IIB

106TH CONGRESS

1ST SESSION H. R. 1907

IN THE SENATE OF THE UNITED STATES

AUGUST 4, 1999

Received

OCTOBER 8, 1999

Read twice and referred to the Committee on the Judiciary

AN ACT

To amend title 35, United States Code, to provide enhanced

protection for inventors and innovators, protect patent

terms, reduce patent litigation, and for other purposes.

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.

2 This Act may be cited as the ‘‘American Inventors

3 Protection Act of 1999’’.

4 SEC. 2. TABLE OF CONTENTS.

5 The table of contents is as follows:

Sec. 1. Short title.

Sec. 2. Table of contents.

TITLE I—INVENTORS’ RIGHTS

Sec. 101. Short title.

Sec. 102. Invention promotion services.

Sec. 103. Effective date.

TITLE II—FIRST INVENTOR DEFENSE

Sec. 201. Short title.

Sec. 202. Defense to patent infringement based on earlier inventor.

Sec. 203. Effective date and applicability.

TITLE III—PATENT TERM GUARANTEE

Sec. 301. Short title.

Sec. 302. Patent term guarantee authority.

Sec. 303. Continued examination of patent applications.

Sec. 304. Technical clarification.

Sec. 305. Effective date.

TITLE IV—UNITED STATES PUBLICATION OF PATENT

APPLICATIONS PUBLISHED ABROAD

Sec. 401. Short title.

Sec. 402. Publication.

Sec. 403. Time for claiming benefit of earlier filing date.

Sec. 404. Provisional rights.

Sec. 405. Prior art effect of published applications.

Sec. 406. Cost recovery for publication.

Sec. 407. Conforming amendments.

Sec. 408. Effective date.

TITLE V—OPTIONAL INTER PARTES REEXAMINATION

PROCEDURE

Sec. 501. Short title.

Sec. 502. Ex parte reexamination of patents.

Sec. 503. Definitions.

Sec. 504. Optional inter partes reexamination procedures.

Sec. 505. Conforming amendments.

Sec. 506. Report to Congress.

Sec. 507. Estoppel effect of reexamination.

Sec. 508. Effective date.
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TITLE VI—PATENT AND TRADEMARK OFFICE

Sec. 601. Short title.

Subtitle A—United States Patent and Trademark Office

Sec. 611. Establishment of Patent and Trademark Office.

Sec. 612. Powers and duties.

Sec. 613. Organization and management.

Sec. 614. Public Advisory Committees.

Sec. 615. Patent and Trademark Office funding.

Sec. 616. Conforming amendments.

Sec. 617. Trademark Trial and Appeal Board.

Sec. 618. Board of Patent Appeals and Interferences.

Sec. 619. Annual report of Director.

Sec. 620. Suspension or exclusion from practice.

Sec. 621. Pay of Director and Deputy Director.

Sec. 622. Study on Alternative Fee Structures.

Subtitle B—Effective Date; Technical Amendments

Sec. 631. Effective date.

Sec. 632. Technical and conforming amendments.

Subtitle C—Miscellaneous Provisions

Sec. 641. References.

Sec. 642. Exercise of authorities.

Sec. 643. Savings provisions.

Sec. 644. Transfer of assets.

Sec. 645. Delegation and assignment.

Sec. 646. Authority of Director of the Office of Management and Budget with

respect to functions transferred.

Sec. 647. Certain vesting of functions considered transfers.

Sec. 648. Availability of existing funds.

Sec. 649. Definitions.

TITLE VII—MISCELLANEOUS PATENT PROVISIONS

Sec. 701. Provisional applications.

Sec. 702. International applications.

Sec. 703. Certain limitations on damages for patent infringement not applicable.

Sec. 704. Electronic filing and publications.

Sec. 705. Study and report on biological deposits in support of biotechnology

patents.

Sec. 706. Prior invention.

Sec. 707. Prior art exclusion for certain commonly assigned patents.

1 TITLE I—INVENTORS’ RIGHTS

2 SEC. 101. SHORT TITLE.

3 This title may be cited as the ‘‘Inventors’ Rights

4 Act’’.
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1 SEC. 102. INVENTION PROMOTION SERVICES.

2 Part I of title 35, United States Code, is amended

3 by adding after chapter 4 the following chapter:

4 ‘‘CHAPTER 5—INVENTION PROMOTION

5 SERVICES

‘‘Sec.

‘‘51. Definitions.

‘‘52. Contracting requirements.

‘‘53. Standard provisions for cover notice.

‘‘54. Reports to customer required.

‘‘55. Mandatory contract terms.

‘‘56. Remedies.

‘‘57. Records of complaints.

‘‘58. Fraudulent representation by an invention promoter.

‘‘59. Rule of construction.

6 ‘‘§ 51. Definitions

7 ‘‘For purposes of this chapter—

8 ‘‘(1) the term ‘contract for invention promotion

9 services’ means a contract by which an invention

10 promoter undertakes invention promotion services

11 for a customer;

12 ‘‘(2) the term ‘customer’ means any person,

13 firm, partnership, corporation, or other entity who

14 enters into a financial relationship or a contract with

15 an invention promoter for invention promotion serv16 ices;

17 ‘‘(3) the term ‘invention promoter’ means any

18 person, firm, partnership, corporation, or other enti19 ty who offers to perform or performs for, or on be-
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1 half of, a customer any act described under para2 graph (4), but does not include—

3 ‘‘(A) any department or agency of the Fed4 eral Government or of a State or local govern5 ment;

6 ‘‘(B) any nonprofit, charitable, scientific,

7 or educational organization, qualified under ap8 plicable State law or described under section

9 170(b)(1)(A) of the Internal Revenue Code of

10 1986;

11 ‘‘(C) any person duly registered with, and

12 in good standing before, the United States Pat13 ent and Trademark Office acting within the

14 scope of that person’s registration to practice

15 before the Patent and Trademark Office, except

16 when that person performs any act described in

17 subparagraph (B) or (C) of paragraph (4); or

18 ‘‘(D) any person or entity involved in the

19 evaluation to determine commercial potential of,

20 or offering to license or sell, a utility patent or

21 a previously filed nonprovisional utility patent

22 application; and

23 ‘‘(4) the term ‘invention promotion services’

24 means, with respect to an invention by a customer,

25 any act involved in—
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1 ‘‘(A) evaluating the invention to determine

2 its protectability as some form of intellectual

3 property, other than evaluation by a person li4 censed by a State to practice law who is acting

5 solely within the scope of that person’s profes6 sional license;

7 ‘‘(B) evaluating the invention to determine

8 its commercial potential by any person for pur9 poses other than providing venture capital; or

10 ‘‘(C) marketing, brokering, offering to li11 cense or sell, or promoting the invention or a

12 product or service in which the invention is in13 corporated or used, except that the display only

14 of an invention at a trade show or exhibit shall

15 not be considered to be invention promotion

16 services.

17 ‘‘§ 52. Contracting requirements

18 ‘‘(a) IN GENERAL.—(1) Every contract for invention

19 promotion services shall be in writing and shall be subject

20 to the provisions of this chapter. A copy of the signed writ21 ten contract shall be given to the customer at the time

22 the customer enters into the contract.

23 ‘‘(2) If a contract is entered into for the benefit of

24 a third party, the identity and address of such party shall
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1 be disclosed by such party’s agent and such party shall

2 be considered a customer for purposes of this chapter.

3 ‘‘(b) REQUIREMENTS OF INVENTION PROMOTER.—

4 The invention promoter shall—

5 ‘‘(1) state in a written document, at the time

6 a customer enters into a contract for invention pro7 motion services, whether the usual business practice

8 of the invention promoter is to—

9 ‘‘(A) seek more than 1 contract in connec10 tion with an invention; or

11 ‘‘(B) seek to perform services in connection

12 with an invention in 1 or more phases, with the

13 performance of each phase covered in 1 or more

14 subsequent contracts; and

15 ‘‘(2) supply to the customer a copy of the writ16 ten document together with a written summary of

17 the usual business practices of the invention pro18 moter, including—

19 ‘‘(A) the usual business terms of contracts;

20 and

21 ‘‘(B) the approximate amount of the usual

22 fees or other consideration that may be required

23 from the customer for each of the services pro24 vided by the invention promoter.
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1 ‘‘(c) RIGHT OF CUSTOMER TO CANCEL CONTRACT.—

2 (1) Notwithstanding any contractual provision to the con3 trary, a customer shall have the right to terminate a con4 tract for invention promotion services by sending a written

5 letter to the invention promoter stating the customer’s in6 tent to cancel the contract. The letter of termination must

7 be deposited with the United States Postal Service on or

8 before 5 business days after the date upon which the cus9 tomer or the invention promoter executes the contract,

10 whichever is later.

11 ‘‘(2) Delivery of a promissory note, check, bill of ex12 change, or negotiable instrument of any kind to the inven13 tion promoter or to a third party for the benefit of the

14 invention promoter, without regard to the date or dates

15 appearing in such instrument, shall be deemed payment

16 received by the invention promoter on the date received

17 for purposes of this section.

18 ‘‘§ 53. Standard provisions for cover notice

19 ‘‘(a) CONTENTS.—Every contract for invention pro20 motion services shall have a conspicuous and legible cover

21 sheet attached with the following notice imprinted in bold22 face type of not less than 12-point size:

23 ‘YOU HAVE THE RIGHT TO TERMINATE THIS

24 CONTRACT. TO TERMINATE THIS CONTRACT,

25 YOU MUST SEND A WRITTEN LETTER TO THE
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1 COMPANY STATING YOUR INTENT TO CANCEL

2 THIS CONTRACT.

3 ‘THE LETTER OF TERMINATION MUST BE

4 DEPOSITED WITH THE UNITED STATES POSTAL

5 SERVICE ON OR BEFORE FIVE (5) BUSINESS

6 DAYS AFTER THE DATE ON WHICH YOU OR THE

7 COMPANY EXECUTE THE CONTRACT, WHICH8 EVER IS LATER.

9 ‘THE TOTAL NUMBER OF INVENTIONS

10 EVALUATED BY THE INVENTION PROMOTER

11 FOR COMMERCIAL POTENTIAL IN THE PAST

12 FIVE (5) YEARS IS XXXXX. OF THAT NUMBER,

13 XXXXX RECEIVED POSITIVE EVALUATIONS AND

14 XXXXX RECEIVED NEGATIVE EVALUATIONS.

15 ‘IF YOU ASSIGN EVEN A PARTIAL INTEREST

16 IN THE INVENTION TO THE INVENTION PRO17 MOTER, THE INVENTION PROMOTER MAY HAVE

18 THE RIGHT TO SELL OR DISPOSE OF THE IN19 VENTION WITHOUT YOUR CONSENT AND MAY

20 NOT HAVE TO SHARE THE PROFITS WITH YOU.

21 ‘THE TOTAL NUMBER OF CUSTOMERS WHO

22 HAVE CONTRACTED WITH THE INVENTION PRO23 MOTER IN THE PAST FIVE (5) YEARS IS XXXXX.

24 THE TOTAL NUMBER OF CUSTOMERS KNOWN

25 BY THIS INVENTION PROMOTER TO HAVE RE-
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1 CEIVED, BY VIRTUE OF THIS INVENTION PRO2 MOTER’S PERFORMANCE, AN AMOUNT OF

3 MONEY IN EXCESS OF THE AMOUNT PAID BY

4 THE CUSTOMER TO THIS INVENTION PRO5 MOTER IS XXXXXXX. AS A RESULT OF THE EF6 FORTS OF THIS INVENTION PROMOTER, XXXXX

7 NUMBER OF CUSTOMERS HAVE RECEIVED LI8 CENSE AGREEMENTS FOR THEIR INVENTIONS.

9 ‘THE OFFICERS OF THIS INVENTION PRO10 MOTER HAVE COLLECTIVELY OR INDIVIDUALLY

11 BEEN AFFILIATED IN THE LAST TEN (10) YEARS

12 WITH THE FOLLOWING INVENTION PROMOTION

13 COMPANIES: (LIST THE NAMES AND ADDRESSES

14 OF ALL PREVIOUS INVENTION PROMOTION

15 COMPANIES WITH WHICH THE PRINCIPAL OFFI16 CERS HAVE BEEN AFFILIATED AS OWNERS,

17 AGENTS, OR EMPLOYEES). YOU ARE ENCOUR18 AGED TO CHECK WITH THE UNITED STATES

19 PATENT AND TRADEMARK OFFICE, THE FED20 ERAL TRADE COMMISSION, YOUR STATE ATTOR21 NEY GENERAL’S OFFICE, AND THE BETTER

22 BUSINESS BUREAU FOR ANY COMPLAINTS

23 FILED AGAINST ANY OF THESE COMPANIES

24 WHICH RESULTED IN REGULATORY SANCTIONS

25 OR OTHER CORRECTIVE ACTIONS.
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1 ‘YOU ARE ENCOURAGED TO CONSULT WITH

2 AN ATTORNEY OF YOUR OWN CHOOSING BE3 FORE SIGNING THIS CONTRACT. BY PRO4 CEEDING WITHOUT THE ADVICE OF AN ATTOR5 NEY REGISTERED TO PRACTICE BEFORE THE

6 UNITED STATES PATENT AND TRADEMARK OF7 FICE, YOU COULD LOSE ANY RIGHTS YOU

8 MIGHT HAVE IN YOUR IDEA OR INVENTION.’.

9 ‘‘(b) OTHER REQUIREMENTS FOR COVER NOTICE.—

10 The cover notice shall contain the items required under

11 subsection (a) and the name, primary office address, and

12 local office address of the invention promoter, and may

13 contain no other matter.

14 ‘‘(c) DISCLOSURE OF CERTAIN CUSTOMERS NOT RE15 QUIRED.—The requirement in the notice set forth in sub16 section (a) to include the ‘TOTAL NUMBER OF CUS17 TOMERS WHO HAVE CONTRACTED WITH THE

18 INVENTION PROMOTER IN THE PAST FIVE (5)

19 YEARS’ need not include information with respect to cus20 tomers who have purchased trade show services, research,

21 advertising, or other nonmarketing services from the in22 vention promoter, nor with respect to customers who have

23 defaulted in their payment to the invention promoter.
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1 ‘‘§ 54. Reports to customer required

2 ‘‘With respect to every contract for invention pro3 motion services, the invention promoter shall deliver to the

4 customer at the address specified in the contract, at least

5 once every 3 months throughout the term of the contract,

6 a written report that identifies the contract and includes—

7 ‘‘(1) a full, clear, and concise description of the

8 services performed to the date of the report and of

9 the services yet to be performed and names of all

10 persons who it is known will perform the services;

11 and

12 ‘‘(2) the name and address of each person,

13 firm, corporation, or other entity to whom the sub14 ject matter of the contract has been disclosed, the

15 reason for each such disclosure, the nature of the

16 disclosure, and complete and accurate summaries of

17 all responses received as a result of those disclo18 sures.

