112TH CONGRESS 

1ST SESSION S. 23 

AN ACT 

To amend title 35, United States Code, to provide for patent 

reform. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 
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1 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

2 (a) SHORT TITLE.—This Act may be cited as the 

3 ‘‘America Invents Act’’. 

4 (b) TABLE OF CONTENTS.—The table of contents for 

5 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. First inventor to file. 

Sec. 3. Inventor’s oath or declaration. 

Sec. 4. Virtual marking and advice of counsel. 

Sec. 5. Post-grant review proceedings. 

Sec. 6. Patent Trial and Appeal Board. 

Sec. 7. Preissuance submissions by third parties. 

Sec. 8. Venue. 

Sec. 9. Fee setting authority. 

Sec. 10. Supplemental examination. 

Sec. 11. Residency of Federal Circuit judges. 

Sec. 12. Micro entity defined. 

Sec. 13. Funding agreements. 

Sec. 14. Tax strategies deemed within the prior art. 

Sec. 15. Best mode requirement. 

Sec. 16. Technical amendments. 

Sec. 17. Clarification of jurisdiction. 

Sec. 18. Transitional program for covered business-method patents. 

Sec. 19. Travel expenses and payment of administrative judges. 

Sec. 20. Patent and Trademark Office funding. 

Sec. 21. Satellite offices. 

Sec. 22. Patent Ombudsman Program for small business concerns. 

Sec. 23. Priority examination for technologies important to American competitiveness. 

Sec. 24. Designation of Detroit satellite office. 

Sec. 25. Effective date. 

Sec. 26. Budgetary effects. 

6 SEC. 2. FIRST INVENTOR TO FILE. 

7 (a) DEFINITIONS.—Section 100 of title 35, United 

8 States Code, is amended by adding at the end the fol9 lowing: 

10 ‘‘(f) The term ‘inventor’ means the individual or, if 

11 a joint invention, the individuals collectively who invented 

12 or discovered the subject matter of the invention. 
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1 ‘‘(g) The terms ‘joint inventor’ and ‘coinventor’ mean 

2 any 1 of the individuals who invented or discovered the 

3 subject matter of a joint invention. 

4 ‘‘(h) The term ‘joint research agreement’ means a 

5 written contract, grant, or cooperative agreement entered 

6 into by 2 or more persons or entities for the performance 

7 of experimental, developmental, or research work in the 

8 field of the claimed invention. 

9 ‘‘(i)(1) The term ‘effective filing date’ of a claimed 

10 invention in a patent or application for patent means— 

11 ‘‘(A) if subparagraph (B) does not apply, the 

12 actual filing date of the patent or the application for 

13 the patent containing a claim to the invention; or 

14 ‘‘(B) the filing date of the earliest application 

15 for which the patent or application is entitled, as to 

16 such invention, to a right of priority under section 

17 119, 365(a), or 365(b) or to the benefit of an earlier 

18 filing date under section 120, 121, or 365(c). 

19 ‘‘(2) The effective filing date for a claimed invention 

20 in an application for reissue or reissued patent shall be 

21 determined by deeming the claim to the invention to have 

22 been contained in the patent for which reissue was sought. 

23 ‘‘(j) The term ‘claimed invention’ means the subject 

24 matter defined by a claim in a patent or an application 

25 for a patent.’’. 
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1 (b) CONDITIONS FOR PATENTABILITY.— 

2 (1) IN GENERAL.—Section 102 of title 35, 

3 United States Code, is amended to read as follows: 

4 ‘‘§ 102. Conditions for patentability; novelty 

5 ‘‘(a) NOVELTY; PRIOR ART.—A person shall be enti6 tled to a patent unless— 

7 ‘‘(1) the claimed invention was patented, de8 scribed in a printed publication, or in public use, on 

9 sale, or otherwise available to the public before the 

10 effective filing date of the claimed invention; or 

11 ‘‘(2) the claimed invention was described in a 

12 patent issued under section 151, or in an application 

13 for patent published or deemed published under sec14 tion 122(b), in which the patent or application, as 

15 the case may be, names another inventor and was 

16 effectively filed before the effective filing date of the 

17 claimed invention. 

18 ‘‘(b) EXCEPTIONS.— 

19 ‘‘(1) DISCLOSURES MADE 1 YEAR OR LESS BE20 FORE THE EFFECTIVE FILING DATE OF THE

21 CLAIMED INVENTION.—A disclosure made 1 year or 

22 less before the effective filing date of a claimed in23 vention shall not be prior art to the claimed inven24 tion under subsection (a)(1) if— 
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1 ‘‘(A) the disclosure was made by the inven2 tor or joint inventor or by another who obtained 

3 the subject matter disclosed directly or indi4 rectly from the inventor or a joint inventor; or 

5 ‘‘(B) the subject matter disclosed had, be6 fore such disclosure, been publicly disclosed by 

7 the inventor or a joint inventor or another who 

8 obtained the subject matter disclosed directly or 

9 indirectly from the inventor or a joint inventor. 

10 ‘‘(2) DISCLOSURES APPEARING IN APPLICA11 TIONS AND PATENTS.—A disclosure shall not be 

12 prior art to a claimed invention under subsection 

13 (a)(2) if— 

14 ‘‘(A) the subject matter disclosed was ob15 tained directly or indirectly from the inventor or 

16 a joint inventor; 

17 ‘‘(B) the subject matter disclosed had, be18 fore such subject matter was effectively filed 

19 under subsection (a)(2), been publicly disclosed 

20 by the inventor or a joint inventor or another 

21 who obtained the subject matter disclosed di22 rectly or indirectly from the inventor or a joint 

23 inventor; or 

24 ‘‘(C) the subject matter disclosed and the 

25 claimed invention, not later than the effective 
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1 filing date of the claimed invention, were owned 

2 by the same person or subject to an obligation 

3 of assignment to the same person. 

4 ‘‘(c) COMMON OWNERSHIP UNDER JOINT RESEARCH

5 AGREEMENTS.—Subject matter disclosed and a claimed 

6 invention shall be deemed to have been owned by the same 

7 person or subject to an obligation of assignment to the 

8 same person in applying the provisions of subsection 

9 (b)(2)(C) if— 

10 ‘‘(1) the subject matter disclosed was developed 

11 and the claimed invention was made by, or on behalf 

12 of, 1 or more parties to a joint research agreement 

13 that was in effect on or before the effective filing 

14 date of the claimed invention; 

15 ‘‘(2) the claimed invention was made as a result 

16 of activities undertaken within the scope of the joint 

17 research agreement; and 

18 ‘‘(3) the application for patent for the claimed 

19 invention discloses or is amended to disclose the 

20 names of the parties to the joint research agree21 ment. 

22 ‘‘(d) PATENTS AND PUBLISHED APPLICATIONS EF23 FECTIVE AS PRIOR ART.—For purposes of determining 

24 whether a patent or application for patent is prior art to 

25 a claimed invention under subsection (a)(2), such patent 
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1 or application shall be considered to have been effectively 

2 filed, with respect to any subject matter described in the 

3 patent or application— 

4 ‘‘(1) if paragraph (2) does not apply, as of the 

5 actual filing date of the patent or the application for 

6 patent; or 

7 ‘‘(2) if the patent or application for patent is 

8 entitled to claim a right of priority under section 

9 119, 365(a), or 365(b), or to claim the benefit of an 

10 earlier filing date under section 120, 121, or 365(c), 

11 based upon 1 or more prior filed applications for 

12 patent, as of the filing date of the earliest such ap13 plication that describes the subject matter.’’. 

14 (2) CONTINUITY OF INTENT UNDER THE CRE15 ATE ACT.—The enactment of section 102(c) of title 

16 35, United States Code, under the preceding para17 graph is done with the same intent to promote joint 

18 research activities that was expressed, including in 

19 the legislative history, through the enactment of the 

20 Cooperative Research and Technology Enhancement 

21 Act of 2004 (Public Law 108–453; the ‘‘CREATE 

22 Act’’), the amendments of which are stricken by sub23 section (c). The United States Patent and Trade24 mark Office shall administer section 102(c) of title 

25 35, United States Code, in a manner consistent with 
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1 the legislative history of the CREATE Act that was 

2 relevant to its administration by the United States 

3 Patent and Trademark Office. 

4 (3) CONFORMING AMENDMENT.—The item re5 lating to section 102 in the table of sections for 

6 chapter 10 of title 35, United States Code, is 

7 amended to read as follows: 

‘‘102. Conditions for patentability; novelty.’’. 

8 (c) CONDITIONS FOR PATENTABILITY; NONOBVIOUS

9 SUBJECT MATTER.—Section 103 of title 35, United 

10 States Code, is amended to read as follows: 

11 ‘‘§ 103. Conditions for patentability; nonobvious sub12 ject matter 

13 ‘‘A patent for a claimed invention may not be ob14 tained, notwithstanding that the claimed invention is not 

15 identically disclosed as set forth in section 102, if the dif16 ferences between the claimed invention and the prior art 

17 are such that the claimed invention as a whole would have 

18 been obvious before the effective filing date of the claimed 

19 invention to a person having ordinary skill in the art to 

20 which the claimed invention pertains. Patentability shall 

21 not be negated by the manner in which the invention was 

22 made.’’. 

23 (d) REPEAL OF REQUIREMENTS FOR INVENTIONS

24 MADE ABROAD.—Section 104 of title 35, United States 

25 Code, and the item relating to that section in the table 
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1 of sections for chapter 10 of title 35, United States Code, 

2 are repealed. 

3 (e) REPEAL OF STATUTORY INVENTION REGISTRA4 TION.— 

5 (1) IN GENERAL.—Section 157 of title 35, 

6 United States Code, and the item relating to that 

7 section in the table of sections for chapter 14 of title 

8 35, United States Code, are repealed. 

9 (2) REMOVAL OF CROSS REFERENCES.—Section 

10 111(b)(8) of title 35, United States Code, is amend11 ed by striking ‘‘sections 115, 131, 135, and 157’’ 

12 and inserting ‘‘sections 131 and 135’’. 

13 (3) EFFECTIVE DATE.—The amendments made 

14 by this subsection shall take effect 18 months after 

15 the date of the enactment of this Act, and shall 

16 apply to any request for a statutory invention reg17 istration filed on or after that date. 

18 (f) EARLIER FILING DATE FOR INVENTOR AND

19 JOINT INVENTOR.—Section 120 of title 35, United States 

20 Code, is amended by striking ‘‘which is filed by an inven21 tor or inventors named’’ and inserting ‘‘which names an 

22 inventor or joint inventor’’. 

23 (g) CONFORMING AMENDMENTS.— 
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1 (1) RIGHT OF PRIORITY.—Section 172 of title 

2 35, United States Code, is amended by striking 

3 ‘‘and the time specified in section 102(d)’’. 

4 (2) LIMITATION ON REMEDIES.—Section 

5 287(c)(4) of title 35, United States Code, is amend6 ed by striking ‘‘the earliest effective filing date of 

7 which is prior to’’ and inserting ‘‘which has an effec8 tive filing date before’’. 

9 (3) INTERNATIONAL APPLICATION DESIG10 NATING THE UNITED STATES: EFFECT.—Section 

11 363 of title 35, United States Code, is amended by 

12 striking ‘‘except as otherwise provided in section 

13 102(e) of this title’’. 

14 (4) PUBLICATION OF INTERNATIONAL APPLICA15 TION: EFFECT.—Section 374 of title 35, United 

16 States Code, is amended by striking ‘‘sections 102(e) 

17 and 154(d)’’ and inserting ‘‘section 154(d)’’. 

18 (5) PATENT ISSUED ON INTERNATIONAL APPLI19 CATION: EFFECT.—The second sentence of section 

20 375(a) of title 35, United States Code, is amended 

21 by striking ‘‘Subject to section 102(e) of this title, 

22 such’’ and inserting ‘‘Such’’. 

23 (6) LIMIT ON RIGHT OF PRIORITY.—Section 

24 119(a) of title 35, United States Code, is amended 

25 by striking ‘‘; but no patent shall be granted’’ and 
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1 all that follows through ‘‘one year prior to such fil2 ing’’. 

3 (7) INVENTIONS MADE WITH FEDERAL ASSIST4 ANCE.—Section 202(c) of title 35, United States 

5 Code, is amended— 

6 (A) in paragraph (2)— 

7 (i) by striking ‘‘publication, on sale, 

8 or public use,’’ and all that follows through 

9 ‘‘obtained in the United States’’ and in10 serting ‘‘the 1-year period referred to in 

11 section 102(b) would end before the end of 

12 that 2-year period’’; and 

13 (ii) by striking ‘‘the statutory’’ and 

14 inserting ‘‘that 1-year’’; and 

15 (B) in paragraph (3), by striking ‘‘any 

16 statutory bar date that may occur under this 

17 title due to publication, on sale, or public use’’ 

18 and inserting ‘‘the expiration of the 1-year pe19 riod referred to in section 102(b)’’. 

20 (h) DERIVED PATENTS.—Section 291 of title 35, 

21 United States Code, is amended to read as follows: 

22 ‘‘§ 291. Derived patents 

23 ‘‘(a) IN GENERAL.—The owner of a patent may have 

24 relief by civil action against the owner of another patent 

25 that claims the same invention and has an earlier effective 
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1 filing date if the invention claimed in such other patent 

2 was derived from the inventor of the invention claimed in 

3 the patent owned by the person seeking relief under this 

4 section. 

5 ‘‘(b) FILING LIMITATION.—An action under this sec6 tion may only be filed within 1 year after the issuance 

7 of the first patent containing a claim to the allegedly de8 rived invention and naming an individual alleged to have 

9 derived such invention as the inventor or joint inventor.’’. 

10 (i) DERIVATION PROCEEDINGS.—Section 135 of title 

11 35, United States Code, is amended to read as follows: 

12 ‘‘§ 135. Derivation proceedings 

13 ‘‘(a) INSTITUTION OF PROCEEDING.—An applicant 

14 for patent may file a petition to institute a derivation pro15 ceeding in the Office. The petition shall set forth with par16 ticularity the basis for finding that an inventor named in 

17 an earlier application derived the claimed invention from 

18 an inventor named in the petitioner’s application and, 

19 without authorization, the earlier application claiming 

20 such invention was filed. Any such petition may only be 

21 filed within 1 year after the first publication of a claim 

22 to an invention that is the same or substantially the same 

23 as the earlier application’s claim to the invention, shall 

24 be made under oath, and shall be supported by substantial 

25 evidence. Whenever the Director determines that a peti-
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1 tion filed under this subsection demonstrates that the 

2 standards for instituting a derivation proceeding are met, 

3 the Director may institute a derivation proceeding. The 

4 determination by the Director whether to institute a deri5 vation proceeding shall be final and nonappealable. 

6 ‘‘(b) DETERMINATION BY PATENT TRIAL AND AP7 PEAL BOARD.—In a derivation proceeding instituted 

8 under subsection (a), the Patent Trial and Appeal Board 

9 shall determine whether an inventor named in the earlier 

10 application derived the claimed invention from an inventor 

11 named in the petitioner’s application and, without author12 ization, the earlier application claiming such invention was 

13 filed. The Director shall prescribe regulations setting forth 

14 standards for the conduct of derivation proceedings. 

15 ‘‘(c) DEFERRAL OF DECISION.—The Patent Trial 

16 and Appeal Board may defer action on a petition for a 

17 derivation proceeding until 3 months after the date on 

18 which the Director issues a patent that includes the 

19 claimed invention that is the subject of the petition. The 

20 Patent Trial and Appeal Board also may defer action on 

21 a petition for a derivation proceeding, or stay the pro22 ceeding after it has been instituted, until the termination 

23 of a proceeding under chapter 30, 31, or 32 involving the 

24 patent of the earlier applicant. 
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1 ‘‘(d) EFFECT OF FINAL DECISION.—The final deci2 sion of the Patent Trial and Appeal Board, if adverse to 

3 claims in an application for patent, shall constitute the 

4 final refusal by the Office on those claims. The final deci5 sion of the Patent Trial and Appeal Board, if adverse to 

6 claims in a patent, shall, if no appeal or other review of 

7 the decision has been or can be taken or had, constitute 

8 cancellation of those claims, and notice of such cancella9 tion shall be endorsed on copies of the patent distributed 

10 after such cancellation. 

11 ‘‘(e) SETTLEMENT.—Parties to a proceeding insti12 tuted under subsection (a) may terminate the proceeding 

13 by filing a written statement reflecting the agreement of 

14 the parties as to the correct inventors of the claimed inven15 tion in dispute. Unless the Patent Trial and Appeal Board 

16 finds the agreement to be inconsistent with the evidence 

17 of record, if any, it shall take action consistent with the 

18 agreement. Any written settlement or understanding of 

19 the parties shall be filed with the Director. At the request 

20 of a party to the proceeding, the agreement or under21 standing shall be treated as business confidential informa22 tion, shall be kept separate from the file of the involved 

23 patents or applications, and shall be made available only 

24 to Government agencies on written request, or to any per25 son on a showing of good cause. 
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1 ‘‘(f) ARBITRATION.—Parties to a proceeding insti2 tuted under subsection (a) may, within such time as may 

3 be specified by the Director by regulation, determine such 

4 contest or any aspect thereof by arbitration. Such arbitra5 tion shall be governed by the provisions of title 9, to the 

6 extent such title is not inconsistent with this section. The 

7 parties shall give notice of any arbitration award to the 

8 Director, and such award shall, as between the parties to 

9 the arbitration, be dispositive of the issues to which it re10 lates. The arbitration award shall be unenforceable until 

11 such notice is given. Nothing in this subsection shall pre12 clude the Director from determining the patentability of 

13 the claimed inventions involved in the proceeding.’’. 

