Union Calendar No. 172

106TH CONGRESS

1ST SESSION H. R. 1907

[Report No. 106–287, Part I]

A BILL

To amend title 35, United States Code, to provide

and for other purposes.protect patent terms, reduce patent litigation,enhanced protection for inventors and innovators,

AUGUST 3, 1999

Reported with an amendment and referred to the Comrule X jurisdiction of that committee pursuant to clause 1(h), provisions of the bill and amendment as fall within the later than August 3, 1999, for consideration of such mittee on Government Reform for a period ending not

AUGUST 3, 1999

Committee on Government Reform discharged; comState of the Union and ordered to be printed mitted to the Committee of the Whole House on the
IB

Union Calendar No. 172

106TH CONGRESS

1ST SESSION H. R. 1907

[Report No. 106–287, Part I]

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.

IN THE HOUSE OF REPRESENTATIVES

MAY 24, 1999

Mr. COBLE (for himself, Mr. BERMAN, Mr. HYDE, Mr. CONYERS, Mr. ROHRABACHER, Mr. CAMPBELL, Mr. GOODLATTE, Ms. LOFGREN, Mr.

DELAHUNT, Mr. PEASE, Mr. WEXLER, and Mr. GALLEGLY) introduced

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

AUGUST 3, 1999

Reported with an amendment and referred to the Committee on Government

Reform for a period ending not later than August 3, 1999, for consideration of such provisions of the bill and amendment as fall within the jurisdiction of that committee pursuant to clause 1(h), rule X

[Strike out all after the enacting clause and insert the part printed in italic]

AUGUST 3, 1999

Additional sponsors: Mr. CANNON, Mrs. MORELLA, Mrs. KELLY, Mr. SMITH

of Washington, Mrs. TAUSCHER, Ms. ESHOO, Mr. LARGENT, Mr. BARTLETT of Maryland, Mr. FRANKS of New Jersey, Mr. FRANK of Massachusetts, Mr. BILBRAY, Mr. FROST, Mr. LANTOS, Mr. SWEENEY, Mr. SHERMAN, Mr. DOOLEY of California, Mr. MCDERMOTT, Mr. BOUCHER, Mr.

PORTMAN, Mr. DAVIS of Florida, Mrs. NAPOLITANO, Mrs. MEEK of Florida, Mr. PETRI, Mr. NORWOOD, Mr. BALLENGER, Mrs. JOHNSON of Connecticut, Mr. BRYANT, Mr. ROTHMAN, Mr. EHRLICH, Mr. MALONEY of

Connecticut, Mr. DICKS, Mr. WATT of North Carolina, Mr. DREIER, Mr.

MCCOLLUM, Mr. VENTO, Mr. CALVERT, Mr. PRICE of North Carolina,

Mr. LEWIS of Georgia, Mr. CLEMENT, Mr. FORD, Mr. MORAN of Virginia, Mr. ETHERIDGE, Ms. MCCARTHY of Missouri, Mr. HILL of Montana, Mr. CASTLE, Mr. MASCARA, Mr. SHADEGG, AND Mr. WOLF
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AUGUST 3, 1999

Committee on Government Reform discharged; committed to the Committee

of the Whole House on the State of the Union and ordered to be printed

[For text of introduced bill, see copy of bill as introduced on May 24, 1999]

A BILL

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,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘American Inventors Pro5 tection Act of 1999’’.

6 SEC. 2. TABLE OF CONTENTS.

7 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.
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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—PATENT LITIGATION REDUCTION ACT

Sec. 501. Short title.

Sec. 502. Definitions.

Sec. 503. Reexamination procedures.

Sec. 504. Conforming amendments.

Sec. 505. Report to Congress.

Sec. 506. Estoppel effect of reexamination.

Sec. 507. Effective date.

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. Personnel flexibility.

Sec. 615. Public Advisory Committees.

Sec. 616. Patent and Trademark Office funding.

Sec. 617. Conforming amendments.

Sec. 618. Trademark Trial and Appeal Board.

Sec. 619. Board of Patent Appeals and Interferences.

Sec. 620. Annual report of Director.

Sec. 621. Suspension or exclusion from practice.

Sec. 622. Pay of Director.

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.
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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.

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 Act’’.

4 SEC. 102. INVENTION PROMOTION SERVICES.

5 Part I of title 35, United States Code, is amended by

6 adding after chapter 4 the following chapter:

7 ‘‘CHAPTER 5—INVENTION PROMOTION

8 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.

9 ‘‘§ 51. Definitions

10 ‘‘For purposes of this chapter—

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

12 services’ means a contract by which an invention pro13 moter undertakes invention promotion services for a

14 customer;
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1 ‘‘(2) the term ‘customer’ means any person, firm,

2 partnership, corporation, or other entity who enters

3 into a financial relationship or a contract with an

4 invention promoter for invention promotion services;

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

6 person, firm, partnership, corporation, or other entity

7 who offers to perform or performs for, or on behalf of,

8 a customer any act described under paragraph (4),

9 but does not include—

10 ‘‘(A) any department or agency of the Fed11 eral Government or of a State or local govern12 ment;

13 ‘‘(B) any nonprofit, charitable, scientific, or

14 educational organization, qualified under appli15 cable State law or described under section

16 170(b)(1)(A) of the Internal Revenue Code of

17 1986; or

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

19 in good standing before, the United States Patent

20 and Trademark Office acting within the scope of

21 that person’s registration to practice before the

22 Patent and Trademark Office, except when that

23 person performs any act described in subpara24 graph (B) or (C) of paragraph (4); and
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1 ‘‘(4) the term ‘invention promotion services’

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

3 any act involved in—

4 ‘‘(A) evaluating the invention to determine

5 its protectability as some form of intellectual

6 property, other than evaluation by a person li7 censed by a State to practice law who is acting

8 solely within the scope of that person’s profes9 sional license;

10 ‘‘(B) evaluating the invention to determine

11 its commercial potential by any person for pur12 poses other than providing venture capital; or

13 ‘‘(C) marketing, brokering, offering to li14 cense or sell, or promoting the invention or a

15 product or service in which the invention is in16 corporated or used, except that the display only

17 of an invention at a trade show or exhibit shall

18 not be considered to be invention promotion serv19 ices.

20 ‘‘§ 52. Contracting requirements

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

22 promotion services shall be in writing and shall be subject

23 to the provisions of this chapter. A copy of the signed writ24 ten contract shall be given to the customer at the time the

25 customer enters into the contract.
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1 ‘‘(2) If a contract is entered into for the benefit of a

2 third party, the identity and address of such party shall

3 be disclosed by such party’s agent and such party shall be

4 considered a customer for purposes of this chapter.

5 ‘‘(b) REQUIREMENTS OF INVENTION PROMOTER.—The

6 invention promoter shall—

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

8 customer enters into a contract forinvention pro9 motion services, whether the usual business practice of

10 the invention promoter is to—

11 ‘‘(A) seek more than 1 contract in connec12 tion with an invention; or

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

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

15 performance of each phase covered in 1 or more

16 subsequent contracts; and

17 ‘‘(2) supply to the customer a copy of the written

18 document together with a written summary of the

19 usual business practices of the invention promoter,

20 including—

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

22 and

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

24 fees or other consideration that may be required
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1 from the customer for each of the services pro2 vided by the invention promoter.

3 ‘‘(c) RIGHT OF CUSTOMER TO CANCEL CONTRACT.—

4 (1) Notwithstanding any contractual provision to the con5 trary, a customer shall have the right to terminate a con6 tract for invention promotion services by sending a written

7 letter to the invention promoter stating the customer’s in8 tent to cancel the contract. The letter of termination must

9 be deposited with the United States Postal Service on or

10 before 5 business days after the date upon which the cus11 tomer or the invention promoter executes the contract,

12 whichever is later.

13 ‘‘(2) Delivery of a promissory note, check, bill of ex14 change, or negotiable instrument of any kind to the inven15 tion promoter or to a third party for the benefit of the in16 vention promoter, without regard to the date or dates ap17 pearing in such instrument, shall be deemed payment re18 ceived by the invention promoter on the date received for

19 purposes of this section.

20 ‘‘§ 53. Standard provisions for cover notice

21 ‘‘(a) CONTENTS.—Every contract for invention pro22 motion services shall have a conspicuous and legible cover

23 sheet attached with the following notice imprinted in bold24 face type of not less than 12-point size:
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1 ‘YOU HAVE THE RIGHT TO TERMINATE THIS

2 CONTRACT. TO TERMINATE THIS CONTRACT, YOU

3 MUST SEND A WRITTEN LETTER TO THE COM4 PANY STATING YOUR INTENT TO CANCEL THIS

5 CONTRACT.

6 ‘THE LETTER OF TERMINATION MUST BE DE7 POSITED WITH THE UNITED STATES POSTAL

8 SERVICE ON OR BEFORE FIVE (5) BUSINESS DAYS

9 AFTER THE DATE ON WHICH YOU OR THE COM10 PANY EXECUTE THE CONTRACT, WHICHEVER IS

11 LATER.

12 ‘THE TOTAL NUMBER OF INVENTIONS EVALU13 ATED BY THE INVENTION PROMOTER FOR COM14 MERCIAL POTENTIAL IN THE PAST FIVE (5)

15 YEARS IS XXXXX. OF THAT NUMBER, XXXXX RE16 CEIVED POSITIVE EVALUATIONS AND XXXXX RE17 CEIVED NEGATIVE EVALUATIONS.

18 ‘IF YOU ASSIGN EVEN A PARTIAL INTEREST

19 IN THE INVENTION TO THE INVENTION PRO20 MOTER, THE INVENTION PROMOTER MAY HAVE

21 THE RIGHT TO SELL OR DISPOSE OF THE INVEN22 TION WITHOUT YOUR CONSENT AND MAY NOT

23 HAVE TO SHARE THE PROFITS WITH YOU.

24 ‘THE TOTAL NUMBER OF CUSTOMERS WHO

25 HAVE CONTRACTED WITH THE INVENTION PRO-
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1 MOTER IN THE PAST FIVE (5) YEARS IS XXXXX.