19 ‘‘§ 55. Mandatory contract terms

20 ‘‘(a) MANDATORY TERMS.—Each contract for inven21 tion promotion services shall include in boldface type of

22 not less than 12-point size—

23 ‘‘(1) the terms and conditions of payment and

24 contract termination rights required under section

25 52;
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1 ‘‘(2) a statement that the customer may avoid

2 entering into the contract by not making the initial

3 payment to the invention promoter;

4 ‘‘(3) a full, clear, and concise description of the

5 specific acts or services that the invention promoter

6 undertakes to perform for the customer;

7 ‘‘(4) a statement as to whether the invention

8 promoter undertakes to construct, sell, or distribute

9 one or more prototypes, models, or devices embody10 ing the invention of the customer;

11 ‘‘(5) the full name and principal place of busi12 ness of the invention promoter and the name and

13 principal place of business of any parent, subsidiary,

14 agent, independent contractor, and any affiliated

15 company or person who it is known will perform any

16 of the services or acts that the invention promoter

17 undertakes to perform for the customer;

18 ‘‘(6) if any oral or written representation of es19 timated or projected customer earnings is given by

20 the invention promoter (or any agent, employee, offi21 cer, director, partner, or independent contractor of

22 such invention promoter), a statement of that esti23 mation or projection and a description of the data

24 upon which such representation is based;
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1 ‘‘(7) the name and address of the custodian of

2 all records and correspondence relating to the con3 tracted for invention promotion services, and a state4 ment that the invention promoter is required to

5 maintain all records and correspondence relating to

6 performance of the invention promotion services for

7 such customer for a period of not less than 2 years

8 after expiration of the term of such contract; and

9 ‘‘(8) a statement setting forth a time schedule

10 for performance of the invention promotion services,

11 including an estimated date in which such perform12 ance is expected to be completed.

13 ‘‘(b) INVENTION PROMOTER AS FIDUCIARY.—To the

14 extent that the description of the specific acts or services

15 affords discretion to the invention promoter with respect

16 to what specific acts or services shall be performed, the

17 invention promoter shall be deemed a fiduciary.

18 ‘‘(c) AVAILABILITY OF INFORMATION.—Records and

19 correspondence described under subsection (a)(7) shall be

20 made available after 7 days written notice to the customer

21 or the representative of the customer to review and copy

22 at a reasonable cost on the invention promoter’s premises

23 during normal business hours.
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1 ‘‘§ 56. Remedies

2 ‘‘(a) IN GENERAL.—(1) Any contract for invention

3 promotion services that does not comply with the applica4 ble provisions of this chapter shall be voidable at the op5 tion of the customer.

6 ‘‘(2) Any contract for invention promotion services

7 entered into in reliance upon any material false, fraudu8 lent, or misleading information, representation, notice, or

9 advertisement of the invention promoter (or any agent,

10 employee, officer, director, partner, or independent con11 tractor of such invention promoter) shall be voidable at

12 the option of the customer.

13 ‘‘(3) Any waiver by the customer of any provision of

14 this chapter shall be deemed contrary to public policy and

15 shall be void and unenforceable.

16 ‘‘(4) Any contract for invention promotion services

17 which provides for filing for and obtaining utility, design,

18 or plant patent protection shall be voidable at the option

19 of the customer unless the invention promoter offers to

20 perform or performs such act through a person duly reg21 istered to practice before, and in good standing with, the

22 Patent and Trademark Office.

23 ‘‘(b) CIVIL ACTION.—(1) Any customer who is in24 jured by a violation of this chapter by an invention pro25 moter or by any material false or fraudulent statement

26 or representation, or any omission of material fact, by an
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1 invention promoter (or any agent, employee, director, offi2 cer, partner, or independent contractor of such invention

3 promoter) or by failure of an invention promoter to make

4 all the disclosures required under this chapter, may re5 cover in a civil action against the invention promoter (or

6 the officers, directors, or partners of such invention pro7 moter) in addition to reasonable costs and attorneys’ fees,

8 the greater of—

9 ‘‘(A) $5,000; or

10 ‘‘(B) the amount of actual damages sustained

11 by the customer.

12 ‘‘(2) Notwithstanding paragraph (1), the court may

13 increase damages to not more than 3 times the amount

14 awarded, taking into account past complaints made

15 against the invention promoter that resulted in regulatory

16 sanctions or other corrective actions based on those

17 records compiled by the Director under section 57.

18 ‘‘(c) REBUTTABLE PRESUMPTION OF INJURY.—For

19 purposes of this section, substantial violation of any provi20 sion of this chapter by an invention promoter or execution

21 by the customer of a contract for invention promotion

22 services in reliance on any material false or fraudulent

23 statements or representations or omissions of material

24 fact shall establish a rebuttable presumption of injury.
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1 ‘‘§ 57. Records of complaints

2 ‘‘(a) RELEASE OF COMPLAINTS.—The Director shall

3 make all complaints received by the United States Patent

4 and Trademark Office involving invention promoters pub5 licly available, together with any response of the invention

6 promoters.

7 ‘‘(b) REQUEST FOR COMPLAINTS.—The Director

8 may request complaints relating to invention promotion

9 services from any Federal or State agency and include

10 such complaints in the records maintained under sub11 section (a), together with any response of the invention

12 promoters.

13 ‘‘§ 58. Fraudulent representation by an invention pro14 moter

15 ‘‘Whoever, in providing invention promotion services,

16 knowingly provides any false or misleading statement, rep17 resentation, or omission of material fact to a customer or

18 fails to make all the disclosures required under this chap19 ter, shall be guilty of a misdemeanor and fined not more

20 than $10,000 for each offense.

21 ‘‘§ 59. Rule of construction

22 ‘‘Except as expressly provided in this chapter, no pro23 vision of this chapter shall be construed to affect any obli24 gation, right, or remedy provided under any other Federal

25 or State law.’’.
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1 SEC. 103. EFFECTIVE DATE.

2 This title and the amendments made by this title

3 shall take effect 60 days after the date of the enactment

4 of this Act.

5 TITLE II—FIRST INVENTOR

6 DEFENSE

7 SEC. 201. SHORT TITLE.

8 This title may be cited as the ‘‘First Inventor Defense

9 Act’’.

10 SEC. 202. DEFENSE TO PATENT INFRINGEMENT BASED ON

11 EARLIER INVENTOR.

12 (a) DEFENSE.—Chapter 28 of title 35, United States

13 Code, is amended by adding at the end the following new

14 section:

15 ‘‘§ 273. Defense to infringement based on earlier in16 ventor

17 ‘‘(a) DEFINITIONS.—For purposes of this section—

18 ‘‘(1) the terms ‘commercially used’ and ‘com19 mercial use’ mean use of a method in the United

20 States, so long as such use is in connection with an

21 internal commercial use or an actual arm’s-length

22 sale or other arm’s-length commercial transfer of a

23 useful end result, whether or not the subject matter

24 at issue is accessible to or otherwise known to the

25 public, except that the subject matter for which com26 mercial marketing or use is subject to a premar-
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1 keting regulatory review period during which the

2 safety or efficacy of the subject matter is estab3 lished, including any period specified in section

4 156(g), shall be deemed ‘commercially used’ and in

5 ‘commercial use’ during such regulatory review pe6 riod;

7 ‘‘(2) in the case of activities performed by a

8 nonprofit research laboratory, or nonprofit entity

9 such as a university, research center, or hospital, a

10 use for which the public is the intended beneficiary

11 shall be considered to be a use described in para12 graph (1), except that the use—

13 ‘‘(A) may be asserted as a defense under

14 this section only for continued use by and in

15 the laboratory or nonprofit entity; and

16 ‘‘(B) may not be asserted as a defense

17 with respect to any subsequent commercializa18 tion or use outside such laboratory or nonprofit

19 entity;

20 ‘‘(3) the term ‘method’ means a method of

21 doing or conducting business; and

22 ‘‘(4) the ‘effective filing date’ of a patent is the

23 earlier of the actual filing date of the application for

24 the patent or the filing date of any earlier United

25 States, foreign, or international application to which
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1 the subject matter at issue is entitled under section

2 119, 120, or 365 of this title.

3 ‘‘(b) DEFENSE TO INFRINGEMENT.—.

4 ‘‘(1) IN GENERAL.—It shall be a defense to an

5 action for infringement under section 271 of this

6 title with respect to any subject matter that would

7 otherwise infringe one or more claims for a method

8 in the patent being asserted against a person, if

9 such person had, acting in good faith, actually re10 duced the subject matter to practice at least one

11 year before the effective filing date of such patent,

12 and commercially used the subject matter before the

13 effective filing date of such patent.

14 ‘‘(2) EXHAUSTION OF RIGHT.—The sale or

15 other disposition, of a useful end result produced by

16 a patented method, by a person entitled to assert a

17 defense under this section with respect to that useful

18 end result shall exhaust the patent owner’s rights

19 under the patent to the extent such rights would

20 have been exhausted had such sale or other disposi21 tion been made by the patent owner.

22 ‘‘(3) LIMITATIONS AND QUALIFICATIONS OF DE23 FENSE.—The defense to infringement under this

24 section is subject to the following:
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1 ‘‘(A) PATENT.—A person may not assert

2 the defense under this section unless the inven3 tion for which the defense is asserted is for a

4 method.

5 ‘‘(B) DERIVATION.—A person may not as6 sert the defense under this section if the subject

7 matter on which the defense is based was de8 rived from the patentee or persons in privity

9 with the patentee.

10 ‘‘(C) NOT A GENERAL LICENSE.—The de11 fense asserted by a person under this section is

12 not a general license under all claims of the

13 patent at issue, but extends only to the specific

14 subject matter claimed in the patent with re15 spect to which the person can assert a defense

16 under this chapter, except that the defense shall

17 also extend to variations in the quantity or vol18 ume of use of the claimed subject matter, and

19 to improvements in the claimed subject matter

20 that do not infringe additional specifically

21 claimed subject matter of the patent.

22 ‘‘(4) BURDEN OF PROOF.—A person asserting

23 the defense under this section shall have the burden

24 of establishing the defense by clear and convincing

25 evidence.
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1 ‘‘(5) ABANDONMENT OF USE.—A person who

2 has abandoned commercial use of subject matter

3 may not rely on activities performed before the date

4 of such abandonment in establishing a defense under

5 this section with respect to actions taken after the

6 date of such abandonment.

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

8 this section may be asserted only by the person who

9 performed the acts necessary to establish the defense

10 and, except for any transfer to the patent owner, the

11 right to assert the defense shall not be licensed or

12 assigned or transferred to another person except as

13 an ancillary and subordinate part of a good faith as14 signment or transfer for other reasons of the entire

15 enterprise or line of business to which the defense

16 relates.

17 ‘‘(7) LIMITATION ON SITES.—A defense under

18 this section, when acquired as part of a good faith

19 assignment or transfer of an entire enterprise or line

20 of business to which the defense relates, may only be

21 asserted for uses at sites where the subject matter

22 that would otherwise infringe one or more of the

23 claims is in use before the later of the effective filing

24 date of the patent or the date of the assignment or

25 transfer of such enterprise or line of business.
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1 ‘‘(8) UNSUCCESSFUL ASSERTION OF DE2 FENSE.—If the defense under this section is pleaded

3 by a person who is found to infringe the patent and

4 who subsequently fails to demonstrate a reasonable

5 basis for asserting the defense, the court shall find

6 the case exceptional for the purpose of awarding at7 torney’s fees under section 285 of this title.

8 ‘‘(9) INVALIDITY.—A patent shall not be

9 deemed to be invalid under section 102 or 103 of

10 this title solely because a defense is raised or estab11 lished under this section.’’.

12 (b) CONFORMING AMENDMENT.—The table of sec13 tions at the beginning of chapter 28 of title 35, United

14 States Code, is amended by adding at the end the fol15 lowing new item:

‘‘273. Defense to infringement based on earlier inventor.’’.

16 SEC. 203. EFFECTIVE DATE AND APPLICABILITY.

17 This title and the amendments made by this title

18 shall take effect on the date of the enactment of this Act,

19 but shall not apply to any action for infringement that

20 is pending on such date of the enactment or with respect

21 to any subject matter for which an adjudication of in22 fringement, including a consent judgment, has been made

23 before such date of the enactment.
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1 TITLE III—PATENT TERM

2 GUARANTEE

3 SEC. 301. SHORT TITLE.

4 This title may be cited as the ‘‘Patent Term Guar5 antee Act’’.

6 SEC. 302. PATENT TERM GUARANTEE AUTHORITY.

7 (a) ADJUSTMENT OF PATENT TERM.—Section

8 154(b) of title 35, United States Code, is amended to read

9 as follows:

10 ‘‘(b) ADJUSTMENT OF PATENT TERM.—

11 ‘‘(1) PATENT TERM GUARANTEES.—

12 ‘‘(A) GUARANTEE OF PROMPT PATENT

13 AND TRADEMARK OFFICE RESPONSES.—Subject

14 to the limitations under paragraph (2), if the

15 issue of an original patent is delayed due to the

16 failure of the Patent and Trademark Office

17 to—

18 ‘‘(i) make a notification of the rejec19 tion of any claim for a patent or any objec20 tion or argument under section 132, or

21 give or mail a written notice of allowance

22 under section 151, within 14 months after

23 the date on which the application was filed;

24 ‘‘(ii) respond to a reply under section

25 132, or to an appeal taken under section
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1 134, within 4 months after the date on

2 which the reply was filed or the appeal was

3 taken;

4 ‘‘(iii) act on an application within 4

5 months after the date of a decision by the

6 Board of Patent Appeals and Interferences

7 under section 134 or 135 or a decision by

8 a Federal court under section 141, 145, or

9 146 in a case in which allowable claims re10 main in the application; or

11 ‘‘(iv) issue a patent within 4 months

12 after the date on which the issue fee was

13 paid under section 151 and all outstanding

14 requirements were satisfied,

15 the term of the patent shall be extended one

16 day for each day after the end of the period

17 specified in clause (i), (ii), (iii), or (iv), as the

18 case may be, until the action described in such

19 clause is taken.

20 ‘‘(B) GUARANTEE OF NO MORE THAN 3-

21 YEAR APPLICATION PENDENCY.—Subject to the

22 limitations under paragraph (2), if the issue of

23 an original patent is delayed due to the failure

24 of the Patent and Trademark Office to issue a

25 patent within 3 years after the actual filing
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1 date of the application in the United States, not

2 including—

3 ‘‘(i) any time consumed by continued

4 examination of the application requested

5 by the applicant under section 132(b);

6 ‘‘(ii) any time consumed by a pro7 ceeding under section 135(a), any time

8 consumed by the imposition of an order

9 pursuant to section 181, or any time con10 sumed by appellate review by the Board of

11 Patent Appeals and Interferences or by a

12 Federal court; or

13 ‘‘(iii) any delay in the processing of

14 the application by the Patent and Trade15 mark Office requested by the applicant ex16 cept as permitted by paragraph (3)(C),

17 the term of the patent shall be extended 1 day

18 for each day after the end of that 3-year period

19 until the patent is issued.