14 (j) ELIMINATION OF REFERENCES TO INTER15 FERENCES.—(1) Sections 41, 134, 145, 146, 154, 305, 

16 and 314 of title 35, United States Code, are each amended 

17 by striking ‘‘Board of Patent Appeals and Interferences’’ 

18 each place it appears and inserting ‘‘Patent Trial and Ap19 peal Board’’. 

20 (2)(A) Sections 146 and 154 of title 35, United 

21 States Code, are each amended— 

22 (i) by striking ‘‘an interference’’ each place 

23 it appears and inserting ‘‘a derivation pro24 ceeding’’; and 
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1 (ii) by striking ‘‘interference’’ each addi2 tional place it appears and inserting ‘‘derivation 

3 proceeding’’. 

4 (B) The subparagraph heading for section 

5 154(b)(1)(C) of title 35, United States Code, as 

6 amended by this paragraph, is further amended 

7 by— 

8 (i) striking ‘‘OR’’ and inserting ‘‘OF’’; and 

9 (ii) striking ‘‘SECRECY ORDER’’ and insert10 ing ‘‘SECRECY ORDERS’’. 

11 (3) The section heading for section 134 of title 35, 

12 United States Code, is amended to read as follows: 

13 ‘‘§ 134. Appeal to the Patent Trial and Appeal Board’’. 

14 (4) The section heading for section 146 of title 35, 

15 United States Code, is amended to read as follows: 

16 ‘‘§ 146. Civil action in case of derivation proceeding’’. 

17 (5) Section 154(b)(1)(C) of title 35, United States 

18 Code, is amended by striking ‘‘INTERFERENCES’’ and in19 serting ‘‘DERIVATION PROCEEDINGS’’. 

20 (6) The item relating to section 6 in the table of sec21 tions for chapter 1 of title 35, United States Code, is 

22 amended to read as follows: 

‘‘6. Patent Trial and Appeal Board.’’. 

23 (7) The items relating to sections 134 and 135 in 

24 the table of sections for chapter 12 of title 35, United 

25 States Code, are amended to read as follows: 
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‘‘134. Appeal to the Patent Trial and Appeal Board. 

‘‘135. Derivation proceedings.’’. 

1 (8) The item relating to section 146 in the table of 

2 sections for chapter 13 of title 35, United States Code, 

3 is amended to read as follows: 

‘‘146. Civil action in case of derivation proceeding.’’. 

4 (k) FALSE MARKING.— 

5 (1) IN GENERAL.—Section 292 of title 35, 

6 United States Code, is amended— 

7 (A) in subsection (a), by adding at the end 

8 the following: 

9 ‘‘Only the United States may sue for the penalty au10 thorized by this subsection.’’; and 

11 (B) by striking subsection (b) and insert12 ing the following: 

13 ‘‘(b) Any person who has suffered a competitive in14 jury as a result of a violation of this section may file a 

15 civil action in a district court of the United States for re16 covery of damages adequate to compensate for the in17 jury.’’. 

18 (2) EFFECTIVE DATE.—The amendments made 

19 by this subsection shall apply to all cases, without 

20 exception, pending on or after the date of the enact21 ment of this Act. 

22 (l) STATUTE OF LIMITATIONS.— 
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1 (1) IN GENERAL.—Section 32 of title 35, 

2 United States Code, is amended by inserting be3 tween the third and fourth sentences the following: 

4 ‘‘A proceeding under this section shall be com5 menced not later than the earlier of either 10 years 

6 after the date on which the misconduct forming the 

7 basis for the proceeding occurred, or 1 year after the 

8 date on which the misconduct forming the basis for 

9 the proceeding is made known to an officer or em10 ployee of the Office as prescribed in the regulations 

11 established under section 2(b)(2)(D).’’. 

12 (2) REPORT TO CONGRESS.—The Director shall 

13 provide on a biennial basis to the Judiciary Commit14 tees of the Senate and House of Representatives a 

15 report providing a short description of incidents 

16 made known to an officer or employee of the Office 

17 as prescribed in the regulations established under 

18 section 2(b)(2)(D) of title 35, United States Code, 

19 that reflect substantial evidence of misconduct be20 fore the Office but for which the Office was barred 

21 from commencing a proceeding under section 32 of 

22 title 35, United States Code, by the time limitation 

23 established by the fourth sentence of that section. 

24 (3) EFFECTIVE DATE.—The amendment made 

25 by paragraph (1) shall apply in all cases in which 
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1 the time period for instituting a proceeding under 

2 section 32 of title 35, United State Code, had not 

3 lapsed prior to the date of the enactment of this Act. 

4 (m) SMALL BUSINESS STUDY.— 

5 (1) DEFINITIONS.—In this subsection— 

6 (A) the term ‘‘Chief Counsel’’ means the 

7 Chief Counsel for Advocacy of the Small Busi8 ness Administration; 

9 (B) the term ‘‘General Counsel’’ means the 

10 General Counsel of the United States Patent 

11 and Trademark Office; and 

12 (C) the term ‘‘small business concern’’ has 

13 the meaning given that term under section 3 of 

14 the Small Business Act (15 U.S.C. 632). 

15 (2) STUDY.— 

16 (A) IN GENERAL.—The Chief Counsel, in 

17 consultation with the General Counsel, shall 

18 conduct a study of the effects of eliminating the 

19 use of dates of invention in determining wheth20 er an applicant is entitled to a patent under 

21 title 35, United States Code. 

22 (B) AREAS OF STUDY.—The study con23 ducted under subparagraph (A) shall include 

24 examination of the effects of eliminating the use 

25 of invention dates, including examining— 
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1 (i) how the change would affect the 

2 ability of small business concerns to obtain 

3 patents and their costs of obtaining pat4 ents; 

5 (ii) whether the change would create, 

6 mitigate, or exacerbate any disadvantage 

7 for applicants for patents that are small 

8 business concerns relative to applicants for 

9 patents that are not small business con10 cerns, and whether the change would cre11 ate any advantages for applicants for pat12 ents that are small business concerns rel13 ative to applicants for patents that are not 

14 small business concerns; 

15 (iii) the cost savings and other poten16 tial benefits to small business concerns of 

17 the change; and 

18 (iv) the feasibility and costs and bene19 fits to small business concerns of alter20 native means of determining whether an 

21 applicant is entitled to a patent under title 

22 35, United States Code. 

23 (3) REPORT.—Not later than 1 year after the 

24 date of enactment of this Act, the Chief Counsel 

25 shall submit to the Committee on Small Business 
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1 and Entrepreneurship and the Committee on the Ju2 diciary of the Senate and the Committee on Small 

3 Business and the Committee on the Judiciary of the 

4 House of Representatives a report regarding the re5 sults of the study under paragraph (2). 

6 (n) REPORT ON PRIOR USER RIGHTS.— 

7 (1) IN GENERAL.—Not later than 1 year after 

8 the date of the enactment of this Act, the Director 

9 shall report, to the Committee on the Judiciary of 

10 the Senate and the Committee on the Judiciary of 

11 the House of Representatives, the findings and rec12 ommendations of the Director on the operation of 

13 prior user rights in selected countries in the indus14 trialized world. The report shall include the fol15 lowing: 

16 (A) A comparison between patent laws of 

17 the United States and the laws of other indus18 trialized countries, including members of the 

19 European Union and Japan, Canada, and Aus20 tralia. 

21 (B) An analysis of the effect of prior user 

22 rights on innovation rates in the selected coun23 tries. 

24 (C) An analysis of the correlation, if any, 

25 between prior user rights and start-up enter-
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1 prises and the ability to attract venture capital 

2 to start new companies. 

3 (D) An analysis of the effect of prior user 

4 rights, if any, on small businesses, universities, 

5 and individual inventors. 

6 (E) An analysis of legal and constitutional 

7 issues, if any, that arise from placing trade se8 cret law in patent law. 

9 (F) An analysis of whether the change to 

10 a first-to-file patent system creates a particular 

11 need for prior user rights. 

12 (2) CONSULTATION WITH OTHER AGENCIES.— 

13 In preparing the report required under paragraph 

14 (1), the Director shall consult with the United 

15 States Trade Representative, the Secretary of State, 

16 and the Attorney General. 

17 (o) EFFECTIVE DATE.— 

18 (1) IN GENERAL.—Except as otherwise pro19 vided by this section, the amendments made by this 

20 section shall take effect on the date that is 18 

21 months after the date of the enactment of this Act, 

22 and shall apply to any application for patent, and to 

23 any patent issuing thereon, that contains or con24 tained at any time— 
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1 (A) a claim to a claimed invention that has 

2 an effective filing date as defined in section 

3 100(i) of title 35, United States Code, that is 

4 18 months or more after the date of the enact5 ment of this Act; or 

6 (B) a specific reference under section 120, 

7 121, or 365(c) of title 35, United States Code, 

8 to any patent or application that contains or 

9 contained at any time such a claim. 

10 (2) INTERFERING PATENTS.—The provisions of 

11 sections 102(g), 135, and 291 of title 35, United 

12 States Code, in effect on the day prior to the date 

13 of the enactment of this Act, shall apply to each 

14 claim of an application for patent, and any patent 

15 issued thereon, for which the amendments made by 

16 this section also apply, if such application or patent 

17 contains or contained at any time— 

18 (A) a claim to an invention having an ef19 fective filing date as defined in section 100(i) of 

20 title 35, United States Code, earlier than 18 

21 months after the date of the enactment of this 

22 Act; or 

23 (B) a specific reference under section 120, 

24 121, or 365(c) of title 35, United States Code, 
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1 to any patent or application that contains or 

2 contained at any time such a claim. 

3 SEC. 3. INVENTOR’S OATH OR DECLARATION. 

4 (a) INVENTOR’S OATH OR DECLARATION.— 

5 (1) IN GENERAL.—Section 115 of title 35, 

6 United States Code, is amended to read as follows: 

7 ‘‘§ 115. Inventor’s oath or declaration 

8 ‘‘(a) NAMING THE INVENTOR; INVENTOR’S OATH OR

9 DECLARATION.—An application for patent that is filed 

10 under section 111(a) or commences the national stage 

11 under section 371 shall include, or be amended to include, 

12 the name of the inventor for any invention claimed in the 

13 application. Except as otherwise provided in this section, 

14 each individual who is the inventor or a joint inventor of 

15 a claimed invention in an application for patent shall exe16 cute an oath or declaration in connection with the applica17 tion. 

18 ‘‘(b) REQUIRED STATEMENTS.—An oath or declara19 tion under subsection (a) shall contain statements that— 

20 ‘‘(1) the application was made or was author21 ized to be made by the affiant or declarant; and 

22 ‘‘(2) such individual believes himself or herself 

23 to be the original inventor or an original joint inven24 tor of a claimed invention in the application. 
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1 ‘‘(c) ADDITIONAL REQUIREMENTS.—The Director 

2 may specify additional information relating to the inventor 

3 and the invention that is required to be included in an 

4 oath or declaration under subsection (a). 

5 ‘‘(d) SUBSTITUTE STATEMENT.— 

6 ‘‘(1) IN GENERAL.—In lieu of executing an oath 

7 or declaration under subsection (a), the applicant for 

8 patent may provide a substitute statement under the 

9 circumstances described in paragraph (2) and such 

10 additional circumstances that the Director may 

11 specify by regulation. 

12 ‘‘(2) PERMITTED CIRCUMSTANCES.—A sub13 stitute statement under paragraph (1) is permitted 

14 with respect to any individual who— 

15 ‘‘(A) is unable to file the oath or declara16 tion under subsection (a) because the indi17 vidual— 

18 ‘‘(i) is deceased; 

19 ‘‘(ii) is under legal incapacity; or 

20 ‘‘(iii) cannot be found or reached after 

21 diligent effort; or 

22 ‘‘(B) is under an obligation to assign the 

23 invention but has refused to make the oath or 

24 declaration required under subsection (a). 
26 

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1 ‘‘(3) CONTENTS.—A substitute statement under 

2 this subsection shall— 

3 ‘‘(A) identify the individual with respect to 

4 whom the statement applies; 

5 ‘‘(B) set forth the circumstances rep6 resenting the permitted basis for the filing of 

7 the substitute statement in lieu of the oath or 

8 declaration under subsection (a); and 

9 ‘‘(C) contain any additional information, 

10 including any showing, required by the Direc11 tor. 

12 ‘‘(e) MAKING REQUIRED STATEMENTS IN ASSIGN13 MENT OF RECORD.—An individual who is under an obliga14 tion of assignment of an application for patent may in15 clude the required statements under subsections (b) and 

16 (c) in the assignment executed by the individual, in lieu 

17 of filing such statements separately. 

18 ‘‘(f) TIME FOR FILING.—A notice of allowance under 

19 section 151 may be provided to an applicant for patent 

20 only if the applicant for patent has filed each required 

21 oath or declaration under subsection (a) or has filed a sub22 stitute statement under subsection (d) or recorded an as23 signment meeting the requirements of subsection (e). 

24 ‘‘(g) EARLIER-FILED APPLICATION CONTAINING RE25 QUIRED STATEMENTS OR SUBSTITUTE STATEMENT.— 
27 

†S 23 ES

1 ‘‘(1) EXCEPTION.—The requirements under 

2 this section shall not apply to an individual with re3 spect to an application for patent in which the indi4 vidual is named as the inventor or a joint inventor 

5 and who claims the benefit under section 120, 121, 

6 or 365(c) of the filing of an earlier-filed application, 

7 if— 

8 ‘‘(A) an oath or declaration meeting the 

9 requirements of subsection (a) was executed by 

10 the individual and was filed in connection with 

11 the earlier-filed application; 

12 ‘‘(B) a substitute statement meeting the 

13 requirements of subsection (d) was filed in the 

14 earlier filed application with respect to the indi15 vidual; or 

16 ‘‘(C) an assignment meeting the require17 ments of subsection (e) was executed with re18 spect to the earlier-filed application by the indi19 vidual and was recorded in connection with the 

20 earlier-filed application. 

21 ‘‘(2) COPIES OF OATHS, DECLARATIONS, STATE22 MENTS, OR ASSIGNMENTS.—Notwithstanding para23 graph (1), the Director may require that a copy of 

24 the executed oath or declaration, the substitute 
28 

†S 23 ES

1 statement, or the assignment filed in the earlier-filed 

2 application be included in the later-filed application. 

3 ‘‘(h) SUPPLEMENTAL AND CORRECTED STATE4 MENTS; FILING ADDITIONAL STATEMENTS.— 

5 ‘‘(1) IN GENERAL.—Any person making a state6 ment required under this section may withdraw, re7 place, or otherwise correct the statement at any 

8 time. If a change is made in the naming of the in9 ventor requiring the filing of 1 or more additional 

10 statements under this section, the Director shall es11 tablish regulations under which such additional 

12 statements may be filed. 

13 ‘‘(2) SUPPLEMENTAL STATEMENTS NOT RE14 QUIRED.—If an individual has executed an oath or 

15 declaration meeting the requirements of subsection 

16 (a) or an assignment meeting the requirements of 

17 subsection (e) with respect to an application for pat18 ent, the Director may not thereafter require that in19 dividual to make any additional oath, declaration, or 

20 other statement equivalent to those required by this 

21 section in connection with the application for patent 

22 or any patent issuing thereon. 

23 ‘‘(3) SAVINGS CLAUSE.—No patent shall be in24 valid or unenforceable based upon the failure to 
29 

†S 23 ES

1 comply with a requirement under this section if the 

2 failure is remedied as provided under paragraph (1). 

3 ‘‘(i) ACKNOWLEDGMENT OF PENALTIES.—Any dec4 laration or statement filed pursuant to this section shall 

5 contain an acknowledgment that any willful false state6 ment made in such declaration or statement is punishable 

7 under section 1001 of title 18 by fine or imprisonment 

8 of not more than 5 years, or both.’’. 

9 (2) RELATIONSHIP TO DIVISIONAL APPLICA10 TIONS.—Section 121 of title 35, United States Code, 

11 is amended by striking ‘‘If a divisional application’’ 

12 and all that follows through ‘‘inventor.’’. 

13 (3) REQUIREMENTS FOR NONPROVISIONAL AP14 PLICATIONS.—Section 111(a) of title 35, United 

15 States Code, is amended— 

16 (A) in paragraph (2)(C), by striking ‘‘by 

17 the applicant’’ and inserting ‘‘or declaration’’; 

18 (B) in the heading for paragraph (3), by 

19 inserting ‘‘OR DECLARATION’’ after ‘‘AND

20 OATH’’; and 

21 (C) by inserting ‘‘or declaration’’ after 

22 ‘‘and oath’’ each place it appears. 

23 (4) CONFORMING AMENDMENT.—The item re24 lating to section 115 in the table of sections for 
30 

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1 chapter 11 of title 35, United States Code, is 

2 amended to read as follows: 

‘‘115. Inventor’s oath or declaration.’’. 