2 THE TOTAL NUMBER OF CUSTOMERS KNOWN BY

3 THIS INVENTION PROMOTER TO HAVE RECEIVED,

4 BY VIRTUE OF THIS INVENTION PROMOTER’S

5 PERFORMANCE, AN AMOUNT OF MONEY IN EX6 CESS OF THE AMOUNT PAID BY THE CUSTOMER

7 TO THIS INVENTION PROMOTER IS XXXXXXX. AS

8 A RESULT OF THE EFFORTS OF THIS INVENTION

9 PROMOTER, XXXXX NUMBER OF CUSTOMERS

10 HAVE RECEIVED LICENSE AGREEMENTS FOR

11 THEIR INVENTIONS.

12 ‘THE OFFICERS OF THIS INVENTION PRO13 MOTER HAVE COLLECTIVELY OR INDIVIDUALLY

14 BEEN AFFILIATED IN THE LAST TEN (10) YEARS

15 WITH THE FOLLOWING INVENTION PROMOTION

16 COMPANIES: (LIST THE NAMES AND ADDRESSES

17 OF ALL PREVIOUS INVENTION PROMOTION COM18 PANIES WITH WHICH THE PRINCIPAL OFFICERS

19 HAVE BEEN AFFILIATED AS OWNERS, AGENTS, OR

20 EMPLOYEES). YOU ARE ENCOURAGED TO CHECK

21 WITH THE UNITED STATES PATENT AND TRADE22 MARK OFFICE, THE FEDERAL TRADE COMMIS23 SION, YOUR STATE ATTORNEY GENERAL’S OF24 FICE, AND THE BETTER BUSINESS BUREAU FOR

25 ANY COMPLAINTS FILED AGAINST ANY OF THESE
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1 COMPANIES WHICH RESULTED IN REGULATORY

2 SANCTIONS OR OTHER CORRECTIVE ACTIONS.

3 ‘YOU ARE ENCOURAGED TO CONSULT WITH

4 AN ATTORNEY OF YOUR OWN CHOOSING BEFORE

5 SIGNING THIS CONTRACT. BY PROCEEDING WITH6 OUT THE ADVICE OF AN ATTORNEY REGISTERED

7 TO PRACTICE BEFORE THE UNITED STATES PAT8 ENT AND TRADEMARK OFFICE, YOU COULD LOSE

9 ANY RIGHTS YOU MIGHT HAVE IN YOUR IDEA OR

10 INVENTION.’.

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

12 The cover notice shall contain the items required under sub13 section (a) and the name, primary office address, and local

14 office address of the invention promoter, and may contain

15 no other matter.

16 ‘‘(c) DISCLOSURE OF CERTAIN CUSTOMERS NOT RE17 QUIRED.—The requirement in the notice set forth in sub18 section (a) to include the ‘TOTAL NUMBER OF CUS19 TOMERS WHO HAVE CONTRACTED WITH THE IN20 VENTION PROMOTER IN THE PAST FIVE (5)

21 YEARS’ need not include information with respect to cus22 tomers who have purchased trade show services, research,

23 advertising, or other nonmarketing services from the inven24 tion promoter, nor with respect to customers who have de25 faulted 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 the

9 services yet to be performed and names of all persons

10 who it is known will perform the services; and

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

12 corporation, or other entity to whom the subject mat13 ter of the contract has been disclosed, the reason for

14 each such disclosure, the nature of the disclosure, and

15 complete and accurate summaries of all responses re16 ceived as a result of those disclosures.

17 ‘‘§ 55. Mandatory contract terms

18 ‘‘(a) MANDATORY TERMS.—Each contract for inven19 tion promotion services shall include in boldface type of not

20 less than 12-point size—

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

22 contract termination rights required under section 52;

23 ‘‘(2) a statement that the customer may avoid

24 entering into the contract by not making the initial

25 payment to the invention promoter;
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1 ‘‘(3) a full, clear, and concise description of the

2 specific acts or services that the invention promoter

3 undertakes to perform for the customer;

4 ‘‘(4) a statement as to whether the invention pro5 moter undertakes to construct, sell, or distribute one

6 or more prototypes, models, or devices embodying the

7 invention of the customer;

8 ‘‘(5) the full name and principal place of busi9 ness of the invention promoter and the name and

10 principal place of business of any parent, subsidiary,

11 agent, independent contractor, and any affiliated

12 company or person who it is known will perform any

13 of the services or acts that the invention promoter un14 dertakes to perform for the customer;

15 ‘‘(6) if any oral or written representation of esti16 mated or projected customer earnings is given by the

17 invention promoter (or any agent, employee, officer,

18 director, partner, or independent contractor of such

19 invention promoter), a statement of that estimation

20 or projection and a description of the data upon

21 which such representation is based;

22 ‘‘(7) the name and address of the custodian of all

23 records and correspondence relating to the contracted

24 for invention promotion services, and a statement

25 that the invention promoter is required to maintain
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1 all records and correspondence relating to perform2 ance of the invention promotion services for such cus3 tomer for a period of not less than 2 years after expi4 ration of the term of such contract; and

5 ‘‘(8) a statement setting forth a time schedule for

6 performance of the invention promotion services, in7 cluding an estimated date in which such performance

8 is expected to be completed.

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

10 extent that the description of the specific acts or services

11 affords discretion to the invention promoter with respect to

12 what specific acts or services shall be performed, the inven13 tion promoter shall be deemed a fiduciary.

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

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

16 made available after 7 days written notice to the customer

17 or the representative of the customer to review and copy

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

19 during normal business hours.

20 ‘‘§ 56. Remedies

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

22 promotion services that does not comply with the applicable

23 provisions of this chapter shall be voidable at the option

24 of the customer.
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1 ‘‘(2) Any contract for invention promotion services en2 tered into in reliance upon any material false, fraudulent,

3 or misleading information, representation, notice, or adver4 tisement of the invention promoter (or any agent, employee,

5 officer, director, partner, or independent contractor of such

6 invention promoter) shall be voidable at the option of the

7 customer.

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

9 this chapter shall be deemed contrary to public policy and

10 shall be void and unenforceable.

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

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

13 or plant patent protection shall be voidable at the option

14 of the customer unless the invention promoter offers to per15 form or performs such act through aperson duly registered

16 to practice before, and in good standing with, the Patent

17 and Trademark Office.

18 ‘‘(b) CIVIL ACTION.—(1) Any customer who is injured

19 by a violation of this chapter by an invention promoter or

20 by any material false or fraudulent statement or representa21 tion, or any omission of material fact, by an invention pro22 moter (or any agent, employee, director, officer, partner, or

23 independent contractor of such invention promoter) or by

24 failure of an invention promoter to make all the disclosures

25 required under this chapter, may recover in a civil action
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1 against the invention promoter (or the officers, directors,

2 or partners of such invention promoter) in addition to rea3 sonable costs and attorneys’ fees, the greater of—

4 ‘‘(A) $5,000; or

5 ‘‘(B) the amount of actual damages sustained by

6 the customer.

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

8 increase damages to not more than 3 times the amount

9 awarded, taking into account past complaints made against

10 the invention promoter that resulted in regulatory sanctions

11 or other corrective actions based on those record compiled

12 by the Director under section 57.

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

14 purposes of this section, substantial violation of any provi15 sion of this chapter by an invention promoter or execution

16 by the customer of a contract for invention promotion serv17 ices in reliance on any material false or fraudulent state18 ments or representations or omissions of material fact shall

19 establish a rebuttable presumption of injury.

20 ‘‘§ 57. Records of complaints

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

22 make all complaints received by the United States Patent

23 and Trademark Office involving invention promoters pub24 licly available, together with any response of the invention

25 promoters.
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1 ‘‘(b) REQUEST FOR COMPLAINTS.—The Director may

2 request complaints relating to invention promotion services

3 from any Federal or State agency and include such com4 plaints in the records maintained under subsection (a), to5 gether with any response of the invention promoters.

6 ‘‘§ 58. Fraudulent representation by an invention pro7 moter

8 ‘‘Whoever, in providing invention promotion services,

9 knowingly provides any false or misleading statement, rep10 resentation, or omission of material fact to a customer or

11 fails to make all the disclosures required under this chapter,

12 shall be guilty of a misdemeanor and fined not more than

13 $10,000 for each offense.

14 ‘‘§ 59. Rule of construction

15 ‘‘Except as expressly provided in this chapter, no pro16 vision of this chapter shall be construed to affect any obliga17 tion, right, or remedy provided under any other Federal

18 or State law.’’.

19 SEC. 103. EFFECTIVE DATE.

20 This title and the amendments made by this title shall

21 take effect 60 days after the date of the enactment of this

22 Act.
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1 TITLE II—FIRST INVENTOR

2 DEFENSE

3 SEC. 201. SHORT TITLE.

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

5 Act’’.

6 SEC. 202. DEFENSE TO PATENT INFRINGEMENT BASED ON

7 EARLIER INVENTOR.

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

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

10 section:

11 ‘‘§ 273. Defense to infringement based on earlier in12 ventor

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

14 ‘‘(1) the terms ‘commercially used’ and ‘commer15 cial use’ mean use of a process or method in the

16 United States or the use of a process or method in the

17 design, testing, or production in the United States of

18 a product or service, so long as such use is in connec19 tion with an actual arm’s-length sale or other arm’s20 length commercial transfer of a product or service,

21 whether or not the subject matter at issue is accessible

22 to or otherwise known to the public, except that the

23 subject matter for which commercial marketing or use

24 is subject to a premarketing regulatory review period

25 during which the safety or efficacy of the subject mat-
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1 ter is established, including any period specified in

2 section 156(g), shall be deemed ‘commercially used’

3 and in ‘commercial use’ during such regulatory re4 view period;

5 ‘‘(2) in the case of activities performed by a non6 profit research laboratory, or nonprofit entity such as

7 a university, research center, or hospital, a use for

8 which the public is the intended beneficiary shall be

9 considered to be a use described in paragraph (1), ex10 cept that the use—

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

12 this section only for continued use by and in the

13 laboratory or nonprofit entity; and

14 ‘‘(B) may not be asserted as a defense with

15 respect to any subsequent commercialization or

16 use outside such laboratory or nonprofit entity;

17 ‘‘(3) the term ‘process or method’ means ‘process’

18 as defined in section 100(b), and includes any inven19 tion that produces a useful end product or service

20 which has been or could have been claimed in a pat21 ent in the form of a process; 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 title

6 with respect to any subject matter that would other7 wise infringe one or more claims asserting a process

8 or method in the patent being asserted against a per9 son, if such person had, acting in good faith, actually

10 reduced the subject matter to practice at least one

11 year before the effective filing date of such patent, and

12 commercially used the subject matter before the effec13 tive filing date of such patent.

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

15 disposition, of a product or service produced by a

16 patented process or method, by a person entitled to

17 assert a defense under this section with respect to that

18 product or service shall exhaust the patent owner’s

19 rights under the patent to the extent such rights

20 would have been exhausted had such sale or other dis21 position been made by the patent owner.

22 ‘‘(3) LIMITATIONS AND QUALIFICATIONS OF DE23 FENSE.—The defense to infringement under this sec24 tion is subject to the following:
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1 ‘‘(A) PATENT.—A person may not assert the

2 defense under this section unless the invention

3 for which the defense is asserted is for a process

4 or method, the exclusive purpose of which is to

5 produce a useful end product or service.