20 ‘‘(C) GUARANTEE OR ADJUSTMENTS FOR

21 DELAYS DUE TO INTERFERENCES, SECRECY OR22 DERS, AND APPEALS.—Subject to the limita23 tions under paragraph (2), if the issue of an

24 original patent is delayed due to—
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1 ‘‘(i) a proceeding under section

2 135(a);

3 ‘‘(ii) the imposition of an order pursu4 ant to section 181; or

5 ‘‘(iii) appellate review by the Board of

6 Patent Appeals and Interferences or by a

7 Federal court in a case in which the patent

8 was issued pursuant to a decision in the

9 review reversing an adverse determination

10 of patentability,

11 the term of the patent shall be extended one

12 day for each day of the pendency of the pro13 ceeding, order, or review, as the case may be.

14 ‘‘(2) LIMITATIONS.—

15 ‘‘(A) IN GENERAL.—To the extent that pe16 riods of delay attributable to grounds specified

17 in paragraph (1) overlap, the period of any ad18 justment granted under this subsection shall

19 not exceed the actual number of days the

20 issuance of the patent was delayed.

21 ‘‘(B) DISCLAIMED TERM.—No patent the

22 term of which has been disclaimed beyond a

23 specified date may be adjusted under this sec24 tion beyond the expiration date specified in the

25 disclaimer.
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1 ‘‘(C) REDUCTION OF PERIOD OF ADJUST2 MENT.—

3 ‘‘(i) The period of adjustment of the

4 term of a patent under paragraph (1) shall

5 be reduced by a period equal to the period

6 of time during which the applicant failed

7 to engage in reasonable efforts to conclude

8 prosecution of the application.

9 ‘‘(ii) With respect to adjustments to

10 patent term made under the authority of

11 paragraph (1)(B), an applicant shall be

12 deemed to have failed to engage in reason13 able efforts to conclude processing or ex14 amination of an application for the cumu15 lative total of any periods of time in excess

16 of 3 months that are taken to respond to

17 a notice from the Office making any rejec18 tion, objection, argument, or other request,

19 measuring such 3-month period from the

20 date the notice was given or mailed to the

21 applicant.

22 ‘‘(iii) The Director shall prescribe reg23 ulations establishing the circumstances

24 that constitute a failure of an applicant to

25 engage in reasonable efforts to conclude
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1 processing or examination of an applica2 tion.

3 ‘‘(3) PROCEDURES FOR PATENT TERM ADJUST4 MENT DETERMINATION.—

5 ‘‘(A) The Director shall prescribe regula6 tions establishing procedures for the application

7 for and determination of patent term adjust8 ments under this subsection.

9 ‘‘(B) Under the procedures established

10 under subparagraph (A), the Director shall—

11 ‘‘(i) make a determination of the pe12 riod of any patent term adjustment under

13 this subsection, and shall transmit a notice

14 of that determination with the written no15 tice of allowance of the application under

16 section 151; and

17 ‘‘(ii) provide the applicant one oppor18 tunity to request reconsideration of any

19 patent term adjustment determination

20 made by the Director.

21 ‘‘(C) The Director shall reinstate all or

22 part of the cumulative period of time of an ad23 justment under paragraph (2)(C) if the appli24 cant, prior to the issuance of the patent, makes

25 a showing that, in spite of all due care, the ap-
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1 plicant was unable to respond within the 3-

2 month period, but in no case shall more than 3

3 additional months for each such response be4 yond the original 3-month period be reinstated.

5 ‘‘(D) The Director shall proceed to grant

6 the patent after completion of the Director’s de7 termination of a patent term adjustment under

8 the procedures established under this sub9 section, notwithstanding any appeal taken by

10 the applicant of such determination.

11 ‘‘(4) APPEAL OF PATENT TERM ADJUSTMENT

12 DETERMINATION.—

13 ‘‘(A) An applicant dissatisfied with a de14 termination made by the Director under para15 graph (3) shall have remedy by a civil action

16 against the Director filed in the United States

17 District Court for the District of Columbia

18 within 180 days after the grant of the patent.

19 Chapter 7 of title 5 shall apply to such action.

20 Any final judgment resulting in a change to the

21 period of adjustment of the patent term shall be

22 served on the Director, and the Director shall

23 thereafter alter the term of the patent to reflect

24 such change.
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1 ‘‘(B) The determination of a patent term

2 adjustment under this subsection shall not be

3 subject to appeal or challenge by a third party

4 prior to the grant of the patent.’’.

5 (b) CONFORMING AMENDMENTS.—

6 (1) Section 282 of title 35, United States Code,

7 is amended in the fourth paragraph by striking ‘‘156

8 of this title’’ and inserting ‘‘154(b) or 156 of this

9 title’’.

10 (2) Section 1295(a)(4)(C) of title 28, United

11 States Code, is amended by striking ‘‘145 or 146’’

12 and inserting ‘‘145, 146, or 154(b)’’.

13 SEC. 303. CONTINUED EXAMINATION OF PATENT APPLICA14 TIONS.

15 Section 132 of title 35, United States Code, is

16 amended—

17 (1) in the first sentence by striking ‘‘Whenever’’

18 and inserting ‘‘(a) Whenever’’; and

19 (2) by adding at the end the following:

20 ‘‘(b) The Director shall prescribe regulations to pro21 vide for the continued examination of applications for pat22 ent at the request of the applicant. The Director may es23 tablish appropriate fees for such continued examination

24 and shall provide a 50 percent reduction in such fees for
32

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1 small entities that qualify for reduced fees under section

2 41(h)(1) of this title.’’.

3 SEC. 304. TECHNICAL CLARIFICATION.

4 Section 156(a) of title 35, United States Code, is

5 amended in the matter preceding paragraph (1) by insert6 ing ‘‘, which shall include any patent term adjustment

7 granted under section 154(b),’’ after ‘‘the original expira8 tion date of the patent’’.

9 SEC. 305. EFFECTIVE DATE.

10 (a) SECTIONS 302 AND 304.—The amendments made

11 by sections 302 and 304 shall take effect on the date of

12 the enactment of this Act and, except for a design patent

13 application filed under chapter 16 of title 35, United

14 States Code, shall apply to any application filed on or after

15 the date of the enactment of this Act.

16 (b) SECTION 303.—The amendments made by sec17 tion 303 shall take effect 6 months after the date of the

18 enactment of this Act.

19 TITLE IV—UNITED STATES PUB20 LICATION OF PATENT APPLI21 CATIONS PUBLISHED

22 ABROAD

23 SEC. 401. SHORT TITLE.

24 This title may be referred to as the ‘‘Publication of

25 Foreign Filed Applications Act’’.
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1 SEC. 402. PUBLICATION.

2 (a) PUBLICATION.—Section 122 of title 35, United

3 States Code, is amended to read as follows:

4 ‘‘§ 122. Confidential status of applications; publica5 tion of patent applications

6 ‘‘(a) CONFIDENTIALITY.—Except as provided in sub7 section (b), applications for patents shall be kept in con8 fidence by the Patent and Trademark Office and no infor9 mation concerning any such application shall be given

10 without authority of the applicant or owner unless nec11 essary to carry out the provisions of an Act of Congress

12 or in such special circumstances as may be determined by

13 the Director.

14 ‘‘(b) UNITED STATES PUBLICATION OF APPLICA15 TIONS PUBLISHED ABROAD.—

16 ‘‘(1) IN GENERAL.—(A) Subject to paragraph

17 (2), each application for patent, except applications

18 for design patents filed under chapter 16 and provi19 sional applications filed under section 111(b), shall

20 be published, in accordance with procedures deter21 mined by the Director, promptly upon the expiration

22 of a period of 18 months after the earliest filing date

23 for which a benefit is sought under this title. At the

24 request of the applicant, an application may be pub25 lished earlier than the end of such 18-month period.
34

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1 ‘‘(B) No information concerning published pat2 ent applications shall be made available to the public

3 except as the Director determines.

4 ‘‘(C) Pursuant to this title and notwithstanding

5 any other provision of law, a determination by the

6 Director to release or not to release information con7 cerning a published patent application shall be final

8 and nonreviewable.

9 ‘‘(2) EXCEPTIONS.—(A) An application that is

10 no longer pending shall not be published.

11 ‘‘(B) An application that is subject to a secrecy

12 order under section 181 shall not be published.

13 ‘‘(C)(i) If an applicant, upon filing, makes a re14 quest that an application not be published pursuant

15 to paragraph (1), and states in such request that the

16 invention disclosed in the application has not been

17 the subject of an application filed in another coun18 try, or under a multilateral international agreement,

19 that requires publication of applications 18 months

20 after filing, the application shall not be published as

21 provided in paragraph (1).

22 ‘‘(ii) An applicant may rescind a request made

23 under clause (i) at any time.

24 ‘‘(iii) An applicant who has made a request

25 under clause (i) but who subsequently files, in a for-
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1 eign country or under a multilateral international

2 agreement specified in clause (i), an application di3 rected to the invention disclosed in the application

4 filed in the Patent and Trademark Office, shall no5 tify the Director of such filing not later than 45

6 days after the date of the filing of such foreign or

7 international application. A failure of the applicant

8 to provide such notice within the prescribed period

9 shall result in the application being regarded as

10 abandoned, unless it is shown to the satisfaction of

11 the Director that the delay in submitting the notice

12 was unintentional.

13 ‘‘(iv) If a notice is made pursuant to clause

14 (iii), or the applicant rescinds a request pursuant to

15 clause (ii), the Director shall publish the application

16 on or as soon as is practical after the date that is

17 specified in clause (i).

18 ‘‘(v) If an applicant has filed applications in

19 one or more foreign countries, directly or through a

20 multilateral international agreement, and such for21 eign filed applications corresponding to an applica22 tion filed in the Patent and Trademark Office or the

23 description of the invention in such foreign filed ap24 plications is less extensive than the application or

25 description of the invention in the application filed
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1 in the Patent and Trademark Office, the applicant

2 may submit a redacted copy of the application filed

3 in the Patent and Trademark Office eliminating any

4 part or description of the invention in such applica5 tion that is not also contained in any of the cor6 responding applications filed in a foreign country.

7 The Director may only publish the redacted copy of

8 the application unless the redacted copy of the appli9 cation is not received within 16 months after the

10 earliest effective filing date for which a benefit is

11 sought under this title. The provisions of section

12 154(d) shall not apply to a claim if the description

13 of the invention published in the redacted applica14 tion filed under this clause with respect to the claim

15 does not enable a person skilled in the art to make

16 and use the subject matter of the claim.

17 ‘‘(c) PROTEST AND PRE-ISSUANCE OPPOSITION.—

18 The Director shall establish appropriate procedures to en19 sure that no protest or other form of pre-issuance opposi20 tion to the grant of a patent on an application may be

21 initiated after publication of the application without the

22 express written consent of the applicant.’’.

23 (b) STUDY BY GAO.—

24 (1) IN GENERAL.—The Comptroller General of

25 the United States shall conduct a study of appli-
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1 cants for patents who file only in the United States

2 during the 3-year period beginning on the effective

3 date of this title.

4 (2) CONTENTS.—The study conducted under

5 paragraph (1) shall—

6 (A) consider the number of such applicants

7 for patent in relation to the number of appli8 cants who file in the United States and outside

9 the United States;

10 (B) examine how many domestic-only filers

11 request at the time of filing not to be published;

12 (C) examine how many such filers rescind

13 that request or later choose to file abroad; and

14 (D) examine the manner of entity seeking

15 an application and any correlation that may

16 exist between such manner and publication of

17 patent applications.

18 (3) REPORT TO JUDICIARY COMMITTEES.—The

19 Comptroller General shall submit to the Committees

20 on the Judiciary of the House of Representatives

21 and the Senate the results of the study conducted

22 under this subsection.
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1 SEC. 403. TIME FOR CLAIMING BENEFIT OF EARLIER FIL2 ING DATE.

3 (a) IN A FOREIGN COUNTRY.—Section 119(b) of title

4 35, United States Code, is amended to read as follows:

5 ‘‘(b)(1) No application for patent shall be entitled to

6 this right of priority unless a claim, identifying the foreign

7 application by specifying its application number, country,

8 and the day, month, and year of its filing, is filed in the

9 Patent and Trademark Office at such time during the

10 pendency of the application as required by the Director.

11 ‘‘(2) The Director may consider the failure of the ap12 plicant to file a timely claim for priority as a waiver of

13 any such claim. The Director may establish procedures,

14 including the payment of a surcharge, to accept an unin15 tentionally delayed claim under this section.

16 ‘‘(3) The Director may require a certified copy of the

17 original foreign application, specification, and drawings

18 upon which it is based, a translation if not in the English

19 language, and such other information as the Director con20 siders necessary. Any such certification shall be made by

21 the foreign intellectual property authority in which the for22 eign application was filed and show the date of the appli23 cation and of the filing of the specification and other pa24 pers.’’.

25 (b) IN THE UNITED STATES.—Section 120 of title

26 35, United States Code, is amended by adding at the end
39

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1 the following: ‘‘The Director may determine the time pe2 riod during the pendency of the application within which

3 an amendment containing the specific reference to the ear4 lier filed application is submitted. The Director may con5 sider the failure to submit such an amendment within that

6 time period as a waiver of any benefit under this section.

7 The Director may establish procedures, including the pay8 ment of a surcharge, to accept unintentionally late submis9 sions of amendments under this section.’’.

10 SEC. 404. PROVISIONAL RIGHTS.

11 Section 154 of title 35, United States Code, is

12 amended—

13 (1) in the section caption by inserting ‘‘; pro14 visional rights’’ after ‘‘patent’’; and

15 (2) by adding at the end the following new sub16 section:

17 ‘‘(d) PROVISIONAL RIGHTS.—

18 ‘‘(1) IN GENERAL.—In addition to other rights

19 provided by this section, a patent shall include the

20 right to obtain a reasonable royalty from any person

21 who, during the period beginning on the date of pub22 lication of the application for such patent pursuant

23 to section 122(b), or in the case of an international

24 application filed under the treaty defined in section

25 351(a) designating the United States under Article
40

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1 21(2)(a) of such treaty, the date of publication of

2 the application, and ending on the date the patent

3 is issued—

4 ‘‘(A)(i) makes, uses, offers for sale, or sells

5 in the United States the invention as claimed in

6 the published patent application or imports

7 such an invention into the United States; or

8 ‘‘(ii) if the invention as claimed in the pub9 lished patent application is a process, uses, of10 fers for sale, or sells in the United States or

11 imports into the United States products made

12 by that process as claimed in the published pat13 ent application; and

14 ‘‘(B) had actual notice of the published

15 patent application, and in a case in which the

16 right arising under this paragraph is based

17 upon an international application designating

18 the United States that is published in a lan19 guage other than English, a translation of the

20 international application into the English lan21 guage.

22 ‘‘(2) RIGHT BASED ON SUBSTANTIALLY IDEN23 TICAL INVENTIONS.—The right under paragraph (1)

24 to obtain a reasonable royalty shall not be available

25 under this subsection unless the invention as claimed
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1 in the patent is substantially identical to the inven2 tion as claimed in the published patent application.

