To ac14 complish the above, the following provisions of title 5,

15 United States Code, shall not apply to the Organization

16 and its employees:

17 ‘‘(1) Chapter 31 (employment authorities) ex18 cept for the provision governing nepotism (5 U.S.C.

19 3110).

20 ‘‘(2) Chapter 33 (examination, selection, and

21 placement); except that the provisions governing rec22 ommendations of Senators or Representatives (5

23 U.S.C. 3303), selective service registration (5 U.S.C.

24 3328), the oath of office (5 U.S.C. 3331), and em25 ployee affidavits (5 U.S.C. 3333) and the principle
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1 of veteran’s preference, shall apply to the Organiza2 tion and its employees.

3 ‘‘(3) Chapter 35 (retention preference, restora4 tion, and reemployment), except the principle of vet5 eran’s preference shall apply to any layoff system.

6 ‘‘(4) Chapter 43 (performance appraisal).

7 ‘‘(5) Chapter 45 (incentive awards).

8 ‘‘(6) Chapter 51 (classification).

9 ‘‘(7) Chapter 53, subchapter 3 (general pay

10 rates).

11 ‘‘(h) APPLICATION OF TITLE 5.—The provisions of

12 chapters 83 (Civil Service Retirement System), 84 (Fed13 eral Employees Retirement System), 87 (life insurance),

14 and 89 (health insurance) of title 5 shall apply to the offi15 cers and employees of the Organization. The Organization

16 may supplement the benefits provided under chapters 83

17 and 84 from time to time. The Organization also may sup18 plement the benefits provided under chapters 87 and 89

19 to its officers and employees.

20 ‘‘(i) PAYMENTS FOR BENEFITS.—

21 ‘‘(1) The Organization shall make such pay22 ments to the Employees’ Compensation Fund as are

23 required by section 8147 of title 5.

24 ‘‘(2) The Organization shall pay to the Civil

25 Service Retirement and Disability Fund—
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1 ‘‘(A) such employee deductions and agency

2 contributions as are required by sections 8334,

3 8422, and 8423 of title 5;

4 ‘‘(B) such additional agency contributions

5 as are determined necessary by the Office of

6 Personnel Management to pay, in combination

7 with the sums under paragraph (1), the normal

8 cost (determined using dynamic assumptions) of

9 retirement benefits for the employees of the Or10 ganization who are subject to subchapter III of

11 chapter 83 of title 5; and

12 ‘‘(C) such additional amounts, not to ex13 ceed two percent of the amounts under para14 graphs (1) and (2), as are determined necessary

15 by the Office of Personnel Management to pay

16 the cost of administering retirement benefits for

17 the Organization’s employees and retirees and

18 their survivors (which amounts shall be avail19 able to the Office as provided in section

20 8348(a)(1)(B) of title 5).

21 ‘‘(3)(A) The Organization shall pay to the Em22 ployees’ Life Insurance Fund—

23 ‘‘(i) such employee deductions and agency

24 contributions as are required by sections 8707

25 and 8708(a) of title 5; and
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1 ‘‘(ii) such amounts as are determined nec2 essary by the Office of Personnel Management

3 under subparagraph (2)(C) of this subsection to

4 reimburse the Office for contributions under

5 section 8708(d) of title 5.

6 ‘‘(B) The Organization shall pay to the Em7 ployees Health Benefits Fund—

8 ‘‘(i) such employee payments and agency

9 contributions as are required by section 8906

10 (a) through (f) of title 5, and

11 ‘‘(ii) such amounts as are determined nec12 essary by the Office of Personnel Management

13 under subparagraph (2)(C) of this subsection to

14 reimburse the Office for contributions under

15 section 8905(g)(1) of title 5.

16 ‘‘(C) The amounts required under subpara17 graphs (A)(ii) and (B)(ii) of this paragraph shall

18 pay the Government contributions for retired em19 ployees who retire from the Organization after the

20 date of transfer, the survivors of such retired em21 ployees, and survivors of employees of the Organiza22 tion who die after the date of transfer, prorated to

23 reflect the portion of the total civilian service of such

24 employees and retired employees that was performed

25 for the Organization after the date of transfer.
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1 ‘‘(4) The Organization shall pay to the Thrift

2 Savings Fund such employee and agency contribu3 tions as are required by section 8432 of title 5.

4 ‘‘(j) JOINT LABOR-MANAGEMENT COMMITTEE.—The

5 Organization shall establish a joint committee, which will

6 include an equal number of members appointed by the Or7 ganization and employees who are designated by its labor

8 organizations accorded exclusive recognition under chapter

9 71 of title 5 to assist the Chief Executive Officer by mak10 ing recommendations concerning the design and imple11 mentation of any position classification system, and any

12 system to determine qualifications and procedures for em13 ployment, any compensation and awards system, and con14 tributions of the Organization to retirement and benefits

15 programs.

16 ‘‘(k) RESTRICTIONS ON FTE NOT APPLICABLE.—

17 The Organization shall not be subject to any restriction

18 or limitation on the number of full-time equivalent Federal

19 employees it may employ unless such restriction or limita20 tion is made applicable to the Organization through an

21 amendment to this subsection. Beginning with the first

22 full fiscal period following enactment of this bill, the num23 ber of full-time equivalent Federal employees available to

24 the Organization shall be adjusted annually by a percent25 age equivalent to the projected change as determined by
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1 the Secretary of Commerce in patent and trademark appli2 cation filings, respectively, for each fiscal year. The projec3 tion shall be based upon a linear regression model taking

4 into account productivity changes.

5 ‘‘(l) INSPECTOR GENERAL.—The Inspector General

6 of the Department of Commerce shall carry out all respon7 sibilities and duties required of him or her, and shall have

8 all powers and authorities vested in him or her, by the

9 Inspector General Act of 1978 (5 U.S.C. App. 3) as

10 amended, with respect to the programs, operations, and

11 activities of the Organization.’’.