6 ‘‘(B) DERIVATION.—A person may not as7 sert the defense under this section if the subject

8 matter on which the defense is based was derived

9 from the patentee or persons in privity with the

10 patentee.

11 ‘‘(C) NOT A GENERAL LICENSE.—The de12 fense asserted by a person under this section is

13 not a general license under all claims of the pat14 ent at issue, but extends only to the specific sub15 ject matter claimed in the patent with respect to

16 which the person can assert a defense under this

17 chapter, except that the defense shall also extend

18 to variations in the quantity or volume of use of

19 the claimed subject matter, and to improvements

20 in the claimed subject matter that do not in21 fringe additional specifically claimed subject

22 matter of the patent.

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

24 defense under this section shall have the burden of es-
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1 tablishing the defense by clear and convincing evi2 dence.

3 ‘‘(5) ABANDONMENT OF USE.—A person who has

4 abandoned commercial use of subject matter may not

5 rely on activities performed before the date of such

6 abandonment in establishing a defense under this sec7 tion with respect to actions taken after the date of

8 such abandonment.

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

10 this section may be asserted only by the person who

11 performed the acts necessary to establish the defense

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

13 right to assert the defense shall not be licensed or as14 signed or transferred to another person except as an

15 ancillary and subordinate part of a good faith assign16 ment or transfer for other reasons of the entire enter17 prise or line of business to which the defense relates.

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

19 this section, when acquired as part of a good faith as20 signment or transfer of an entire enterprise or line of

21 business to which the defense relates, may only be as22 serted for uses at sites where the subject matter that

23 would otherwise infringe one or more of the claims is

24 in use before the later of the effective filing date of the
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1 patent or the date of the assignment or transfer of

2 such enterprise or line of business.

3 ‘‘(8) UNSUCCESSFUL ASSERTION OF DEFENSE.—

4 If the defense under this section is pleaded by a per5 son who is found to infringe the patent and who sub6 sequently fails to demonstrate a reasonable basis for

7 asserting the defense, the court shall find the case ex8 ceptional for the purpose of awarding attorney’s fees

9 under section 285 of this title.

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

11 to be invalid under section 102 or 103 of this title

12 solely because a defense is raised or established under

13 this section.’’.

14 (b) CONFORMING AMENDMENT.—The table of sections

15 at the beginning of chapter 28 of title 35, United States

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

17 item:

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

18 SEC. 203. EFFECTIVE DATE AND APPLICABILITY.

19 This title and the amendments made by this title shall

20 take effect on the date of the enactment of this Act, but shall

21 not apply to any action for infringement that is pending

22 on such date of enactment or with respect to any subject

23 matter for which an adjudication of infringement, includ24 ing a consent judgment, has been made before such date of

25 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 Guarantee

5 Act’’.

6 SEC. 302. PATENT TERM GUARANTEE AUTHORITY.

7 (a) ADJUSTMENT OF PATENT TERM.—Section 154(b)

8 of title 35, United States Code, is amended to read as fol9 lows:

10 ‘‘(b) ADJUSTMENT OF PATENT TERM.—

11 ‘‘(1) PATENT TERM GUARANTEES.—

12 ‘‘(A) GUARANTEE OF PROMPT PATENT AND

13 TRADEMARK OFFICE RESPONSES.—Subject to the

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

15 an original patent is delayed due to the failure

16 of the Patent and Trademark Office to—

17 ‘‘(i) make a notification of the rejection

18 of any claim for a patent or any objection

19 or argument under section 132, or give or

20 mail a written notice of allowance under

21 section 151, within 14 months after the date

22 on which the application was filed;

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

24 132, or to an appeal taken under section

25 134, within 4 months after the date on
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1 which the reply was filed or the appeal was

2 taken;

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

4 months after the date of a decision by the

5 Board of Patent Appeals and Interferences

6 under section 134 or 135 or a decision by

7 a Federal court under section 141, 145, or

8 146 in a case in which allowable claims re9 main in the application; or

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

11 after the date on which the issue fee was

12 paid under section 151 and all outstanding

13 requirements were satisfied;

14 the term of the patent shall be extended one day

15 for each day after the end of the period specified

16 in clause (i), (ii), (iii), or (iv), as the case may

17 be, until the action described in such clause is

18 taken.

19 ‘‘(B) GUARANTEE OF NO MORE THAN 3-

20 YEAR APPLICATION PENDENCY.—Subject to the

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

22 an original patent is delayed due to the failure

23 of the Patent and Trademark Office to issue a

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

2 including—

3 ‘‘(i) any time consumed by continued

4 examination of the application requested by

5 the applicant under section 132(b);

6 ‘‘(ii) any time consumed by a pro7 ceeding under section 135(a), any time con8 sumed by the imposition of an order pursu9 ant to section 181, or any time consumed

10 by appellate review by the Board of Patent

11 Appeals and Interferences or by a Federal

12 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 (2)(C),

17 the term of the patent shall be extended 1 day for

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

19 the patent is issued.

20 ‘‘(C) GUARANTEE OR ADJUSTMENTS FOR

21 DELAYS DUE TO INTERFERENCES, SECRECY OR22 DERS, AND APPEALS.—Subject to the limitations

23 under paragraph (2), if the issue of an original

24 patent is delayed due to—

25 ‘‘(i) a proceeding under section 135(a);
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1 ‘‘(ii) the imposition of an order pursu2 ant to section 181; or

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

4 Patent Appeals and Interferences or by a

5 Federal court in a case in which the patent

6 was issued pursuant to a decision in the re7 view reversing an adverse determination of

8 patentability,

9 the term of the patent shall be extended one day

10 for each day of the pendency of the proceeding,

11 order, or review, as the case may be.

12 ‘‘(2) LIMITATIONS.—

13 ‘‘(A) IN GENERAL.—To the extent that peri14 ods of delay attributable to grounds specified in

15 paragraph (1) overlap, the period of any adjust16 ment granted under this subsection shall not ex17 ceed the actual number of days the issuance of

18 the patent was delayed.

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

20 term of which has been disclaimed beyond a

21 specified date may be adjusted under this section

22 beyond the expiration date specified in the dis23 claimer.

24 ‘‘(C) REDUCTION OF PERIOD OF ADJUST25 MENT.—
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1 ‘‘(i) The period of adjustment of the

2 term of a patent under paragraph (1) shall

3 be reduced by a period equal to the period

4 of time during which the applicant failed to

5 engage in reasonable efforts to conclude

6 prosecution of the application.

7 ‘‘(ii) With respect to adjustments to

8 patent term made under the authority of

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

10 deemed to have failed to engage in reason11 able efforts to conclude processing or exam12 ination of an application for the cumulative

13 total of any periods of time in excess of 3

14 months that are taken to respond to a notice

15 from the Office making any rejection, objec16 tion, argument, or other request, measuring

17 such 3-month period from the date the no18 tice was given or mailed to the applicant.

19 ‘‘(iii) The Director shall prescribe reg20 ulations establishing the circumstances that

21 constitute a failure of an applicant to en22 gage in reasonable efforts to conclude proc23 essing or examination of an application.

24 ‘‘(3) PROCEDURES FOR PATENT TERM ADJUST25 MENT DETERMINATION.—
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1 ‘‘(A) The Director shall prescribe regula2 tions establishing procedures for the application

3 for and determination of patent term adjust4 ments under this subsection.

5 ‘‘(B) Under the procedures established under

6 subparagraph (A), the Director shall—

7 ‘‘(i) make a determination of the pe8 riod of any patent term adjustment under

9 this subsection, and shall transmit a notice

10 of that determination with the written no11 tice of allowance of the application under

12 section 151; and

13 ‘‘(ii) provide the applicant one oppor14 tunity to request reconsideration of any

15 patent term adjustment determination made

16 by the Director.

17 ‘‘(C) The Director shall reinstate all or part

18 of the cumulative period of time of an adjust19 ment under paragraph (2)(C) if the applicant,

20 prior to the issuance of the patent, makes a

21 showing that, in spite of all due care, the appli22 cant was unable to respond within the 3-month

23 period, but in no case shall more than 3 addi24 tional months for each such response beyond the

25 original 3-month period be reinstated.
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1 ‘‘(D) The Director shall proceed to grant the

2 patent after completion of the Director’s deter3 mination of a patent term adjustment under the

4 procedures established under this subsection, not5 withstanding any appeal taken by the applicant

6 of such determination.

7 ‘‘(4) APPEAL OF PATENT TERM ADJUSTMENT DE8 TERMINATION.—

9 ‘‘(A) An applicant dissatisfied with a deter10 mination made by the Director under paragraph

11 (3) shall have remedy by a civil action against

12 the Director filed in the United States District

13 Court for the District of Columbia within 180

14 days after the grant of the patent. Chapter 7 of

15 title 5 shall apply to such action. Any final

16 judgment resulting in a change to the period of

17 adjustment of the patent term shall be served on

18 the Director, and the Director shall thereafter

19 alter the term of the patent to reflect such

20 change.

21 ‘‘(B) The determination of a patent term

22 adjustment under this subsection shall not be

23 subject to appeal or challenge by a third party

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

25 (b) CONFORMING AMENDMENTS.—
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1 (1) Section 282 of title 35, United States Code,

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

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

4 title’’.

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

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

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

8 SEC. 303. CONTINUED EXAMINATION OF PATENT APPLICA9 TIONS.

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

11 amended—

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

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

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

15 ‘‘(b) The Director shall prescribe regulations to provide

16 for the continued examination of applications for patent

17 at the request of the applicant. The Commissioner may es18 tablish appropriate fees for such continued examination

19 and shall provide a 50 percent reduction on such fees for

20 small entities that qualify for reduced fees under section

21 41(h)(1) of this title.’’.

22 SEC. 304. TECHNICAL CLARIFICATION.

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

24 amended in the matter preceding paragraph (1) by insert25 ing ‘‘, which shall include any patent term adjustment
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1 granted under section 154(b),’’ after ‘‘the original expira2 tion date of the patent’’.

3 SEC. 305. EFFECTIVE DATE.

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

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

6 enactment of this Act and, except for a design patent appli7 cation filed under chapter 16 of title 35, United States

8 Code, shall apply to any application filed on or after the

9 date of the enactment of this Act.

10 (b) SECTION 303.—The amendments made by section

11 303 shall take effect 6 months after the date of the enactment

12 of this Act.