3 ‘‘(3) TIME LIMITATION ON OBTAINING A REA4 SONABLE ROYALTY.—The right under paragraph (1)

5 to obtain a reasonable royalty shall be available only

6 in an action brought not later than 6 years after the

7 patent is issued. The right under paragraph (1) to

8 obtain a reasonable royalty shall not be affected by

9 the duration of the period described in paragraph

10 (1).

11 ‘‘(4) REQUIREMENTS FOR INTERNATIONAL AP12 PLICATIONS.—

13 ‘‘(A) EFFECTIVE DATE.—The right under

14 paragraph (1) to obtain a reasonable royalty

15 based upon the publication under the treaty de16 fined in section 351(a) of an international ap17 plication designating the United States shall

18 commence on the date on which the Patent and

19 Trademark Office receives a copy of the publi20 cation under the treaty of the international ap21 plication, or, if the publication under the treaty

22 of the international application is in a language

23 other than English, on the date on which the

24 Patent and Trademark Office receives a trans-
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1 lation of the international application in the

2 English language.

3 ‘‘(B) COPIES.—The Director may require

4 the applicant to provide a copy of the inter5 national application and a translation thereof.’’.

6 SEC. 405. PRIOR ART EFFECT OF PUBLISHED APPLICA7 TIONS.

8 Section 102(e) of title 35, United States Code, is

9 amended to read as follows:

10 ‘‘(e) the invention was described in—

11 ‘‘(1)(A) an application for patent, published

12 pursuant to section 122(b), by another filed in the

13 United States before the invention by the applicant

14 for patent, except that an international application

15 filed under the treaty defined in section 351(a) shall

16 have the effect under this subsection of a national

17 application published under section 122(b) only if

18 the international application designating the United

19 States was published under Article 21(2)(a) of such

20 treaty in the English language; or

21 ‘‘(B) a patent granted on an application for

22 patent by another filed in the United States before

23 the invention by the applicant for patent, except that

24 a patent shall not be deemed filed in the United

25 States for the purposes of this subsection based on
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1 the filing of an international application filed under

2 the treaty defined in section 351(a); or’’.

3 SEC. 406. COST RECOVERY FOR PUBLICATION.

4 The Director of the United States Patent and Trade5 mark Office shall recover the cost of early publication re6 quired by the amendment made by section 402 by charg7 ing a separate publication fee after notice of allowance is

8 given pursuant to section 151 of title 35, United States

9 Code.

10 SEC. 407. CONFORMING AMENDMENTS.

11 The following provisions of title 35, United States

12 Code, are amended:

13 (1) Section 11 is amended in paragraph 1 of

14 subsection (a) by inserting ‘‘and published applica15 tions for patents’’ after ‘‘Patents’’.

16 (2) Section 12 is amended—

17 (A) in the section caption by inserting

18 ‘‘and applications’’ after ‘‘patents’’; and

19 (B) by inserting ‘‘and published applica20 tions for patents’’ after ‘‘patents’’.

21 (3) Section 13 is amended—

22 (A) in the section caption by inserting

23 ‘‘and applications’’ after ‘‘patents’’; and

24 (B) by inserting ‘‘and published applica25 tions for patents’’ after ‘‘patents’’.
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1 (4) The item relating to section 122 in the table

2 of sections for chapter 11 is amended by inserting

3 ‘‘; publication of patent applications’’ after ‘‘applica4 tions’’.

5 (5) The item relating to section 154 in the table

6 of sections for chapter 14 is amended by inserting

7 ‘‘; provisional rights’’ after ‘‘patent’’.

8 (6) Section 181 is amended—

9 (A) in the first undesignated paragraph—

10 (i) by inserting ‘‘by the publication of

11 an application or’’ after ‘‘disclosure’’; and

12 (ii) by inserting ‘‘the publication of

13 the application or’’ after ‘‘withhold’’;

14 (B) in the second undesignated paragraph

15 by inserting ‘‘by the publication of an applica16 tion or’’ after ‘‘disclosure of an invention’’;

17 (C) in the third undesignated paragraph—

18 (i) by inserting ‘‘by the publication of

19 the application or’’ after ‘‘disclosure of the

20 invention’’; and

21 (ii) by inserting ‘‘the publication of

22 the application or’’ after ‘‘withhold’’; and

23 (D) in the fourth undesignated paragraph

24 by inserting ‘‘the publication of an application

25 or’’ after ‘‘and’’ in the first sentence.
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1 (7) Section 252 is amended in the first undesig2 nated paragraph by inserting ‘‘substantially’’ before

3 ‘‘identical’’ each place it appears.

4 (8) Section 284 is amended by adding at the

5 end of the second undesignated paragraph the fol6 lowing: ‘‘Increased damages under this paragraph

7 shall not apply to provisional rights under section

8 154(d) of this title.’’.

9 (9) Section 374 is amended to read as follows:

10 ‘‘§ 374. Publication of international application: effect

11 ‘‘The publication under the treaty defined in section

12 351(a) of this title of an international application desig13 nating the United States shall confer the same rights and

14 shall have the same effect under this title as an application

15 for patent published under section 122(b), except as pro16 vided in sections 102(e) and 154(d).’’.

17 SEC. 408. EFFECTIVE DATE.

18 This title and the amendments made by this title,

19 shall take effect on the date that is 1 year after the date

20 of the enactment of this Act and shall apply to all applica21 tions filed under section 111 of title 35, United States

22 Code, on or after that date, and all applications complying

23 with section 371 of title 35, United States Code, that re24 sulted from international applications filed on or after that

25 date. The amendments made by sections 404 and 405
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1 shall apply to any such application voluntarily published

2 by the applicant under procedures established under this

3 title that is pending on the date that is 1 year after the

4 date of the enactment of this Act. The amendment made

5 by section 404 shall also apply to international applica6 tions designating the United States that are filed on or

7 after the date that is 1 year after the date of the enact8 ment of this Act.

9 TITLE V—OPTIONAL INTER

10 PARTES REEXAMINATION

11 PROCEDURE

12 SEC. 501. SHORT TITLE.

13 This title may be cited as the ‘‘Optional Inter Partes

14 Reexamination Procedure Act’’.

15 SEC. 502. EX PARTE REEXAMINATION OF PATENTS.

16 Chapter 30 of title 35, United States Code, is amend17 ed in the title by inserting ‘‘EX PARTE’’ before ‘‘RE18 EXAMINATION OF PATENTS’’.

19 SEC. 503. DEFINITIONS.

20 Section 100 of title 35, United States Code, is

21 amended by adding at the end the following new sub22 section:

23 ‘‘(e) The term ‘third-party requester’ means a person

24 requesting ex parte reexamination under section 302 or
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1 inter partes reexamination under section 311 who is not

2 the patent owner.’’.

3 SEC. 504. OPTIONAL INTER PARTES REEXAMINATION PRO4 CEDURES.

5 (a) IN GENERAL.—Part 3 of title 35, United Stats

6 Code, is amended by adding after chapter 30 the following

7 new chapter:

8 ‘‘CHAPTER 31—OPTIONAL INTER PARTES

9 REEXAMINATION PROCEDURES

‘‘Sec.

‘‘311. Request for inter partes reexamination.

‘‘312. Determination of issue by Director.

‘‘313. Inter partes reexamination order by Director.

‘‘314. Conduct of inter partes reexamination proceedings.

‘‘315. Appeal.

‘‘316. Certificate of patentability, unpatentability, and claim cancellation.

‘‘317. Inter partes reexamination prohibited.

‘‘318. Stay of litigation.

10 ‘‘§ 311. Request for inter partes reexamination

11 ‘‘(a) IN GENERAL.—Any person at any time may file

12 a request for inter partes reexamination by the Office of

13 a patent on the basis of any prior art cited under the pro14 visions of section 301.

15 ‘‘(b) REQUIREMENTS.—The request shall—

16 ‘‘(1) be in writing, include the identity of the

17 real party in interest, and be accompanied by pay18 ment of an inter partes reexamination fee estab19 lished by the Director under section 41; and
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1 ‘‘(2) set forth the pertinency and manner of ap2 plying cited prior art to every claim for which reex3 amination is requested.

4 ‘‘(c) COPY.—Unless the requesting person is the

5 owner of the patent, the Director promptly shall send a

6 copy of the request to the owner of record of the patent.

7 ‘‘§ 312. Determination of issue by Director

8 ‘‘(a) REEXAMINATION.—Not later than 3 months

9 after the filing of a request for inter partes reexamination

10 under section 311, the Director shall determine whether

11 a substantial new question of patentability affecting any

12 claim of the patent concerned is raised by the request,

13 with or without consideration of other patents or printed

14 publications. On the Director’s initiative, and at any time,

15 the Director may determine whether a substantial new

16 question of patentability is raised by patents and publica17 tions.

18 ‘‘(b) RECORD.—A record of the Director’s determina19 tion under subsection (a) shall be placed in the official

20 file of the patent, and a copy shall be promptly given or

21 mailed to the owner of record of the patent and to the

22 third-party requester, if any.

23 ‘‘(c) FINAL DECISION.—A determination by the Di24 rector pursuant to subsection (a) shall be final and non25 appealable. Upon a determination that no substantial new
49

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1 question of patentability has been raised, the Director may

2 refund a portion of the inter partes reexamination fee re3 quired under section 311.

4 ‘‘§ 313. Inter partes reexamination order by Director

5 ‘‘If, in a determination made under section 312(a),

6 the Director finds that a substantial new question of pat7 entability affecting a claim of a patent is raised, the deter8 mination shall include an order for inter partes reexamina9 tion of the patent for resolution of the question. The order

10 may be accompanied by the initial action of the Patent

11 and Trademark Office on the merits of the inter partes

12 reexamination conducted in accordance with section 314.

13 ‘‘§ 314. Conduct of inter partes reexamination pro14 ceedings

15 ‘‘(a) IN GENERAL.—Subject to subsection (b), reex16 amination shall be conducted according to the procedures

17 established for initial examination under the provisions of

18 sections 132 and 133, except as provided for under this

19 section. In any inter partes reexamination proceeding

20 under this chapter, the patent owner shall be permitted

21 to propose any amendment to the patent and a new claim

22 or claims, except that no proposed amended or new claim

23 enlarging the scope of the claims of the patent shall be

24 permitted.
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1 ‘‘(b) RESPONSE.—(1) This subsection shall apply to

2 any inter partes reexamination proceeding in which the

3 order for inter partes reexamination is based upon a re4 quest by a third-party requester.

5 ‘‘(2) With the exception of the inter partes reexam6 ination request, any document filed by either the patent

7 owner or the third-party requester shall be served on the

8 other party. In addition, the third-party requester shall

9 receive a copy of any communication sent by the Office

10 to the patent owner concerning the patent subject to the

11 inter partes reexamination proceeding.

12 ‘‘(3) Each time that the patent owner files a response

13 to an action on the merits from the Patent and Trademark

14 Office, the third-party requester shall have one oppor15 tunity to file written comments addressing issues raised

16 by the action of the Office or the patent owner’s response

17 thereto, if those written comments are received by the Of18 fice within 30 days after the date of service of the patent

19 owner’s response.

20 ‘‘(c) SPECIAL DISPATCH.—Unless otherwise provided

21 by the Director for good cause, all inter partes reexamina22 tion proceedings under this section, including any appeal

23 to the Board of Patent Appeals and Interferences, shall

24 be conducted with special dispatch within the Office.
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1 ‘‘§ 315. Appeal

2 ‘‘(a) PATENT OWNER.—The patent owner involved in

3 an inter partes reexamination proceeding under this

4 chapter—

5 ‘‘(1) may appeal under the provisions of section

6 134, and may appeal under the provisions of sec7 tions 141 through 144, with respect to any decision

8 adverse to the patentability of any original or pro9 posed amended or new claim of the patent; and

10 ‘‘(2) may be a party to any appeal taken by a

11 third-party requester under subsection (b).

12 ‘‘(b) THIRD-PARTY REQUESTER.—A third-party re13 quester may—

14 ‘‘(1) appeal under the provisions of section 134

15 with respect to any final decision favorable to the

16 patentability of any original or proposed amended or

17 new claim of the patent; or

18 ‘‘(2) be a party to any appeal taken by the pat19 ent owner under the provisions of section 134, sub20 ject to subsection (c).

21 ‘‘(c) CIVIL ACTION.—A third-party requester whose

22 request for an inter partes reexamination results in an

23 order under section 313 is estopped from asserting at a

24 later time, in any civil action arising in whole or in part

25 under section 1338 of title 28, the invalidity of any claim

26 finally determined to be valid and patentable on any
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1 ground which the third-party requester raised or could

2 have raised during the inter partes reexamination pro3 ceedings. This subsection does not prevent the assertion

4 of invalidity based on newly discovered prior art unavail5 able to the third-party requester and the Patent and

6 Trademark Office at the time of the inter partes reexam7 ination proceedings.

8 ‘‘§ 316. Certificate of patentability, unpatentability,

9 and claim cancellation

10 ‘‘(a) IN GENERAL.—In an inter partes reexamination

11 proceeding under this chapter, when the time for appeal

12 has expired or any appeal proceeding has terminated, the

13 Director shall issue and publish a certificate canceling any

14 claim of the patent finally determined to be unpatentable,

15 confirming any claim of the patent determined to be pat16 entable, and incorporating in the patent any proposed

17 amended or new claim determined to be patentable.

18 ‘‘(b) AMENDED OR NEW CLAIM.—Any proposed

19 amended or new claim determined to be patentable and

20 incorporated into a patent following an inter partes reex21 amination proceeding shall have the same effect as that

22 specified in section 252 of this title for reissued patents

23 on the right of any person who made, purchased, or used

24 within the United States, or imported into the United

25 States, anything patented by such proposed amended or
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1 new claim, or who made substantial preparation for the

2 same, prior to issuance of a certificate under the provi3 sions of subsection (a) of this section.

4 ‘‘§ 317. Inter partes reexamination prohibited

5 ‘‘(a) ORDER FOR REEXAMINATION.—Notwith6 standing any provision of this chapter, once an order for

7 inter partes reexamination of a patent has been issued

8 under section 313, neither the patent owner nor the third9 party requester, if any, nor privies of either, may file a

10 subsequent request for inter partes reexamination of the

11 patent until an inter partes reexamination certificate is

12 issued and published under section 316, unless authorized

13 by the Director.

14 ‘‘(b) FINAL DECISION.—Once a final decision has

15 been entered against a party in a civil action arising in

16 whole or in part under section 1338 of title 28 that the

17 party has not sustained its burden of proving the invalidity

18 of any patent claim in suit or if a final decision in an

19 inter partes reexamination proceeding instituted by a

20 third-party requester is favorable to the patentability of

21 any original or proposed amended or new claim of the pat22 ent then neither that party nor its privies may thereafter

23 request inter partes reexamination of any such patent

24 claim on the basis of issues which that party or its privies

25 raised or could have raised in such civil action or inter
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1 partes reexamination proceeding, and an inter partes reex2 amination requested by that party or its privies on the

3 basis of such issues may not thereafter be maintained by

4 the Office, notwithstanding any other provision of this

5 chapter. This subsection does not prevent the assertion of

6 invalidity based on newly discovered prior art unavailable

7 to the third-party requester and the Patent and Trade8 mark Office at the time of the inter partes reexamination

9 proceedings.