3 (b) FILING BY OTHER THAN INVENTOR.— 

4 (1) IN GENERAL.—Section 118 of title 35, 

5 United States Code, is amended to read as follows: 

6 ‘‘§ 118. Filing by other than inventor 

7 ‘‘A person to whom the inventor has assigned or is 

8 under an obligation to assign the invention may make an 

9 application for patent. A person who otherwise shows suf10 ficient proprietary interest in the matter may make an ap11 plication for patent on behalf of and as agent for the in12 ventor on proof of the pertinent facts and a showing that 

13 such action is appropriate to preserve the rights of the 

14 parties. If the Director grants a patent on an application 

15 filed under this section by a person other than the inven16 tor, the patent shall be granted to the real party in inter17 est and upon such notice to the inventor as the Director 

18 considers to be sufficient.’’. 

19 (2) CONFORMING AMENDMENT.—Section 251 

20 of title 35, United States Code, is amended in the 

21 third undesignated paragraph by inserting ‘‘or the 

22 application for the original patent was filed by the 

23 assignee of the entire interest’’ after ‘‘claims of the 

24 original patent’’. 
31 

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1 (c) SPECIFICATION.—Section 112 of title 35, United 

2 States Code, is amended— 

3 (1) in the first paragraph— 

4 (A) by striking ‘‘The specification’’ and in5 serting ‘‘(a) IN GENERAL.—The specification’’; 

6 and 

7 (B) by striking ‘‘of carrying out his inven8 tion’’ and inserting ‘‘or joint inventor of car9 rying out the invention’’; 

10 (2) in the second paragraph— 

11 (A) by striking ‘‘The specification’’ and in12 serting ‘‘(b) CONCLUSION.—The specification’’; 

13 and 

14 (B) by striking ‘‘applicant regards as his 

15 invention’’ and inserting ‘‘inventor or a joint in16 ventor regards as the invention’’; 

17 (3) in the third paragraph, by striking ‘‘A 

18 claim’’ and inserting ‘‘(c) FORM.—A claim’’; 

19 (4) in the fourth paragraph, by striking ‘‘Sub20 ject to the following paragraph,’’ and inserting ‘‘(d) 

21 REFERENCE IN DEPENDENT FORMS.—Subject to 

22 subsection (e),’’; 

23 (5) in the fifth paragraph, by striking ‘‘A 

24 claim’’ and inserting ‘‘(e) REFERENCE IN MULTIPLE

25 DEPENDENT FORM.—A claim’’; and 
32 

†S 23 ES

1 (6) in the last paragraph, by striking ‘‘An ele2 ment’’ and inserting ‘‘(f) ELEMENT IN CLAIM FOR

3 A COMBINATION.—An element’’. 

4 (d) CONFORMING AMENDMENTS.— 

5 (1) Sections 111(b)(1)(A) is amended by strik6 ing ‘‘the first paragraph of section 112 of this title’’ 

7 and inserting ‘‘section 112(a)’’. 

8 (2) Section 111(b)(2) is amended by striking 

9 ‘‘the second through fifth paragraphs of section 

10 112,’’ and inserting ‘‘subsections (b) through (e) of 

11 section 112,’’. 

12 (e) EFFECTIVE DATE.—The amendments made by 

13 this section shall take effect 1 year after the date of the 

14 enactment of this Act and shall apply to patent applica15 tions that are filed on or after that effective date. 

16 SEC. 4. VIRTUAL MARKING AND ADVICE OF COUNSEL. 

17 (a) DEFENSE TO INFRINGEMENT BASED ON EAR18 LIER INVENTOR.—Section 273(b)(6) of title 35, United 

19 States Code, is amended to read as follows: 

20 ‘‘(6) PERSONAL DEFENSE.—The defense under 

21 this section may be asserted only by the person who 

22 performed or caused the performance of the acts 

23 necessary to establish the defense as well as any 

24 other entity that controls, is controlled by, or is 

25 under common control with such person and, except 
33 

†S 23 ES

1 for any transfer to the patent owner, the right to as2 sert the defense shall not be licensed or assigned or 

3 transferred to another person except as an ancillary 

4 and subordinate part of a good faith assignment or 

5 transfer for other reasons of the entire enterprise or 

6 line of business to which the defense relates. Not7 withstanding the preceding sentence, any person 

8 may, on its own behalf, assert a defense based on 

9 the exhaustion of rights provided under paragraph 

10 (3), including any necessary elements thereof.’’. 

11 (b) VIRTUAL MARKING.—Section 287(a) of title 35, 

12 United States Code, is amended by inserting ‘‘, or by fix13 ing thereon the word ‘patent’ or the abbreviation ‘pat.’ to14 gether with an address of a posting on the Internet, acces15 sible to the public without charge for accessing the ad16 dress, that associates the patented article with the number 

17 of the patent’’ before ‘‘, or when’’. 

18 (c) ADVICE OF COUNSEL.—Chapter 29 of title 35, 

19 United States Code, is amended by adding at the end the 

20 following: 

21 ‘‘§ 298. Advice of Counsel 

22 ‘‘The failure of an infringer to obtain the advice of 

23 counsel with respect to any allegedly infringed patent or 

24 the failure of the infringer to present such advice to the 

25 court or jury may not be used to prove that the accused 
34 

†S 23 ES

1 infringer willfully infringed the patent or that the in2 fringer intended to induce infringement of the patent.’’. 

3 (d) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply to any civil action commenced on 

5 or after the date of the enactment of this Act. 

6 SEC. 5. POST-GRANT REVIEW PROCEEDINGS. 

7 (a) INTER PARTES REVIEW.—Chapter 31 of title 35, 

8 United States Code, is amended to read as follows: 

9 ‘‘CHAPTER 31—INTER PARTES REVIEW 

‘‘Sec. 

‘‘311. Inter partes review. 

‘‘312. Petitions. 

‘‘313. Preliminary response to petition. 

‘‘314. Institution of inter partes review. 

‘‘315. Relation to other proceedings or actions. 

‘‘316. Conduct of inter partes review. 

‘‘317. Settlement. 

‘‘318. Decision of the board. 

‘‘319. Appeal. 

10 ‘‘§ 311. Inter partes review 

11 ‘‘(a) IN GENERAL.—Subject to the provisions of this 

12 chapter, a person who is not the patent owner may file 

13 with the Office a petition to institute an inter partes re14 view for a patent. The Director shall establish, by regula15 tion, fees to be paid by the person requesting the review, 

16 in such amounts as the Director determines to be reason17 able, considering the aggregate costs of the review. 

18 ‘‘(b) SCOPE.—A petitioner in an inter partes review 

19 may request to cancel as unpatentable 1 or more claims 

20 of a patent only on a ground that could be raised under 
35 

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1 section 102 or 103 and only on the basis of prior art con2 sisting of patents or printed publications. 

3 ‘‘(c) FILING DEADLINE.—A petition for inter partes 

4 review shall be filed after the later of either— 

5 ‘‘(1) 9 months after the grant of a patent or 

6 issuance of a reissue of a patent; or 

7 ‘‘(2) if a post-grant review is instituted under 

8 chapter 32, the date of the termination of such post9 grant review. 

10 ‘‘§ 312. Petitions 

11 ‘‘(a) REQUIREMENTS OF PETITION.—A petition filed 

12 under section 311 may be considered only if— 

13 ‘‘(1) the petition is accompanied by payment of 

14 the fee established by the Director under section 

15 311; 

16 ‘‘(2) the petition identifies all real parties in in17 terest; 

18 ‘‘(3) the petition identifies, in writing and with 

19 particularity, each claim challenged, the grounds on 

20 which the challenge to each claim is based, and the 

21 evidence that supports the grounds for the challenge 

22 to each claim, including— 

23 ‘‘(A) copies of patents and printed publica24 tions that the petitioner relies upon in support 

25 of the petition; and 
36 

†S 23 ES

1 ‘‘(B) affidavits or declarations of sup2 porting evidence and opinions, if the petitioner 

3 relies on expert opinions; 

4 ‘‘(4) the petition provides such other informa5 tion as the Director may require by regulation; and 

6 ‘‘(5) the petitioner provides copies of any of the 

7 documents required under paragraphs (2), (3), and 

8 (4) to the patent owner or, if applicable, the des9 ignated representative of the patent owner. 

10 ‘‘(b) PUBLIC AVAILABILITY.—As soon as practicable 

11 after the receipt of a petition under section 311, the Direc12 tor shall make the petition available to the public. 

13 ‘‘§ 313. Preliminary response to petition 

14 ‘‘(a) PRELIMINARY RESPONSE.—If an inter partes 

15 review petition is filed under section 311, the patent owner 

16 shall have the right to file a preliminary response within 

17 a time period set by the Director. 

18 ‘‘(b) CONTENT OF RESPONSE.—A preliminary re19 sponse to a petition for inter partes review shall set forth 

20 reasons why no inter partes review should be instituted 

21 based upon the failure of the petition to meet any require22 ment of this chapter. 

23 ‘‘§ 314. Institution of inter partes review 

24 ‘‘(a) THRESHOLD.—The Director may not authorize 

25 an inter partes review to commence unless the Director 
37 

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1 determines that the information presented in the petition 

2 filed under section 311 and any response filed under sec3 tion 313 shows that there is a reasonable likelihood that 

4 the petitioner would prevail with respect to at least 1 of 

5 the claims challenged in the petition. 

6 ‘‘(b) TIMING.—The Director shall determine whether 

7 to institute an inter partes review under this chapter with8 in 3 months after receiving a preliminary response under 

9 section 313 or, if none is filed, within three months after 

10 the expiration of the time for filing such a response. 

11 ‘‘(c) NOTICE.—The Director shall notify the peti12 tioner and patent owner, in writing, of the Director’s de13 termination under subsection (a), and shall make such no14 tice available to the public as soon as is practicable. Such 

15 notice shall list the date on which the review shall com16 mence. 

17 ‘‘(d) NO APPEAL.—The determination by the Direc18 tor whether to institute an inter partes review under this 

19 section shall be final and nonappealable. 

20 ‘‘§ 315. Relation to other proceedings or actions 

21 ‘‘(a) INFRINGER’S ACTION.—An inter partes review 

22 may not be instituted or maintained if the petitioner or 

23 real party in interest has filed a civil action challenging 

24 the validity of a claim of the patent. 
38 

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1 ‘‘(b) PATENT OWNER’S ACTION.—An inter partes re2 view may not be instituted if the petition requesting the 

3 proceeding is filed more than 6 months after the date on 

4 which the petitioner, real party in interest, or his privy 

5 is served with a complaint alleging infringement of the 

6 patent. The time limitation set forth in the preceding sen7 tence shall not apply to a request for joinder under sub8 section (c). 

9 ‘‘(c) JOINDER.—If the Director institutes an inter 

10 partes review, the Director, in his discretion, may join as 

11 a party to that inter partes review any person who prop12 erly files a petition under section 311 that the Director, 

13 after receiving a preliminary response under section 313 

14 or the expiration of the time for filing such a response, 

15 determines warrants the institution of an inter partes re16 view under section 314. 

17 ‘‘(d) MULTIPLE PROCEEDINGS.—Notwithstanding 

18 sections 135(a), 251, and 252, and chapter 30, during the 

19 pendency of an inter partes review, if another proceeding 

20 or matter involving the patent is before the Office, the 

21 Director may determine the manner in which the inter 

22 partes review or other proceeding or matter may proceed, 

23 including providing for stay, transfer, consolidation, or 

24 termination of any such matter or proceeding. 

25 ‘‘(e) ESTOPPEL.— 
39 

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1 ‘‘(1) PROCEEDINGS BEFORE THE OFFICE.—The 

2 petitioner in an inter partes review under this chap3 ter, or his real party in interest or privy, may not 

4 request or maintain a proceeding before the Office 

5 with respect to a claim on any ground that the peti6 tioner raised or reasonably could have raised during 

7 an inter partes review of the claim that resulted in 

8 a final written decision under section 318(a). 

9 ‘‘(2) CIVIL ACTIONS AND OTHER PRO10 CEEDINGS.—The petitioner in an inter partes review 

11 under this chapter, or his real party in interest or 

12 privy, may not assert either in a civil action arising 

13 in whole or in part under section 1338 of title 28 

14 or in a proceeding before the International Trade 

15 Commission that a claim in a patent is invalid on 

16 any ground that the petitioner raised or reasonably 

17 could have raised during an inter partes review of 

18 the claim that resulted in a final written decision 

19 under section 318(a). 

20 ‘‘§ 316. Conduct of inter partes review 

21 ‘‘(a) REGULATIONS.—The Director shall prescribe 

22 regulations— 

23 ‘‘(1) providing that the file of any proceeding 

24 under this chapter shall be made available to the 

25 public, except that any petition or document filed 
40 

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1 with the intent that it be sealed shall be accom2 panied by a motion to seal, and such petition or doc3 ument shall be treated as sealed pending the out4 come of the ruling on the motion; 

5 ‘‘(2) setting forth the standards for the showing 

6 of sufficient grounds to institute a review under sec7 tion 314(a); 

8 ‘‘(3) establishing procedures for the submission 

9 of supplemental information after the petition is 

10 filed; 

11 ‘‘(4) in accordance with section 2(b)(2), estab12 lishing and governing inter partes review under this 

13 chapter and the relationship of such review to other 

14 proceedings under this title; 

15 ‘‘(5) setting a time period for requesting joinder 

16 under section 315(c); 

17 ‘‘(6) setting forth standards and procedures for 

18 discovery of relevant evidence, including that such 

19 discovery shall be limited to— 

20 ‘‘(A) the deposition of witnesses submitting 

21 affidavits or declarations; and 

22 ‘‘(B) what is otherwise necessary in the in23 terest of justice; 

24 ‘‘(7) prescribing sanctions for abuse of dis25 covery, abuse of process, or any other improper use 
41 

†S 23 ES

1 of the proceeding, such as to harass or to cause un2 necessary delay or an unnecessary increase in the 

3 cost of the proceeding; 

4 ‘‘(8) providing for protective orders governing 

5 the exchange and submission of confidential infor6 mation; 

7 ‘‘(9) allowing the patent owner to file a re8 sponse to the petition after an inter partes review 

9 has been instituted, and requiring that the patent 

10 owner file with such response, through affidavits or 

11 declarations, any additional factual evidence and ex12 pert opinions on which the patent owner relies in 

13 support of the response; 

14 ‘‘(10) setting forth standards and procedures 

15 for allowing the patent owner to move to amend the 

16 patent under subsection (d) to cancel a challenged 

17 claim or propose a reasonable number of substitute 

18 claims, and ensuring that any information submitted 

19 by the patent owner in support of any amendment 

20 entered under subsection (d) is made available to the 

21 public as part of the prosecution history of the pat22 ent; 

23 ‘‘(11) providing either party with the right to 

24 an oral hearing as part of the proceeding; and 
42 

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1 ‘‘(12) requiring that the final determination in 

2 an inter partes review be issued not later than 1 

3 year after the date on which the Director notices the 

4 institution of a review under this chapter, except 

5 that the Director may, for good cause shown, extend 

6 the 1-year period by not more than 6 months, and 

7 may adjust the time periods in this paragraph in the 

8 case of joinder under section 315(c). 

9 ‘‘(b) CONSIDERATIONS.—In prescribing regulations 

10 under this section, the Director shall consider the effect 

11 of any such regulation on the economy, the integrity of 

12 the patent system, the efficient administration of the Of13 fice, and the ability of the Office to timely complete pro14 ceedings instituted under this chapter. 

15 ‘‘(c) PATENT TRIAL AND APPEAL BOARD.—The Pat16 ent Trial and Appeal Board shall, in accordance with sec17 tion 6, conduct each proceeding authorized by the Direc18 tor. 

19 ‘‘(d) AMENDMENT OF THE PATENT.— 

20 ‘‘(1) IN GENERAL.—During an inter partes re21 view instituted under this chapter, the patent owner 

22 may file 1 motion to amend the patent in 1 or more 

23 of the following ways: 

24 ‘‘(A) Cancel any challenged patent claim. 
43 

†S 23 ES

1 ‘‘(B) For each challenged claim, propose a 

2 reasonable number of substitute claims. 

3 ‘‘(2) ADDITIONAL MOTIONS.—Additional mo4 tions to amend may be permitted upon the joint re5 quest of the petitioner and the patent owner to ma6 terially advance the settlement of a proceeding under 

7 section 317, or as permitted by regulations pre8 scribed by the Director. 

9 ‘‘(3) SCOPE OF CLAIMS.—An amendment under 

10 this subsection may not enlarge the scope of the 

11 claims of the patent or introduce new matter. 

12 ‘‘(e) EVIDENTIARY STANDARDS.—In an inter partes 

13 review instituted under this chapter, the petitioner shall 

14 have the burden of proving a proposition of 

15 unpatentability by a preponderance of the evidence. 

16 ‘‘§ 317. Settlement 

17 ‘‘(a) IN GENERAL.—An inter partes review instituted 

18 under this chapter shall be terminated with respect to any 

19 petitioner upon the joint request of the petitioner and the 

20 patent owner, unless the Office has decided the merits of 

21 the proceeding before the request for termination is filed. 

22 If the inter partes review is terminated with respect to 

23 a petitioner under this section, no estoppel under section 

24 315(e) shall apply to that petitioner. If no petitioner re25 mains in the inter partes review, the Office may terminate 
44 

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1 the review or proceed to a final written decision under sec2 tion 318(a). 