13 TITLE IV—UNITED STATES PUB14 LICATION OF PATENT APPLI15 CATIONS PUBLISHED ABROAD

16 SEC. 401. SHORT TITLE.

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

18 Foreign Filed Applications Act’’.

19 SEC. 402. PUBLICATION.

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

21 States Code, is amended to read as follows:

22 ‘‘§ 122. Confidential status of applications; publica23 tion of patent applications

24 ‘‘(a) CONFIDENTIALITY.—Except as provided in sub25 section (b), applications for patents shall be kept in con-
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1 fidence by the Patent and Trademark Office and no infor2 mation concerning any such application shall be given

3 without authority of the applicant or owner unless nec4 essary to carry out the provisions of an Act of Congress

5 or in such special circumstances as may be determined by

6 the Director.

7 ‘‘(b) UNITED STATES PUBLICATION OF APPLICATIONS

8 PUBLISHED ABROAD.—

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

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

11 for design patents filed under chapter 16 and provi12 sional applications filed under section 111(b), shall be

13 published, in accordance with procedures determined

14 by the Director, promptly upon the expiration of a

15 period of 18 months after the earliest filing date for

16 which a benefit is sought under this title. At the re17 quest of the applicant, an application may be pub18 lished earlier than the end of such 18-month period.

19 ‘‘(B) No information concerning published pat20 ent applications shall be made available to the public

21 except as the Director determines.

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

23 any other provision of law, a determination by the

24 Director to release or not to release information con-
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1 cerning a published patent application shall be final

2 and nonreviewable.

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

4 no longer pending shall not be published.

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

6 order under section 181 shall not be published.

7 ‘‘(C)(i) If an applicant, upon filing, makes a re8 quest that an application not be published pursuant

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

10 invention disclosed in the application has not been

11 the subject of an application filed in another country,

12 or under a multilateral international agreement, that

13 requires publication of applications 18 months after

14 filing, the application shall not be published as pro15 vided in paragraph (1).

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

17 under clause (i) at any time.

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

19 under clause (i) but who subsequently files, in a for20 eign country or under a multilateral international

21 agreement specified in clause (i), an application di22 rected to the invention disclosed in the application

23 filed in the Patent and Trademark Office, shall notify

24 the Director of such filing not later than 45 days

25 after the date of the filing of such foreign or inter-
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1 national application. A failure of the applicant to

2 provide such notice within the prescribed period shall

3 result in the application being regarded as aban4 doned, unless it is shown to the satisfaction of the Di5 rector that the delay in submitting the notice was un6 intentional.

7 ‘‘(iv) If a notice is made pursuant to clause (iii),

8 or the applicant rescinds a request pursuant to clause

9 (ii), the Director shall publish the application on or

10 as soon as is practical after the date that is specified

11 in clause (i).

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

13 one or more foreign countries, directly or through a

14 multilateral international agreement, and such for15 eign filed applications corresponding to an applica16 tion filed in the Patent and Trademark Office or the

17 description of the invention in such foreign filed ap18 plications is less extensive than the application or de19 scription of the invention in the application filed in

20 the Patent and Trademark Office, the applicant may

21 submit a redacted copy of the application filed in the

22 Patent and Trademark Office eliminating any part

23 or description of the invention in such application

24 that is not also contained in any of the corresponding

25 applications filed in a foreign country. The Director
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1 may only publish the redacted copy of the application

2 unless the redacted copy of the application is not re3 ceived within 16 months after the earliest effective fil4 ing date for which a benefit is sought under this title.

5 The provisions of section 154(d) shall not apply to a

6 claim if the description of the invention published in

7 the redacted application filed under this clause with

8 respect to the claim does not enable a person skilled

9 in the art to make and use the subject matter of the

10 claim.

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

12 Director shall establish appropriate procedures to ensure

13 that no protest or other form of pre-issuance opposition to

14 the grant of a patent on an application may be initiated

15 after publication of the application without the express

16 written consent of the applicant.’’.

17 (b) STUDY BY GAO.—

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

19 the United States shall conduct a study of applicants

20 for patents who file only in the United States during

21 the 3-year period beginning on the effective date of

22 this title.

23 (2) CONTENTS.—The study conducted under

24 paragraph (1) shall—
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1 (A) consider the number of such applicants

2 for patent in relation to the number of appli3 cants who file in the United States and outside

4 the United States;

5 (B) examine how many domestic-only filers

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

7 (C) examine how many such filers rescind

8 that request or later choose to file abroad; and

9 (D) examine the manner of entity seeking

10 an application and any correlation that may

11 exist between such manner and publication of

12 patent applications.

13 (3) REPORT TO JUDICIARY COMMITTEES.—The

14 Comptroller General shall submit to the Committees

15 on the Judiciary of the House of Representatives and

16 the Senate the results of the study conducted under

17 this subsection.

18 SEC. 403. TIME FOR CLAIMING BENEFIT OF EARLIER FILING

19 DATE.

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

21 35, United States Code, is amended to read as follows:

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

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

24 application by specifying its application number, country,

25 and the day, month, and year of its filing, is filed in the
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1 Patent and Trademark Office at such time during the pend2 ency of the application as required by the Director.

3 ‘‘(2) The Director may consider the failure of the ap4 plicant to file a timely claim for priority as a waiver of

5 any such claim. The Director may establish procedures, in6 cluding the payment of a surcharge, to accept an uninten7 tionally delayed claim under this section.

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

9 original foreign application, specification, and drawings

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

11 language, and such other information as the Director con12 siders necessary. Any such certification shall be made by

13 the foreign intellectual property authority in which the for14 eign application was filed and show the date of the applica15 tion and of the filing of the specification and other papers.’’.

16 (b) IN THE UNITED STATES.—Section 120 of title 35,

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

18 following: ‘‘The Director may determine the time period

19 during the pendency of the application within which an

20 amendment containing the specific reference to the earlier

21 filed application is submitted. The Director may consider

22 the failure to submit such an amendment within that time

23 period as a waiver of any benefit under this section. The

24 Director may establish procedures, including the payment
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1 of a surcharge, to accept unintentionally late submissions

2 of amendments under this section.’’.

3 SEC. 404. PROVISIONAL RIGHTS.

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

5 amended—

6 (1) in the section caption by inserting ‘‘; provi7 sional rights’’ after ‘‘patent’’; and

8 (2) by adding at the end the following new sub9 section:

10 ‘‘(d) PROVISIONAL RIGHTS.—-

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

12 provided by this section, a patent shall include the

13 right to obtain a reasonable royalty from any person

14 who, during the period beginning on the date of pub15 lication of the application for such patent pursuant

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

17 application filed under the treaty defined in section

18 351(a) designating the United States under Article

19 21(2)(a) of such treaty, the date of publication of the

20 application, and ending on the date the patent is

21 issued—

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

23 in the United States the invention as claimed in

24 the published patent application or imports such

25 an invention into the United States; or
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1 ‘‘(ii) if the invention as claimed in the pub2 lished patent application is a process, uses, offers

3 for sale, or sells in the United States or imports

4 into the United States products made by that

5 process as claimed in the published patent appli6 cation; and

7 ‘‘(B) had actual notice of the published pat8 ent application, and in a case in which the right

9 arising under this paragraph is based upon an

10 international application designating the United

11 States that is published in a language other than

12 English, a translation of the international appli13 cation into the English language.

14 ‘‘(2) RIGHT BASED ON SUBSTANTIALLY IDEN15 TICAL INVENTIONS.—The right under paragraph (1)

16 to obtain a reasonable royalty shall not be available

17 under this subsection unless the invention as claimed

18 in the patent is substantially identical to the inven19 tion as claimed in the published patent application.

20 ‘‘(3) TIME LIMITATION ON OBTAINING A REASON21 ABLE ROYALTY.—The right under paragraph (1) to

22 obtain a reasonable royalty shall be available only in

23 an action brought not later than 6 years after the

24 patent is issued. The right under paragraph (1) to ob-
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1 tain a reasonable royalty shall not be affected by the

2 duration of the period described in paragraph (1).

3 ‘‘(4) REQUIREMENTS FOR INTERNATIONAL APPLI4 CATIONS.—

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

6 paragraph (1) to obtain a reasonable royalty

7 based upon the publication under the treaty de8 fined in section 351(a) of an international ap9 plication designating the United States shall

10 commence on the date on which the Patent and

11 Trademark Office receives a copy of the publica12 tion under the treaty of the international appli13 cation, or, if the publication under the treaty of

14 the international application is in a language

15 other than English, on the date on which the

16 Patent and Trademark Office receives a trans17 lation of the international application in the

18 English language.

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

20 the applicant to provide a copy of the inter21 national application and a translation thereof.

22 ‘‘(5) ISSUANCE OF PATENTS ON INDIVIDUAL

23 CLAIMS.—If the Director in a notification to the ap24 plicant under section 132 indicates that one or more

25 claims of a published application are allowable, the
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1 applicant may request the issuance of a patent incor2 porating those claims. The applicant may continue

3 prosecution of the remaining claims as provided in

4 chapter 12 of this title. Any subsequently allowed

5 claims may be incorporated into the patent or issued

6 in a separate patent, in accordance with regulations

7 adopted by the Director. The Director may establish

8 appropriate fees to cover the costs of incorporating

9 any additional claims into the patent or issuing a

10 separate patent.’’.

11 SEC. 405. PRIOR ART EFFECT OF PUBLISHED APPLICA12 TIONS.

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

14 amended to read as follows:

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

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

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

18 United States before the invention by the applicant

19 for patent, except that an international application

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

21 have the effect under this subsection of a national ap22 plication published under section 122(b) only if the

23 international application designating the United

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

25 treaty in the English language, or
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1 ‘‘(B) a patent granted on an application for pat2 ent by another filed in the United States before the

3 invention by the applicant for patent, except that a

4 patent shall not be deemed filed in the United States

5 for the purposes of this subsection based on the filing

6 of an international application filed under the treaty

7 defined in section 351(a), or’’.

8 SEC. 406. COST RECOVERY FOR PUBLICATION.

9 The Director of the United States Patent and Trade10 mark Office shall recover the cost of early publication re11 quired by the amendment made by section 402 by charging

12 a separate publication fee after notice of allowance is given

13 pursuant to section 151 of title 35, United States Code.

14 SEC. 407. CONFORMING AMENDMENTS.

15 The following provisions of title 35, United States

16 Code, are amended:

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

18 subsection (a) by inserting ‘‘and published applica19 tions for patents’’ after ‘‘Patents’’.

20 (2) Section 12 is amended—

21 (A) in the section caption by inserting

22 ‘‘and applications’’ after ‘‘patents’’; and

23 (B) by inserting ‘‘and published applica24 tions for patents’’ after ‘‘patents’’.

25 (3) Section 13 is amended—
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1 (A) in the section caption by inserting

2 ‘‘and applications’’ after ‘‘patents’’; and

3 (B) by inserting ‘‘and published applica4 tions for patents’’ after ‘‘patents’’.