10 ‘‘§ 318. Stay of litigation

11 ‘‘Once an order for inter partes reexamination of a

12 patent has been issued under section 313, the patent

13 owner may obtain a stay of any pending litigation which

14 involves an issue of patentability of any claims of the pat15 ent which are the subject of the inter partes reexamination

16 order, unless the court before which such litigation is

17 pending determines that a stay would not serve the inter18 ests of justice.’’.

19 (b) CONFORMING AMENDMENTS.—The table of chap20 ters for part III of title 35, United States Code, is amend21 ed by striking the item relating to chapter 30 and insert22 ing the following:

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

‘‘31. Optional Inter Partes Reexamination of Patents ........ 311’’.
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1 SEC. 505. CONFORMING AMENDMENTS.

2 (a) PATENT FEES; PATENT SEARCH SYSTEMS.—Sec3 tion 41(a)(7) of title 35, United States Code, is amended

4 to read as follows:

5 ‘‘(7) On filing each petition for the revival of an

6 unintentionally abandoned application for a patent,

7 for the unintentionally delayed payment of the fee

8 for issuing each patent, or for an unintentionally de9 layed response by the patent owner in any reexam10 ination proceeding, $1,210, unless the petition is

11 filed under section 133 or 151 of this title, in which

12 case the fee shall be $110.’’.

13 (b) APPEAL TO THE BOARD OF PATENT APPEALS

14 AND INTERFERENCES.—Section 134 of title 35, United

15 States Code, is amended to read as follows:

16 ‘‘§ 134. Appeal to the Board of Patent Appeals and

17 Interferences

18 ‘‘(a) PATENT APPLICANT.—An applicant for a pat19 ent, any of whose claims has been twice rejected, may ap20 peal from the decision of the primary examiner to the

21 Board of Patent Appeals and Interferences, having once

22 paid the fee for such appeal.

23 ‘‘(b) PATENT OWNER.—A patent owner in any reex24 amination proceeding may appeal from the final rejection

25 of any claim by the primary examiner to the Board of Pat-
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1 ent Appeals and Interferences, having once paid the fee

2 for such appeal.

3 ‘‘(c) THIRD-PARTY.—A third-party requester in an

4 inter partes proceeding may appeal to the Board of Patent

5 Appeals and Interferences from the final decision of the

6 primary examiner favorable to the patentability of any

7 original or proposed amended or new claim of a patent,

8 having once paid the fee for such appeal. The third-party

9 requester may not appeal the decision of the Board of Pat10 ent Appeals and Interferences.’’.

11 (c) APPEAL TO COURT OF APPEALS FOR THE FED12 ERAL CIRCUIT.—Section 141 of title 35, United States

13 Code, is amended by adding the following after the second

14 sentence: ‘‘A patent owner in any reexamination pro15 ceeding dissatisfied with the final decision in an appeal

16 to the Board of Patent Appeals and Interferences under

17 section 134 may appeal the decision only to the United

18 States Court of Appeals for the Federal Circuit.’’.

19 (d) PROCEEDINGS ON APPEAL.—Section 143 of title

20 35, United States Code, is amended by amending the third

21 sentence to read as follows: ‘‘In any reexamination cases,

22 the Director shall submit to the court in writing the

23 grounds for the decision of the Patent and Trademark Of24 fice, addressing all the issues involved in the appeal.’’.
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1 (e) CIVIL ACTION TO OBTAIN PATENT.—Section 145

2 of title 35, United States Code, is amended in the first

3 sentence by inserting ‘‘(a)’’ after ‘‘section 134’’.

4 SEC. 506. REPORT TO CONGRESS.

5 Not later than 5 years after the effective date of this

6 title, the Director of the United States Patent and Trade7 mark Office shall submit to the Congress a report evalu8 ating whether the inter partes reexamination proceedings

9 established under the amendments made by this title are

10 inequitable to any of the parties in interest and, if so, the

11 report shall contain recommendations for changes to the

12 amendments made by this title to remove such inequity.

13 SEC. 507. ESTOPPEL EFFECT OF REEXAMINATION.

14 Any party who requests an inter partes reexamina15 tion under section 311 of title 35, United States Code,

16 is estopped from challenging at a later time, in any civil

17 action, any fact determined during the process of such re18 examination, except with respect to a fact determination

19 later proved to be erroneous based on information unavail20 able at the time of the inter partes reexamination decision.

21 If this section is held to be unenforceable, the enforce22 ability of the rest of this title or of this Act shall not be

23 denied as a result.
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1 SEC. 508. EFFECTIVE DATE.

2 This title and the amendments made by this title

3 shall take effect on the date that is 1 year after the date

4 of the enactment of this Act and shall apply to inter partes

5 reexamination requests filed on or after such date.

6 TITLE VI—PATENT AND

7 TRADEMARK OFFICE

8 SEC. 601. SHORT TITLE.

9 This title may be cited as the ‘‘Patent and Trade10 mark Office Efficiency Act’’.

11 Subtitle A—United States Patent

12 and Trademark Office

13 SEC. 611. ESTABLISHMENT OF PATENT AND TRADEMARK

14 OFFICE.

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

16 to read as follows:

17 ‘‘§ 1. Establishment

18 ‘‘(a) ESTABLISHMENT.—The United States Patent

19 and Trademark Office is established as an agency of the

20 United States, within the Department of Commerce. In

21 carrying out its functions, the United States Patent and

22 Trademark Office shall be subject to the policy direction

23 of the Secretary of Commerce, but otherwise shall retain

24 responsibility for decisions regarding the management and

25 administration of its operations and shall exercise inde26 pendent control of its budget allocations and expenditures,
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1 personnel decisions and processes, procurements, and

2 other administrative and management functions in accord3 ance with this title and applicable provisions of law. Those

4 operations designed to grant and issue patents and those

5 operations which are designed to facilitate the registration

6 of trademarks shall be treated as separate operating units

7 within the Office.

8 ‘‘(b) OFFICES.—The United States Patent and

9 Trademark Office shall maintain its principal office in the

10 metropolitan Washington, DC, area, for the service of

11 process and papers and for the purpose of carrying out

12 its functions. The United States Patent and Trademark

13 Office shall be deemed, for purposes of venue in civil ac14 tions, to be a resident of the district in which its principal

15 office is located, except where jurisdiction is otherwise pro16 vided by law. The United States Patent and Trademark

17 Office may establish satellite offices in such other places

18 in the United States as it considers necessary and appro19 priate in the conduct of its business.

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

21 United States Patent and Trademark Office shall also be

22 referred to as the ‘Office’ and the ‘Patent and Trademark

23 Office’.’’.
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1 SEC. 612. POWERS AND DUTIES.

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

3 to read as follows:

4 ‘‘§ 2. Powers and duties

5 ‘‘(a) IN GENERAL.—The United States Patent and

6 Trademark Office, subject to the policy direction of the

7 Secretary of Commerce—

8 ‘‘(1) shall be responsible for the granting and

9 issuing of patents and the registration of trade10 marks; and

11 ‘‘(2) shall be responsible for disseminating to

12 the public information with respect to patents and

13 trademarks.

14 ‘‘(b) SPECIFIC POWERS.—The Office—

15 ‘‘(1) shall adopt and use a seal of the Office,

16 which shall be judicially noticed and with which let17 ters patent, certificates of trademark registrations,

18 and papers issued by the Office shall be authenti19 cated;

20 ‘‘(2) may establish regulations, not inconsistent

21 with law, which—

22 ‘‘(A) shall govern the conduct of pro23 ceedings in the Office;

24 ‘‘(B) shall be made in accordance with sec25 tion 553 of title 5;
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1 ‘‘(C) shall facilitate and expedite the proc2 essing of patent applications, particularly those

3 which can be filed, stored, processed, searched,

4 and retrieved electronically, subject to the provi5 sions of section 122 relating to the confidential

6 status of applications;

7 ‘‘(D) may govern the recognition and con8 duct of agents, attorneys, or other persons rep9 resenting applicants or other parties before the

10 Office, and may require them, before being rec11 ognized as representatives of applicants or

12 other persons, to show that they are of good

13 moral character and reputation and are pos14 sessed of the necessary qualifications to render

15 to applicants or other persons valuable service,

16 advice, and assistance in the presentation or

17 prosecution of their applications or other busi18 ness before the Office;

19 ‘‘(E) shall recognize the public interest in

20 continuing to safeguard broad access to the

21 United States patent system through the re22 duced fee structure for small entities under sec23 tion 41(h)(1) of this title; and

24 ‘‘(F) provide for the development of a per25 formance-based process that includes quan-
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1 titative and qualitative measures and standards

2 for evaluating cost-effectiveness and is con3 sistent with the principles of impartiality and

4 competitiveness;

5 ‘‘(3) may acquire, construct, purchase, lease,

6 hold, manage, operate, improve, alter, and renovate

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

8 therein, as it considers necessary to carry out its

9 functions;

10 ‘‘(4)(A) may make such purchases, contracts

11 for the construction, maintenance, or management

12 and operation of facilities, and contracts for supplies

13 or services, without regard to the provisions of the

14 Federal Property and Administrative Services Act of

15 1949 (40 U.S.C. 471 et seq.), the Public Buildings

16 Act (40 U.S.C. 601 et seq.), and the Stewart B.

17 McKinney Homeless Assistance Act (42 U.S.C.

18 11301 et seq.); and

19 ‘‘(B) may enter into and perform such pur20 chases and contracts for printing services, including

21 the process of composition, platemaking, presswork,

22 silk screen processes, binding, microform, and the

23 products of such processes, as it considers necessary

24 to carry out the functions of the Office, without re-
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1 gard to sections 501 through 517 and 1101 through

2 1123 of title 44, United States Code;

3 ‘‘(5) may use, with their consent, services,

4 equipment, personnel, and facilities of other depart5 ments, agencies, and instrumentalities of the Fed6 eral Government, on a reimbursable basis, and co7 operate with such other departments, agencies, and

8 instrumentalities in the establishment and use of

9 services, equipment, and facilities of the Office;

10 ‘‘(6) may, when the Director determines that it

11 is practicable, efficient, and cost-effective to do so,

12 use, with the consent of the United States and the

13 agency, instrumentality, patent and trademark of14 fice, or international organization concerned, the

15 services, records, facilities, or personnel of any State

16 or local government agency or instrumentality or

17 foreign patent and trademark office or international

18 organization to perform functions on its behalf;

19 ‘‘(7) may retain and use all of its revenues and

20 receipts, including revenues from the sale, lease, or

21 disposal of any real, personal, or mixed property, or

22 any interest therein, of the Office;

23 ‘‘(8) shall advise the President, through the

24 Secretary of Commerce, on national and certain

25 international intellectual property policy issues;
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1 ‘‘(9) shall advise Federal departments and

2 agencies on matters of intellectual property policy in

3 the United States and intellectual property protec4 tion in other countries;

5 ‘‘(10) shall provide guidance, as appropriate,

6 with respect to proposals by agencies to assist for7 eign governments and international intergovern8 mental organizations on matters of intellectual prop9 erty protection;

10 ‘‘(11) may conduct programs, studies, or ex11 changes of items or services regarding domestic and

12 international intellectual property law and the effec13 tiveness of intellectual property protection domesti14 cally and throughout the world;

15 ‘‘(12)(A) shall advise the Secretary of Com16 merce on programs and studies relating to intellec17 tual property policy that are conducted, or author18 ized to be conducted, cooperatively with foreign in19 tellectual property offices and international intergov20 ernmental organizations; and

21 ‘‘(B) may conduct programs and studies de22 scribed in subparagraph (A); and

23 ‘‘(13)(A) in coordination with the Department

24 of State, may conduct programs and studies coop25 eratively with foreign intellectual property offices
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1 and international intergovernmental organizations;

2 and

3 ‘‘(B) with the concurrence of the Secretary of

4 State, may authorize the transfer of not to exceed

5 $100,000 in any year to the Department of State

6 for the purpose of making special payments to inter7 national intergovernmental organizations for studies

8 and programs for advancing international coopera9 tion concerning patents, trademarks, and other mat10 ters.

11 ‘‘(c) CLARIFICATION OF SPECIFIC POWERS.—(1) The

12 special payments under subsection (b)(13)(B) shall be in

13 addition to any other payments or contributions to inter14 national organizations described in subsection (b)(13)(B)

15 and shall not be subject to any limitations imposed by law

16 on the amounts of such other payments or contributions

17 by the United States Government.

18 ‘‘(2) Nothing in subsection (b) shall derogate from

19 the duties of the Secretary of State or from the duties

20 of the United States Trade Representative as set forth in

21 section 141 of the Trade Act of 1974 (19 U.S.C. 2171).

22 ‘‘(3) Nothing in subsection (b) shall derogate from

23 the duties and functions of the Register of Copyrights or

24 otherwise alter current authorities relating to copyright

25 matters.
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1 ‘‘(4) In exercising the Director’s powers under para2 graphs (3) and (4)(A) of subsection (b), the Director shall

3 consult with the Administrator of General Services.

4 ‘‘(d) CONSTRUCTION.—Nothing in this section shall

5 be construed to nullify, void, cancel, or interrupt any pend6 ing request-for-proposal let or contract issued by the Gen7 eral Services Administration for the specific purpose of re8 locating or leasing space to the United States Patent and

9 Trademark Office.’’.

10 SEC. 613. ORGANIZATION AND MANAGEMENT.

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

12 to read as follows:

13 ‘‘§ 3. Officers and employees

14 ‘‘(a) UNDER SECRETARY AND DIRECTOR.—

15 ‘‘(1) IN GENERAL.—The powers and duties of

16 the United States Patent and Trademark Office

17 shall be vested in an Under Secretary of Commerce

18 for Intellectual Property and Director of the United

19 States Patent and Trademark Office (in this title re20 ferred to as the ‘Director’), who shall be a citizen of

21 the United States and who shall be appointed by the

22 President, by and with the advice and consent of the

23 Senate. The Director shall be a person who has a

24 professional background and experience in patent or

25 trademark law.
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1 ‘‘(2) DUTIES.—

2 ‘‘(A) IN GENERAL.—The Director shall be

3 responsible for providing policy direction and

4 management supervision for the Office and for

5 the issuance of patents and the registration of

6 trademarks. The Director shall perform these

7 duties in a fair, impartial, and equitable man8 ner.

