I 

110TH CONGRESS 

1ST SESSION H. R. 2365 

To amend title 35, United States Code, to limit damages and other remedies 

with respect to patents for tax planning methods. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 17, 2007 

Mr. BOUCHER (for himself, Mr. GOODLATTE, and Mr. CHABOT) introduced 

the following bill; which was referred to the Committee on the Judiciary 

A BILL 

To amend title 35, United States Code, to limit damages 

and other remedies with respect to patents for tax planning methods. 

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

3 SECTION 1. LIMITATION ON DAMAGES AND OTHER REM4 EDIES WITH RESPECT TO PATENTS FOR TAX 

5 PLANNING METHODS. 

6 (a) LIMITATION.—Section 287 of title 35, United 

7 States Code, is amended by adding at the end the fol8 lowing new subsection: 

9 ‘‘(d)(1) With respect to the use by a taxpayer or a 

10 tax practitioner of a tax planning method that constitutes 


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1 an infringement under subsection (a) or (b) of section 271, 

2 the provisions of sections 281, 283, 284, and 285 shall 

3 not apply against the taxpayer, the tax practitioner, or any 

4 related professional organization with respect to such tax 

5 planning method. 

6 ‘‘(2) For the purposes of this subsection— 

7 ‘‘(A) the term ‘tax planning method’ means a 

8 plan, strategy, technique, or structure that is de9 signed to reduce, minimize, or defer, or has, when 

10 implemented, the effect of reducing, minimizing or 

11 deferring, a taxpayer’s tax liability, but does not in12 clude the use of tax preparation software or other 

13 tools used solely to perform or model mathematical 

14 calculations or prepare tax or information returns; 

15 ‘‘(B) the term ‘taxpayer’ means an individual, 

16 entity, or other person (as defined in section 7701 

17 of the Internal Revenue Code of 1986) that is sub18 ject to taxation directly, is required to prepare a tax 

19 return or information statement to enable one or 

20 more other persons to determine their tax liability, 

21 or is otherwise subject to a tax law; 

22 ‘‘(C) the terms ‘tax’, ‘tax laws’, ‘tax liability’, 

23 and ‘taxation’ refer to any Federal, State (as de24 fined in subsection (c)(2)(G)), county, city, munici25 pality, or other governmental levy, assessment, or 


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1 imposition, whether measured by income, value, or 

2 otherwise; 

3 ‘‘(D) the term ‘tax practitioner’ means any nat4 ural person who provides advice and consultation to 

5 a taxpayer with respect to a tax planning method or 

6 who is acting under the direction of such person in 

7 connection with the development or use of a tax 

8 planning method; 

9 ‘‘(E) the term ‘related professional organiza10 tion’ means an entity with which a tax practitioner 

11 has a professional affiliation under which the tax 

12 practitioner may provide advice and consultation 

13 with respect to a tax planning method, including a 

14 law firm, accounting firm, or a bank; and 

15 ‘‘(F) the term ‘professional affiliation’ means 

16 an employment or contractual relationship or part17 nership or other ownership interest.’’. 

18 (b) EFFECTIVE DATE.—The amendment made by 

19 subsection (a) shall take effect on the date of the enact20 ment of this Act and shall apply to any action for patent 

21 infringement that is filed on or after that date. 

Æ 


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