3 ‘‘(b) AGREEMENTS IN WRITING.—Any agreement or 

4 understanding between the patent owner and a petitioner, 

5 including any collateral agreements referred to in such 

6 agreement or understanding, made in connection with, or 

7 in contemplation of, the termination of an inter partes re8 view under this section shall be in writing and a true copy 

9 of such agreement or understanding shall be filed in the 

10 Office before the termination of the inter partes review 

11 as between the parties. If any party filing such agreement 

12 or understanding so requests, the copy shall be kept sepa13 rate from the file of the inter partes review, and shall be 

14 made available only to Federal Government agencies upon 

15 written request, or to any other person on a showing of 

16 good cause. 

17 ‘‘§ 318. Decision of the board 

18 ‘‘(a) FINAL WRITTEN DECISION.—If an inter partes 

19 review is instituted and not dismissed under this chapter, 

20 the Patent Trial and Appeal Board shall issue a final writ21 ten decision with respect to the patentability of any patent 

22 claim challenged by the petitioner and any new claim 

23 added under section 316(d). 

24 ‘‘(b) CERTIFICATE.—If the Patent Trial and Appeal 

25 Board issues a final written decision under subsection (a) 
45 

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1 and the time for appeal has expired or any appeal has 

2 terminated, the Director shall issue and publish a certifi3 cate canceling any claim of the patent finally determined 

4 to be unpatentable, confirming any claim of the patent de5 termined to be patentable, and incorporating in the patent 

6 by operation of the certificate any new or amended claim 

7 determined to be patentable. 

8 ‘‘(c) DATA ON LENGTH OF REVIEW.—The Patent 

9 and Trademark Office shall make available to the public 

10 data describing the length of time between the commence11 ment of each inter partes review and the conclusion of that 

12 review. 

13 ‘‘§ 319. Appeal 

14 ‘‘A party dissatisfied with the final written decision 

15 of the Patent Trial and Appeal Board under section 

16 318(a) may appeal the decision pursuant to sections 141 

17 through 144. Any party to the inter partes review shall 

18 have the right to be a party to the appeal.’’. 

19 (b) TECHNICAL AND CONFORMING AMENDMENT.— 

20 The table of chapters for part III of title 35, United States 

21 Code, is amended by striking the item relating to chapter 

22 31 and inserting the following: 

‘‘31. Inter Partes Review .......................................................................... 311.’’. 

23 (c) REGULATIONS AND EFFECTIVE DATE.— 

24 (1) REGULATIONS.—The Director shall, not 

25 later than the date that is 1 year after the date of 
46 

†S 23 ES

1 the enactment of this Act, issue regulations to carry 

2 out chapter 31 of title 35, United States Code, as 

3 amended by subsection (a) of this section. 

4 (2) APPLICABILITY.— 

5 (A) IN GENERAL.—The amendments made 

6 by subsection (a) shall take effect on the date 

7 that is 1 year after the date of the enactment 

8 of this Act and shall apply to all patents issued 

9 before, on, or after the effective date of sub10 section (a). 

11 (B) EXCEPTION.—The provisions of chap12 ter 31 of title 35, United States Code, as 

13 amended by paragraph (3), shall continue to 

14 apply to requests for inter partes reexamination 

15 that are filed prior to the effective date of sub16 section (a) as if subsection (a) had not been en17 acted. 

18 (C) GRADUATED IMPLEMENTATION.—The 

19 Director may impose a limit on the number of 

20 inter partes reviews that may be instituted dur21 ing each of the first 4 years following the effec22 tive date of subsection (a), provided that such 

23 number shall in each year be equivalent to or 

24 greater than the number of inter partes reex25 aminations that are ordered in the last full fis-
47 

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1 cal year prior to the effective date of subsection 

2 (a). 

3 (3) TRANSITION.— 

4 (A) IN GENERAL.—Chapter 31 of title 35, 

5 United States Code, is amended— 

6 (i) in section 312— 

7 (I) in subsection (a)— 

8 (aa) in the first sentence, by 

9 striking ‘‘a substantial new ques10 tion of patentability affecting any 

11 claim of the patent concerned is 

12 raised by the request,’’ and in13 serting ‘‘the information pre14 sented in the request shows that 

15 there is a reasonable likelihood 

16 that the requester would prevail 

17 with respect to at least 1 of the 

18 claims challenged in the re19 quest,’’; and 

20 (bb) in the second sentence, 

21 by striking ‘‘The existence of a 

22 substantial new question of pat23 entability’’ and inserting ‘‘A 

24 showing that there is a reason25 able likelihood that the requester 
48 

†S 23 ES

1 would prevail with respect to at 

2 least 1 of the claims challenged 

3 in the request’’; and 

4 (II) in subsection (c), in the sec5 ond sentence, by striking ‘‘no substan6 tial new question of patentability has 

7 been raised,’’ and inserting ‘‘the show8 ing required by subsection (a) has not 

9 been made,’’; and 

10 (ii) in section 313, by striking ‘‘a sub11 stantial new question of patentability af12 fecting a claim of the patent is raised’’ and 

13 inserting ‘‘it has been shown that there is 

14 a reasonable likelihood that the requester 

15 would prevail with respect to at least 1 of 

16 the claims challenged in the request’’. 

17 (B) APPLICATION.—The amendments 

18 made by this paragraph shall apply to requests 

19 for inter partes reexamination that are filed on 

20 or after the date of the enactment of this Act, 

21 but prior to the effective date of subsection (a). 

22 (d) POST-GRANT REVIEW.—Part III of title 35, 

23 United States Code, is amended by adding at the end the 

24 following: 
49 

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1 ‘‘CHAPTER 32—POST-GRANT REVIEW 

‘‘Sec. 

‘‘321. Post-grant review. 

‘‘322. Petitions. 

‘‘323. Preliminary response to petition. 

‘‘324. Institution of post-grant review. 

‘‘325. Relation to other proceedings or actions. 

‘‘326. Conduct of post-grant review. 

‘‘327. Settlement. 

‘‘328. Decision of the board. 

‘‘329. Appeal. 

2 ‘‘§ 321. Post-grant review 

3 ‘‘(a) IN GENERAL.—Subject to the provisions of this 

4 chapter, a person who is not the patent owner may file 

5 with the Office a petition to institute a post-grant review 

6 for a patent. The Director shall establish, by regulation, 

7 fees to be paid by the person requesting the review, in 

8 such amounts as the Director determines to be reasonable, 

9 considering the aggregate costs of the post-grant review. 

10 ‘‘(b) SCOPE.—A petitioner in a post-grant review may 

11 request to cancel as unpatentable 1 or more claims of a 

12 patent on any ground that could be raised under para13 graph (2) or (3) of section 282(b) (relating to invalidity 

14 of the patent or any claim). 

15 ‘‘(c) FILING DEADLINE.—A petition for a post-grant 

16 review shall be filed not later than 9 months after the 

17 grant of the patent or issuance of a reissue patent. 

18 ‘‘§ 322. Petitions 

19 ‘‘(a) REQUIREMENTS OF PETITION.—A petition filed 

20 under section 321 may be considered only if— 
50 

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1 ‘‘(1) the petition is accompanied by payment of 

2 the fee established by the Director under section 

3 321; 

4 ‘‘(2) the petition identifies all real parties in in5 terest; 

6 ‘‘(3) the petition identifies, in writing and with 

7 particularity, each claim challenged, the grounds on 

8 which the challenge to each claim is based, and the 

9 evidence that supports the grounds for the challenge 

10 to each claim, including— 

11 ‘‘(A) copies of patents and printed publica12 tions that the petitioner relies upon in support 

13 of the petition; and 

14 ‘‘(B) affidavits or declarations of sup15 porting evidence and opinions, if the petitioner 

16 relies on other factual evidence or on expert 

17 opinions; 

18 ‘‘(4) the petition provides such other informa19 tion as the Director may require by regulation; and 

20 ‘‘(5) the petitioner provides copies of any of the 

21 documents required under paragraphs (2), (3), and 

22 (4) to the patent owner or, if applicable, the des23 ignated representative of the patent owner. 
51 

†S 23 ES

1 ‘‘(b) PUBLIC AVAILABILITY.—As soon as practicable 

2 after the receipt of a petition under section 321, the Direc3 tor shall make the petition available to the public. 

4 ‘‘§ 323. Preliminary response to petition 

5 ‘‘(a) PRELIMINARY RESPONSE.—If a post-grant re6 view petition is filed under section 321, the patent owner 

7 shall have the right to file a preliminary response within 

8 2 months of the filing of the petition. 

9 ‘‘(b) CONTENT OF RESPONSE.—A preliminary re10 sponse to a petition for post-grant review shall set forth 

11 reasons why no post-grant review should be instituted 

12 based upon the failure of the petition to meet any require13 ment of this chapter. 

14 ‘‘§ 324. Institution of post-grant review 

15 ‘‘(a) THRESHOLD.—The Director may not authorize 

16 a post-grant review to commence unless the Director de17 termines that the information presented in the petition, 

18 if such information is not rebutted, would demonstrate 

19 that it is more likely than not that at least 1 of the claims 

20 challenged in the petition is unpatentable. 

21 ‘‘(b) ADDITIONAL GROUNDS.—The determination re22 quired under subsection (a) may also be satisfied by a 

23 showing that the petition raises a novel or unsettled legal 

24 question that is important to other patents or patent ap25 plications. 
52 

†S 23 ES

1 ‘‘(c) TIMING.—The Director shall determine whether 

2 to institute a post-grant review under this chapter within 

3 3 months after receiving a preliminary response under sec4 tion 323 or, if none is filed, the expiration of the time 

5 for filing such a response. 

6 ‘‘(d) NOTICE.—The Director shall notify the peti7 tioner and patent owner, in writing, of the Director’s de8 termination under subsection (a) or (b), and shall make 

9 such notice available to the public as soon as is prac10 ticable. The Director shall make each notice of the institu11 tion of a post-grant review available to the public. Such 

12 notice shall list the date on which the review shall com13 mence. 

14 ‘‘(e) NO APPEAL.—The determination by the Direc15 tor whether to institute a post-grant review under this sec16 tion shall be final and nonappealable. 

17 ‘‘§ 325. Relation to other proceedings or actions 

18 ‘‘(a) INFRINGER’S ACTION.—A post-grant review 

19 may not be instituted or maintained if the petitioner or 

20 real party in interest has filed a civil action challenging 

21 the validity of a claim of the patent. 

22 ‘‘(b) PRELIMINARY INJUNCTIONS.—If a civil action 

23 alleging infringement of a patent is filed within 3 months 

24 of the grant of the patent, the court may not stay its con25 sideration of the patent owner’s motion for a preliminary 
53 

†S 23 ES

1 injunction against infringement of the patent on the basis 

2 that a petition for post-grant review has been filed or that 

3 such a proceeding has been instituted. 

4 ‘‘(c) JOINDER.—If more than 1 petition for a post5 grant review is properly filed against the same patent and 

6 the Director determines that more than 1 of these peti7 tions warrants the institution of a post-grant review under 

8 section 324, the Director may consolidate such reviews 

9 into a single post-grant review. 

10 ‘‘(d) MULTIPLE PROCEEDINGS.—Notwithstanding 

11 sections 135(a), 251, and 252, and chapter 30, during the 

12 pendency of any post-grant review, if another proceeding 

13 or matter involving the patent is before the Office, the 

14 Director may determine the manner in which the post15 grant review or other proceeding or matter may proceed, 

16 including providing for stay, transfer, consolidation, or 

17 termination of any such matter or proceeding. In deter18 mining whether to institute or order a proceeding under 

19 this chapter, chapter 30, or chapter 31, the Director may 

20 take into account whether, and reject the petition or re21 quest because, the same or substantially the same prior 

22 art or arguments previously were presented to the Office. 

23 ‘‘(e) ESTOPPEL.— 

24 ‘‘(1) PROCEEDINGS BEFORE THE OFFICE.—The 

25 petitioner in a post-grant review under this chapter, 
54 

†S 23 ES

1 or his real party in interest or privy, may not re2 quest or maintain a proceeding before the Office 

3 with respect to a claim on any ground that the peti4 tioner raised or reasonably could have raised during 

5 a post-grant review of the claim that resulted in a 

6 final written decision under section 328(a). 

7 ‘‘(2) CIVIL ACTIONS AND OTHER PRO8 CEEDINGS.—The petitioner in a post-grant review 

9 under this chapter, or his real party in interest or 

10 privy, may not assert either in a civil action arising 

11 in whole or in part under section 1338 of title 28 

12 or in a proceeding before the International Trade 

13 Commission that a claim in a patent is invalid on 

14 any ground that the petitioner raised during a post15 grant review of the claim that resulted in a final 

16 written decision under section 328(a). 

17 ‘‘(f) REISSUE PATENTS.—A post-grant review may 

18 not be instituted if the petition requests cancellation of 

19 a claim in a reissue patent that is identical to or narrower 

20 than a claim in the original patent from which the reissue 

21 patent was issued, and the time limitations in section 

22 321(c) would bar filing a petition for a post-grant review 

23 for such original patent. 
55 

†S 23 ES

1 ‘‘§ 326. Conduct of post-grant review 

2 ‘‘(a) REGULATIONS.—The Director shall prescribe 

3 regulations— 

4 ‘‘(1) providing that the file of any proceeding 

5 under this chapter shall be made available to the 

6 public, except that any petition or document filed 

7 with the intent that it be sealed shall be accom8 panied by a motion to seal, and such petition or doc9 ument shall be treated as sealed pending the out10 come of the ruling on the motion; 

11 ‘‘(2) setting forth the standards for the showing 

12 of sufficient grounds to institute a review under sub13 sections (a) and (b) of section 324; 

14 ‘‘(3) establishing procedures for the submission 

15 of supplemental information after the petition is 

16 filed; 

17 ‘‘(4) in accordance with section 2(b)(2), estab18 lishing and governing a post-grant review under this 

19 chapter and the relationship of such review to other 

20 proceedings under this title; 

21 ‘‘(5) setting forth standards and procedures for 

22 discovery of relevant evidence, including that such 

23 discovery shall be limited to evidence directly related 

24 to factual assertions advanced by either party in the 

25 proceeding; 
56 

†S 23 ES

1 ‘‘(6) prescribing sanctions for abuse of dis2 covery, abuse of process, or any other improper use 

3 of the proceeding, such as to harass or to cause un4 necessary delay or an unnecessary increase in the 

5 cost of the proceeding; 

6 ‘‘(7) providing for protective orders governing 

7 the exchange and submission of confidential infor8 mation; 

9 ‘‘(8) allowing the patent owner to file a re10 sponse to the petition after a post-grant review has 

11 been instituted, and requiring that the patent owner 

12 file with such response, through affidavits or dec13 larations, any additional factual evidence and expert 

14 opinions on which the patent owner relies in support 

15 of the response; 

16 ‘‘(9) setting forth standards and procedures for 

17 allowing the patent owner to move to amend the pat18 ent under subsection (d) to cancel a challenged claim 

19 or propose a reasonable number of substitute claims, 

20 and ensuring that any information submitted by the 

21 patent owner in support of any amendment entered 

22 under subsection (d) is made available to the public 

23 as part of the prosecution history of the patent; 

24 ‘‘(10) providing either party with the right to 

25 an oral hearing as part of the proceeding; and 
57 

†S 23 ES

1 ‘‘(11) requiring that the final determination in 

2 any post-grant review be issued not later than 1 

3 year after the date on which the Director notices the 

4 institution of a proceeding under this chapter, except 

5 that the Director may, for good cause shown, extend 

6 the 1-year period by not more than 6 months, and 

7 may adjust the time periods in this paragraph in the 

8 case of joinder under section 325(c). 

9 ‘‘(b) CONSIDERATIONS.—In prescribing regulations 

10 under this section, the Director shall consider the effect 

11 of any such regulation on the economy, the integrity of 

12 the patent system, the efficient administration of the Of13 fice, and the ability of the Office to timely complete pro14 ceedings instituted under this chapter. 

15 ‘‘(c) PATENT TRIAL AND APPEAL BOARD.—The Pat16 ent Trial and Appeal Board shall, in accordance with sec17 tion 6, conduct each proceeding authorized by the Direc18 tor. 

19 ‘‘(d) AMENDMENT OF THE PATENT.— 

20 ‘‘(1) IN GENERAL.—During a post-grant review 

21 instituted under this chapter, the patent owner may 

22 file 1 motion to amend the patent in 1 or more of 

23 the following ways: 

24 ‘‘(A) Cancel any challenged patent claim. 
58 

†S 23 ES

1 ‘‘(B) For each challenged claim, propose a 

2 reasonable number of substitute claims. 

3 ‘‘(2) ADDITIONAL MOTIONS.—Additional mo4 tions to amend may be permitted upon the joint re5 quest of the petitioner and the patent owner to ma6 terially advance the settlement of a proceeding under 

7 section 327, or upon the request of the patent owner 

8 for good cause shown. 

9 ‘‘(3) SCOPE OF CLAIMS.—An amendment under 

10 this subsection may not enlarge the scope of the 

11 claims of the patent or introduce new matter. 

12 ‘‘(e) EVIDENTIARY STANDARDS.—In a post-grant re13 view instituted under this chapter, the petitioner shall 

14 have the burden of proving a proposition of 

15 unpatentability by a preponderance of the evidence. 