9 ‘‘(B) CONSULTING WITH THE PUBLIC AD10 VISORY COMMITTEES.—The Director shall con11 sult with the Patent Public Advisory Committee

12 established in section 5 on a regular basis on

13 matters relating to the patent operations of the

14 Office, shall consult with the Trademark Public

15 Advisory Committee established in section 5 on

16 a regular basis on matters relating to the trade17 mark operations of the Office, and shall consult

18 with the respective Public Advisory Committee

19 before submitting budgetary proposals to the

20 Office of Management and Budget or changing

21 or proposing to change patent or trademark

22 user fees or patent or trademark regulations

23 which are subject to the requirement to provide

24 notice and opportunity for public comment pur-
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1 suant to section 553 of title 5, as the case may

2 be.

3 ‘‘(3) OATH.—The Director shall, before taking

4 office, take an oath to discharge faithfully the duties

5 of the Office.

6 ‘‘(4) REMOVAL.—The Director may be removed

7 from office by the President. The President shall

8 provide notification of any such removal to both

9 Houses of Congress.

10 ‘‘(b) OFFICERS AND EMPLOYEES OF THE OFFICE.—

11 ‘‘(1) DEPUTY UNDER SECRETARY AND DEPUTY

12 DIRECTOR.—The Secretary of Commerce, upon nom13 ination by the Director, shall appoint a Deputy

14 Under Secretary of Commerce for Intellectual Prop15 erty and Deputy Director of the United States Pat16 ent and Trademark Office who shall be vested with

17 the authority to act in the capacity of the Director

18 in the event of the absence or incapacity of the Di19 rector. The Deputy Director shall be a citizen of the

20 United States who has a professional background

21 and experience in patent or trademark law.

22 ‘‘(2) COMMISSIONERS.—

23 ‘‘(A) APPOINTMENT AND DUTIES.—The

24 Secretary of Commerce shall appoint a Commis25 sioner for Patents and a Commissioner for
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1 Trademarks, without regard to chapter 33, 51,

2 or 53 of title 5. The Commissioner for Patents

3 shall be a citizen of the United States with

4 demonstrated management ability and profes5 sional background and experience in patent law

6 and serve for a term of 5 years. The Commis7 sioner for Trademarks shall be a citizen of the

8 United States with demonstrated management

9 ability and professional background and experi10 ence in trademark law and serve for a term of

11 5 years. The Commissioner for Patents and the

12 Commissioner for Trademarks shall serve as

13 the chief operating officers for the operations of

14 the Office relating to patents and trademarks,

15 respectively, and shall be responsible for the

16 management and direction of all aspects of the

17 activities of the Office that affect the adminis18 tration of patent and trademark operations, re19 spectively. The Secretary may reappoint a Com20 missioner to subsequent terms of 5 years as

21 long as the performance of the Commissioner as

22 set forth in the performance agreement in sub23 paragraph (B) is satisfactory.

24 ‘‘(B) SALARY AND PERFORMANCE AGREE25 MENT.—The Commissioners shall be paid an
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1 annual rate of basic pay not to exceed the max2 imum rate of basic pay for the Senior Executive

3 Service established under section 5382 of title

4 5, including any applicable locality-based com5 parability payment that may be authorized

6 under section 5304(h)(2)(C) of title 5. The

7 compensation of the Commissioners shall be

8 considered, for purposes of section 207(c)(2)(A)

9 of title 18, to be the equivalent of that de10 scribed under clause (ii) of section 207(c)(2)(A)

11 of title 18. In addition, the Commissioners may

12 receive a bonus in an amount of up to, but not

13 in excess of, 50 percent of the Commissioner’s

14 annual rate of basic pay, based upon an evalua15 tion by the Secretary of Commerce, acting

16 through the Director, of the Commissioners’

17 performance as defined in an annual perform18 ance agreement between the Commissioners and

19 the Secretary. The annual performance agree20 ments shall incorporate measurable organiza21 tion and individual goals in key operational

22 areas as delineated in an annual performance

23 plan agreed to by the Commissioners and the

24 Secretary. Payment of a bonus under this sub25 paragraph may be made to the Commissioners
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1 only to the extent that such payment does not

2 cause the Commissioners’ total aggregate com3 pensation in a calendar year to equal or exceed

4 the amount of the salary of the Vice President

5 under section 104 of title 3, United States

6 Code.

7 ‘‘(C) REMOVAL.—The Commissioners may

8 be removed from office by the Secretary for

9 misconduct or nonsatisfactory performance

10 under the performance agreement described in

11 subparagraph (B), without regard to the provi12 sions of title 5. The Secretary shall provide no13 tification of any such removal to both Houses

14 of Congress.

15 ‘‘(3) OTHER OFFICERS AND EMPLOYEES.—The

16 Director shall—

17 ‘‘(A) appoint such officers, employees (in18 cluding attorneys), and agents of the Office as

19 the Director considers necessary to carry out

20 the functions of the Office; and

21 ‘‘(B) define the title, authority, and duties

22 of such officers and employees and delegate to

23 them such of the powers vested in the Office as

24 the Director may determine.
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1 The Office shall not be subject to any administra2 tively or statutorily imposed limitation on positions

3 or personnel, and no positions or personnel of the

4 Office shall be taken into account for purposes of

5 applying any such limitation.

6 ‘‘(4) TRAINING OF EXAMINERS.—The Office

7 shall submit to the Congress a proposal to provide

8 an incentive program to retain as employees patent

9 and trademark examiners of the primary examiner

10 grade or higher who are eligible for retirement, for

11 the sole purpose of training patent and trademark

12 examiners.

13 ‘‘(c) CONTINUED APPLICABILITY OF TITLE 5.—Offi14 cers and employees of the Office shall be subject to the

15 provisions of title 5 relating to Federal employees.

16 ‘‘(d) ADOPTION OF EXISTING LABOR AGREE17 MENTS.—The Office shall adopt all labor agreements

18 which are in effect, as of the day before the effective date

19 of the Patent and Trademark Office Efficiency Act, with

20 respect to such Office (as then in effect).

21 ‘‘(e) CARRYOVER OF PERSONNEL.—

22 ‘‘(1) FROM PTO.—Effective as of the effective

23 date of the Patent and Trademark Office Efficiency

24 Act, all officers and employees of the Patent and

25 Trademark Office on the day before such effective
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1 date shall become officers and employees of the Of2 fice, without a break in service.

3 ‘‘(2) OTHER PERSONNEL.—Any individual who,

4 on the day before the effective date of the Patent

5 and Trademark Office Efficiency Act, is an officer

6 or employee of the Department of Commerce (other

7 than an officer or employee under paragraph (1))

8 shall be transferred to the Office, as necessary to

9 carry out the purposes of this Act, if—

10 ‘‘(A) such individual serves in a position

11 for which a major function is the performance

12 of work reimbursed by the Patent and Trade13 mark Office, as determined by the Secretary of

14 Commerce;

15 ‘‘(B) such individual serves in a position

16 that performed work in support of the Patent

17 and Trademark Office during at least half of

18 the incumbent’s work time, as determined by

19 the Secretary of Commerce; or

20 ‘‘(C) such transfer would be in the interest

21 of the Office, as determined by the Secretary of

22 Commerce in consultation with the Director.

23 Any transfer under this paragraph shall be effective

24 as of the same effective date as referred to in para-
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1 graph (1), and shall be made without a break in

2 service.

3 ‘‘(f) TRANSITION PROVISIONS.—

4 ‘‘(1) INTERIM APPOINTMENT OF DIRECTOR.—

5 On or after the effective date of the Patent and

6 Trademark Office Efficiency Act, the President shall

7 appoint an individual to serve as the Director until

8 the date on which a Director qualifies under sub9 section (a). The President shall not make more than

10 one such appointment under this subsection.

11 ‘‘(2) CONTINUATION IN OFFICE OF CERTAIN

12 OFFICERS.—(A) The individual serving as the As13 sistant Commissioner for Patents on the day before

14 the effective date of the Patent and Trademark Of15 fice Efficiency Act may serve as the Commissioner

16 for Patents until the date on which a Commissioner

17 for Patents is appointed under subsection (b).

18 ‘‘(B) The individual serving as the Assistant

19 Commissioner for Trademarks on the day before the

20 effective date of the Patent and Trademark Office

21 Efficiency Act may serve as the Commissioner for

22 Trademarks until the date on which a Commissioner

23 for Trademarks is appointed under subsection (b).’’.
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1 SEC. 614. PUBLIC ADVISORY COMMITTEES.

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

3 is amended by inserting after section 4 the following:

4 ‘‘§ 5. Patent and Trademark Office Public Advisory

5 Committees

6 ‘‘(a) ESTABLISHMENT OF PUBLIC ADVISORY COM7 MITTEES.—

8 ‘‘(1) APPOINTMENT.—The United States Pat9 ent and Trademark Office shall have a Patent Pub10 lic Advisory Committee and a Trademark Public Ad11 visory Committee, each of which shall have nine vot12 ing members who shall be appointed by the Sec13 retary of Commerce and serve at the pleasure of the

14 Secretary of Commerce. Members of each Public Ad15 visory Committee shall be appointed for a term of 3

16 years, except that of the members first appointed,

17 three shall be appointed for a term of 1 year, and

18 three shall be appointed for a term of 2 years. In

19 making appointments to each Committee, the Sec20 retary of Commerce shall consider the risk of loss of

21 competitive advantage in international commerce or

22 other harm to United States companies as a result

23 of such appointments.

24 ‘‘(2) CHAIR.—The Secretary shall designate a

25 chair of each Advisory Committee, whose term as

26 chair shall be for 3 years.
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1 ‘‘(3) TIMING OF APPOINTMENTS.—Initial ap2 pointments to each Advisory Committee shall be

3 made within 3 months after the effective date of the

4 Patent and Trademark Office Efficiency Act. Vacan5 cies shall be filled within 3 months after they occur.

6 ‘‘(b) BASIS FOR APPOINTMENTS.—Members of each

7 Advisory Committee—

8 ‘‘(1) shall be citizens of the United States who

9 shall be chosen so as to represent the interests of di10 verse users of the United States Patent and Trade11 mark Office with respect to patents, in the case of

12 the Patent Public Advisory Committee, and with re13 spect to trademarks, in the case of the Trademark

14 Public Advisory Committee;

15 ‘‘(2) shall include members who represent small

16 and large entity applicants located in the United

17 States in proportion to the number of applications

18 filed by such applicants, but in no case shall mem19 bers who represent small entity patent applicants,

20 including small business concerns, independent in21 ventors, and nonprofit organizations, constitute less

22 than 25 percent of the members of the Patent Pub23 lic Advisory Committee, and such members shall in24 clude at least one independent inventor; and
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1 ‘‘(3) shall include individuals with substantial

2 background and achievement in finance, manage3 ment, labor relations, science, technology, and office

4 automation.

5 In addition to the voting members, each Advisory Com6 mittee shall include a representative of each labor organi7 zation recognized by the United States Patent and Trade8 mark Office. Such representatives shall be nonvoting

9 members of the Advisory Committee to which they are ap10 pointed.

11 ‘‘(c) MEETINGS.—Each Advisory Committee shall

12 meet at the call of the chair to consider an agenda set

13 by the chair.

14 ‘‘(d) DUTIES.—Each Advisory Committee shall—

15 ‘‘(1) review the policies, goals, performance,

16 budget, and user fees of the United States Patent

17 and Trademark Office with respect to patents, in the

18 case of the Patent Public Advisory Committee, and

19 with respect to Trademarks, in the case of the

20 Trademark Public Advisory Committee, and advise

21 the Director on these matters;

22 ‘‘(2) within 60 days after the end of each fiscal

23 year—

24 ‘‘(A) prepare an annual report on the mat25 ters referred to in paragraph (1);
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1 ‘‘(B) transmit the report to the Secretary

2 of Commerce, the President, and the Commit3 tees on the Judiciary of the Senate and the

4 House of Representatives; and

5 ‘‘(C) publish the report in the Official Ga6 zette of the United States Patent and Trade7 mark Office.

8 ‘‘(e) COMPENSATION.—Each member of each Advi9 sory Committee shall be compensated for each day (includ10 ing travel time) during which such member is attending

11 meetings or conferences of that Advisory Committee or

12 otherwise engaged in the business of that Advisory Com13 mittee, at the rate which is the daily equivalent of the an14 nual rate of basic pay in effect for level III of the Execu15 tive Schedule under section 5314 of title 5. While away

16 from such member’s home or regular place of business

17 such member shall be allowed travel expenses, including

18 per diem in lieu of subsistence, as authorized by section

19 5703 of title 5, United States Code.

20 ‘‘(f) ACCESS TO INFORMATION.—Members of each

21 Advisory Committee shall be provided access to records

22 and information in the United States Patent and Trade23 mark Office, except for personnel or other privileged infor24 mation and information concerning patent applications re25 quired to be kept in confidence by section 122.
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1 ‘‘(g) APPLICABILITY OF CERTAIN ETHICS LAWS.—

2 Members of each Advisory Committee shall be special Gov3 ernment employees within the meaning of section 202 of

4 title 18, United States Code.

5 ‘‘(h) INAPPLICABILITY OF FEDERAL ADVISORY COM6 MITTEE ACT.—The Federal Advisory Committee Act (5

7 U.S.C. App.) shall not apply to each Advisory Committee.

8 ‘‘(i) OPEN MEETINGS.—The meetings of each Advi9 sory Committee shall be open to the public, except that

10 each Advisory Committee may by majority vote meet in

11 executive session when considering personnel or other con12 fidential information.’’.

13 SEC. 615. PATENT AND TRADEMARK OFFICE FUNDING.

14 Section 42(c) of title 35, United States Code, is

15 amended in the second sentence—

16 (1) by striking ‘‘Fees available’’ and inserting

17 ‘‘All fees available’’; and

18 (2) by striking ‘‘may’’ and inserting ‘‘shall’’.

19 SEC. 616. CONFORMING AMENDMENTS.

20 (a) DUTIES.—Chapter 1 of title 35, United States

21 Code, is amended by striking section 6.

22 (b) REGULATIONS FOR AGENTS AND ATTORNEYS.—

23 Section 31 of title 35, United States Code, and the item

24 relating to such section in the table of sections for chapter

25 3 of title 35, United States Code, are repealed.
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1 (c) SUSPENSION OR EXCLUSION FROM PRACTICE.—

2 Section 32 of title 35, United States Code, is amended

3 by striking ‘‘31’’ and inserting ‘‘2(b)(2)(D)’’.

4 SEC. 617. TRADEMARK TRIAL AND APPEAL BOARD.

5 Section 17 of the Act of July 5, 1946 (commonly re6 ferred to as the ‘‘Trademark Act of 1946’’) (15 U.S.C.

7 1067) is amended to read as follows:

8 ‘‘SEC. 17. (a) In every case of interference, opposition

9 to registration, application to register as a lawful concur10 rent user, or application to cancel the registration of a

11 mark, the Director shall give notice to all parties and shall

12 direct a Trademark Trial and Appeal Board to determine

13 and decide the respective rights of registration.