12 SEC. 104. DEFINITIONS.

13 Section 6 of title 35 of the United States Code is

14 amended to read as follows:

15 ‘‘§ 6. Definitions

16 ‘‘As used in this title, the following terms have the

17 meanings indicated:

18 ‘‘(a) The term ‘Chief Executive Officer’ means

19 the chief executive officer of the United States Intel20 lectual Property Organization.

21 ‘‘(b) The term ‘Commissioner’ means the Com22 missioner of Patent and Trademarks.

23 ‘‘(c) The term ‘Department’ means the Depart24 ment of Commerce.
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1 ‘‘(d) The term ‘intellectual property’ shall in2 clude rights in inventions; in trademarks, service

3 marks, and commercial names and designations; in

4 literary, artistic and scientific works; in perform5 ances of performing artists, phonograms and broad6 casts; in industrial designs; in trade secrets and sci7 entific discoveries; in semiconductor chip layout de8 signs; in geographical indications; and all other

9 rights resulting from intellectual activity in the in10 dustrial, scientific, literary, or artistic fields.

11 ‘‘(e) The term ‘organic statues’ includes this

12 Act and the Federal statutes that confer authority

13 upon and refer specifically to the Office, the United

14 States Intellectual Property Organization, the Com15 missioner, or the Chief Executive Officer, including

16 the Patent Act (35 U.S.C. 1, et seq.) and the Trade17 mark Act (15 U.S.C. 1051 et seq.).

18 ‘‘(f) The term ‘Organization’ means the United

19 States Intellectual Property Organization.

20 ‘‘(g) The terms ‘Patent and Trademark Office’

21 and ‘‘Office’’ mean the Patent and Trademark Of22 fice of the Department of Commerce.

23 ‘‘(h) The term ‘Secretary’ means the Secretary

24 of Commerce.’’.
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1 Subtitle B—Trademark Trial and Appeal

2 Board; Board of Patent Appeals and

3 Interferences; Suits By and Against the

4 Organization

5 SEC. 105. TRADEMARK TRIAL AND APPEAL BOARD.

6 Section 17 of the Act of July 5, 1946 (commonly

7 called the Trademark Act of 1946), as amended, is amend8 ed to read as follows:

9 ‘‘(a) FUNCTION.—In every case of interference, oppo10 sition to registration, application to register as a lawful

11 concurrent user, or application to cancel the registration

12 of a mark, the Chief Executive Officer of the United

13 States Intellectual Property Organization shall give notice

14 to all parties and shall direct a Trademark Trial and Ap15 peal Board to determine and decide the respective rights

16 of registration.

17 ‘‘(b) COMPOSITION.—The Trademark Trial and Ap18 peal Board shall include the Chief Executive Officer, the

19 officer of the Organization principally responsible for the

20 examination of trademarks, the officer of the Organization

21 principally responsible for the examination of patents, and

22 members competent in trademark law who are appointed

23 by the Secretary of Commerce. Each case shall be heard

24 by at least three members of the Board.’’.
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1 SEC. 106. BOARD OF PATENT APPEALS AND INTER2 FERENCES.

3 Section 7 of title 35, United States Code is amended

4 to read as follows:

5 ‘‘§ 7. Board of Patent Appeals and Interferences

6 ‘‘(a) COMPOSITION.—There shall be in the United

7 States Intellectual Property Organization a Board of Pat8 ent Appeals and Interferences. The Chief Executive Offi9 cer, the officer of the Organization principally responsible

10 for the examination of patents, the officer of the Organiza11 tion principally responsible for the examination of trade12 marks, and the examiners-in-chief shall constitute the

13 Board. The examiners-in-chief shall be appointed by the

14 Secretary of Commerce and shall be persons of competent

15 legal knowledge and scientific ability.

16 ‘‘(b) FUNCTION.—The Board of Patent Appeals and

17 Interferences shall, on written appeal of an applicant, re18 view adverse decisions of examiners upon applications for

19 patents and shall determine priority and patentability of

20 invention in interferences declared under section 135(a)

21 of this title. Each appeal and interference shall be heard

22 by at least three members of the Board. Only the Board

23 of Patent Appeals and Interferences may grant

24 rehearings.’’.
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1 SEC. 107. SUITS BY AND AGAINST THE ORGANIZATION.

2 (a) Sections 8 through 14 of this title (35 U.S.C. 8,

3 9, 10, 11, 12, 13, and 14) are renumbered 9, 10, 11, 12,

4 13, 14, and 15, respectively.

5 (b) The following new section is added to this title:

6 ‘‘§ 8. Suits by and against the Organization

7 ‘‘(a) ACTIONS UNDER UNITED STATES LAW.—Any

8 civil action, suit, or proceeding to which the Organization

9 is a party is deemed to arise under the laws of the United

10 States. Exclusive jurisdiction over all civil actions by or

11 against the Organization is in the Federal courts as pro12 vided by law. For purposes of filing suits, the Chief Execu13 tive Officer shall be the head of the agency.

14 ‘‘(b) CONTRACT CLAIMS.—Any action, suit, or pro15 ceeding against the Organization founded upon contract

16 shall be subject to the limitations and exclusive remedy

17 provided in sections 1346(a)(2) and 1491 through 1509

18 of title 28, whether or not such contract claims are cog19 nizable under sections 507, 1346, 1402, 1491, 1496,

20 1497, 1501, 1503, 2071, 2072, 2411, 2501, and 2512 of

21 title 28. For purposes of the Contract Disputes Act of

22 1978 (41 U.S.C. 601), the Chief Executive Officer shall

23 be deemed to be the agency head with respect to contract

24 claims arising with respect to the Organization.

25 ‘‘(c) TORT CLAIMS.—Any action, suit, or proceeding

26 against the Organization founded upon tort shall be sub-
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1 ject to the limitations and exclusive remedies provided in

2 subsection 1346(b) and sections 2671 through 2680 of

3 title 28, whether or not such tort claims are cognizable

4 under section 1346(b) of title 28.