5 (4) The item relating to section 122 in the table

6 of sections for chapter 11 is amended by inserting ‘‘;

7 publication of patent applications’’ after ‘‘applica8 tions’’.

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

10 of sections for chapter 14 is amended by inserting ‘‘;

11 provisional rights’’ after ‘‘patent’’.

12 (6) Section 181 is amended—

13 (A) in the first undesignated paragraph—

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

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

16 (ii) by inserting ‘‘the publication of the

17 application or’’ after ‘‘withhold’’;

18 (B) in the second undesignated paragraph

19 by inserting ‘‘by the publication of an applica20 tion or’’ after ‘‘disclosure of an invention’’;

21 (C) in the third undesignated paragraph—

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

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

24 invention’’; and
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1 (ii) by inserting ‘‘the publication of the

2 application or’’ after ‘‘withhold’’; and

3 (D) in the fourth undesignated paragraph

4 by inserting ‘‘the publication of an application

5 or’’ after ‘‘and’’ in the first sentence.

6 (7) Section 252 is amended in the first undesig7 nated paragraph by inserting ‘‘substantially’’ before

8 ‘‘identical’’ each place it appears.

9 (8) Section 284 is amended by adding at the end

10 of the second undesignated paragraph the following:

11 ‘‘Increased damages under this paragraph shall not

12 apply to provisional rights under section 154(d) of

13 this title.’’.

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

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

16 ‘‘The publication under the treaty defined in section

17 351(a) of this title of an international application desig18 nating the United States shall confer the same rights and

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

20 for patent published under section 122(b), except as pro21 vided in sections 102(e) and 154(d).’’.

22 SEC. 408. EFFECTIVE DATE.

23 This title and the amendments made by this title, shall

24 take effect on the date that is 1 year after the date of the

25 enactment of this Act and shall apply to all applications
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1 filed under section 111 of title 35, United States Code, on

2 or after that date, and all applications complying with sec3 tion 371 of title 35, United States Code, that resulted from

4 international applications filed on or after that date. The

5 amendments made by sections 404 and 405 shall apply to

6 any such application voluntarily published by the appli7 cant under procedures established under this title that is

8 pending on the date that is 1 year after the date of enact9 ment of this Act. The amendment made by section 404 shall

10 also apply to international applications designating the

11 United States that are filed on or after the date that is

12 1 year after the date of the enactment of this Act.

13 TITLE V—PATENT LITIGATION

14 REDUCTION ACT

15 SEC. 501. SHORT TITLE.

16 This title may be cited as the ‘‘Patent Litigation Re17 duction Act’’.

18 SEC. 502. DEFINITIONS.

19 Section 100 of title 35, United States Code, is amended

20 by adding at the end the following new subsection:

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

22 requesting reexamination under section 302 of this title who

23 is not the patent owner.’’.
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1 SEC. 503. REEXAMINATION PROCEDURES.

2 (a) CITATION OF PRIOR ART.—Section 301 of title 35,

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

4 ‘‘§ 301. Citation of prior art

5 ‘‘Any person at any time may cite to the Office in

6 writing prior art consisting of patents or printed publica7 tions which that person believes to have a bearing on the

8 patentability of any claim of a particular patent. If the

9 person explains in writing the pertinency and manner of

10 applying such prior art to at least one claim of the patent,

11 the citation of such prior art and the explanation thereof

12 will become a part of the official file of the patent.’’.

13 (b) REQUEST FOR REEXAMINATION.—Section 302 of

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

15 ‘‘§ 302. Request for reexamination

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

17 a request for reexamination by the Office of a patent on

18 the basis of any prior art cited under the provisions of sec19 tion 301.

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

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

22 real party in interest, and be accompanied by pay23 ment of a reexamination fee established by the Direc24 tor 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 owner

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

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

7 (c) DETERMINATION OF ISSUE BY DIRECTOR.—Sec8 tion 303 of title 35, United States Code, is amended to read

9 as follows:

10 ‘‘§ 303. Determination of issue by Director

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

12 the filing of a request for reexamination under section 302,

13 the Director shall determine whether a substantial new

14 question of patentability affecting any claim of the patent

15 concerned is raised by the request, with or without consider16 ation of other patents or printed publications. On the Direc17 tor’s initiative, and any time, the Director may determine

18 whether a substantial new question of patentability is

19 raised by patents and publications.

20 ‘‘(b) RECORD.—A record of the Director’s determina21 tion under subsection (a) shall be placed in the official file

22 of the patent, and a copy shall be promptly given or mailed

23 to the owner of record of the patent and to the third-party

24 requester, if any.
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1 ‘‘(c) FINAL DECISION.—A determination by the Direc2 tor pursuant to subsection (a) shall be final and nonappeal3 able. Upon a determination that no substantial new ques4 tion of patentability has been raised, the Director may re5 fund a portion of the reexamination fee required under sec6 tion 302.’’.

7 (d) REEXAMINATION ORDER BY DIRECTOR.—Section

8 304 of title 35, United States Code, is amended to read as

9 follows:

10 ‘‘§ 304. Reexamination order by Director

11 ‘‘If, in a determination made under section 303(a), the

12 Director finds that a substantial new question of patent13 ability affecting a claim of a patent is raised, the deter14 mination shall include an order for reexamination of the

15 patent for resolution of the question. The order may be ac16 companied by the initial action of the Patent and Trade17 mark Office on the merits of the reexamination conducted

18 in accordance with section 305.’’.

19 (e) CONDUCT OF REEXAMINATION PROCEEDINGS.—

20 Section 305 of title 35, United States Code, is amended to

21 read as follows:

22 ‘‘§ 305. Conduct of reexamination proceedings

23 ‘‘(a) IN GENERAL.—Subject to subsection (b), reexam24 ination shall be conducted according to the procedures es25 tablished for initial examination under the provisions of
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1 sections 132 and 133, except as provided for under this sec2 tion. In any reexamination proceeding under this chapter,

3 the patent owner shall be permitted to propose any amend4 ment to the patent and a new claim or claims, except that

5 no proposed amended or new claim enlarging the scope of

6 the claims of the patent shall be permitted.

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

8 any reexamination proceeding in which the order for reex9 amination is based upon a request by a third-party re10 quester.

11 ‘‘(2) With the exception of the reexamination request,

12 any document filed by either the patent owner or the third13 party requester shall be served on the other party. In addi14 tion, the third-party requester shall receive a copy of any

15 communication sent by the Office to the patent owner con16 cerning the patent subject to the reexamination proceeding.

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

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

19 Office, the third-party requester shall have one opportunity

20 to file written comments addressing issues raised by the ac21 tion of the Office or the patent owner’s response thereto, if

22 those written comments are received by the Office within

23 30 days after the date of service of the patent owner’s re24 sponse.
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1 ‘‘(c) SPECIAL DISPATCH.—Unless otherwise provided

2 by the Director for good cause, all reexamination pro3 ceedings under this section, including any appeal to the

4 Board of Patent Appeals and Interferences, shall be con5 ducted with special dispatch within the Office.’’.

6 (f) APPEAL.—Section 306 of title 35, United States

7 Code, is amended to read as follows:

8 ‘‘§ 306. Appeal

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

10 a reexamination proceeding under this chapter—

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

12 134, and may appeal under the provisions of sections

13 141 through 144, with respect to any decision adverse

14 to the patentability of any original or proposed

15 amended or new claim of the patent; and

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

17 third-party requester under subsection (b).

18 ‘‘(b) THIRD-PARTY REQUESTER.—A third-party re19 quester may—

20 ‘‘(1) appeal under the provisions of section 134,

21 and may appeal under the provisions of sections 141

22 through 144, with respect to any final decision favor23 able to the patentability of any original or proposed

24 amended or new claim of the patent; or
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1 ‘‘(2) be a party to any appeal taken by the pat2 ent owner, subject to subsection (c).

3 ‘‘(c) CIVIL ACTION.—A third-party requester whose re4 quest for a reexamination results in an order under section

5 304 is estopped from asserting at a later time, in any civil

6 action arising in whole or in part under section 1338 of

7 title 28, the invalidity of any claim finally determined to

8 be valid and patentable on any ground which the third9 party requester raised or could have raised during the reex10 amination proceedings. This subsection does not prevent the

11 assertion of invalidity based on newly discovered prior art

12 unavailable to the third-party requester and the Patent and

13 Trademark Office at the time of the reexamination pro14 ceedings.’’.

15 (g) REEXAMINATION PROHIBITED; STAY OF LITIGA16 TION.—

17 (1) IN GENERAL.—Chapter 30 of title 35, United

18 States Code, is amended by adding at the end the fol19 lowing new sections:

20 ‘‘§ 308. Reexamination prohibited

21 ‘‘(a) ORDER FOR REEXAMINATION.—Notwithstanding

22 any provision of this chapter, once an order for reexamina23 tion of a patent has been issued under section 304, neither

24 the patent owner nor the third-party requester, if any, nor

25 privies of either, may file a subsequent request for reexam-
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1 ination of the patent until a reexamination certificate is

2 issued and published under section 307, unless authorized

3 by the Director.

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

5 entered against a party in a civil action arising in whole

6 or in part under section 1338 of title 28 that the party

7 has not sustained its burden of proving the invalidity of

8 any patent claim in suit or if a final decision in a reexam9 ination proceeding instituted by a third-party requester is

10 favorable to the patentability of any original or proposed

11 amended or new claim of the patent then neither that party

12 nor its privies may thereafter request reexamination of any

13 such patent claim on the basis of issues which that party

14 or its privies raised or could have raised in such civil action

15 or reexamination proceeding, and a reexamination re16 quested by that party or its privies on the basis of such

17 issues may not thereafter be maintained by the Office, not18 withstanding any other provision of this chapter. This sub19 section does not prevent the assertion of invalidity based

20 on newly discovered prior art unavailable to the third-party

21 requester and the Patent and Trademark Office at the time

22 of the reexamination proceedings.

23 ‘‘§ 309. Stay of litigation

24 ‘‘Once an order for reexamination of a patent has been

25 issued under section 304, the patent owner may obtain a
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1 stay of any pending litigation which involves an issue of

2 patentability of any claims of the patent which are the sub3 ject of the reexamination order, unless the court before

4 which such litigation is pending determines that a stay

5 would not serve the interests of justice.’’.

6 (2) TECHNICAL AND CONFORMING AMEND7 MENT.—The table of sections for chapter 30 of title

8 35, United States Code, is amended to read as follows:

9 ‘‘CHAPTER 30—PRIOR ART CITATIONS TO

10 OFFICE AND REEXAMINATION OF PAT11 ENTS

‘‘Sec.