16 ‘‘§ 327. Settlement 

17 ‘‘(a) IN GENERAL.—A post-grant review instituted 

18 under this chapter shall be terminated with respect to any 

19 petitioner upon the joint request of the petitioner and the 

20 patent owner, unless the Office has decided the merits of 

21 the proceeding before the request for termination is filed. 

22 If the post-grant review is terminated with respect to a 

23 petitioner under this section, no estoppel under section 

24 325(e) shall apply to that petitioner. If no petitioner re25 mains in the post-grant review, the Office may terminate 
59 

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1 the post-grant review or proceed to a final written decision 

2 under section 328(a). 

3 ‘‘(b) AGREEMENTS IN WRITING.—Any agreement or 

4 understanding between the patent owner and a petitioner, 

5 including any collateral agreements referred to in such 

6 agreement or understanding, made in connection with, or 

7 in contemplation of, the termination of a post-grant review 

8 under this section shall be in writing, and a true copy of 

9 such agreement or understanding shall be filed in the Of10 fice before the termination of the post-grant review as be11 tween the parties. If any party filing such agreement or 

12 understanding so requests, the copy shall be kept separate 

13 from the file of the post-grant review, and shall be made 

14 available only to Federal Government agencies upon writ15 ten request, or to any other person on a showing of good 

16 cause. 

17 ‘‘§ 328. Decision of the board 

18 ‘‘(a) FINAL WRITTEN DECISION.—If a post-grant re19 view is instituted and not dismissed under this chapter, 

20 the Patent Trial and Appeal Board shall issue a final writ21 ten decision with respect to the patentability of any patent 

22 claim challenged by the petitioner and any new claim 

23 added under section 326(d). 

24 ‘‘(b) CERTIFICATE.—If the Patent Trial and Appeal 

25 Board issues a final written decision under subsection (a) 
60 

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1 and the time for appeal has expired or any appeal has 

2 terminated, the Director shall issue and publish a certifi3 cate canceling any claim of the patent finally determined 

4 to be unpatentable, confirming any claim of the patent de5 termined to be patentable, and incorporating in the patent 

6 by operation of the certificate any new or amended claim 

7 determined to be patentable. 

8 ‘‘(c) DATA ON LENGTH OF REVIEW.—The Patent 

9 and Trademark Office shall make available to the public 

10 data describing the length of time between the commence11 ment of each post-grant review and the conclusion of that 

12 review. 

13 ‘‘§ 329. Appeal 

14 ‘‘A party dissatisfied with the final written decision 

15 of the Patent Trial and Appeal Board under section 

16 328(a) may appeal the decision pursuant to sections 141 

17 through 144. Any party to the post-grant review shall have 

18 the right to be a party to the appeal.’’. 

19 (e) TECHNICAL AND CONFORMING AMENDMENT.— 

20 The table of chapters for part III of title 35, United States 

21 Code, is amended by adding at the end the following: 

‘‘32. Post-Grant Review ............................................................................ 321.’’. 

22 (f) REGULATIONS AND EFFECTIVE DATE.— 

23 (1) REGULATIONS.—The Director shall, not 

24 later than the date that is 1 year after the date of 

25 the enactment of this Act, issue regulations to carry 
61 

†S 23 ES

1 out chapter 32 of title 35, United States Code, as 

2 added by subsection (d) of this section. 

3 (2) APPLICABILITY.—The amendments made 

4 by subsection (d) shall take effect on the date that 

5 is 1 year after the date of the enactment of this Act 

6 and, except as provided in section 18 and in para7 graph (3), shall apply only to patents that are de8 scribed in section 2(o)(1). The Director may impose 

9 a limit on the number of post-grant reviews that 

10 may be instituted during each of the 4 years fol11 lowing the effective date of subsection (d). 

12 (3) PENDING INTERFERENCES.—The Director 

13 shall determine the procedures under which inter14 ferences commenced before the effective date of sub15 section (d) are to proceed, including whether any 

16 such interference is to be dismissed without preju17 dice to the filing of a petition for a post-grant review 

18 under chapter 32 of title 35, United States Code, or 

19 is to proceed as if this Act had not been enacted. 

20 The Director shall include such procedures in regu21 lations issued under paragraph (1). For purposes of 

22 an interference that is commenced before the effec23 tive date of subsection (d), the Director may deem 

24 the Patent Trial and Appeal Board to be the Board 

25 of Patent Appeals and Interferences, and may allow 
62 

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1 the Patent Trial and Appeal Board to conduct any 

2 further proceedings in that interference. The author3 ization to appeal or have remedy from derivation 

4 proceedings in sections 141(d) and 146 of title 35, 

5 United States Code, and the jurisdiction to entertain 

6 appeals from derivation proceedings in section 

7 1295(a)(4)(A) of title 28, United States Code, shall 

8 be deemed to extend to final decisions in inter9 ferences that are commenced before the effective 

10 date of subsection (d) and that are not dismissed 

11 pursuant to this paragraph. 

12 (g) CITATION OF PRIOR ART AND WRITTEN STATE13 MENTS.— 

14 (1) IN GENERAL.—Section 301 of title 35, 

15 United States Code, is amended to read as follows: 

16 ‘‘§ 301. Citation of prior art and written statements 

17 ‘‘(a) IN GENERAL.—Any person at any time may cite 

18 to the Office in writing— 

19 ‘‘(1) prior art consisting of patents or printed 

20 publications which that person believes to have a 

21 bearing on the patentability of any claim of a par22 ticular patent; or 

23 ‘‘(2) statements of the patent owner filed in a 

24 proceeding before a Federal court or the Office in 
63 

†S 23 ES

1 which the patent owner took a position on the scope 

2 of any claim of a particular patent. 

3 ‘‘(b) OFFICIAL FILE.—If the person citing prior art 

4 or written statements pursuant to subsection (a) explains 

5 in writing the pertinence and manner of applying the prior 

6 art or written statements to at least 1 claim of the patent, 

7 the citation of the prior art or written statements and the 

8 explanation thereof shall become a part of the official file 

9 of the patent. 

10 ‘‘(c) ADDITIONAL INFORMATION.—A party that sub11 mits a written statement pursuant to subsection (a)(2) 

12 shall include any other documents, pleadings, or evidence 

13 from the proceeding in which the statement was filed that 

14 addresses the written statement. 

15 ‘‘(d) LIMITATIONS.—A written statement submitted 

16 pursuant to subsection (a)(2), and additional information 

17 submitted pursuant to subsection (c), shall not be consid18 ered by the Office for any purpose other than to determine 

19 the proper meaning of a patent claim in a proceeding that 

20 is ordered or instituted pursuant to section 304, 314, or 

21 324. If any such written statement or additional informa22 tion is subject to an applicable protective order, it shall 

23 be redacted to exclude information that is subject to that 

24 order. 
64 

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1 ‘‘(e) CONFIDENTIALITY.—Upon the written request 

2 of the person citing prior art or written statements pursu3 ant to subsection (a), that person’s identity shall be ex4 cluded from the patent file and kept confidential.’’. 

5 (2) EFFECTIVE DATE.—The amendment made 

6 by this subsection shall take effect 1 year after the 

7 date of the enactment of this Act and shall apply to 

8 patents issued before, on, or after that effective 

9 date. 

10 (h) REEXAMINATION.— 

11 (1) DETERMINATION BY DIRECTOR.— 

12 (A) IN GENERAL.—Section 303(a) of title 

13 35, United States Code, is amended by striking 

14 ‘‘section 301 of this title’’ and inserting ‘‘sec15 tion 301 or 302’’. 

16 (B) EFFECTIVE DATE.—The amendment 

17 made by this paragraph shall take effect 1 year 

18 after the date of the enactment of this Act and 

19 shall apply to patents issued before, on, or after 

20 that effective date. 

21 (2) APPEAL.— 

22 (A) IN GENERAL.—Section 306 of title 35, 

23 United States Code, is amended by striking 

24 ‘‘145’’ and inserting ‘‘144’’. 
65 

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1 (B) EFFECTIVE DATE.—The amendment 

2 made by this paragraph shall take effect on the 

3 date of enactment of this Act and shall apply 

4 to appeals of reexaminations that are pending 

5 before the Board of Patent Appeals and Inter6 ferences or the Patent Trial and Appeal Board 

7 on or after the date of the enactment of this 

8 Act. 

9 SEC. 6. PATENT TRIAL AND APPEAL BOARD. 

10 (a) COMPOSITION AND DUTIES.—Section 6 of title 

11 35, United States Code, is amended to read as follows: 

12 ‘‘§ 6. Patent Trial and Appeal Board 

13 ‘‘(a) There shall be in the Office a Patent Trial and 

14 Appeal Board. The Director, the Deputy Director, the 

15 Commissioner for Patents, the Commissioner for Trade16 marks, and the administrative patent judges shall con17 stitute the Patent Trial and Appeal Board. The adminis18 trative patent judges shall be persons of competent legal 

19 knowledge and scientific ability who are appointed by the 

20 Secretary, in consultation with the Director. Any reference 

21 in any Federal law, Executive order, rule, regulation, or 

22 delegation of authority, or any document of or pertaining 

23 to the Board of Patent Appeals and Interferences is 

24 deemed to refer to the Patent Trial and Appeal Board. 

25 ‘‘(b) The Patent Trial and Appeal Board shall— 
66 

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1 ‘‘(1) on written appeal of an applicant, review 

2 adverse decisions of examiners upon applications for 

3 patents pursuant to section 134(a); 

4 ‘‘(2) review appeals of reexaminations pursuant 

5 to section 134(b); 

6 ‘‘(3) conduct derivation proceedings pursuant to 

7 section 135; and 

8 ‘‘(4) conduct inter partes reviews and post9 grant reviews pursuant to chapters 31 and 32. 

10 ‘‘(c) Each appeal, derivation proceeding, post-grant 

11 review, and inter partes review shall be heard by at least 

12 3 members of the Patent Trial and Appeal Board, who 

13 shall be designated by the Director. Only the Patent Trial 

14 and Appeal Board may grant rehearings. 

15 ‘‘(d) The Secretary of Commerce may, in his discre16 tion, deem the appointment of an administrative patent 

17 judge who, before the date of the enactment of this sub18 section, held office pursuant to an appointment by the Di19 rector to take effect on the date on which the Director 

20 initially appointed the administrative patent judge. It shall 

21 be a defense to a challenge to the appointment of an ad22 ministrative patent judge on the basis of the judge’s hav23 ing been originally appointed by the Director that the ad24 ministrative patent judge so appointed was acting as a de 

25 facto officer.’’. 
67 

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1 (b) ADMINISTRATIVE APPEALS.—Section 134 of title 

2 35, United States Code, is amended— 

3 (1) in subsection (b), by striking ‘‘any reexam4 ination proceeding’’ and inserting ‘‘a reexamina5 tion’’; and 

6 (2) by striking subsection (c). 

7 (c) CIRCUIT APPEALS.— 

8 (1) IN GENERAL.—Section 141 of title 35, 

9 United States Code, is amended to read as follows: 

10 ‘‘§ 141. Appeal to the Court of Appeals for the Federal 

11 Circuit 

12 ‘‘(a) EXAMINATIONS.—An applicant who is dissatis13 fied with the final decision in an appeal to the Patent Trial 

14 and Appeal Board under section 134(a) may appeal the 

15 Board’s decision to the United States Court of Appeals 

16 for the Federal Circuit. By filing such an appeal, the ap17 plicant waives his right to proceed under section 145. 

18 ‘‘(b) REEXAMINATIONS.—A patent owner who is dis19 satisfied with the final decision in an appeal of a reexam20 ination to the Patent Trial and Appeal Board under sec21 tion 134(b) may appeal the Board’s decision only to the 

22 United States Court of Appeals for the Federal Circuit. 

23 ‘‘(c) POST-GRANT AND INTER PARTES REVIEWS.— 

24 A party to a post-grant or inter partes review who is dis25 satisfied with the final written decision of the Patent Trial 
68 

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1 and Appeal Board under section 318(a) or 328(a) may 

2 appeal the Board’s decision only to the United States 

3 Court of Appeals for the Federal Circuit. 

4 ‘‘(d) DERIVATION PROCEEDINGS.—A party to a deri5 vation proceeding who is dissatisfied with the final deci6 sion of the Patent Trial and Appeal Board on the pro7 ceeding may appeal the decision to the United States 

8 Court of Appeals for the Federal Circuit, but such appeal 

9 shall be dismissed if any adverse party to such derivation 

10 proceeding, within 20 days after the appellant has filed 

11 notice of appeal in accordance with section 142, files no12 tice with the Director that the party elects to have all fur13 ther proceedings conducted as provided in section 146. If 

14 the appellant does not, within 30 days after the filing of 

15 such notice by the adverse party, file a civil action under 

16 section 146, the Board’s decision shall govern the further 

17 proceedings in the case.’’. 

18 (2) JURISDICTION.—Section 1295(a)(4)(A) of 

19 title 28, United States Code, is amended to read as 

20 follows: 

21 ‘‘(A) the Patent Trial and Appeal Board of 

22 the United States Patent and Trademark Office 

23 with respect to patent applications, derivation 

24 proceedings, reexaminations, post-grant reviews, 

25 and inter partes reviews at the instance of a 
69 

†S 23 ES

1 party who exercised his right to participate in 

2 a proceeding before or appeal to the Board, ex3 cept that an applicant or a party to a derivation 

4 proceeding may also have remedy by civil action 

5 pursuant to section 145 or 146 of title 35. An 

6 appeal under this subparagraph of a decision of 

7 the Board with respect to an application or der8 ivation proceeding shall waive the right of such 

9 applicant or party to proceed under section 145 

10 or 146 of title 35;’’. 

11 (3) PROCEEDINGS ON APPEAL.—Section 143 of 

12 title 35, United States Code, is amended— 

13 (A) by striking the third sentence and in14 serting the following: ‘‘In an ex parte case, the 

15 Director shall submit to the court in writing the 

16 grounds for the decision of the Patent and 

17 Trademark Office, addressing all of the issues 

18 raised in the appeal. The Director shall have 

19 the right to intervene in an appeal from a deci20 sion entered by the Patent Trial and Appeal 

21 Board in a derivation proceeding under section 

22 135 or in an inter partes or post-grant review 

23 under chapter 31 or 32.’’; and 

24 (B) by repealing the second of the two 

25 identical fourth sentences. 
70 

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1 (d) EFFECTIVE DATE.—The amendments made by 

2 this section shall take effect 1 year after the date of the 

3 enactment of this Act and shall apply to proceedings com4 menced on or after that effective date, except that— 

5 (1) the extension of jurisdiction to the United 

6 States Court of Appeals for the Federal Circuit to 

7 entertain appeals of decisions of the Patent Trial 

8 and Appeal Board in reexaminations under the 

9 amendment made by subsection (c)(2) shall be 

10 deemed to take effect on the date of enactment of 

11 this Act and shall extend to any decision of the 

12 Board of Patent Appeals and Interferences with re13 spect to a reexamination that is entered before, on, 

14 or after the date of the enactment of this Act; 

15 (2) the provisions of sections 6, 134, and 141 

16 of title 35, United States Code, in effect on the day 

17 prior to the date of the enactment of this Act shall 

18 continue to apply to inter partes reexaminations that 

19 are requested under section 311 prior to the date 

20 that is 1 year after the date of the enactment of this 

21 Act; 

22 (3) the Patent Trial and Appeal Board may be 

23 deemed to be the Board of Patent Appeals and 

24 Interferences for purposes of appeals of inter partes 

25 reexaminations that are requested under section 311 
71 

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1 prior to the date that is 1 year after the date of the 

2 enactment of this Act; and 

3 (4) the Director’s right under the last sentence 

4 of section 143 of title 35, United States Code, as 

5 amended by subsection (c)(3), to intervene in an ap6 peal from a decision entered by the Patent Trial and 

7 Appeal Board shall be deemed to extend to inter 

8 partes reexaminations that are requested under sec9 tion 311 prior to the date that is 1 year after the 

10 date of the enactment of this Act. 

11 SEC. 7. PREISSUANCE SUBMISSIONS BY THIRD PARTIES. 

12 (a) IN GENERAL.—Section 122 of title 35, United 

13 States Code, is amended by adding at the end the fol14 lowing: 

15 ‘‘(e) PREISSUANCE SUBMISSIONS BY THIRD PAR16 TIES.— 

17 ‘‘(1) IN GENERAL.—Any third party may sub18 mit for consideration and inclusion in the record of 

19 a patent application, any patent, published patent 

20 application, or other printed publication of potential 

21 relevance to the examination of the application, if 

22 such submission is made in writing before the earlier 

23 of— 
72 

†S 23 ES

1 ‘‘(A) the date a notice of allowance under 

2 section 151 is given or mailed in the application 

3 for patent; or 

4 ‘‘(B) the later of— 

5 ‘‘(i) 6 months after the date on which 

6 the application for patent is first published 

7 under section 122 by the Office, or 

8 ‘‘(ii) the date of the first rejection 

9 under section 132 of any claim by the ex10 aminer during the examination of the ap11 plication for patent. 

12 ‘‘(2) OTHER REQUIREMENTS.—Any submission 

13 under paragraph (1) shall— 

14 ‘‘(A) set forth a concise description of the 

15 asserted relevance of each submitted document; 

16 ‘‘(B) be accompanied by such fee as the 

17 Director may prescribe; and 

18 ‘‘(C) include a statement by the person 

19 making such submission affirming that the sub20 mission was made in compliance with this sec21 tion.’’. 