5 ‘‘(d) FEDERAL REMEDIES APPLY.—Any action, suit,

6 or proceeding against the Organization based upon civil

7 rights laws shall be subject to the limitations and exclusive

8 remedies provided for other Federal Government executive

9 agencies under 42 U.S.C. 2000e–16, 29 U.S.C. 633a, 29

10 U.S.C. 791 et seq., and 29 U.S.C. 206(d).

11 ‘‘(e) PROHIBITION ON ATTACHMENTS, LIENS,

12 ETC.—No attachment, garnishment, lien, or similar proc13 ess, intermediate or final, in law or equity, may be issued

14 against property of the Organization.’’.

15 SEC. 108. ANNUAL MANAGEMENT REPORT.

16 Section 15 of title 35, United States Code, as redesig17 nated by section 107 of this Act, is amended to read as

18 follows:

19 ‘‘§ 15. Reports to Congress

20 ‘‘(a) ANNUAL REPORT ON MONIES AND STATIS21 TICS.—The Chief Executive Officer shall report to the

22 President and the Congress annually the monies received

23 and expended, statistics concerning the work of the Orga24 nization, and other information relating to the Organiza25 tion as may be useful to the Congress or the public.
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1 ‘‘(b) MANAGEMENT REPORT.—The Chief Executive

2 Officer shall prepare and submit to the President and the

3 Congress an annual management report as required by

4 section 9106 of title 31.’’.

5 Subtitle C—Fees; Organization Moneys;

6 Borrowing; Audits

7 SEC. 109. FEES.

8 ‘‘(a) ESTABLISHMENT OF FEE SCHEDULE.—Section

9 41 of title 35 of the United States Code is amended to

10 read as follows:

11 ‘‘§ 41. Fees

12 ‘‘Consistent with section 553 of title 5, the Organiza13 tion shall recommend a schedule to the Secretary of fees

14 to be levied for the services rendered and products pro15 vided in carrying out its activities. Any schedule of fees,

16 or revision thereof, before it is promulgated, must be ap17 proved by the Secretary.’’.

18 (b) PRINCIPLES FOR DEVELOPING FEE SCHED19 ULES.—In the course of the deliberations to propose modi20 fications to the fee schedule, the Organization shall be

21 guided by the following principles:

22 (1) The fees shall be fair and equitable and

23 shall give due consideration to the objectives of the

24 patent and trademark systems.
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1 (2) Financial relief, in the form of a 50 percent

2 reduction of the major fees for filing a patent appli3 cation, and issuing and maintaining a patent, shall

4 be provided to individual inventors and non-profit

5 organizations. Such financial relief shall be provided

6 to small business concerns as defined in section 3 of

7 the Small Business Act (15 U.S.C. 632) and by reg8 ulations established by the Small Business Adminis9 tration.

10 (3) Fees shall be established, in the aggregate,

11 in such a manner that all costs of operating and

12 maintaining the Organization shall be recovered, in13 cluding depreciation, capital expenditures, and pay14 ments in lieu of taxes, if any, and to provide the

15 reimbursement under section 1503c(d) of title 15,

16 United States Code (15 U.S.C. 1503c(d)).

17 (4) Fees for the processing of trademark reg18 istrations and for other services and materials relat19 ed to trademarks shall be calculated based solely

20 upon the full cost of, and capital expenditures for,

21 such trademark operations. Furthermore, trademark

22 revenues shall be used exclusively for the processing

23 of trademark registrations and for other services and

24 materials related to trademarks, including a fair

25 share of allocated general and administrative sup-
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1 port costs and the reimbursement provided under

2 section 1503c(d) of title 15, United States Code (15

3 U.S.C. 1503c(d)).

4 (5) Fees for the processing of patent grants

5 and for other services and materials related to pat6 ents shall be calculated based solely upon the full

7 cost of, and capital expenditures for, such patent op8 erations. Furthermore, patent revenues shall be used

9 exclusively for the processing of patent grants and

10 for other services and materials related to patents,

11 including a fair share of allocated general and ad12 ministrative support costs and the reimbursement

13 provided under section 1503c(d) of title 15, United

14 States Code (15 U.S.C. 1503c(d)).

15 (c) TRANSITION PROVISION FOR FEES.—The fee

16 schedule promulgated by the Patent and Trademark Of17 fice, which is in effect immediately prior to the enactment

18 of this legislation, shall remain in full force and effect until

19 such time as the Secretary of Commerce has established

20 and promulgated a schedule of fees.

21 (d) EXEMPTION FROM SEQUESTRATION ORDERS.—

22 Section 255(g)(1)(A) of the Balanced Budget and Emer23 gency Deficit Control Act of 1985 (2 U.S.C. 905(g)(a)(A))

24 is amended by inserting after the ‘‘Tennessee Valley Au-
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1 thority fund . . .’’ the following, ‘‘United States Intellec2 tual Property Fund’’.

3 (e) CONFORMING AMENDMENTS TO OBRA.—Section

4 10101 of the Omnibus Reconciliation Act of 1990 (35

5 U.S.C. 41 note), as amended, is amended as follows:

6 (1) In subsection (a), by striking the phrase

7 ‘‘by subsections (a) and (b)’’.

8 (2) In subsections (b)(1)(A) and (b)(2)(A), by

9 striking ‘‘Patent and Trademark activities in the

10 Department of Commerce’’ and inserting in lieu

11 thereof ‘‘United States Intellectual Property Organi12 zation’’.