‘‘301. Citation of prior art.

‘‘302. Request for reexamination.

‘‘303. Determination of issue by Director.

‘‘304. Reexamination order by Director.

‘‘305. Conduct of reexamination proceedings.

‘‘306. Appeal.

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

‘‘308. Reexamination prohibited.

‘‘309. Stay of litigation.’’.

12 SEC. 504. CONFORMING AMENDMENTS.

13 (a) PATENT FEES; PATENT SEARCH SYSTEMS.—Sec14 tion 41(a)(7) of title 35, United States Code, is amended

15 to read as follows:

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

17 unintentionally abandoned application for a patent,

18 for the unintentionally delayed payment of the fee for

19 issuing each patent, or for an unintentionally delayed

20 response by the patent owner in a reexamination pro-
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1 ceeding, $1,210, unless the petition is filed under sec2 tion 133 or 151 of this title, in which case the fee

3 shall be $110.’’.

4 (b) APPEAL TO THE BOARD OF PATENT APPEALS AND

5 INTERFERENCES.—Section 134 of title 35, United States

6 Code, is amended to read as follows:

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

8 Interferences

9 ‘‘(a) PATENT APPLICANT.—An applicant for a patent,

10 any of whose claims has been twice rejected, may appeal

11 from the decision of the primary examiner to the Board

12 of Patent Appeals and Interferences, having once paid the

13 fee for such appeal.

14 ‘‘(b) PATENT OWNER.—A patent owner in a reexam15 ination proceeding may appeal from the final rejection of

16 any claim by the primary examiner to the Board of Patent

17 Appeals and Interferences, having once paid the fee for such

18 appeal.

19 ‘‘(c) THIRD-PARTY.—A third-party requester may ap20 peal to the Board of Patent Appeals and Interferences from

21 the final decision of the primary examiner favorable to the

22 patentability of any original or proposed amended or new

23 claim of a patent, having once paid the fee for such ap24 peal.’’.
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1 (c) APPEAL TO COURT OF APPEALS FOR THE FEDERAL

2 CIRCUIT.—Section 141 of title 35, United States Code, is

3 amended by adding the following after the second sentence:

4 ‘‘A patent owner or third-party requester in a reexamina5 tion proceeding dissatisfied with the final decision in an

6 appeal to the Board of Patent Appeals and Interferences

7 under section 134 may appeal the decision only to the

8 United States Court of Appeals for the Federal Circuit.’’.

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

10 35, United States Code, is amended by amending the third

11 sentence to read as follows: ‘‘In ex parte and reexamination

12 cases, the Director shall submit to the court in writing the

13 grounds for the decision of the Patent and Trademark Of14 fice, addressing all the issues involved in the appeal.’’.

15 (e) CIVIL ACTION TO OBTAIN PATENT.—Section 145

16 of title 35, United States Code, is amended in the first sen17 tence by inserting ‘‘(a)’’ after ‘‘section 134’’.

18 SEC. 505. REPORT TO CONGRESS.

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

20 title, the Director of the United States Patent and Trade21 mark Office shall submit to the Congress a report evaluating

22 whether the reexamination proceedings established under

23 the amendments made by this title are inequitable to any

24 of the parties in interest and, if so, the report shall contain
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1 recommendations for changes to the amendments made by

2 this title to remove such inequity.

3 SEC. 506. ESTOPPEL EFFECT OF REEXAMINATION.

4 Any party who requests a reexamination under section

5 302 of title 35, United States Code, is estopped from chal6 lenging at a later time, in any civil action, any fact deter7 mined during the process of such reexamination. If this sec8 tion is held to be unenforceable, the enforceability of the rest

9 of this title or of this Act shall not be denied as a result.

10 SEC. 507. EFFECTIVE DATE.

11 This title and the amendments made by this title shall

12 take effect on the date that is 1 year after the date of the

13 enactment of this Act and shall apply to all reexamination

14 requests filed on or after such date.

15 TITLE VI—PATENT AND

16 TRADEMARK OFFICE

17 SEC. 601. SHORT TITLE.

18 This title may be cited as the ‘‘Patent and Trademark

19 Office Efficiency Act’’.

20 Subtitle A—United States Patent

21 and Trademark Office

22 SEC. 611. ESTABLISHMENT OF PATENT AND TRADEMARK

23 OFFICE.

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

25 to read as follows:
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1 ‘‘§ 1. Establishment

2 ‘‘(a) ESTABLISHMENT.—The United States Patent and

3 Trademark Office is established as an agency of the United

4 States, within the Department of Commerce. In carrying

5 out its functions, the United States Patent and Trademark

6 Office shall be subject to the policy direction of the Secretary

7 of Commerce, but otherwise shall retain responsibility for

8 decisions regarding the management and administration of

9 its operations and shall exercise independent control of its

10 budget allocations and expenditures, personnel decisions

11 and processes, procurements, and other administrative and

12 management functions in accordance with this title and ap13 plicable provisions of law. Those operations designed to

14 grant and issue patents and those operations which are de15 signed to facilitate the registration of trademarks shall be

16 treated as separate operating units within the Office.

17 ‘‘(b) OFFICES.—The United States Patent and Trade18 mark Office shall maintain its principal office in the metro19 politan Washington, DC, area, for the service of process and

20 papers and for the purpose of carrying out its functions.

21 The United States Patent and Trademark Office shall be

22 deemed, for purposes of venue in civil actions, to be a resi23 dent of the district in which its principal office is located,

24 except where jurisdiction is otherwise provided by law. The

25 United States Patent and Trademark Office may establish

26 satellite offices in such other places in the United States
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1 as it considers necessary and appropriate in the conduct

2 of its business.

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

4 United States Patent and Trademark Office shall also be

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

6 Office’.’’.

7 SEC. 612. POWERS AND DUTIES.

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

9 to read as follows:

10 ‘‘§ 2. Powers and duties

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

12 Trademark Office, subject to the policy direction of the Sec13 retary of Commerce—

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

15 issuing of patents and the registration of trademarks;

16 and

17 ‘‘(2) shall be responsible for disseminating to the

18 public information with respect to patents and trade19 marks.

20 ‘‘(b) SPECIFIC POWERS.—The Office—

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

22 which shall be judicially noticed and with which let23 ters patent, certificates of trademark registrations,

24 and papers issued by the Office shall be authenticated;
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1 ‘‘(2) may establish regulations, not inconsistent

2 with law, which—

3 ‘‘(A) shall govern the conduct of proceedings

4 in the Office;

5 ‘‘(B) shall be made after notice and oppor6 tunity for full participation by interested public

7 and private parties;

8 ‘‘(C) shall facilitate and expedite the proc9 essing of patent applications, particularly those

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

11 and retrieved electronically, subject to the provi12 sions of section 122 relating to the confidential

13 status of applications;

14 ‘‘(D) may govern the recognition and con15 duct of agents, attorneys, or other persons rep16 resenting applicants or other parties before the

17 Office, and may require them, before being recog18 nized as representatives of applicants or other

19 persons, to show that they are of good moral

20 character and reputation and are possessed of

21 the necessary qualifications to render to appli22 cants or other persons valuable service, advice,

23 and assistance in the presentation or prosecution

24 of their applications or other business before the

25 Office;
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1 ‘‘(E) shall recognize the public interest in

2 continuing to safeguard broad access to the

3 United States patent system through the reduced

4 fee structure for small entities under section

5 41(b)(1) of this title; and

6 ‘‘(F) provide for the development of a per7 formance-based process that includes quan8 titative and qualitative measures and standards

9 for evaluating cost-effectiveness and is consistent

10 with the principles of impartiality and competi11 tiveness;

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

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

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

15 therein, as it considers necessary to carry out its

16 functions;

17 ‘‘(4)(A) may make such purchases, contracts for

18 the construction, maintenance, or management and

19 operation of facilities, and contracts for supplies or

20 services, without regard to the provisions of the Fed21 eral Property and Administrative Services Act of

22 1949 (40 U.S.C. 471 and following), the Public

23 Buildings Act (40 U.S.C. 601 and following), and the

24 Stewart B. McKinney Homeless Assistance Act (42

25 U.S.C.11301 and following); and
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1 ‘‘(B) may enter into and perform such purchases

2 and contracts for printing services, including the

3 process of composition, platemaking, presswork, silk

4 screen processes, binding, microform, and the products

5 of such processes, as it considers necessary to carry

6 out the functions of the Office, without regard to sec7 tions 501 through 517 and 1101 through 1123 of title

8 44;

9 ‘‘(5) may use, with their consent, services, equip10 ment, personnel, and facilities of other departments,

11 agencies, and instrumentalities of the Federal Govern12 ment, on a reimbursable basis, and cooperate with

13 such other departments, agencies, and instrumental14 ities in the establishment and use of services, equip15 ment, and facilities of the Office;

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

17 is practicable, efficient, and cost-effective to do so, use,

18 with the consent of the United States and the agency,

19 government, or international organization concerned,

20 the services, records, facilities, or personnel of any

21 State or local government agency or instrumentality

22 or foreign government or international organization

23 to perform functions on its behalf;

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

25 receipts, including revenues from the sale, lease, or
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1 disposal of any real, personal, or mixed property, or

2 any interest therein, of the Office;

3 ‘‘(8) in coordination with the Under Secretary of

4 Commerce for International Trade, shall promote ex5 ports of goods and services of the United States indus6 tries that rely on intellectual property;

7 ‘‘(9) shall advise the President, through the Sec8 retary of Commerce, on national and certain inter9 national intellectual property policy issues;

10 ‘‘(10) shall advise Federal departments and

11 agencies on matters of intellectual property policy in

12 the United States and intellectual property protection

13 in other countries;

14 ‘‘(11) shall provide guidance, as appropriate,

15 with respect to proposals by agencies to assist foreign

16 governments and international intergovernmental or17 ganizations on matters of intellectual property protec18 tion;

19 ‘‘(12) may conduct programs, studies, or ex20 changes of items or services regarding domestic and

21 international intellectual property law and the effec22 tiveness of intellectual property protection domesti23 cally and throughout the world;

24 ‘‘(13)(A) shall advise the Secretary of Commerce

25 on programs and studies relating to intellectual prop-
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1 erty policy that are conducted, or authorized to be

2 conducted, cooperatively with foreign intellectual

3 property offices and international intergovernmental

4 organizations; and

5 ‘‘(B) may conduct programs and studies de6 scribed in subparagraph (A); and

7 ‘‘(14)(A) in coordination with the Department of

8 State, may conduct programs and studies coopera9 tively with foreign intellectual property offices and

10 international intergovernmental organizations; and

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

12 State, may authorize the transfer of not to exceed

13 $100,000 in any year to the Department of State for

14 the purpose of making special payments to inter15 national intergovernmental organizations for studies

16 and programs for advancing international coopera17 tion concerning patents, trademarks, and other mat18 ters.