22 (b) EFFECTIVE DATE.—The amendments made by 

23 this section shall take effect 1 year after the date of the 

24 enactment of this Act and shall apply to patent applica25 tions filed before, on, or after that effective date. 
73 

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1 SEC. 8. VENUE. 

2 (a) TECHNICAL AMENDMENTS RELATING TO

3 VENUE.—Sections 32, 145, 146, 154(b)(4)(A), and 293 

4 of title 35, United States Code, and section 21(b)(4) of 

5 the Act entitled ‘‘An Act to provide for the registration 

6 and protection of trademarks used in commerce, to carry 

7 out the provisions of certain international conventions, 

8 and for other purposes’’, approved July 5, 1946 (com9 monly referred to as the ‘‘Trademark Act of 1946’’ or the 

10 ‘‘Lanham Act’’; 15 U.S.C. 1071(b)(4)), are each amended 

11 by striking ‘‘United States District Court for the District 

12 of Columbia’’ each place that term appears and inserting 

13 ‘‘United States District Court for the Eastern District of 

14 Virginia’’. 

15 (b) EFFECTIVE DATE.—The amendments made by 

16 this section shall take effect upon the date of the enact17 ment of this Act and shall apply to civil actions com18 menced on or after that date. 

19 SEC. 9. FEE SETTING AUTHORITY. 

20 (a) FEE SETTING.— 

21 (1) IN GENERAL.—The Director shall have au22 thority to set or adjust by rule any fee established, 

23 authorized, or charged under title 35, United States 

24 Code, and the Trademark Act of 1946 (15 U.S.C. 

25 1051 et seq.), notwithstanding the fee amounts es26 tablished, authorized, or charged thereunder, for all 
74 

†S 23 ES

1 services performed by or materials furnished by, the 

2 Office, provided that patent and trademark fee 

3 amounts are in the aggregate set to recover the esti4 mated cost to the Office for processing, activities, 

5 services, and materials relating to patents and trade6 marks, respectively, including proportionate shares 

7 of the administrative costs of the Office. 

8 (2) SMALL AND MICRO ENTITIES.—The fees es9 tablished under paragraph (1) for filing, searching, 

10 examining, issuing, appealing, and maintaining pat11 ent applications and patents shall be reduced by 50 

12 percent with respect to their application to any small 

13 entity that qualifies for reduced fees under section 

14 41(h)(1) of title 35, United States Code, and shall 

15 be reduced by 75 percent with respect to their appli16 cation to any micro entity as defined in section 123 

17 of that title. 

18 (3) REDUCTION OF FEES IN CERTAIN FISCAL

19 YEARS.—In any fiscal year, the Director— 

20 (A) shall consult with the Patent Public 

21 Advisory Committee and the Trademark Public 

22 Advisory Committee on the advisability of re23 ducing any fees described in paragraph (1); and 

24 (B) after the consultation required under 

25 subparagraph (A), may reduce such fees. 
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1 (4) ROLE OF THE PUBLIC ADVISORY COM2 MITTEE.—The Director shall— 

3 (A) submit to the Patent Public Advisory 

4 Committee or the Trademark Public Advisory 

5 Committee, or both, as appropriate, any pro6 posed fee under paragraph (1) not less than 45 

7 days before publishing any proposed fee in the 

8 Federal Register; 

9 (B) provide the relevant advisory com10 mittee described in subparagraph (A) a 30-day 

11 period following the submission of any proposed 

12 fee, on which to deliberate, consider, and com13 ment on such proposal, and require that— 

14 (i) during such 30-day period, the rel15 evant advisory committee hold a public 

16 hearing related to such proposal; and 

17 (ii) the Director shall assist the rel18 evant advisory committee in carrying out 

19 such public hearing, including by offering 

20 the use of Office resources to notify and 

21 promote the hearing to the public and in22 terested stakeholders; 

23 (C) require the relevant advisory com24 mittee to make available to the public a written 

25 report detailing the comments, advice, and rec-
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1 ommendations of the committee regarding any 

2 proposed fee; 

3 (D) consider and analyze any comments, 

4 advice, or recommendations received from the 

5 relevant advisory committee before setting or 

6 adjusting any fee; and 

7 (E) notify, through the Chair and Ranking 

8 Member of the Senate and House Judiciary 

9 Committees, the Congress of any final rule set10 ting or adjusting fees under paragraph (1). 

11 (5) PUBLICATION IN THE FEDERAL REG12 ISTER.— 

13 (A) IN GENERAL.—Any rules prescribed 

14 under this subsection shall be published in the 

15 Federal Register. 

16 (B) RATIONALE.—Any proposal for a 

17 change in fees under this section shall— 

18 (i) be published in the Federal Reg19 ister; and 

20 (ii) include, in such publication, the 

21 specific rationale and purpose for the pro22 posal, including the possible expectations 

23 or benefits resulting from the proposed 

24 change. 
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1 (C) PUBLIC COMMENT PERIOD.—Following 

2 the publication of any proposed fee in the Fed3 eral Register pursuant to subparagraph (A), the 

4 Director shall seek public comment for a period 

5 of not less than 45 days. 

6 (6) CONGRESSIONAL COMMENT PERIOD.—Fol7 lowing the notification described in paragraph 

8 (3)(E), Congress shall have not more than 45 days 

9 to consider and comment on any final rule setting or 

10 adjusting fees under paragraph (1). No fee set or 

11 adjusted under paragraph (1) shall be effective prior 

12 to the end of such 45-day comment period. 

13 (7) RULE OF CONSTRUCTION.—No rules pre14 scribed under this subsection may diminish— 

15 (A) an applicant’s rights under title 35, 

16 United States Code, or the Trademark Act of 

17 1946; or 

18 (B) any rights under a ratified treaty. 

19 (b) FEES FOR PATENT SERVICES.—Division B of 

20 Public Law 108–447 is amended in title VIII of the De21 partments of Commerce, Justice, and State, the Judiciary, 

22 and Related Agencies Appropriations Act, 2005— 

23 (1) in subsections (a), (b), and (c) of section 

24 801, by— 
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1 (A) striking ‘‘During’’ and all that follows 

2 through ‘‘ 2006, subsection’’ and inserting 

3 ‘‘Subsection’’; and 

4 (B) striking ‘‘shall be administered as 

5 though that subsection reads’’ and inserting ‘‘is 

6 amended to read’’; 

7 (2) in subsection (d) of section 801, by striking 

8 ‘‘During’’ and all that follows through ‘‘ 2006, sub9 section’’ and inserting ‘‘Subsection’’; and 

10 (3) in subsection (e) of section 801, by— 

11 (A) striking ‘‘During’’ and all that follows 

12 through ‘‘2006, subsection’’ and inserting 

13 ‘‘Subsection’’; and 

14 (B) striking ‘‘shall be administered as 

15 though that subsection’’. 

16 (c) ADJUSTMENT OF TRADEMARK FEES.—Division 

17 B of Public Law 108–447 is amended in title VIII of the 

18 Departments of Commerce, Justice and State, the Judici19 ary and Related Agencies Appropriations Act, 2005, in 

20 section 802(a) by striking ‘‘During fiscal years 2005, 

21 2006 and 2007’’, and inserting ‘‘Until such time as the 

22 Director sets or adjusts the fees otherwise,’’. 

23 (d) EFFECTIVE DATE, APPLICABILITY, AND TRANSI24 TION PROVISIONS.—Division B of Public Law 108–447 is 

25 amended in title VIII of the Departments of Commerce, 
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1 Justice and State, the Judiciary and Related Agencies Ap2 propriations Act, 2005, in section 803(a) by striking ‘‘and 

3 shall apply only with respect to the remaining portion of 

4 fiscal year 2005, 2006 and 2007’’. 

5 (e) STATUTORY AUTHORITY.—Section 41(d)(1)(A) of 

6 title 35, United States Code, is amended by striking ‘‘, 

7 and the Director may not increase any such fee there8 after’’. 

9 (f) RULE OF CONSTRUCTION.—Nothing in this sec10 tion shall be construed to affect any other provision of Di11 vision B of Public Law 108–447, including section 801(c) 

12 of title VIII of the Departments of Commerce, Justice and 

13 State, the Judiciary and Related Agencies Appropriations 

14 Act, 2005. 

15 (g) DEFINITIONS.—In this section, the following defi16 nitions shall apply: 

17 (1) DIRECTOR.—The term ‘‘Director’’ means 

18 the Director of the United States Patent and Trade19 mark Office. 

20 (2) OFFICE.—The term ‘‘Office’’ means the 

21 United States Patent and Trademark Office. 

22 (3) TRADEMARK ACT OF 1946.—The term 

23 ‘‘Trademark Act of 1946’’ means an Act entitled 

24 ‘‘Act to provide for the registration and protection 

25 of trademarks used in commerce, to carry out the 
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1 provisions of certain international conventions, and 

2 for other purposes’’, approved July 5, 1946 (15 

3 U.S.C. 1051 et seq.) (commonly referred to as the 

4 Trademark Act of 1946 or the Lanham Act). 

5 (h) ELECTRONIC FILING INCENTIVE.— 

6 (1) IN GENERAL.—Notwithstanding any other 

7 provision of this section, a fee of $400 shall be es8 tablished for each application for an original patent, 

9 except for a design, plant, or provisional application, 

10 that is not filed by electronic means as prescribed by 

11 the Director. The fee established by this subsection 

12 shall be reduced 50 percent for small entities that 

13 qualify for reduced fees under section 41(h)(1) of 

14 title 35, United States Code. All fees paid under this 

15 subsection shall be deposited in the Treasury as an 

16 offsetting receipt that shall not be available for obli17 gation or expenditure. 

18 (2) EFFECTIVE DATE.—This subsection shall 

19 become effective 60 days after the date of the enact20 ment of this Act. 

21 (i) REDUCTION IN FEES FOR SMALL ENTITY PAT22 ENTS.—The Director shall reduce fees for providing 

23 prioritized examination of utility and plant patent applica24 tions by 50 percent for small entities that qualify for re25 duced fees under section 41(h)(1) of title 35, United 
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1 States Code, so long as the fees of the prioritized examina2 tion program are set to recover the estimated cost of the 

3 program. 

4 (j) EFFECTIVE DATE.—Except as provided in sub5 section (h), the provisions of this section shall take effect 

6 upon the date of the enactment of this Act. 

7 SEC. 10. SUPPLEMENTAL EXAMINATION. 

8 (a) IN GENERAL.—Chapter 25 of title 35, United 

9 States Code, is amended by adding at the end the fol10 lowing: 

11 ‘‘§ 257. Supplemental examinations to consider, re12 consider, or correct information 

13 ‘‘(a) IN GENERAL.—A patent owner may request 

14 supplemental examination of a patent in the Office to con15 sider, reconsider, or correct information believed to be rel16 evant to the patent. Within 3 months of the date a request 

17 for supplemental examination meeting the requirements of 

18 this section is received, the Director shall conduct the sup19 plemental examination and shall conclude such examina20 tion by issuing a certificate indicating whether the infor21 mation presented in the request raises a substantial new 

22 question of patentability. 

23 ‘‘(b) REEXAMINATION ORDERED.—If a substantial 

24 new question of patentability is raised by 1 or more items 

25 of information in the request, the Director shall order re-
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1 examination of the patent. The reexamination shall be 

2 conducted according to procedures established by chapter 

3 30, except that the patent owner shall not have the right 

4 to file a statement pursuant to section 304. During the 

5 reexamination, the Director shall address each substantial 

6 new question of patentability identified during the supple7 mental examination, notwithstanding the limitations 

8 therein relating to patents and printed publication or any 

9 other provision of chapter 30. 

10 ‘‘(c) EFFECT.— 

11 ‘‘(1) IN GENERAL.—A patent shall not be held 

12 unenforceable on the basis of conduct relating to in13 formation that had not been considered, was inad14 equately considered, or was incorrect in a prior ex15 amination of the patent if the information was con16 sidered, reconsidered, or corrected during a supple17 mental examination of the patent. The making of a 

18 request under subsection (a), or the absence thereof, 

19 shall not be relevant to enforceability of the patent 

20 under section 282. 

21 ‘‘(2) EXCEPTIONS.— 

22 ‘‘(A) PRIOR ALLEGATIONS.—This sub23 section shall not apply to an allegation pled 

24 with particularity, or set forth with particu25 larity in a notice received by the patent owner 
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1 under section 505(j)(2)(B)(iv)(II) of the Fed2 eral Food, Drug, and Cosmetic Act (21 U.S.C. 

3 355(j)(2)(B)(iv)(II)), before the date of a sup4 plemental-examination request under subsection 

5 (a) to consider, reconsider, or correct informa6 tion forming the basis for the allegation. 

7 ‘‘(B) PATENT ENFORCEMENT ACTIONS.— 

8 In an action brought under section 337(a) of 

9 the Tariff Act of 1930 (19 U.S.C. 1337(a)), or 

10 section 281 of this title, this subsection shall 

11 not apply to any defense raised in the action 

12 that is based upon information that was consid13 ered, reconsidered, or corrected pursuant to a 

14 supplemental-examination request under sub15 section (a) unless the supplemental examina16 tion, and any reexamination ordered pursuant 

17 to the request, are concluded before the date on 

18 which the action is brought. 

19 ‘‘(d) FEES AND REGULATIONS.—The Director shall, 

20 by regulation, establish fees for the submission of a re21 quest for supplemental examination of a patent, and to 

22 consider each item of information submitted in the re23 quest. If reexamination is ordered pursuant to subsection 

24 (a), fees established and applicable to ex parte reexamina25 tion proceedings under chapter 30 shall be paid in addition 
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1 to fees applicable to supplemental examination. The Direc2 tor shall promulgate regulations governing the form, con3 tent, and other requirements of requests for supplemental 

4 examination, and establishing procedures for conducting 

5 review of information submitted in such requests. 

6 ‘‘(e) RULE OF CONSTRUCTION.—Nothing in this sec7 tion shall be construed— 

8 ‘‘(1) to preclude the imposition of sanctions 

9 based upon criminal or antitrust laws (including sec10 tion 1001(a) of title 18, the first section of the Clay11 ton Act, and section 5 of the Federal Trade Com12 mission Act to the extent that section relates to un13 fair methods of competition); 

14 ‘‘(2) to limit the authority of the Director to in15 vestigate issues of possible misconduct and impose 

16 sanctions for misconduct in connection with matters 

17 or proceedings before the Office; or 

18 ‘‘(3) to limit the authority of the Director to 

19 promulgate regulations under chapter 3 relating to 

20 sanctions for misconduct by representatives prac21 ticing before the Office.’’. 

22 (b) EFFECTIVE DATE.—This section shall take effect 

23 1 year after the date of the enactment of this Act and 

24 shall apply to patents issued before, on, or after that date. 
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1 SEC. 11. RESIDENCY OF FEDERAL CIRCUIT JUDGES. 

2 (a) IN GENERAL.—Section 44(c) of title 28, United 

3 States Code, is amended— 

4 (1) by repealing the second sentence; and 

5 (2) in the third sentence, by striking ‘‘state’’ 

6 and inserting ‘‘State’’. 

7 (b) NO PROVISION OF FACILITIES AUTHORIZED.— 

8 The repeal made by the amendment in subsection (a)(1) 

9 shall not be construed to authorize the provision of any 

10 court facilities or administrative support services outside 

11 of the District of Columbia. 

12 (c) EFFECTIVE DATE.—This section shall take effect 

13 on the date of enactment of this Act. 

14 SEC. 12. MICRO ENTITY DEFINED. 

15 Chapter 11 of title 35, United States Code, is amend16 ed by adding at the end the following new section: 

17 ‘‘§ 123. Micro entity defined 

18 ‘‘(a) IN GENERAL.—For purposes of this title, the 

19 term ‘micro entity’ means an applicant who makes a cer20 tification that the applicant— 

21 ‘‘(1) qualifies as a small entity, as defined in 

22 regulations issued by the Director; 

23 ‘‘(2) has not been named on 5 or more pre24 viously filed patent applications, not including appli25 cations filed in another country, provisional applica26 tions under section 111(b), or international applica-
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1 tions filed under the treaty defined in section 351(a) 

2 for which the basic national fee under section 41(a) 

3 was not paid; 

4 ‘‘(3) did not in the prior calendar year have a 

5 gross income, as defined in section 61(a) of the In6 ternal Revenue Code (26 U.S.C. 61(a)), exceeding 3 

7 times the most recently reported median household 

8 income, as reported by the Bureau of Census; and 

9 ‘‘(4) has not assigned, granted, conveyed, and is 

10 not under an obligation by contract or law to assign, 

11 grant, or convey, a license or other ownership inter12 est in the particular application to an entity that 

13 had a gross income, as defined in section 61(a) of 

14 the Internal Revenue Code (26 U.S.C. 61(a)), ex15 ceeding 3 times the most recently reported median 

16 household income, as reported by the Bureau of the 

17 Census, in the calendar year preceding the calendar 

18 year in which the fee is being paid, other than an 

19 entity of higher education where the applicant is not 

20 an employee, a relative of an employee, or have any 

21 affiliation with the entity of higher education. 

22 ‘‘(b) APPLICATIONS RESULTING FROM PRIOR EM23 PLOYMENT.—An applicant is not considered to be named 

24 on a previously filed application for purposes of subsection 

25 (a)(2) if the applicant has assigned, or is under an obliga-
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1 tion by contract or law to assign, all ownership rights in 

2 the application as the result of the applicant’s previous 

3 employment. 