13 (3) In subsections (b) and (c), by striking all

14 other references to ‘‘Patent and Trademark Office’’

15 and substituting therefor ‘‘United States Intellectual

16 Property Organization’’.

17 (4) In subsection (c), by striking ‘‘Commis18 sioner of Patents and Trademarks’’ and inserting in

19 lieu thereof ‘‘Chief Executive Officer of the United

20 States Intellectual Property Organization’’.

21 (5) Notwithstanding the provisions of any other

22 law, except insofar as such law amends this sen23 tence, on October 1, 1998, the provisions of section

24 10101, as they apply to the Organization, shall cease

25 to apply to the revenues of the Organization.
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1 (f) RECOMMEND TRADEMARK FEE SCHEDULE.—

2 Subsection 31(a) of the Act of July 5, 1946 (commonly

3 referred to as the Trademark Act of 1946), as amended,

4 is amended to read as follows:

5 ‘‘(a) Consistent with section 553 of title 5, the Orga6 nization shall recommend to the Secretary a schedule of

7 fees to be levied for the services rendered and products

8 provided in carrying out its activities. Any schedule of

9 fees, or revision therefore, before it is promulgated, must

10 be approved by the Secretary.’’.

11 (g) PCT FEES.—Section 371 of title 35, United

12 States Code, is amended to read as follows:

13 ‘‘§ 376. Fees required

14 ‘‘The required payment of the international fee and

15 the handling fee, which amounts are specified in the Regu16 lations, shall be paid in United States currency. The Orga17 nization shall charge national fees as provided in section

18 41 of this title and may also charge the following fees:

19 ‘‘(a) A transmittal fee (see section 361(d)).

20 ‘‘(b) A search fee (see section 361(d)).

21 ‘‘(c) A supplemental search fee (to be paid

22 when required).

23 ‘‘(d) A preliminary examination fee and any ad24 ditional fees (see section 362(b)).
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1 ‘‘(e) Such other fees as established by the Sec2 retary.’’.

3 SEC. 110. ORGANIZATION MONIES.

4 Section 42 of title 35, United States Code, is amend5 ed to read as follows:

6 ‘‘§ 42. United States Intellectual Property Organiza7 tion Funding

8 ‘‘(a) ESTABLISHMENT OF A REVOLVING FUND.—

9 There is established with the Secretary of the Treasury

10 a revolving fund, which shall be known as the Patent and

11 Trademark Organization Fund (the ‘‘Fund’’). All fees for

12 services performed or furnished by the Organization, will

13 be payable to the Organization, and, except as otherwise

14 provided in section 10101 of the Omnibus Budget Rec15 onciliation Act of 1990, as amended (35 U.S.C. 41 note),

16 fees authorized under section 31 of the Act of July 5,

17 1946 (commonly called Trademark Act of 1946), as

18 amended, and sections 41 and 376 of title 35, and all

19 other revenues and monies accruing to the Organization

20 shall be deposited in the Fund. Amounts deposited in the

21 Fund shall be available to the Organization for obligation

22 without further appropriation and shall remain available

23 for obligation without time limitation. All monies in the

24 Fund shall remain available to the Organization for obli25 gation until expended.
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1 ‘‘(b) AUTHORITY TO INVEST.—Upon the request of

2 the Organization, the Secretary of the Treasury shall in3 vest such portion of the Fund as is not, in the judgment

4 of the Organization, required to meet current withdrawals.

5 Such investments shall be in public debt securities with

6 maturities suitable to the needs of the Fund, as deter7 mined by the Organization, and bearing interest at rates

8 determined by the Secretary of the Treasury, taking into

9 consideration current market yields on outstanding mar10 ketable obligations of the United States of comparable ma11 turities. The income on such investments shall be credited

12 to and form a part of the Fund.

13 ‘‘(c) AUTHORITY TO ISSUE OBLIGATIONS.—To assist

14 in financing its activities, the Organization is authorized

15 after October 1, 1998 to issue obligations, to the Secretary

16 of the Treasury and the Secretary of the Treasury may,

17 at his or her discretion, purchase such obligations, pro18 vided that the amount of such obligations outstanding at

19 any one time does not exceed $2,000,000,000 and pro20 vided further that expenditures (including capital invest21 ment and interest on borrowing) are fully offset by the

22 Organization’s revenues in each fiscal year. For such pur23 pose, the Secretary of the Treasury is authorized to use

24 as a public debt transaction the proceeds of the sale of

25 any securities hereafter issued under chapter 31 of title
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1 31 of the United States Code and the purposes for which

2 securities may be issued under that chapter are extended

3 to include such purchases. Each purchase of obligations

4 by the Secretary of the Treasury shall be upon such terms

5 and conditions as to yield a return at a rate not less than

6 a rate determined by the Secretary of the Treasury, taking

7 into consideration the current yields on outstanding mar8 ketable obligations of the United States of comparable ma9 turity. The Secretary of the Treasury may sell, upon such

10 terms and conditions and at such price or prices as deter11 mined by the Secretary of the Treasury, any of the obliga12 tions acquired under this subsection. All purchases and

13 sales by the Secretary of the Treasury of such obligations

14 under this subsection shall be treated as public debt trans15 actions of the United States. Funds obtained by the Orga16 nization from the issuance of such obligations shall be

17 credited to and form part of the Fund.

18 ‘‘(d) FORM OF PAYMENT.—All fees for services per19 formed by or materials furnished by the United States In20 tellectual Property Organization will be payable to the Or21 ganization.’’.

22 SEC. 111. AUDITS.

23 Chapter 4 of part I of title 35, United States Code,

24 is amended by adding at the end the following new section:
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1 ‘‘§ 43. Audits

2 ‘‘The Organization shall reimburse the Inspector

3 General for the full cost of any audit conducted by the

4 Inspector General or an external auditor under section

5 9105 of title 31 as determined by the Inspector General.’’.

6 Subtitle D—Transfers; Use of Organization

7 Name; Transition Provisions; Technical

8 and Conforming Amendments

9 SEC. 112. TRANSFERS.

10 (a) TRANSFER OF FUNCTIONS, POWERS, AND DU11 TIES.—Except as otherwise provided in this Act, on the

12 effective date of this Act, there are hereby transferred to,

13 and vested in, the United States Intellectual Property Or14 ganization all functions, powers and duties vested by law

15 in the Secretary of Commerce or the Department of Com16 mence or in officers or components in the Department

17 with respect to the authority to examine patent and trade18 mark applications, and in the Patent and Trademark Of19 fice, and in the officers and components of such Office.