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

20 special payments under paragraph (14)(B) shall be in ad21 dition to any other payments or contributions to inter22 national organizations described in paragraph (14)(B) and

23 shall not be subject to any limitations imposed by law on

24 the amounts of such other payments or contributions by the

25 United States Government.
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1 ‘‘(2) Nothing in subsection (b) shall derogate from the

2 duties of the Secretary of State or from the duties of the

3 United States Trade Representative as set forth in section

4 141 of the Trade Act of 1974 (19 U.S.C. 2171).

5 ‘‘(3) Nothing in subsection (b) shall derogate from the

6 duties and functions of the Register of Copyrights or other7 wise alter current authorities relating to copyright matters.

8 ‘‘(4) In exercising the Director’s powers under para9 graphs (3) and (4)(A) of subsection (b), the Director shall

10 consult with the Administrator of General Services.

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

12 construed to nullify, void, cancel, or interrupt any pending

13 request-for-proposal let or contract issued by the General

14 Services Administration for the specific purpose of relo15 cating or leasing space to the United States Patent and

16 Trademark Office.’’.

17 SEC. 613. ORGANIZATION AND MANAGEMENT.

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

19 to read as follows:

20 ‘‘§ 3. Officers and employees

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

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

23 United States Patent and Trademark Office shall be

24 vested in an Under Secretary of Commerce for Intel25 lectual Property and Director of the United States
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1 Patent and Trademark Office (in this title referred to

2 as the ‘Director’), who shall be a citizen of the United

3 States and who shall be appointed by the President,

4 by and with the advice and consent of the Senate. The

5 Director shall be a person who has a professional

6 background and experience in patent or trademark

7 law. The Director shall be responsible for providing

8 policy direction and management supervision for the

9 Office.

10 ‘‘(2) DUTIES.—

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

12 responsible for the supervision and direction of

13 the Office, including the issuance of patents and

14 the registration of trademarks, and shall perform

15 these duties in a fair, impartial, and equitable

16 manner.

17 ‘‘(B) CONSULTING WITH THE PUBLIC ADVI18 SORY COMMITTEES.—The Director shall consult

19 with the Patent Public Advisory Committee es20 tablished in section 5 on a regular basis on mat21 ters relating to the patent operations of the Of22 fice, shall consult with the Trademark Public

23 Advisory Committee established in section 5 on

24 a regular basis on matters relating to the trade25 mark operations of the Office, and shall consult
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1 with the respective Public Advisory Committee

2 before submitting budgetary proposals to the Of3 fice of Management and Budget or changing or

4 proposing to change patent or trademark user

5 fees or patent or trademark regulations, as the

6 case may be.

7 ‘‘(C) SECURITY CLEARANCES.—The Direc8 tor, in consultation with the Director of the Of9 fice of Personnel Management, shall maintain a

10 program for identifying national security posi11 tions and providing for appropriate security

12 clearances.

13 ‘‘(3) OATH.—The Director shall, before taking of14 fice, take an oath to discharge faithfully the duties of

15 the Office.

16 ‘‘(4) COMPENSATION.—In addition to the Direc17 tor’s pay as prescribed in section 5314 of title 5, the

18 Director may receive a bonus in an amount up to,

19 but not in excess of, 50 percent of the Director’s an20 nual rate of pay, based upon an evaluation by the

21 Secretary of Commerce of the Director’s performance

22 as defined in an annual performance agreement be23 tween the Director and the Secretary. The annual

24 performance agreement shall incorporate measurable

25 organization and individual goals in key operational
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1 areas as delineated in an annual performance plan

2 agreed to by the Director and the Secretary and made

3 public in the annual report of the Director. Payment

4 of a bonus under this paragraph may be made to the

5 Director only to the extent that such payment does

6 not cause the Director’s total aggregate compensation

7 in a calendar year to equal or exceed the amount of

8 the salary of the President under section 102 of title

9 3.

10 ‘‘(5) REMOVAL.—The Director may be removed

11 from office by the President. The President shall pro12 vide notification of any such removal to both Houses

13 of Congress.

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

15 ‘‘(1) DEPUTY UNDER SECRETARY AND DEPUTY

16 DIRECTOR.—The Director shall appoint a Deputy

17 Under Secretary of Commerce for Intellectual Prop18 erty and Deputy Director of the United States Patent

19 and Trademark Office who shall be vested with the

20 authority to act in the capacity of the Director in the

21 event of the absence or incapacity of the Director. The

22 Deputy Under Secretary and Deputy Director shall

23 be a citizen of the United States who has a profes24 sional background and experience in patent or trade25 mark law.
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1 ‘‘(2) COMMISSIONERS.—

2 ‘‘(A) APPOINTMENT AND DUTIES.—The Sec3 retary of Commerce shall appoint a Commis4 sioner for Patents and a Commissioner for

5 Trademarks. The Commissioner for Patents shall

6 be a citizen of the United States with dem7 onstrated management ability and professional

8 background and experience in patent law and

9 serve for a term of 5 years. The Commissioner

10 for Trademarks shall be a citizen of the United

11 States with demonstrated management ability

12 and professional background and experience in

13 trademark law and serve for a term of 5 years.

14 The Commissioner for Patents and the Commis15 sioner for Trademarks shall serve as the chief op16 erating officers for the operations of the Office

17 relating to patents and trademarks, respectively,

18 and shall be responsible for the management and

19 direction of all aspects of the activities of the Of20 fice that affect the administration of patent and

21 trademark operations, respectively. The Sec22 retary may reappoint a Commissioner to subse23 quent terms of 5 years as long as the perform24 ance of the Commissioner as set forth in the per-
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1 formance agreement in subparagraph (B) is sat2 isfactory.

3 ‘‘(B) SALARY AND PERFORMANCE AGREE4 MENT.—The Commissioners shall be paid an an5 nual rate of basic pay not to exceed the max6 imum rate of basic pay for the Senior Executive

7 Service established under section 5382 of title 5,

8 United States Code, including any applicable lo9 cality-based comparability payment that may be

10 authorized under section 5304(h)(2)(C) of title 5.

11 The compensation of the Commissioners shall be

12 considered for purposes of section 207(c)(2)(A) of

13 title 18, United States Code, to be the equivalent

14 of that described under clause (ii) of section

15 207(c)(2)(A) of title 18. In addition, the Com16 missioners may receive a bonus in an amount of

17 up to, but not in excess of, 50 percent of the

18 Commissioner’s annual rate of basic pay, based

19 upon an evaluation by the Secretary of Com20 merce, acting through the Director, of the Com21 missioners’ performance as defined in an annual

22 performance agreement between the Commis23 sioners and the Secretary. The annual perform24 ance agreements shall incorporate measurable or25 ganization and individual goals in key oper-
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1 ational areas as delineated in an annual per2 formance plan agreed to by the Commissioners

3 and the Secretary. Payment of a bonus under

4 this subparagraph may be made to the Commis5 sioners only to the extent that such payment does

6 not cause the Commissioners’ total aggregate

7 compensation in a calendar year to equal or ex8 ceed the amount of the salary of the President

9 under section 102 of title 3.

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

11 be removed from office by the Secretary for mis12 conduct or nonsatisfactory performance under

13 the performance agreement described in subpara14 graph (B). The Secretary shall provide notifica15 tion of any such removal to both Houses of Con16 gress.

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

18 Director shall—

19 ‘‘(A) appoint such officers, employees (in20 cluding attorneys), and agents of the Office as

21 the Director considers necessary to carry out the

22 functions of the Office; and

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

24 of such officers and employees and delegate to
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1 them such of the powers vested in the Office as

2 the Director may determine.

3 The Office shall not be subject to any administra4 tively or statutorily imposed limitation on positions

5 or personnel, and no positions or personnel of the Of6 fice shall be taken into account for purposes of apply7 ing any such limitation.

8 ‘‘(4) TRAINING OF EXAMINERS.—The Patent and

9 Trademark Office shall develop an incentive program

10 to retain as employees patent and trademark exam11 iners of the primary examiner grade or higher who

12 are eligible for retirement, for the sole purpose of

13 training patent and trademark examiners.

14 ‘‘(c) CONTINUED APPLICABILITY OF TITLE 5.—Officers

15 and employees of the Office shall be subject to the provisions

16 of title 5 relating to Federal employees.

17 ‘‘(d) ADOPTION OF EXISTING LABOR AGREEMENTS.—

18 The Office shall adopt all labor agreements which are in

19 effect, as of the day before the effective date of the Patent

20 and Trademark Office Efficiency Act, with respect to such

21 Office (as then in effect).

22 ‘‘(e) CARRYOVER OF PERSONNEL.—

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

24 date of the Patent and Trademark Office Efficiency

25 Act, all officers and employees of the Patent and
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1 Trademark Office on the day before such effective date

2 shall become officers and employees of the Office,

3 without a break in service.

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

5 on the day before the effective date of the Patent and

6 Trademark Office Efficiency Act, is an officer or em7 ployee of the Department of Commerce (other than an

8 officer or employee under paragraph (1)) shall be

9 transferred to the Office, as necessary to carry out the

10 purposes of this Act, if—

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

12 for which a major function is the performance of

13 work reimbursed by the Patent and Trademark

14 Office, as determined by the Secretary of Com15 merce;

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

17 that performed work in support of the Patent

18 and Trademark Office during at least half of the

19 incumbent’s work time, as determined by the

20 Secretary of Commerce; or

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

22 of the Office, as determined by the Secretary of

23 Commerce in consultation with the Director.

24 Any transfer under this paragraph shall be effective

25 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 serv2 ice.

3 ‘‘(3) ACCUMULATED LEAVE.—The amount of sick

4 and annual leave and compensatory time accumu5 lated under title 5 before the effective date described

6 in paragraph (1), by those becoming officers or em7 ployees of the Office pursuant to this subsection, are

8 obligations of the Office.

9 ‘‘(f) TRANSITION PROVISIONS.—

10 ‘‘(1) INTERIM APPOINTMENT OF DIRECTOR.—On

11 or after the effective date of the Patent and Trade12 mark Office Efficiency Act, the President shall ap13 point an individual to serve as the Director until the

14 date on which a Director qualifies under subsection

15 (a). The President shall not make more than one such

16 appointment under this subsection.

17 ‘‘(2) CONTINUATION IN OFFICE OF CERTAIN OFFI18 CERS.—(A) The individual serving as the Assistant

19 Commissioner for Patents on the day before the effec20 tive date of the Patent and Trademark Office Effi21 ciency Act may serve as the Commissioner for Patents

22 until the date on which a Commissioner for Patents

23 is appointed under subsection (b).