4 ‘‘(c) FOREIGN CURRENCY EXCHANGE RATE.—If an 

5 applicant’s or entity’s gross income in the preceding year 

6 is not in United States dollars, the average currency ex7 change rate, as reported by the Internal Revenue Service, 

8 during the preceding year shall be used to determine 

9 whether the applicant’s or entity’s gross income exceeds 

10 the threshold specified in paragraphs (3) or (4) of sub11 section (a). 

12 ‘‘(d) STATE INSTITUTIONS OF HIGHER EDU13 CATION.— 

14 ‘‘(1) IN GENERAL.—For purposes of this sec15 tion, a micro entity shall include an applicant who 

16 certifies that— 

17 ‘‘(A) the applicant’s employer, from which 

18 the applicant obtains the majority of the appli19 cant’s income, is a State public institution of 

20 higher education, as defined in section 102 of 

21 the Higher Education Act of 1965 (20 U.S.C. 

22 1002); or 

23 ‘‘(B) the applicant has assigned, granted, 

24 conveyed, or is under an obligation by contract 

25 or law to assign, grant, or convey, a license or 
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1 other ownership interest in the particular appli2 cation to such State public institution. 

3 ‘‘(2) DIRECTOR’S AUTHORITY.—The Director 

4 may, in the Director’s discretion, impose income lim5 its, annual filing limits, or other limits on who may 

6 qualify as a micro entity pursuant to this subsection 

7 if the Director determines that such additional limits 

8 are reasonably necessary to avoid an undue impact 

9 on other patent applicants or owners or are other10 wise reasonably necessary and appropriate. At least 

11 3 months before any limits proposed to be imposed 

12 pursuant to this paragraph shall take effect, the Di13 rector shall inform the Committee on the Judiciary 

14 of the House of Representatives and the Committee 

15 on the Judiciary of the Senate of any such proposed 

16 limits.’’. 

17 SEC. 13. FUNDING AGREEMENTS. 

18 (a) IN GENERAL.—Section 202(c)(7)(E)(i) of title 

19 35, United States Code, is amended— 

20 (1) by striking ‘‘75 percent’’ and inserting ‘‘15 

21 percent’’; and 

22 (2) by striking ‘‘25 percent’’ and inserting ‘‘85 

23 percent’’. 

24 (b) EFFECTIVE DATE.—The amendments made by 

25 this section shall take effect on the date of enactment of 
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1 this Act and shall apply to patents issued before, on, or 

2 after that date. 

3 SEC. 14. TAX STRATEGIES DEEMED WITHIN THE PRIOR 

4 ART. 

5 (a) IN GENERAL.—For purposes of evaluating an in6 vention under section 102 or 103 of title 35, United States 

7 Code, any strategy for reducing, avoiding, or deferring tax 

8 liability, whether known or unknown at the time of the 

9 invention or application for patent, shall be deemed insuf10 ficient to differentiate a claimed invention from the prior 

11 art. 

12 (b) DEFINITION.—For purposes of this section, the 

13 term ‘‘tax liability’’ refers to any liability for a tax under 

14 any Federal, State, or local law, or the law of any foreign 

15 jurisdiction, including any statute, rule, regulation, or or16 dinance that levies, imposes, or assesses such tax liability. 

17 (c) RULE OF CONSTRUCTION.—Nothing in this sec18 tion shall be construed to imply that other business meth19 ods are patentable or that other business-method patents 

20 are valid. 

21 (d) EFFECTIVE DATE; APPLICABILITY.—This section 

22 shall take effect on the date of enactment of this Act and 

23 shall apply to any patent application pending and any pat24 ent issued on or after that date. 
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1 (e) EXCLUSION.—This section does not apply to that 

2 part of an invention that is a method, apparatus, com3 puter program product, or system, that is used solely for 

4 preparing a tax or information return or other tax filing, 

5 including one that records, transmits, transfers, or orga6 nizes data related to such filing. 

7 SEC. 15. BEST MODE REQUIREMENT. 

8 (a) IN GENERAL.—Section 282 of title 35, United 

9 State Code, is amended in its second undesignated para10 graph by striking paragraph (3) and inserting the fol11 lowing: 

12 ‘‘(3) Invalidity of the patent or any claim in 

13 suit for failure to comply with— 

14 ‘‘(A) any requirement of section 112, ex15 cept that the failure to disclose the best mode 

16 shall not be a basis on which any claim of a 

17 patent may be canceled or held invalid or other18 wise unenforceable; or 

19 ‘‘(B) any requirement of section 251.’’. 

20 (b) CONFORMING AMENDMENT.—Sections 119(e)(1) 

21 and 120 of title 35, United States Code, are each amended 

22 by striking ‘‘the first paragraph of section 112 of this 

23 title’’ and inserting ‘‘section 112(a) (other than the re24 quirement to disclose the best mode)’’. 
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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall take effect upon the date of the enact3 ment of this Act and shall apply to proceedings com4 menced on or after that date. 

5 SEC. 16. TECHNICAL AMENDMENTS. 

6 (a) JOINT INVENTIONS.—Section 116 of title 35, 

7 United States Code, is amended— 

8 (1) in the first paragraph, by striking 

9 ‘‘When’’ and inserting ‘‘(a) JOINT INVEN10 TIONS.—When’’; 

11 (2) in the second paragraph, by striking 

12 ‘‘If a joint inventor’’ and inserting ‘‘(b) OMIT13 TED INVENTOR.—If a joint inventor’’; and 

14 (3) in the third paragraph— 

15 (A) by striking ‘‘Whenever’’ and in16 serting ‘‘(c) CORRECTION OF ERRORS IN

17 APPLICATION.—Whenever’’; and 

18 (B) by striking ‘‘and such error arose 

19 without any deceptive intent on his part,’’. 

20 (b) FILING OF APPLICATION IN FOREIGN COUN21 TRY.—Section 184 of title 35, United States Code, is 

22 amended— 

23 (1) in the first paragraph— 
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1 (A) by striking ‘‘Except when’’ and insert2 ing ‘‘(a) FILING IN FOREIGN COUNTRY.—Ex3 cept when’’; and 

4 (B) by striking ‘‘and without deceptive in5 tent’’; 

6 (2) in the second paragraph, by striking ‘‘The 

7 term’’ and inserting ‘‘(b) APPLICATION.—The 

8 term’’; and 

9 (3) in the third paragraph, by striking ‘‘The 

10 scope’’ and inserting ‘‘(c) SUBSEQUENT MODIFICA11 TIONS, AMENDMENTS, AND SUPPLEMENTS.—The 

12 scope’’. 

13 (c) FILING WITHOUT A LICENSE.—Section 185 of 

14 title 35, United States Code, is amended by striking ‘‘and 

15 without deceptive intent’’. 

16 (d) REISSUE OF DEFECTIVE PATENTS.—Section 251 

17 of title 35, United States Code, is amended— 

18 (1) in the first paragraph— 

19 (A) by striking ‘‘Whenever’’ and inserting 

20 ‘‘(a) IN GENERAL.—Whenever’’; and 

21 (B) by striking ‘‘without any deceptive in22 tention’’; 

23 (2) in the second paragraph, by striking ‘‘The 

24 Director’’ and inserting ‘‘(b) MULTIPLE REISSUED

25 PATENTS.—The Director’’; 
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1 (3) in the third paragraph, by striking ‘‘The 

2 provisions’’ and inserting ‘‘(c) APPLICABILITY OF

3 THIS TITLE.—The provisions’’; and 

4 (4) in the last paragraph, by striking ‘‘No re5 issued patent’’ and inserting ‘‘(d) REISSUE PATENT

6 ENLARGING SCOPE OF CLAIMS.—No reissued pat7 ent’’. 

8 (e) EFFECT OF REISSUE.—Section 253 of title 35, 

9 United States Code, is amended— 

10 (1) in the first paragraph, by striking ‘‘When11 ever, without any deceptive intention’’ and inserting 

12 ‘‘(a) IN GENERAL.—Whenever’’; and 

13 (2) in the second paragraph, by striking ‘‘in 

14 like manner’’ and inserting ‘‘(b) ADDITIONAL DIS15 CLAIMER OR DEDICATION.—In the manner set forth 

16 in subsection (a),’’. 

17 (f) CORRECTION OF NAMED INVENTOR.—Section 

18 256 of title 35, United States Code, is amended— 

19 (1) in the first paragraph— 

20 (A) by striking ‘‘Whenever’’ and inserting 

21 ‘‘(a) CORRECTION.—Whenever’’; and 

22 (B) by striking ‘‘and such error arose with23 out any deceptive intention on his part’’; and 
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1 (2) in the second paragraph, by striking ‘‘The 

2 error’’ and inserting ‘‘(b) PATENT VALID IF ERROR

3 CORRECTED.—The error’’. 

4 (g) PRESUMPTION OF VALIDITY.—Section 282 of 

5 title 35, United States Code, is amended— 

6 (1) in the first undesignated paragraph— 

7 (A) by striking ‘‘A patent’’ and inserting 

8 ‘‘(a) IN GENERAL.—A patent’’; and 

9 (B) by striking the third sentence; 

10 (2) in the second undesignated paragraph, by 

11 striking ‘‘The following’’ and inserting ‘‘(b) DE12 FENSES.—The following’’; and 

13 (3) in the third undesignated paragraph, by 

14 striking ‘‘In actions’’ and inserting ‘‘(c) NOTICE OF

15 ACTIONS; ACTIONS DURING EXTENSION OF PATENT

16 TERM.—In actions’’. 

17 (h) ACTION FOR INFRINGEMENT.—Section 288 of 

18 title 35, United States Code, is amended by striking ‘‘, 

19 without deceptive intention,’’. 

20 (i) REVISER’S NOTES.— 

21 (1) Section 3(e)(2) of title 35, United States 

22 Code, is amended by striking ‘‘this Act,’’ and insert23 ing ‘‘that Act,’’. 

24 (2) Section 202 of title 35, United States Code, 

25 is amended— 
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1 (A) in subsection (b)(3), by striking ‘‘the 

2 section 203(b)’’ and inserting ‘‘section 203(b)’’; 

3 and 

4 (B) in subsection (c)(7)— 

5 (i) in subparagraph (D), by striking 

6 ‘‘except where it proves’’ and all that fol7 lows through ‘‘; and’’ and inserting: ‘‘ex8 cept where it is determined to be infeasible 

9 following a reasonable inquiry, a preference 

10 in the licensing of subject inventions shall 

11 be given to small business firms; and’’; and 

12 (ii) in subparagraph (E)(i), by strik13 ing ‘‘as described above in this clause 

14 (D);’’ and inserting ‘‘described above in 

15 this clause;’’. 

16 (3) Section 209(d)(1) of title 35, United States 

17 Code, is amended by striking ‘‘nontransferrable’’ 

18 and inserting ‘‘nontransferable’’. 

19 (4) Section 287(c)(2)(G) of title 35, United 

20 States Code, is amended by striking ‘‘any state’’ and 

21 inserting ‘‘any State’’. 

22 (5) Section 371(b) of title 35, United States 

23 Code, is amended by striking ‘‘of the treaty’’ and in24 serting ‘‘of the treaty.’’. 

25 (j) UNNECESSARY REFERENCES.— 
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1 (1) IN GENERAL.—Title 35, United States 

2 Code, is amended by striking ‘‘of this title’’ each 

3 place that term appears. 

4 (2) EXCEPTION.—The amendment made by 

5 paragraph (1) shall not apply to the use of such 

6 term in the following sections of title 35, United 

7 States Code: 

8 (A) Section 1(c). 

9 (B) Section 101. 

10 (C) Subsections (a) and (b) of section 105. 

11 (D) The first instance of the use of such 

12 term in section 111(b)(8). 

13 (E) Section 157(a). 

14 (F) Section 161. 

15 (G) Section 164. 

16 (H) Section 171. 

17 (I) Section 251(c), as so designated by this 

18 section. 

19 (J) Section 261. 

20 (K) Subsections (g) and (h) of section 271. 

21 (L) Section 287(b)(1). 

22 (M) Section 289. 

23 (N) The first instance of the use of such 

24 term in section 375(a). 
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1 (k) EFFECTIVE DATE.—The amendments made by 

2 this section shall take effect 1 year after the date of the 

3 enactment of this Act and shall apply to proceedings com4 menced on or after that effective date. 

5 SEC. 17. CLARIFICATION OF JURISDICTION. 

6 (a) SHORT TITLE.—This section may be cited as the 

7 ‘‘Intellectual Property Jurisdiction Clarification Act of 

8 2011’’. 

9 (b) STATE COURT JURISDICTION.—Section 1338(a) 

10 of title 28, United States Code, is amended by striking 

11 the second sentence and inserting the following: ‘‘No State 

12 court shall have jurisdiction over any claim for relief aris13 ing under any Act of Congress relating to patents, plant 

14 variety protection, or copyrights.’’. 

15 (c) COURT OF APPEALS FOR THE FEDERAL CIR16 CUIT.—Section 1295(a)(1) of title 28, United States Code, 

17 is amended to read as follows: 

18 ‘‘(1) of an appeal from a final decision of a dis19 trict court of the United States, the District Court 

20 of Guam, the District Court of the Virgin Islands, 

21 or the District Court of the Northern Mariana Is22 lands, in any civil action arising under, or in any 

23 civil action in which a party has asserted a compul24 sory counterclaim arising under, any Act of Con-
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1 gress relating to patents or plant variety protec2 tion;’’. 

3 (d) REMOVAL.— 

4 (1) IN GENERAL.—Chapter 89 of title 28, 

5 United States Code, is amended by adding at the 

6 end the following new section: 

7 ‘‘§ 1454. Patent, plant variety protection, and copy8 right cases 

9 ‘‘(a) IN GENERAL.—A civil action in which any party 

10 asserts a claim for relief arising under any Act of Con11 gress relating to patents, plant variety protection, or copy12 rights may be removed to the district court of the United 

13 States for the district and division embracing the place 

14 where such action is pending. 

15 ‘‘(b) SPECIAL RULES.—The removal of an action 

16 under this section shall be made in accordance with sec17 tion 1446 of this chapter, except that if the removal is 

18 based solely on this section— 

19 ‘‘(1) the action may be removed by any party; 

20 and 

21 ‘‘(2) the time limitations contained in section 

22 1446(b) may be extended at any time for cause 

23 shown. 

24 ‘‘(c) DERIVATIVE JURISDICTION NOT REQUIRED.— 

25 The court to which a civil action is removed under this 
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1 section is not precluded from hearing and determining any 

2 claim in such civil action because the State court from 

3 which such civil action is removed did not have jurisdiction 

4 over that claim. 

5 ‘‘(d) REMAND.—If a civil action is removed solely 

6 under this section, the district court— 

7 ‘‘(1) shall remand all claims that are neither a 

8 basis for removal under subsection (a) nor within 

9 the original or supplemental jurisdiction of the dis10 trict court under any Act of Congress; and 

11 ‘‘(2) may, under the circumstances specified in 

12 section 1367(c), remand any claims within the sup13 plemental jurisdiction of the district court under sec14 tion 1367.’’. 

15 (2) CONFORMING AMENDMENT.—The table of 

16 sections for chapter 89 of title 28, United States 

17 Code, is amended by adding at the end the following 

18 new item: 

‘‘1454. Patent, plant variety protection, and copyright cases.’’. 

19 (e) TRANSFER BY COURT OF APPEALS FOR THE

20 FEDERAL CIRCUIT.— 

21 (1) IN GENERAL.—Chapter 99 of title 28, 

22 United States Code, is amended by adding at the 

23 end the following new section: 
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1 ‘‘§ 1632. Transfer by the Court of Appeals for the Fed2 eral Circuit 

3 ‘‘When a case is appealed to the Court of Appeals 

4 for the Federal Circuit under section 1295(a)(1), and no 

5 claim for relief arising under any Act of Congress relating 

6 to patents or plant variety protection is the subject of the 

7 appeal by any party, the Court of Appeals for the Federal 

8 Circuit shall transfer the appeal to the court of appeals 

9 for the regional circuit embracing the district from which 

10 the appeal has been taken.’’. 

11 (2) CONFORMING AMENDMENT.—The table of 

12 sections for chapter 99 of title 28, United States 

13 Code, is amended by adding at the end the following 

14 new item: 

‘‘1632. Transfer by the Court of Appeals for the Federal Circuit.’’. 

15 (f) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to any civil action commenced on 

17 or after the date of the enactment of this Act. 

18 SEC. 18. TRANSITIONAL PROGRAM FOR COVERED BUSI19 NESS-METHOD PATENTS. 

20 (a) REFERENCES.—Except as otherwise expressly 

21 provided, wherever in this section language is expressed 

22 in terms of a section or chapter, the reference shall be 

23 considered to be made to that section or chapter in title 

24 35, United States Code. 

25 (b) TRANSITIONAL PROGRAM.— 
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1 (1) ESTABLISHMENT.—Not later than 1 year 

2 after the date of enactment of this Act, the Director 

3 shall issue regulations establishing and implementing 

4 a transitional post-grant review proceeding for re5 view of the validity of covered business-method pat6 ents. The transitional proceeding implemented pur7 suant to this subsection shall be regarded as, and 

8 shall employ the standards and procedures of, a 

9 post-grant review under chapter 32, subject to the 

10 following exceptions and qualifications: 

11 (A) Section 321(c) and subsections (e)(2), 

12 (f), and (g) of section 325 shall not apply to a 

13 transitional proceeding. 