20 (b) TRANSFER OF ASSETS, LIABILITIES, ETC.—The

21 Secretary of Commerce is authorized and directed, without

22 need of further appropriation, to transfer to the United

23 States Intellectual Property Organization, on the effective

24 date of this Act, those assets, liabilities, contracts, prop25 erty, records, and unexpended and unobligated balances

26 of appropriations, authorizations, allocations and other
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1 funds employed, held, used, arising from, available or to

2 be made available to the Department of Commerce (inclu3 sive of funds set aside for accounts receivable which are

4 related to functions, powers and duties which are vested

5 in the Organization by this Act).

6 (c) TRANSFER OF INVESTED CAPITAL.—From time

7 to time, and at least at the close of each fiscal year, the

8 United States Intellectual Property Organization shall pay

9 into the Treasury as miscellaneous receipts interest on the

10 invested capital transferred to the Organization under

11 subsection (b) less the cumulative total of invested capital

12 repaid to the general fund. The rate of interest shall be

13 determined by the Secretary of the Treasury taking into

14 consideration the average market yield on outstanding

15 marketable obligations of the United States with remain16 ing periods to maturity of approximately one year during

17 the month preceding each fiscal year. Interest payments

18 may be deferred, but any interest payments so deferred

19 shall themselves bear interest.

20 SEC. 113. USE OF ORGANIZATION NAME.

21 Chapter 1 of part I of title 35, United States Code,

22 is amended by adding at the end the following new section:

23 ‘‘§ 16. Use of Organization name

24 ‘‘No individual, association, partnership, or corpora25 tion, except the Organization, shall hereafter use words
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1 ‘United States Intellectual Property Organization,’ ‘Pat2 ent and Trademark Office,’ or any combination of such

3 words, as the name or part thereof under which such indi4 vidual or entity shall do business. Violations of the fore5 going may be enjoined by any Federal court at the suit

6 of the Organization. In any such suit, the Organization

7 shall be entitled to statutory damages of $1,000 for each

8 day during which such violation continues or is repeated

9 and, in addition, may recover actual damages flowing from

10 such violation.’’.

11 SEC. 114. TRANSITION PROVISIONS.

12 (a) CONTINUATION OF CONTRACTS, ETC.—Except as

13 provided elsewhere in this Act, all contracts, agreements,

14 leases and other business instruments, and licenses, per15 mits and privileges that have been afforded to the Patent

16 and Trademark Office prior to the effective date of this

17 Act, shall continue in effect as if the United States Intel18 lectual Property Organization had executed such con19 tracts, agreements, leases or other business instruments

20 which have been made in the exercise of functions which

21 are transferred to the Organization by this Act.

22 (b) CONTINUATION OF RULES.—Until changed by

23 the United States Intellectual Property Organization, any

24 procedural and administrative rules applicable to particu25 lar functions over which the Organization acquires juris-
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1 diction on the effective date of this Act shall continue in

2 effect with respect to such particular functions.

3 (c) CESSATION OF CERTAIN ORDERS, ETC.—Unless

4 otherwise provided by this Act, as related to the functions

5 vested in the United States Intellectual Property Organi6 zation by this Act, all orders, determinations, rules, regu7 lations, and privileges of the Department of Commerce

8 shall cease to apply to the Organization on the effective

9 date of this Act, except for those which the Organization

10 determines shall continue to be applicable.

11 (d) TRANSFER NOT AFFECTING OTHER PROCEED12 INGS.—Except as provided elsewhere in this Act, the

13 transfer of functions related to and vested in the United

14 States Intellectual Property Organization by this Act shall

15 not affect judicial, administrative, or other proceedings

16 which are pending at the time this Act takes effect, and

17 such proceedings shall be continued by the Organization.

18 (e) TRANSITION PROVISIONS FOR EMPLOYEES.—

19 (1) REASSIGNMENT.—On the effective date of

20 this Act and without a break in service, all officers

21 and employees of the Office on the day before the

22 effective date of this Act will become officers and

23 employees of the Organization or will be reassigned

24 to the Office of the Under Secretary for Intellectual

25 Property within the Department.
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1 (2) NO SEPARATIONS OR REDUCTIONS IN COM2 PENSATION.—No officer or employee of the Office

3 who becomes an officer or employee of the Organiza4 tion shall, for a period of one year after the effective

5 date of this Act, be subject to separation or to any

6 reduction in compensation as a consequence of the

7 establishment of the Organization.

8 (f) TRANSITION PROVISIONS FOR LABOR AGREE9 MENTS.—All orders, determinations, rules, and regula10 tions regarding compensation and benefits and other

11 terms and conditions of employment in effect for the Of12 fice and its officers and employees on the day before the

13 effective date of this Act shall continue in effect with re14 spect to the Organization and its officers and employees

15 until modified, superseded, or set aside by the Organiza16 tion. The collective bargaining agreements between the

17 Patent and Trademark Office and National Treasury Em18 ployees Union 243, dated March 13, 1993, the Patent and

19 Trademark Office and the National Treasury Employees

20 Union 245, dated July 20, 1993, and the Patent and

21 Trademark Office and the Patent Office Professional As22 sociation, dated October 6, 1986, as well as the recogni23 tion of the three units, shall remain in effect until modi24 fied, superseded, or set aside by the parties.
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1 SEC. 115. TECHNICAL AND CONFORMING AMENDMENTS.

2 (a) Section 5314 of title 5, United States Code is

3 amended by adding at the end ‘‘Under Secretary of Com4 merce for Intellectual Property.’’.

5 (b) Section 9101(3) of title 31, United States Code,

6 is amended by adding at the end the following:

7 ‘‘(O) the United States Intellectual Prop8 erty Organization.’’.