14 ‘‘(b) The Trademark Trial and Appeal Board shall

15 include the Director, the Commissioner for Patents, the

16 Commissioner for Trademarks, and administrative trade17 mark judges who are appointed by the Director.’’.

18 SEC. 618. BOARD OF PATENT APPEALS AND INTER19 FERENCES.

20 Chapter 1 of title 35, United States Code, is

21 amended—

22 (1) by striking section 7 and redesignating sec23 tions 8 through 14 as sections 7 through 13, respec24 tively; and

25 (2) by inserting after section 5 the following:
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1 ‘‘§ 6. Board of Patent Appeals and Interferences

2 ‘‘(a) ESTABLISHMENT AND COMPOSITION.—There

3 shall be in the United States Patent and Trademark Of4 fice a Board of Patent Appeals and Interferences. The Di5 rector, the Commissioner for Patents, the Commissioner

6 for Trademarks, and the administrative patent judges

7 shall constitute the Board. The administrative patent

8 judges shall be persons of competent legal knowledge and

9 scientific ability who are appointed by the Director.

10 ‘‘(b) DUTIES.—The Board of Patent Appeals and

11 Interferences shall, on written appeal of an applicant, re12 view adverse decisions of examiners upon applications for

13 patents and shall determine priority and patentability of

14 invention in interferences declared under section 135(a).

15 Each appeal and interference shall be heard by at least

16 3 members of the Board, who shall be designated by the

17 Director. Only the Board of Patent Appeals and Inter18 ferences may grant rehearings.’’.

19 SEC. 619. ANNUAL REPORT OF DIRECTOR.

20 Section 13 of title 35, United States Code, as redesig21 nated by section 618 of this Act, is amended to read as

22 follows:

23 ‘‘§ 13. Annual report to Congress

24 ‘‘The Director shall report to the Congress, not later

25 than 180 days after the end of each fiscal year, the mon26 eys received and expended by the Office, the purposes for
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1 which the moneys were spent, the quality and quantity of

2 the work of the Office, the nature of training provided to

3 examiners, the evaluation of the Commissioner of Patents

4 and the Commissioner of Trademarks by the Secretary of

5 Commerce, the compensation of the Commissioners, and

6 other information relating to the Office.’’.

7 SEC. 620. SUSPENSION OR EXCLUSION FROM PRACTICE.

8 Section 32 of title 35, United States Code, is amend9 ed by inserting before the last sentence the following: ‘‘The

10 Director shall have the discretion to designate any attor11 ney who is an officer or employee of the United States

12 Patent and Trademark Office to conduct the hearing re13 quired by this section.’’.

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

15 (a) PAY OF DIRECTOR.—Section 5314 of title 5,

16 United States Code, is amended by striking:

17 ‘‘Assistant Secretary of Commerce and Com18 missioner of Patents and Trademarks.’’.

19 and inserting:

20 ‘‘Under Secretary of Commerce for Intellectual

21 Property and Director of the United States Patent

22 and Trademark Office.’’.

23 (b) PAY OF DEPUTY DIRECTOR.—Section 5315 of

24 title 5, United States Code, is amended by adding at the

25 end the following:
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1 ‘‘Deputy Under Secretary of Commerce for In2 tellectual Property and Deputy Director of the

3 United States Patent and Trademark Office.’’.

4 SEC. 622. STUDY ON ALTERNATIVE FEE STRUCTURES.

5 The Under Secretary of Commerce for Intellectual

6 Property and Director of the United States Patent and

7 Trademark Office shall conduct a study of alternative fee

8 structures that could be adopted by the United States Pat9 ent and Trademark Office to encourage maximum partici10 pation by the inventor community in the United States.

11 The Director shall submit to the Committees on the Judi12 ciary of the House of Representatives and the Senate a

13 report on the study not later than 1 year after the date

14 of the enactment of this Act.

15 Subtitle B—Effective Date;

16 Technical Amendments

17 SEC. 631. EFFECTIVE DATE.

18 This title and the amendments made by this title

19 shall take effect 4 months after the date of the enactment

20 of this Act.

21 SEC. 632. TECHNICAL AND CONFORMING AMENDMENTS.

22 (a) AMENDMENTS TO TITLE 35.—

23 (1) The item relating to part I in the table of

24 parts for chapter 35, United States Code, is amend25 ed to read as follows:

‘‘I. United States Patent and Trademark Office .................... 1’’.
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1 (2) The heading for part I of title 35, United

2 States Code, is amended to read as follows:

3 ‘‘PART I—UNITED STATES PATENT AND

4 TRADEMARK OFFICE’’.

5 (3) The table of chapters for part I of title 35,

6 United States Code, is amended by amending the

7 item relating to chapter 1 to read as follows:

‘‘1. Establishment, Officers and Employees, Functions ...... 1’’.

8 (4) The table of sections for chapter 1 of title

9 35, United States Code, is amended to read as fol10 lows:

11 ‘‘CHAPTER 1—ESTABLISHMENT, OFFICERS

12 AND EMPLOYEES, FUNCTIONS

‘‘Sec.

‘‘ 1. Establishment.

‘‘ 2. Powers and duties.

‘‘ 3. Officers and employees.

‘‘ 4. Restrictions on officers and employees as to interest in patent s.

‘‘ 5. Patent and Trademark Office Public Advisory Committees.

‘‘ 6. Board of Patent Appeals and Interferences.

‘‘ 7. Library.

‘‘ 8. Classification of patents.

‘‘ 9. Certified copies of records.

‘‘10. Publications.

‘‘11. Exchange of copies of patents and applications with foreign countries.

‘‘12. Copies of patents and applications for public libraries.

‘‘13. Annual report to Congress.’’.

13 (5) Section 41(h) of title 35, United States

14 Code, is amended by striking ‘‘Commissioner of Pat15 ents and Trademarks’’ and inserting ‘‘Director’’.
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1 (6) Section 155 of title 35, United States Code,

2 is amended by striking ‘‘Commissioner of Patents

3 and Trademarks’’ and inserting ‘‘Director’’.

4 (7) Section 155A(c) of title 35, United States

5 Code, is amended by striking ‘‘Commissioner of Pat6 ents and Trademarks’’ and inserting ‘‘Director’’.

7 (8) Section 302 of title 35, United States Code,

8 is amended by striking ‘‘Commissioner of Patents’’

9 and inserting ‘‘Director’’.

10 (9) Section 303(b) of title 35, United States

11 Code, is amended by striking ‘‘Commissioner’s’’ and

12 inserting ‘‘Director’s’’.

13 (10)(A) Except as provided in subparagraph

14 (B), title 35, United States Code, is amended by

15 striking ‘‘Commissioner’’ each place it appears and

16 inserting ‘‘Director’’.

17 (B) Chapter 17 of title 35, United States Code,

18 is amended by striking ‘‘Commissioner’’ each place

19 it appears and inserting ‘‘Commissioner of Patents’’.

20 (11) Section 157(d) of title 35, United States

21 Code, is amended by striking ‘‘Secretary of Com22 merce’’ and inserting ‘‘Director’’.

23 (12) Section 202(a) of title 35, United States

24 Code, is amended—
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1 (A) by striking ‘‘iv)’’ and inserting ‘‘(iv)’’;

2 and

3 (B) by striking the second period after

4 ‘‘Department of Energy’’ at the end of the first

5 sentence.

6 (b) OTHER PROVISIONS OF LAW.—

7 (1)(A) Section 45 of the Act of July 5, 1946

8 (commonly referred to as the ‘‘Trademark Act of

9 1946’’; 15 U.S.C. 1127), is amended by striking

10 ‘‘The term ‘Commissioner’’ means the Commissioner

11 of Patents and Trademarks.’ and inserting ‘‘The

12 term ‘Director’ means the Director of the United

13 States Patent and Trademark Office.’’.

14 (B) The Act of July 5, 1946 (commonly re15 ferred to as the ‘‘Trademark Act of 1946’’; 15

16 U.S.C. 1051 and following), except for section 17, as

17 amended by section 617 of this Act, is amended by

18 striking ‘‘Commissioner’’ each place it appears and

19 inserting ‘‘Director’’.

20 (2) Section 500(e) of title 5, United States

21 Code, is amended by striking ‘‘Patent Office’’ and

22 inserting ‘‘United States Patent and Trademark Of23 fice’’.

24 (3) Section 5102(c)(23) of title 5, United

25 States Code, is amended to read as follows:
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1 ‘‘(23) administrative patent judges and des2 ignated administrative patent judges in the United

3 States Patent and Trademark Office;’’.

4 (4) Section 5316 of title 5, United States Code

5 (5 U.S.C. 5316) is amended by striking ‘‘Commis6 sioner of Patents, Department of Commerce.’’,

7 ‘‘Deputy Commissioner of Patents and Trade8 marks.’’, ‘‘Assistant Commissioner for Patents.’’,

9 and ‘‘Assistant Commissioner for Trademarks.’’.

10 (5) Section 9(p)(1)(B) of the Small Business

11 Act (15 U.S.C. 638(p)(1)(B)) is amended to read as

12 follows:

13 ‘‘(B) the Director of the United States

14 Patent and Trademark Office; and’’.

15 (6) Section 12 of the Act of February 14, 1903

16 (15 U.S.C. 1511) is amended—

17 (A) by striking ‘‘(d) Patent and Trade18 mark Office;’’ and inserting:

19 ‘‘(4) United States Patent and Trademark Of20 fice’’; and

21 (B) by redesignating subsections (a), (b),

22 (c), (e), (f), and (g) as paragraphs (1), (2), (3),

23 (5), (6), and (7), respectively and indenting the

24 paragraphs as so redesignated 2 ems to the

25 right.
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1 (7) Section 19 of the Tennessee Valley Author2 ity Act of 1933 (16 U.S.C. 831r) is amended—

3 (A) by striking ‘‘Patent Office of the

4 United States’’ and inserting ‘‘United States

5 Patent and Trademark Office’’; and

6 (B) by striking ‘‘Commissioner of Patents’’

7 and inserting ‘‘Director of the United States

8 Patent and Trademark Office’’.

9 (8) Section 182(b)(2)(A) of the Trade Act of

10 1974 (19 U.S.C. 2242(b)(2)(A)) is amended by

11 striking ‘‘Commissioner of Patents and Trade12 marks’’ and inserting ‘‘Director of the United States

13 Patent and Trademark Office’’.

14 (9) Section 302(b)(2)(D) of the Trade Act of

15 1974 (19 U.S.C. 2412(b)(2)(D)) is amended by

16 striking ‘‘Commissioner of Patents and Trade17 marks’’ and inserting ‘‘Director of the United States

18 Patent and Trademark Office’’.

19 (10) The Act of April 12, 1892 (27 Stat. 395;

20 20 U.S.C. 91) is amended by striking ‘‘Patent Of21 fice’’ and inserting ‘‘United States Patent and

22 Trademark Office’’.

23 (11) Sections 505(m) and 512(o) of the Federal

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

25 and 360b(o)) are each amended by striking ‘‘Patent
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1 and Trademark Office of the Department of Com2 merce’’ and inserting ‘‘United States Patent and

3 Trademark Office’’.

4 (12) Section 702(d) of the Federal Food, Drug,

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

6 striking ‘‘Commissioner of Patents’’ and inserting

7 ‘‘Director of the United States Patent and Trade8 mark Office’’ and by striking ‘‘Commissioner’’ and

9 inserting ‘‘Director’’.

10 (13) Section 105(e) of the Federal Alcohol Ad11 ministration Act (27 U.S.C. 205(e)) is amended by

12 striking ‘‘United States Patent Office’’ and inserting

13 ‘‘United States Patent and Trademark Office’’.

14 (14) Section 1295(a)(4) of title 28, United

15 States Code, is amended—

16 (A) in subparagraph (A) by inserting

17 ‘‘United States’’ before ‘‘Patent and Trade18 mark’’; and

19 (B) in subparagraph (B) by striking

20 ‘‘Commissioner of Patents and Trademarks’’

21 and inserting ‘‘Director of the United States

22 Patent and Trademark Office’’.

23 (15) Chapter 115 of title 28, United States

24 Code, is amended—
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1 (A) in the item relating to section 1744 in

2 the table of sections by striking ‘‘Patent Office’’

3 and inserting ‘‘United States Patent and

4 Trademark Office’’;

5 (B) in section 1744—

6 (i) by striking ‘‘Patent Office’’ each

7 place it appears in the text and section

8 heading and inserting ‘‘United States Pat9 ent and Trademark Office’’; and

10 (ii) by striking ‘‘Commissioner of Pat11 ents’’ and inserting ‘‘Director of the

12 United States Patent and Trademark Of13 fice’’; and

14 (C) by striking ‘‘Commissioner’’ and in15 serting ‘‘Director’’.

16 (16) Section 1745 of title 28, United States

17 Code, is amended by striking ‘‘United States Patent

18 Office’’ and inserting ‘‘United States Patent and

19 Trademark Office’’.

20 (17) Section 1928 of title 28, United States

21 Code, is amended by striking ‘‘Patent Office’’ and

22 inserting ‘‘United States Patent and Trademark Of23 fice’’.

24 (18) Section 151 of the Atomic Energy Act of

25 1954 (42 U.S.C. 2181) is amended in subsections c.
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1 and d. by striking ‘‘Commissioner of Patents’’ and

2 inserting ‘‘Director of the United States Patent and

3 Trademark Office’’.

4 (19) Section 152 of the Atomic Energy Act of

5 1954 (42 U.S.C. 2182) is amended by striking

6 ‘‘Commissioner of Patents’’ each place it appears

7 and inserting ‘‘Director of the United States Patent

8 and Trademark Office’’.

9 (20) Section 305 of the National Aeronautics

10 and Space Act of 1958 (42 U.S.C. 2457) is

11 amended—

12 (A) in subsection (c) by striking ‘‘Commis13 sioner of Patents’’ and inserting ‘‘Director of

14 the United States Patent and Trademark Office

15 (hereafter in this section referred to as the ‘Di16 rector’)’’; and

17 (B) by striking ‘‘Commissioner’’ each sub18 sequent place it appears and inserting ‘‘Direc19 tor’’.

20 (21) Section 12(a) of the Solar Heating and

21 Cooling Demonstration Act of 1974 (42 U.S.C.

22 5510(a)) is amended by striking ‘‘Commissioner of

23 the Patent Office’’ and inserting ‘‘Director of the

24 United States Patent and Trademark Office’’.
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1 (22) Section 1111 of title 44, United States

2 Code, is amended by striking ‘‘the Commissioner of

3 Patents,’’.

4 (23) Section 1114 of title 44, United States

5 Code, is amended by striking ‘‘the Commissioner of

6 Patents,’’.

7 (24) Section 1123 of title 44, United States

8 Code, is amended by striking ‘‘the Patent Office,’’.

9 (25) Sections 1337 and 1338 of title 44, United

10 States Code, and the items relating to those sections

11 in the table of contents for chapter 13 of such title,

12 are repealed.

13 (26) Section 10(i) of the Trading with the

14 enemy Act (50 U.S.C. App. 10(i)) is amended by

15 striking ‘‘Commissioner of Patents’’ and inserting

16 ‘‘Director of the United States Patent and Trade17 mark Office’’.