14 (B) A person may not file a petition for a 

15 transitional proceeding with respect to a cov16 ered business-method patent unless the person 

17 or his real party in interest has been sued for 

18 infringement of the patent or has been charged 

19 with infringement under that patent. 

20 (C) A petitioner in a transitional pro21 ceeding who challenges the validity of 1 or more 

22 claims in a covered business-method patent on 

23 a ground raised under section 102 or 103 as in 

24 effect on the day prior to the date of enactment 
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1 of this Act may support such ground only on 

2 the basis of— 

3 (i) prior art that is described by sec4 tion 102(a) (as in effect on the day prior 

5 to the date of enactment of this Act); or 

6 (ii) prior art that— 

7 (I) discloses the invention more 

8 than 1 year prior to the date of the 

9 application for patent in the United 

10 States; and 

11 (II) would be described by section 

12 102(a) (as in effect on the day prior 

13 to the date of enactment of this Act) 

14 if the disclosure had been made by an15 other before the invention thereof by 

16 the applicant for patent. 

17 (D) The petitioner in a transitional pro18 ceeding, or his real party in interest, may not 

19 assert either in a civil action arising in whole or 

20 in part under section 1338 of title 28, United 

21 States Code, or in a proceeding before the 

22 International Trade Commission that a claim in 

23 a patent is invalid on any ground that the peti24 tioner raised during a transitional proceeding 

25 that resulted in a final written decision. 
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1 (E) The Director may institute a transi2 tional proceeding only for a patent that is a 

3 covered business-method patent. 

4 (2) EFFECTIVE DATE.—The regulations issued 

5 pursuant to paragraph (1) shall take effect on the 

6 date that is 1 year after the date of enactment of 

7 this Act and shall apply to all covered business8 method patents issued before, on, or after such date 

9 of enactment, except that the regulations shall not 

10 apply to a patent described in the first sentence of 

11 section 5(f)(2) of this Act during the period that a 

12 petition for post-grant review of that patent would 

13 satisfy the requirements of section 321(c). 

14 (3) SUNSET.— 

15 (A) IN GENERAL.—This subsection, and 

16 the regulations issued pursuant to this sub17 section, are repealed effective on the date that 

18 is 4 years after the date that the regulations 

19 issued pursuant to paragraph (1) take effect. 

20 (B) APPLICABILITY.—Notwithstanding 

21 subparagraph (A), this subsection and the regu22 lations implemented pursuant to this subsection 

23 shall continue to apply to any petition for a 

24 transitional proceeding that is filed prior to the 
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1 date that this subsection is repealed pursuant 

2 to subparagraph (A). 

3 (c) REQUEST FOR STAY.— 

4 (1) IN GENERAL.—If a party seeks a stay of a 

5 civil action alleging infringement of a patent under 

6 section 281 in relation to a transitional proceeding 

7 for that patent, the court shall decide whether to 

8 enter a stay based on— 

9 (A) whether a stay, or the denial thereof, 

10 will simplify the issues in question and stream11 line the trial; 

12 (B) whether discovery is complete and 

13 whether a trial date has been set; 

14 (C) whether a stay, or the denial thereof, 

15 would unduly prejudice the nonmoving party or 

16 present a clear tactical advantage for the mov17 ing party; and 

18 (D) whether a stay, or the denial thereof, 

19 will reduce the burden of litigation on the par20 ties and on the court. 

21 (2) REVIEW.—A party may take an immediate 

22 interlocutory appeal from a district court’s decision 

23 under paragraph (1). The United States Court of 

24 Appeals for the Federal Circuit shall review the dis25 trict court’s decision to ensure consistent application 
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1 of established precedent, and such review may be de 

2 novo. 

3 (d) DEFINITION.—For purposes of this section, the 

4 term ‘‘covered business method patent’’ means a patent 

5 that claims a method or corresponding apparatus for per6 forming data processing operations utilized in the practice, 

7 administration, or management of a financial product or 

8 service, except that the term shall not include patents for 

9 technological inventions. Solely for the purpose of imple10 menting the transitional proceeding authorized by this 

11 subsection, the Director shall prescribe regulations for de12 termining whether a patent is for a technological inven13 tion. 

14 (e) RULE OF CONSTRUCTION.—Nothing in this sec15 tion shall be construed as amending or interpreting cat16 egories of patent-eligible subject matter set forth under 

17 section 101. 

18 SEC. 19. TRAVEL EXPENSES AND PAYMENT OF ADMINIS19 TRATIVE JUDGES. 

20 (a) AUTHORITY TO COVER CERTAIN TRAVEL RE21 LATED EXPENSES.—Section 2(b)(11) of title 35, United 

22 States Code, is amended by inserting ‘‘, and the Office 

23 is authorized to expend funds to cover the subsistence ex24 penses and travel-related expenses, including per diem, 
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1 lodging costs, and transportation costs, of non-federal em2 ployees attending such programs’’ after ‘‘world’’. 

3 (b) PAYMENT OF ADMINISTRATIVE JUDGES.—Sec4 tion 3(b) of title 35, United States Code, is amended by 

5 adding at the end the following: 

6 ‘‘(6) ADMINISTRATIVE PATENT JUDGES AND

7 ADMINISTRATIVE TRADEMARK JUDGES.—The Direc8 tor has the authority to fix the rate of basic pay for 

9 the administrative patent judges appointed pursuant 

10 to section 6 of this title and the administrative 

11 trademark judges appointed pursuant to section 17 

12 of the Trademark Act of 1946 (15 U.S.C. 1067) at 

13 not greater than the rate of basic pay payable for 

14 Level III of the Executive Schedule. The payment of 

15 a rate of basic pay under this paragraph shall not 

16 be subject to the pay limitation of section 5306(e) 

17 or 5373 of title 5.’’. 

18 SEC. 20. PATENT AND TRADEMARK OFFICE FUNDING. 

19 (a) DEFINITIONS.—In this section, the following defi20 nitions shall apply: 

21 (1) DIRECTOR.—The term ‘‘Director’’ means 

22 the Director of the United States Patent and Trade23 mark Office. 
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1 (2) FUND.—The term ‘‘Fund’’ means the pub2 lic enterprise revolving fund established under sub3 section (c). 

4 (3) OFFICE.—The term ‘‘Office’’ means the 

5 United States Patent and Trademark Office. 

6 (4) TRADEMARK ACT OF 1946.—The term 

7 ‘‘Trademark Act of 1946’’ means an Act entitled 

8 ‘‘Act to provide for the registration and protection 

9 of trademarks used in commerce, to carry out the 

10 provisions of certain international conventions, and 

11 for other purposes’’, approved July 5, 1946 (15 

12 U.S.C. 1051 et seq.) (commonly referred to as the 

13 ‘‘Trademark Act of 1946’’ or the ‘‘Lanham Act’’). 

14 (5) UNDER SECRETARY.—The term ‘‘Under 

15 Secretary’’ means the Under Secretary of Commerce 

16 for Intellectual Property. 

17 (b) FUNDING.— 

18 (1) IN GENERAL.—Section 42 of title 35, 

19 United States Code, is amended— 

20 (A) in subsection (b), by striking ‘‘Patent 

21 and Trademark Office Appropriation Account’’ 

22 and inserting ‘‘United States Patent and 

23 Trademark Office Public Enterprise Fund’’; 

24 and 
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1 (B) in subsection (c), in the first sen2 tence— 

3 (i) by striking ‘‘To the extent’’ and all 

4 that follows through ‘‘fees’’ and inserting 

5 ‘‘Fees’’; and 

6 (ii) by striking ‘‘shall be collected by 

7 and shall be available to the Director’’ and 

8 inserting ‘‘shall be collected by the Direc9 tor and shall be available until expended’’. 

10 (2) EFFECTIVE DATE.—The amendments made 

11 by paragraph (1) shall take effect on the later of— 

12 (A) October 1, 2011; or 

13 (B) the first day of the first fiscal year 

14 that begins after the date of the enactment of 

15 this Act. 

16 (c) USPTO REVOLVING FUND.— 

17 (1) ESTABLISHMENT.—There is established in 

18 the Treasury of the United States a revolving fund 

19 to be known as the ‘‘United States Patent and 

20 Trademark Office Public Enterprise Fund’’. Any 

21 amounts in the Fund shall be available for use by 

22 the Director without fiscal year limitation. 

23 (2) DERIVATION OF RESOURCES.—There shall 

24 be deposited into the Fund on or after the effective 

25 date of subsection (b)(1)— 
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1 (A) any fees collected under sections 41, 

2 42, and 376 of title 35, United States Code, 

3 provided that notwithstanding any other provi4 sion of law, if such fees are collected by, and 

5 payable to, the Director, the Director shall 

6 transfer such amounts to the Fund, provided, 

7 however, that no funds collected pursuant to 

8 section 9(h) of this Act or section 1(a)(2) of 

9 Public Law 111–45 shall be deposited in the 

10 Fund; and 

11 (B) any fees collected under section 31 of 

12 the Trademark Act of 1946 (15 U.S.C. 1113). 

13 (3) EXPENSES.—Amounts deposited into the 

14 Fund under paragraph (2) shall be available, with15 out fiscal year limitation, to cover— 

16 (A) all expenses to the extent consistent 

17 with the limitation on the use of fees set forth 

18 in section 42(c) of title 35, United States Code, 

19 including all administrative and operating ex20 penses, determined in the discretion of the 

21 Under Secretary to be ordinary and reasonable, 

22 incurred by the Under Secretary and the Direc23 tor for the continued operation of all services, 

24 programs, activities, and duties of the Office re25 lating to patents and trademarks, as such serv-
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1 ices, programs, activities, and duties are de2 scribed under— 

3 (i) title 35, United States Code; and 

4 (ii) the Trademark Act of 1946; and 

5 (B) all expenses incurred pursuant to any 

6 obligation, representation, or other commitment 

7 of the Office. 

8 (d) ANNUAL REPORT.—Not later than 60 days after 

9 the end of each fiscal year, the Under Secretary and the 

10 Director shall submit a report to Congress which shall— 

11 (1) summarize the operations of the Office for 

12 the preceding fiscal year, including financial details 

13 and staff levels broken down by each major activity 

14 of the Office; 

15 (2) detail the operating plan of the Office, in16 cluding specific expense and staff needs for the up17 coming fiscal year; 

18 (3) describe the long term modernization plans 

19 of the Office; 

20 (4) set forth details of any progress towards 

21 such modernization plans made in the previous fiscal 

22 year; and 

23 (5) include the results of the most recent audit 

24 carried out under subsection (f). 

25 (e) ANNUAL SPENDING PLAN.— 
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1 (1) IN GENERAL.—Not later than 30 days after 

2 the beginning of each fiscal year, the Director shall 

3 notify the Committees on Appropriations of both 

4 Houses of Congress of the plan for the obligation 

5 and expenditure of the total amount of the funds for 

6 that fiscal year in accordance with section 605 of the 

7 Science, State, Justice, Commerce, and Related 

8 Agencies Appropriations Act, 2006 (Public Law 

9 109–108; 119 Stat. 2334). 

10 (2) CONTENTS.—Each plan under paragraph 

11 (1) shall— 

12 (A) summarize the operations of the Office 

13 for the current fiscal year, including financial 

14 details and staff levels with respect to major ac15 tivities; and 

16 (B) detail the operating plan of the Office, 

17 including specific expense and staff needs, for 

18 the current fiscal year. 

19 (f) AUDIT.—The Under Secretary shall, on an annual 

20 basis, provide for an independent audit of the financial 

21 statements of the Office. Such audit shall be conducted 

22 in accordance with generally acceptable accounting proce23 dures. 

24 (g) BUDGET.—The Fund shall prepare and submit 

25 each year to the President a business-type budget in a 
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1 manner, and before a date, as the President prescribes by 

2 regulation for the budget program. 

3 SEC. 21. SATELLITE OFFICES. 

4 (a) ESTABLISHMENT.—Subject to available re5 sources, the Director may establish 3 or more satellite of6 fices in the United States to carry out the responsibilities 

7 of the Patent and Trademark Office. 

8 (b) PURPOSE.—The purpose of the satellite offices 

9 established under subsection (a) are to— 

10 (1) increase outreach activities to better connect 

11 patent filers and innovators with the Patent and 

12 Trademark Office; 

13 (2) enhance patent examiner retention; 

14 (3) improve recruitment of patent examiners; 

15 and 

16 (4) decrease the number of patent applications 

17 waiting for examination and improve the quality of 

18 patent examination. 

19 (c) REQUIRED CONSIDERATIONS.—In selecting the 

20 locale of each satellite office to be established under sub21 section (a), the Director— 

22 (1) shall ensure geographic diversity among the 

23 offices, including by ensuring that such offices are 

24 established in different States and regions through25 out the Nation; 
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1 (2) may rely upon any previous evaluations by 

2 the Patent and Trademark Office of potential locales 

3 for satellite offices, including any evaluations pre4 pared as part of the Patent and Trademark Office’s 

5 Nationwide Workforce Program that resulted in the 

6 2010 selection of Detroit, Michigan as the first ever 

7 satellite office of the Patent and Trademark Office; 

8 and 

9 (3) nothing in the preceding paragraph shall 

10 constrain the Patent and Trademark Office to only 

11 consider its prior work from 2010. The process for 

12 site selection shall be open. 

13 (d) PHASE-IN.—The Director shall satisfy the re14 quirements of subsection (a) over the 3-year period begin15 ning on the date of enactment of this Act. 

16 (e) REPORT TO CONGRESS.—Not later than the end 

17 of the first fiscal year that occurs after the date of the 

18 enactment of this Act, and each fiscal year thereafter, the 

19 Director shall submit a report to Congress on— 

20 (1) the rationale of the Director in selecting the 

21 locale of any satellite office required under sub22 section (a); 

23 (2) the progress of the Director in establishing 

24 all such satellite offices; and 
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1 (3) whether the operation of existing satellite 

2 offices is achieving the purposes required under sub3 section (b). 

4 (f) DEFINITIONS.—In this section, the following defi5 nitions shall apply: 

6 (1) DIRECTOR.—The term ‘‘Director’’ means 

7 the Director of the United States Patent and Trade8 mark Office. 

9 (2) PATENT AND TRADEMARK OFFICE.—The 

10 term ‘‘Patent and Trademark Office’’ means the 

11 United States Patent and Trademark Office. 

12 SEC. 22. PATENT OMBUDSMAN PROGRAM FOR SMALL BUSI13 NESS CONCERNS. 

14 Subject to available resources, the Director may es15 tablish in the United States Patent and Trademark Office 

16 a Patent Ombudsman Program. The duties of the Pro17 gram’s staff shall include providing support and services 

18 relating to patent filings to small business concerns. 

19 SEC. 23. PRIORITY EXAMINATION FOR TECHNOLOGIES IM20 PORTANT TO AMERICAN COMPETITIVENESS. 

21 Section 2(b)(2) of title 35, United States Code, is 

22 amended— 

23 (1) in subparagraph (E), by striking ‘‘; and’’ 

24 and inserting a semicolon; 
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1 (2) in subparagraph (F), by striking the semi2 colon and inserting ‘‘; and’’; and 

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

4 ‘‘(G) may, subject to any conditions pre5 scribed by the Director and at the request of 

6 the patent applicant, provide for prioritization 

7 of examination of applications for products, 

8 processes, or technologies that are important to 

9 the national economy or national competitive10 ness without recovering the aggregate extra cost 

11 of providing such prioritization, notwith12 standing section 41 or any other provision of 

13 law;’’. 

14 SEC. 24. DESIGNATION OF DETROIT SATELLITE OFFICE. 

15 (a) DESIGNATION.—The satellite office of the United 

16 States Patent and Trademark Office to be located in De17 troit, Michigan shall be known and designated as the ‘‘Eli18 jah J. McCoy United States Patent and Trademark Of19 fice’’. 

20 (b) REFERENCES.—Any reference in a law, map, reg21 ulation, document, paper, or other record of the United 

22 States to the satellite office of the United States Patent 

23 and Trademark Office to be located in Detroit, Michigan 

24 referred to in subsection (a) shall be deemed to be a ref-
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1 erence to the ‘‘Elijah J. McCoy United States Patent and 

2 Trademark Office’’. 

3 SEC. 25. EFFECTIVE DATE. 

4 Except as otherwise provided in this Act, the provi5 sions of this Act shall take effect 1 year after the date 

6 of the enactment of this Act and shall apply to any patent 

7 issued on or after that effective date. 

8 SEC. 26. BUDGETARY EFFECTS. 

9 The budgetary effects of this Act, for the purpose of 

10 complying with the Statutory Pay-As-You-Go-Act of 2010, 

11 shall be determined by reference to the latest statement 

12 titled ‘‘Budgetary Effects of PAYGO Legislation’’ for this 

13 Act, submitted for printing in the Congressional Record 

14 by the Chairman of the Senate Budget Committee, pro15 vided that such statement has been submitted prior to the 

16 vote on passage. 

Passed the Senate March 8, 2011. 

Attest: 

Secretary. 

112TH CONGRESS 

1ST SESSION S. 23 

AN ACT 

To amend title 35, United States Code, to provide 

for patent reform.