9 (c) Section 602(d) of the Federal Property and Ad10 ministrative Services Act of 1949 (40 U.S.C. 474), is

11 amended—

12 (1) in paragraph (20) by striking ‘‘or’’ after the

13 semicolon;

14 (2) in paragraph (21) by striking the period

15 and inserting ‘‘; or’’; and

16 (3) by adding at the end the following:

17 ‘‘(22) the United States Intellectual Property

18 Organization.’’.

19 (d) Title 35, United States Code is amended—

20 (1) in section 13 by striking ‘‘at the rate for

21 each year’s issue established for this purpose in sec22 tion 41(d) of this title’’;

23 (2) in section 111 by striking ‘‘required by law’’

24 and inserting ‘‘established by the Chief Executive

25 Officer’’;
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1 (3) in section 131 by striking the second occur2 rence of ‘‘Commissioner’’ and inserting ‘‘Under Sec3 retary for Intellectual Property’’;

4 (4) in the third sentence of subsection 135(2)

5 by striking ‘‘Commissioner’’ and inserting ‘‘Under

6 Secretary for Intellectual Property’’;

7 (5) in subsection 153—

8 (A) by striking ‘‘Commissioner’’ and in9 serting ‘‘Under Secretary for Intellectual Prop10 erty’’; and

11 (B) by striking ‘‘under the seal of the Pat12 ent and Trademark Office,’’

13 (6) in section 251 by striking ‘‘Commissioner’’

14 in all occurrences and insert ‘‘Under Secretary for

15 Intellectual Property’’;

16 (7) in section 254 by striking the second occur17 rence of ‘‘Commissioner’’ and inserting ‘‘Under Sec18 retary for Intellectual Property’’;

19 (8) in section 302 by inserting ‘‘established’’

20 before the word ‘‘pursuant’’;

21 (9) in subsection 307(a) by striking ‘‘Commis22 sioner’’ and inserting ‘‘Under Secretary for Intellec23 tual Property’’;
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1 (10) in section 371(c)(1) by striking ‘‘provided

2 in section 41(a)’’ and inserting ‘‘established under

3 section 41’’;

4 (11) in all other occurrences by striking the

5 words ‘‘Commissioner of Patents and Trademarks’’

6 and ‘‘Commissioner’’ (insofar as the word refers to

7 the Commissioner of Patents and Trademarks) and

8 inserting ‘‘Chief Executive Officer’’; and

9 (12) by striking the words ‘‘Patent and Trade10 mark Office’’ whenever they appear and inserting

11 ‘‘United States Intellectual Property Organization’’.

12 (e) The Act of July 5, 1946 (commonly known as

13 the Trademark Act of 1946), as amended (chapter 22 of

14 title 15), is amended—

15 (1) in paragraph 1(d)(1), second sentence, by

16 striking ‘‘in the Patent and Trademark Office’’ and

17 inserting ‘‘by the Under Secretary for Intellectual

18 Property’’;

19 (2) in subsection 2(d)—

20 (A) by striking ‘‘Patent and Trademark

21 Office’’ and inserting ‘‘United States’’; and

22 (B) in the second and third sentences by

23 striking ‘‘Commissioner’’ and inserting ‘‘Under

24 Secretary for Intellectual Property’’;

25 (3) in section 7—
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1 (A) in subsection (a) by striking ‘‘under

2 the seal of the Patent and Trademark Office

3 and shall be signed by the Commissioner’’ and

4 inserting ‘‘and shall be signed by the Under

5 Secretary for Intellectual Property’’;

6 (B) in subsection (d) by striking ‘‘Commis7 sioner’’ and inserting ‘‘Under Secretary for In8 tellectual Property’’;

9 (C) in subsection (e) by striking ‘‘Commis10 sioner’’ in all occurrences and inserting ‘‘Under

11 Secretary for Intellectual Property’’;

12 (D) in subsection (g) by striking ‘‘Commis13 sioner’’ and inserting ‘‘Under Secretary for In14 tellectual Property’’; and

15 (E) in subsection (h) by striking ‘‘Commis16 sioner’’ and inserting ‘‘Under Secretary for In17 tellectual Property’’;

18 (4) in subsection 12(a) by striking ‘‘shall refer

19 the application to the examiner in charge of the reg20 istration of marks’’;

21 (5) in section 45 by striking ‘‘The term Com22 missioner means the Commissioner of Patents and

23 Trademarks.’’ and inserting ‘‘The term Chief Execu24 tive Officer’’ means the Chief Executive Officer of

25 the United States Intellectual Property Organization
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1 and the term ‘‘Under Secretary for Intellectual

2 Property’’ shall mean the Under Secretary for Intel3 lectual Property within the Department of Com4 merce.’’;

5 (6) in all other occurrences by striking the

6 words ‘‘Commissioner of Patents and Trademarks’’

7 and ‘‘Commissioner’’ (insofar as the word refers to

8 the Commissioner of Patents and Trademarks) and

9 inserting ‘‘Chief Executive Officer’’; and

10 (7) by striking the words ‘‘Patent and Trade11 mark Office’’ whenever they appear and inserting

12 ‘‘United States Intellectual Property Organization’’.

13 (f) Section 500(e) of title 5, United States Code, is

14 amended by striking ‘‘the Patent Office’’ and ‘‘the United

15 States Intellectual Property Organization’’.

16 (g) Subsection 5102(c) of title 5, United States Code,

17 by striking paragraph (23) and redesignating paragraphs

18 (24) through (30) as paragraphs (23) through (29).

19 (h) Section 5316 of title 5, United States Code, is

20 amended—

21 (1) by striking ‘‘Commissioner of Patents, De22 partment of Commerce’’;

23 (2) by striking ‘‘Deputy Commissioner for Pat24 ents’’;
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1 (3) by striking ‘‘Assistant Commissioner for

2 Patents’’; and

3 (4) by striking ‘‘Assistant Commissioner for

4 Trademarks’’.

5 (i) Subparagraph 9(p)(1)(B) of the Small Business

6 Act (15 U.S.C. 638(p)(1)(B)) is amended by striking

7 ‘‘Commissioner of Patents and Trademarks’’ and insert8 ing ‘‘Under Secretary for Intellectual Property’’.