18 Subtitle C—Miscellaneous

19 Provisions

20 SEC. 641. REFERENCES.

21 (a) IN GENERAL.—Any reference in any other Fed22 eral law, Executive order, rule, regulation, or delegation

23 of authority, or any document of or pertaining to a depart24 ment or office from which a function is transferred by this

25 title—
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1 (1) to the head of such department or office is

2 deemed to refer to the head of the department or of3 fice to which such function is transferred; or

4 (2) to such department or office is deemed to

5 refer to the department or office to which such func6 tion is transferred.

7 (b) SPECIFIC REFERENCES.—Any reference in any

8 other Federal law, Executive order, rule, regulation, or

9 delegation of authority, or any document of or pertaining

10 to the Patent and Trademark Office—

11 (1) to the Commissioner of Patents and Trade12 marks is deemed to refer to the Under Secretary of

13 Commerce for Intellectual Property and Director of

14 the United States Patent and Trademark Office;

15 (2) to the Assistant Commissioner for Patents

16 is deemed to refer to the Commissioner for Patents;

17 or

18 (3) to the Assistant Commissioner for Trade19 marks is deemed to refer to the Commissioner for

20 Trademarks.

21 SEC. 642. EXERCISE OF AUTHORITIES.

22 Except as otherwise provided by law, a Federal offi23 cial to whom a function is transferred by this title may,

24 for purposes of performing the function, exercise all au25 thorities under any other provision of law that were avail-
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1 able with respect to the performance of that function to

2 the official responsible for the performance of the function

3 immediately before the effective date of the transfer of the

4 function under this title.

5 SEC. 643. SAVINGS PROVISIONS.

6 (a) LEGAL DOCUMENTS.—All orders, determinations,

7 rules, regulations, permits, grants, loans, contracts, agree8 ments, certificates, licenses, and privileges—

9 (1) that have been issued, made, granted, or al10 lowed to become effective by the President, the Sec11 retary of Commerce, any officer or employee of any

12 office transferred by this title, or any other Govern13 ment official, or by a court of competent jurisdic14 tion, in the performance of any function that is

15 transferred by this title; and

16 (2) that are in effect on the effective date of

17 such transfer (or become effective after such date

18 pursuant to their terms as in effect on such effective

19 date), shall continue in effect according to their

20 terms until modified, terminated, superseded, set

21 aside, or revoked in accordance with law by the

22 President, any other authorized official, a court of

23 competent jurisdiction, or operation of law.

24 (b) PROCEEDINGS.—This title shall not affect any

25 proceedings or any application for any benefits, service,
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1 license, permit, certificate, or financial assistance pending

2 on the effective date of this title before an office trans3 ferred by this title, but such proceedings and applications

4 shall be continued. Orders shall be issued in such pro5 ceedings, appeals shall be taken therefrom, and payments

6 shall be made pursuant to such orders, as if this title had

7 not been enacted, and orders issued in any such pro8 ceeding shall continue in effect until modified, terminated,

9 superseded, or revoked by a duly authorized official, by

10 a court of competent jurisdiction, or by operation of law.

11 Nothing in this subsection shall be considered to prohibit

12 the discontinuance or modification of any such proceeding

13 under the same terms and conditions and to the same ex14 tent that such proceeding could have been discontinued

15 or modified if this title had not been enacted.

16 (c) SUITS.—This title shall not affect suits com17 menced before the effective date of this title, and in all

18 such suits, proceedings shall be had, appeals taken, and

19 judgments rendered in the same manner and with the

20 same effect as if this title had not been enacted.

21 (d) NONABATEMENT OF ACTIONS.—No suit, action,

22 or other proceeding commenced by or against the Depart23 ment of Commerce or the Secretary of Commerce, or by

24 or against any individual in the official capacity of such

25 individual as an officer or employee of an office trans-
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1 ferred by this title, shall abate by reason of the enactment

2 of this title.

3 (e) CONTINUANCE OF SUITS.—If any Government of4 ficer in the official capacity of such officer is party to a

5 suit with respect to a function of the officer, and under

6 this title such function is transferred to any other officer

7 or office, then such suit shall be continued with the other

8 officer or the head of such other office, as applicable, sub9 stituted or added as a party.

10 (f) ADMINISTRATIVE PROCEDURE AND JUDICIAL RE11 VIEW.—Except as otherwise provided by this title, any

12 statutory requirements relating to notice, hearings, action

13 upon the record, or administrative or judicial review that

14 apply to any function transferred by this title shall apply

15 to the exercise of such function by the head of the Federal

16 agency, and other officers of the agency, to which such

17 function is transferred by this title.

18 SEC. 644. TRANSFER OF ASSETS.

19 Except as otherwise provided in this title, so much

20 of the personnel, property, records, and unexpended bal21 ances of appropriations, allocations, and other funds em22 ployed, used, held, available, or to be made available in

23 connection with a function transferred to an official or

24 agency by this title shall be available to the official or the

25 head of that agency, respectively, at such time or times
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1 as the Director of the Office of Management and Budget

2 directs for use in connection with the functions trans3 ferred.

4 SEC. 645. DELEGATION AND ASSIGNMENT.

5 Except as otherwise expressly prohibited by law or

6 otherwise provided in this title, an official to whom func7 tions are transferred under this title (including the head

8 of any office to which functions are transferred under this

9 title) may delegate any of the functions so transferred to

10 such officers and employees of the office of the official as

11 the official may designate, and may authorize successive

12 redelegations of such functions as may be necessary or ap13 propriate. No delegation of functions under this section

14 or under any other provision of this title shall relieve the

15 official to whom a function is transferred under this title

16 of responsibility for the administration of the function.

17 SEC. 646. AUTHORITY OF DIRECTOR OF THE OFFICE OF

18 MANAGEMENT AND BUDGET WITH RESPECT

19 TO FUNCTIONS TRANSFERRED.

20 (a) DETERMINATIONS.—If necessary, the Director of

21 the Office of Management and Budget shall make any de22 termination of the functions that are transferred under

23 this title.

24 (b) INCIDENTAL TRANSFERS.—The Director of the

25 Office of Management and Budget, at such time or times
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1 as the Director shall provide, may make such determina2 tions as may be necessary with regard to the functions

3 transferred by this title, and to make such additional inci4 dental dispositions of personnel, assets, liabilities, grants,

5 contracts, property, records, and unexpended balances of

6 appropriations, authorizations, allocations, and other

7 funds held, used, arising from, available to, or to be made

8 available in connection with such functions, as may be nec9 essary to carry out the provisions of this title. The Direc10 tor shall provide for the termination of the affairs of all

11 entities terminated by this title and for such further meas12 ures and dispositions as may be necessary to effectuate

13 the purposes of this title.

14 SEC. 647. CERTAIN VESTING OF FUNCTIONS CONSIDERED

15 TRANSFERS.

16 For purposes of this title, the vesting of a function

17 in a department or office pursuant to reestablishment of

18 an office shall be considered to be the transfer of the func19 tion.

20 SEC. 648. AVAILABILITY OF EXISTING FUNDS.

21 Existing appropriations and funds available for the

22 performance of functions, programs, and activities termi23 nated pursuant to this title shall remain available, for the

24 duration of their period of availability, for necessary ex25 penses in connection with the termination and resolution
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1 of such functions, programs, and activities, subject to the

2 submission of a plan to the Committees on Appropriations

3 of the House and Senate in accordance with the proce4 dures set forth in section 605 of the Departments of Com5 merce, Justice, and State, the Judiciary, and Related

6 Agencies Appropriations Act, 1999, as contained in Public

7 Law 105–277.

8 SEC. 649. DEFINITIONS.

9 For purposes of this title—

10 (1) the term ‘‘function’’ includes any duty, obli11 gation, power, authority, responsibility, right, privi12 lege, activity, or program; and

13 (2) the term ‘‘office’’ includes any office, ad14 ministration, agency, bureau, institute, council, unit,

15 organizational entity, or component thereof.

16 TITLE VII—MISCELLANEOUS

17 PATENT PROVISIONS

18 SEC. 701. PROVISIONAL APPLICATIONS.

19 (a) ABANDONMENT.—Section 111(b)(5) of title 35,

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

21 ‘‘(5) ABANDONMENT.—Notwithstanding the ab22 sence of a claim, upon timely request and as pre23 scribed by the Commissioner, a provisional applica24 tion may be treated as an application filed under

25 subsection (a). Subject to section 119(e)(3) of this
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1 title, if no such request is made, the provisional ap2 plication shall be regarded as abandoned 12 months

3 after the filing date of such application and shall not

4 be subject to revival thereafter.’’.

5 (b) TECHNICAL AMENDMENT RELATING TO WEEK6 ENDS AND HOLIDAYS.—Section 119(e) of title 35, United

7 States code, is amended by adding at the end the fol8 lowing:

9 ‘‘(3) If the day that is 12 months after the filing date

10 of a provisional application falls on a Saturday, Sunday,

11 or Federal holiday within the District of Columbia, the

12 period of pendency of the provisional application shall be

13 extended to the next succeeding secular or business day.’’.

14 (c) ELIMINATION OF COPENDENCY REQUIRE15 MENT.—Section 119(e)(2) of title 35, United States Code,

16 is amended by striking ‘‘and the provisional application

17 was pending on the filing date of the application for patent

18 under section 111(a) or section 363 of this title’’.

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

20 this section shall take effect on the date of the enactment

21 of this Act and shall apply to any provisional application

22 filed on or after June 8, 1995, except that the amend23 ments made by subsections (b) and (c) shall have no effect

24 with respect to any patent which is the subject of litigation
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1 in an action commenced before such date of the enact2 ment.

3 SEC. 702. INTERNATIONAL APPLICATIONS.

4 Section 119 of title 35, United States Code, is

5 amended—

6 (1) in subsection (a)—

7 (A) by inserting ‘‘in a WTO member coun8 try or’’ after ‘‘patent for the same invention’’;

9 and

10 (B) by inserting ‘‘such WTO member

11 country or’’ after ‘‘first filed in’’;

12 (2) in subsection (c), by inserting ‘‘WTO mem13 ber country or’’ after ‘‘application in the same’’; and

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

15 ‘‘(f) Applications for plant breeder’s rights filed in

16 a WTO member country (or in a foreign UPOV Con17 tracting Party) shall have the same effect for the purpose

18 of the right of priority under subsections (a) through (c)

19 of this section as applications for patent, subject to the

20 same conditions and requirements of this section as apply

21 to applications for patents.

22 ‘‘(g) As used in this section—

23 ‘‘(1) the term ‘WTO member country’ has the

24 meaning given that term in section 2(10) of the

25 Uruguay Round Agreements Act; and
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1 ‘‘(2) the term ‘UPOV Contracting Party’ means

2 a member of the International Convention for the

3 Protection of New Varieties of Plants.’’.

4 SEC. 703. CERTAIN LIMITATIONS ON DAMAGES FOR PAT5 ENT INFRINGEMENT NOT APPLICABLE.

6 Section 287(c)(4) of title 35, United States Code, is

7 amended by striking ‘‘before the date of enactment of this

8 subsection’’ and inserting ‘‘based on an application the

9 earliest effective filing date of which is prior to September

10 30, 1996’’.

11 SEC. 704. ELECTRONIC FILING AND PUBLICATIONS.

12 (a) PRINTING OF PAPERS FILED.—Section 22 of title

13 35, United States Code, is amended by striking ‘‘printed

14 or typewritten’’ and inserting ‘‘printed, typewritten, or on

15 an electronic medium’’.

16 (b) PUBLICATIONS.—Section 11(a) of title 35, United

17 States Code, is amended by amending the matter pre18 ceding paragraph 1 to read as follows:

19 ‘‘(a) The Director may publish in printed, type20 written, or electronic form, the following:’’.

21 (c) COPIES OF PATENTS FOR PUBLIC LIBRARIES.—

22 Section 13 of title 35, United States Code, is amended

23 by striking ‘‘The Commissioner may supply printed copies

24 of specifications and drawings of patents’’ and inserting
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1 ‘‘The Director may supply copies of specifications and

2 drawings of patents in printed or electronic form’’.

3 (d) MAINTENANCE OF COLLECTIONS.—Section

4 41(i)(1) of title 35, United States Code, is amended by

5 striking ‘‘The Commissioner shall maintain, for use by the

6 public, paper or microform’’ and inserting ‘‘The Director

7 shall maintain, for use by the public, paper, microform,

8 or electronic’’.

9 SEC. 705. STUDY AND REPORT ON BIOLOGICAL DEPOSITS

10 IN SUPPORT OF BIOTECHNOLOGY PATENTS.

11 (a) IN GENERAL.—No later than 6 months after the

12 date of the enactment of this Act, the Comptroller General

13 of the United States, in consultation with the Director of

14 the United States Patent and Trademark Office, shall

15 conduct a study and submit a report to the Congress on

16 the potential risks to the United States biotechnology in17 dustry relating to biological deposits in support of bio18 technology patents.

19 (b) CONTENTS.—The study conducted under this sec20 tion shall include—

21 (1) an examination of the risk of export and the

22 risk of transfers to third parties of biological depos23 its, and the risks posed by the change to 18-month

24 publication requirements made by this Act;
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1 (2) an analysis of comparative legal and regu2 latory regimes; and

3 (3) any related recommendations.

4 (c) CONSIDERATION OF REPORT.—In drafting regu5 lations affecting biological deposits (including any modi6 fication of title 37, Code of Federal Regulations, section

7 1.801 et seq.), the Patent and Trademark Office shall con8 sider the recommendations of the study conducted under

9 this section.

10 SEC. 706. PRIOR INVENTION.

11 Section 102(g) of title 35, United States Code, is

12 amended to read as follows:

13 ‘‘(g)(1) during the course of an interference con14 ducted under section 135 or section 291, another inventor

15 involved therein establishes, to the extent permitted in sec16 tion 104, that before such person’s invention thereof the

17 invention was made by such other inventor and not aban18 doned, suppressed, or concealed, or (2) before such per19 son’s invention thereof, the invention was made in this

20 country by another inventor who had not abandoned, sup21 pressed, or concealed it. In determining priority of inven22 tion under this subsection, there shall be considered not

23 only the respective dates of conception and reduction to

24 practice of the invention, but also the reasonable diligence
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1 of one who was first to conceive and last to reduce to prac2 tice, from a time prior to conception by the other.’’.

3 SEC. 707. PRIOR ART EXCLUSION FOR CERTAIN COMMONLY

4 ASSIGNED PATENTS.

5 (a) PRIOR ART EXCLUSION.—Section 103(c) of title

6 35, United States Code, is amended by striking ‘‘sub7 section (f) or (g)’’ and inserting ‘‘one or more of sub8 sections (e), (f), and (g)’’.

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

10 subsection (a) shall apply to any application for patent

11 filed on or after the date of the enactment of this Act.

Attest: JEFF TRANDALL,

Clerk.

By MARTHA C. MORRISON,

Deputy Clerk.