9 (j) Section 4 of the Act of February 14, 1903 (15

10 U.S.C. 1511) is amended by striking ‘‘(d) Patent and

11 Trademark Office;’’ and redesignating subsections (a)

12 through (g) as paragraphs (1) through (6), respectively.

13 (k) Section 19 of the Tennessee Valley Authority Act

14 of 1933 (16 U.S.C. 831r) is amended—

15 (1) by striking ‘‘Patent and Trademark Office’’

16 and inserting ‘‘United States Patent and Trademark

17 Organization’’; and

18 (2) by striking ‘‘Commissioner of Patents and

19 Trademarks’’ and inserting ‘‘Chief Executive Officer

20 of the United States Intellectual Property Organiza21 tion’’.

22 (l) Subparagraph 2320(d)(1)(A)(ii) of title 18,

23 United States Code, is amended by striking ‘‘Patent Of24 fice’’ and inserting ‘‘United States Patent and Trademark

25 Organization’’.
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1 (m) Section 1526(a) of title 19, United States Code

2 (19 U.S.C. 1526(a)) is amended by striking ‘‘Patent and

3 Trademark Office’’ and inserting in lieu thereof ‘‘United

4 States Intellectual Property Organization’’.

5 (n) Sections 2242(b)(2)(A) and 2412(b)(2)(D) of

6 title 19, United States Code (19 U.S.C. 2242(b)(2)(A)

7 and 2412(b)(2)(D)) are amended by striking ‘‘Commis8 sioner of Patents and Trademarks’’ and inserting in lieu

9 thereof ‘‘Under Secretary of Commerce for Intellectual

10 Property’’.

11 (o) The Act of April 12, 1892 (27 Stat. 395; 20

12 U.S.C. 20) is amended by striking ‘‘Patent Office’’ and

13 inserting ‘‘United States Intellectual Property Organiza14 tion’’.

15 (p) Subsections 505(m) and 512(o) of the Federal

16 Food, Drug, and Cosmetic Act (21 U.S.C. 355(m) and

17 360b(o)) are amended by striking ‘‘Patent and Trademark

18 Office’’ and inserting ‘‘United States Intellectual Property

19 Organization’’.

20 (q) Subsection 702(d) of the Federal Food, Drug,

21 and Cosmetic Act (21 U.S.C. 372) is amended by striking

22 ‘‘Commissioner of Patents’’ and inserting ‘‘Chief Execu23 tive Officer of the United States Intellectual Property Or24 ganization’’.
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1 (r) Section 2151t–1 of title 22, United States Code

2 (22 U.S.C. 2151t–1) is amended by striking ‘‘Patent and

3 Trademark Office’’ and inserting in lieu thereof ‘‘Under

4 Secretary of Commerce for Intellectual Property’’.

5 (s) Section 305a of title 25, United States Code (25

6 U.S.C. 305a) is amended by striking ‘‘Patent and Trade7 mark Office’’ and inserting in lieu thereof ‘‘United States

8 Intellectual Property Organization’’.

9 (t) Subsection 105(e) of the Federal Alcohol Adminis10 tration Act (27 U.S.C. 205(e)) is amended by striking

11 ‘‘Patent Office’’ and inserting ‘‘United States Intellectual

12 Property Organization’’.

13 (u) Paragraph 1295(a)(4) of title 28, United States

14 Code, is amended—

15 (1) by striking ‘‘Patent and Trademark Office’’

16 and inserting ‘‘United States Intellectual Property

17 Organization’’; and

18 (2) striking ‘‘Commissioner of Patents and

19 Trademarks’’ and inserting ‘‘Chief Executive Officer

20 of the United States Intellectual Property Organiza21 tion’’.

22 (v) Section 1744 of title 28, United States Code, is

23 amended—
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1 (1) by striking ‘‘Patent Office’’ each place it

2 appears and inserting ‘‘United States Intellectual

3 Property Organization’’;

4 (2) by striking ‘‘Commissioner of Patents’’ and

5 inserting ‘‘Chief Executive Officer of the United

6 States Intellectual Property Organization’’; and

7 (3) by striking ‘‘Commissioner’’ and inserting

8 ‘‘Chief Executive Officer’’.

9 (w) Section 1745 of title 28, United States Code, is

10 amended by striking ‘‘Patent Office’’ and inserting

11 ‘‘United States Intellectual Property Organization’’.

12 (x) Section 1928 of title 28, United States Code, is

13 amended by striking ‘‘Patent Office’’ and inserting

14 ‘‘United States Intellectual Property Organization’’.

15 (y) Section 2181 (c) and (d) of title 42, United States

16 Code (42 U.S.C. 2181 (c) and (d)) are amended by strik17 ing ‘‘Commissioner of Patents’’ and inserting in lieu there18 of ‘‘Chief Executive Officer of the United States Intellec19 tual Property Organization’’.

20 (z) Section 160 of the Atomic Energy Act of 1954

21 (42 U.S.C. 2190) is amended—

22 (1) by striking ‘‘Patent Office’’ and inserting

23 ‘‘United States Intellectual Property Organization’’;

24 and
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1 (2) by striking ‘‘Commissioner of Patents’’ and

2 inserting ‘‘Chief Executive Officer’’.

3 (aa) Subsection 305(c) of the National Aeronautics

4 and Space Act of 1958 (42 U.S.C. 2457(c)) is amended—

5 (1) by striking ‘‘Commissioner of Patents’’ and

6 inserting ‘‘Chief Executive Officer of the United

7 States Intellectual Property Organization’’; and

8 (2) by striking ‘‘Commissioner’’ and inserting

9 ‘‘Chief Executive Officer’’.

10 (bb) Subsection 12(a) of the Solar Heating and Cool11 ing Demonstration Act of 1974 (42 U.S.C. 5510(a)) is

12 amended by striking ‘‘Commissioner of Patent Office’’ and

13 inserting ‘‘Chief Executive Officer of the United States In14 tellectual Property Organization’’.

15 (cc) Section 1111 of title 44, United States Code, is

16 amended by striking ‘‘Commissioner of Patents’’ and in17 serting ‘‘Chief Executive Officer of the United States In18 tellectual Property Organization’’.

19 (dd) Sections 1114 and 1123 of title 44, United

20 States Code, are amended by striking ‘‘Commissioner of

21 Patents’’.

22 (ee) Sections 1337 and 1338 of title 44, United

23 States Code, and the items relating to those sections in

24 the table of contents for chapter 13 of such title are re25 pealed.
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1 (ff) Subsection 10(I) of the Trading With the Enemy

2 Act (50 U.S.C. App. 10(i)) is amended by striking ‘‘Com3 missioner of Patents’’ and inserting ‘‘Chief Executive Offi4 cer of the United States Intellectual Property Organiza5 tion’’.

6 (gg) Section 5 of Public Law 103–226 is amended

7 as follows:

8 (1) In paragraph (a) by adding ‘‘and the Unit9 ed States Intellectual Property Organization’’ follow10 ing ‘‘General Accounting Office,’’.

11 (2) In subsection (b), by striking paragraphs

12 (3) through (6) and inserting the following:

13 ‘‘(3) 1,998,200 during fiscal year 1996;

14 ‘‘(4) 1,958,200 during fiscal year 1997;

15 ‘‘(5) 1,917,300 during fiscal year 1998; and

16 ‘‘(6) 1,877,400 during fiscal year 1999.’’.

17 Subtitle E—Separability; Effective Date;

18 Report of the Secretary

19 SEC. 116. SEPARABILITY.

20 If any provision of this Act or the application thereof

21 to any person or circumstance is held invalid, the remain22 der of this Act, and the application of such provision to

23 other persons or circumstances shall not be affected there24 by.
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1 SEC. 117. EFFECTIVE DATE.

2 This Act shall take effect 6 months after the date

3 of the enactment of this Act.

4 SEC. 118. REPORT OF THE SECRETARY.

5 Not later than five years from the effective date of

6 this Act, the Secretary of Commerce shall provide to the

7 President and the Congress a report on the operation and

8 effectiveness of the provisions of this Act and the costs

9 associated therewith. As part of the report, the Secretary

10 shall include (a) the Secretary’s recommendation as to

11 whether the Organization should continue to exist and (b)

12 any recommendations for legislation the Secretary deems

13 necessary or appropriate as a result of his or her analysis

14 of the operation and effectiveness of the Act and the costs

15 associated therewith. The Secretary shall provide to the

16 President and the Congress additional reports that comply

17 with the requirements of this section every six years after

18 the submission of the first report. The preceding sentence

19 shall cease to be effective upon the enactment of legisla20 tion to terminate the Organization or to amend this Act.

21 TITLE II—UNDER SECRETARY FOR

22 INTELLECTUAL PROPERTY

23 SEC. 201. UNDER SECRETARY FOR INTELLECTUAL PROP24 ERTY.

25 (A) APPOINTMENT.—There shall be within the De26 partment of Commerce, an Under Secretary of Commerce
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1 for Intellectual property, who shall be appointed by the

2 President by and with the advice and consent of the Sen3 ate.

4 (b) DUTIES.—The Under Secretary for Intellectual

5 Property, under the direction of the Secretary of Com6 merce, shall perform the following functions with respect

7 to intellectual property policy:

8 (1) Grant patents and register trademarks.

9 (2) Advise the Secretary on all aspects of intel10 lectual property policy, legislation, and issues, in11 cluding international trade issues concerning intel12 lectual property.

13 (3) Advise the Chief Executive Officer of the

14 United States Intellectual Property Organization on

15 patent and trademark policy as provided in section

16 2(a) of title 35, United States Code, as amended.

17 (4) Promote in international trade the United

18 States industries that rely on intellectual property.

19 (5) Advise the Secretary of State, the United

20 States Trade Representative, and other appropriate

21 department and agency heads, subject to the author22 ity of the Secretary, on international intellectual

23 property issues.
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1 (6) Advise Federal agencies on ways to improve

2 intellectual property protection in other countries

3 through economic assistance and international trade.

4 (7) Review and coordinate all proposals by

5 agencies to assist foreign governments and inter6 national intergovernmental agencies in improving in7 tellectual property protection.

8 (8) Carry on studies related to the effectiveness

9 of intellectual property protection throughout the

10 world.

11 (9) Advise the Secretary on programs and stud12 ies which the Organization is carrying on coopera13 tively, or is authorizing to be carried on, with for14 eign patent and trademark offices and international

15 intergovernmental organizations in connection with

16 the examination of patent and trademark applica17 tions.

18 (10) In coordination with the Department of

19 State, carry on studies cooperatively with foreign in20 tellectual property offices and international intergov21 ernmental organizations.

22 (c) DEPUTY UNDER SECRETARIES.—The Under Sec23 retary for Intellectual Property shall be assisted by two

24 Deputy Under Secretaries of Commerce for Intellectual

25 Property. The Deputy Under Secretaries shall be ap-
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1 pointed by the Secretary of Commerce to non-career posi2 tions within the Senior Executive Service and shall be

3 compensated in accordance with the provisions of title V,

4 United States Code. The Deputy Under Secretaries shall

5 perform such duties and functions as the Under Secretary

6 for Intellectual Property shall prescribe.

7 (d) FUNDING.—The offices of the Under Secretary

8 for Intellectual Property shall be financially supported

9 through reimbursement from the United States Intellec10 tual Property Organization, in lieu of all other payments

11 by the Organization, upon determination of requirements

12 by the Secretary and in an amount not to exceed two (2)

13 percent of the Organization’s projected annual revenues

14 from fees for services and goods.

Æ

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