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

25 Commissioner for Trademarks on the day before the
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1 effective date of the Patent and Trademark Office Ef2 ficiency Act may serve as the Commissioner for

3 Trademarks until the date on which a Commissioner

4 for Trademarks is appointed under subsection (b).’’.

5 SEC. 614. PUBLIC ADVISORY COMMITTEES.

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

7 is amended by inserting after section 4 the following:

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

9 Committees

10 ‘‘(a) ESTABLISHMENT OF PUBLIC ADVISORY COMMIT11 TEES.—

12 ‘‘(1) APPOINTMENT.—The United States Patent

13 and Trademark Office shall have a Patent Public Ad14 visory Committee and a Trademark Public Advisory

15 Committee, each of which shall have 9 voting members

16 who shall be appointed by the Secretary of Commerce

17 and serve at the pleasure of the Secretary of Com18 merce. Members of each Public Advisory Committee

19 shall be appointed for a term of 3 years, except that

20 of the members first appointed, 3 shall be appointed

21 for a term of 1 year, and 3 shall be appointed for a

22 term of 2 years. In making appointments to each

23 Committee, the Secretary of Commerce shall consider

24 the risk of loss of competitive advantage in inter-
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1 national commerce or other harm to United States

2 companies as a result of such appointments.

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

4 chair of each Advisory Committee, whose term as

5 chair shall be for 3 years.

6 ‘‘(3) TIMING OF APPOINTMENTS.—Initial ap7 pointments to each Advisory Committee shall be made

8 within 3 months after the effective date of the Patent

9 and Trademark Office Efficiency Act. Vacancies shall

10 be filled within 3 months after they occur.

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

12 Advisory Committee—

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

14 shall be chosen so as to represent the interests of di15 verse users of the Patent and Trademark Office with

16 respect to patents, in the case of the Patent Public

17 Advisory Committee, and with respect to trademarks,

18 in the case of the Trademark Public Advisory Com19 mittee;

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

21 and large entity applicants located in the United

22 States in proportion to the number of applications

23 filed by such members, but in no case shall members

24 who represent small entity patent applicants, includ25 ing small business concerns, independent inventors,
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1 and nonprofit organizations, constitute less than 25

2 percent of the members of the Patent Public Advisory

3 Committee; and

4 ‘‘(3) shall include individuals with substantial

5 background and achievement in finance, management,

6 labor relations, science, technology, and office automa7 tion.

8 In addition to the voting members, each Advisory Com9 mittee shall include a representative of each labor organiza10 tion recognized by the Patent and Trademark Office. Such

11 representatives shall be nonvoting members of the Advisory

12 Committee to which they are appointed.

13 ‘‘(c) MEETINGS.—Each Advisory Committee shall meet

14 at the call of the chair to consider an agenda set by the

15 Chair.

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

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

18 budget, and user fees of the Patent and Trademark

19 Office with respect to patents, in the case of the Pat20 ent Public Advisory Committee, and with respect to

21 Trademarks, in the case of the Trademark Public Ad22 visory Committee, and advise the Director on these

23 matters;

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

25 year—
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1 ‘‘(A) prepare an annual report on the mat2 ters referred to in paragraph (1);

3 ‘‘(B) transmit the report to the Secretary of

4 Commerce, the President, and the Committees on

5 the Judiciary of the Senate and the House of

6 Representatives; and

7 ‘‘(C) publish the report in the Official Ga8 zette of the Patent and Trademark Office.

9 ‘‘(e) COMPENSATION.—Each member of each Advisory

10 Committee shall be compensated for each day (including

11 travel time) during which such member is attending meet12 ings or conferences of that Advisory Committee or otherwise

13 engaged in the business of that Advisory Committee, at the

14 rate which is the daily equivalent of the annual rate of basic

15 pay in effect for level III of the Executive Schedule under

16 section 5314 of title 5. While away from such member’s

17 home or regular place of business such member shall be al18 lowed travel expenses, including per diem in lieu of subsist19 ence, as authorized by section 5703 of title 5.

20 ‘‘(f) ACCESS TO INFORMATION.—Members of each Ad21 visory Committee shall be provided access to records and

22 information in the Patent and Trademark Office, except for

23 personnel or other privileged information and information

24 concerning patent applications required to be kept in con25 fidence 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.

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 Advisory

9 Committee shall be open to the public, except that each Ad10 visory Committee may by majority vote meet in executive

11 session when considering personnel or other confidential in12 formation.’’.

13 SEC. 615. PATENT AND TRADEMARK OFFICE FUNDING.

14 Section 42(c) of title 35, United States Code, is amend15 ed 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 SEC. 617. TRADEMARK TRIAL AND APPEAL BOARD.

2 Section 17 of the Act of July 5, 1946 (commonly re3 ferred to as the ‘‘Trademark Act of 1946’’) (15 U.S.C. 1067)

4 is amended to read as follows:

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

6 to registration, application to register as a lawful concur7 rent user, or application to cancel the registration of a

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

9 direct a Trademark Trial and Appeal Board to determine

10 and decide the respective rights of registration.

11 ‘‘(b) The Trademark Trial and Appeal Board shall in12 clude the Director, the Commissioner for Patents, the Com13 missioner for Trademarks, and administrative trademark

14 judges who are appointed by the Director.’’.

15 SEC. 618. BOARD OF PATENT APPEALS AND INTER16 FERENCES.

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

18 amended—

19 (1) by striking section 7 and redesignating sec20 tions 8 through 14 as sections 7 through 13, respec21 tively; and

22 (2) by inserting after section 5 the following:

23 ‘‘§ 6. Board of Patent Appeals and Interferences

24 ‘‘(a) ESTABLISHMENT AND COMPOSITION.—There shall

25 be in the United States Patent and Trademark Office a

26 Board of Patent Appeals and Interferences. The Director,
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1 the Commissioner for Patents, the Commissioner for Trade2 marks, and the administrative patent judges shall con3 stitute the Board. The administrative patent judges shall

4 be persons of competent legal knowledge and scientific abil5 ity who are appointed by the Director.

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

7 Interferences shall, on written appeal of an applicant, re8 view adverse decisions of examiners upon applications for

9 patents and shall determine priority and patentability of

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

11 Each appeal and interference shall be heard by at least 3

12 members of the Board, who shall be designated by the Direc13 tor. Only the Board of Patent Appeals and Interferences

14 may grant rehearings.’’.

15 SEC. 619. ANNUAL REPORT OF DIRECTOR.

16 Section 13 of title 35, United States Code, as redesig17 nated by section 618 of this Act, is amended to read as

18 follows:

19 ‘‘§ 13. Annual report to Congress

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

21 than 180 days after the end of each fiscal year, the moneys

22 received and expended by the Office, the purposes for which

23 the moneys were spent, the quality and quantity of the work

24 of the Office, the nature of training provided to examiners,

25 the evaluation of the Director and the Commissioners by
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1 the Secretary of Commerce, the Director’s and the Commis2 sioners’ compensation, and other information relating to

3 the Office.’’.

4 SEC. 620. SUSPENSION OR EXCLUSION FROM PRACTICE.

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

6 by inserting before the last sentence the following: ‘‘The Di7 rector shall have the discretion to designate any attorney

8 who is an officer or employee of the United States Patent

9 and Trademark Office to conduct the hearing required by

10 this section.’’.

11 SEC. 621. PAY OF DIRECTOR.

12 Section 5314 of title 5, United States Code, is amended

13 by striking

14 ‘‘Assistant Secretary of Commerce and Commis15 sioner of Patents and Trademarks.’’

16 and inserting

17 ‘‘Under Secretary of Commerce for Intellectual

18 Property and Director of the United States Patent

19 and Trademark Office.’’.

20 Subtitle B—Effective Date;

21 Technical Amendments

22 SEC. 631. EFFECTIVE DATE.

23 This title and the amendments made by this title shall

24 take effect 4 months after the date of the enactment of this

25 Act.
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1 SEC. 632. TECHNICAL AND CONFORMING AMENDMENTS.

2 (a) AMENDMENTS TO TITLE 35.—

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

4 parts for chapter 35, United States Code, is amended

5 to read as follows:

‘‘I. United States Patent and Trademark Office ...................... 1’’.

6 (2) The heading for part I of title 35, United

7 States Code, is amended to read as follows:

8 ‘‘PART I—UNITED STATES PATENT AND

9 TRADEMARK OFFICE’’.

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

11 United States Code, is amended by amending the

12 item relating to chapter 1 to read as follows:

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

13 (4) The table of sections for chapter 1 of title 35,

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

15 ‘‘CHAPTER 1—ESTABLISHMENT, OFFICERS

16 AND EMPLOYEES, FUNCTIONS

‘‘Sec.

‘‘1. Establishment.

‘‘2. Powers and duties.

‘‘3. Officers and employees.

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

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

‘‘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.’’.
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1 (5) Section 41(h) of title 35, United States Code,

2 is amended by striking ‘‘Commissioner of Patents and

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

4 (6) Section 155 of title 35, United States Code,

5 is amended by striking ‘‘Commissioner of Patents and

6 Trademarks’’ and inserting ‘‘Director’’.

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

8 Code, is amended by striking ‘‘Commissioner of Pat9 ents and Trademarks’’ and inserting ‘‘Director’’.

10 (8)(A) Except as provided in subparagraph (B),

11 title 35, United States Code, is amended by striking

12 ‘‘Commissioner’’ each place it appears and inserting

13 ‘‘Director’’.

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

15 is amended by striking ‘‘Commissioner’’ each place it

16 appears and inserting ‘‘Commissioner of Patents’’.

17 (9) Section 41(a)(8)(A) of title 35, United States

18 Code, is amended by striking ‘‘On’’ and inserting

19 ‘‘on’’.

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

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

23 (11) Section 181 of title 35, United States Code,

24 is amended in the third paragraph by striking ‘‘Sec25 retary of Commerce under rules prescribed by him’’
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1 and inserting ‘‘Director under rules prescribed by the

2 Patent and Trademark Office’’.

3 (12) Section 188 of title 35, United States Code,

4 is amended by striking ‘‘Secretary of Commerce’’ and

5 inserting ‘‘Patent and Trademark Office’’.

6 (13) Section 202(a) of title 35, United States

7 Code, is amended—

8 (A) by striking ‘‘iv)’’ and inserting ‘‘(iv)’’;

9 and

10 (B) by striking the second period after ‘‘De11 partment of Energy’’ at the end of the first sen12 tence.

13 (b) OTHER PROVISIONS OF LAW.—

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

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

16 1946’’; 15 U.S.C. 1127), is amended by striking ‘‘The

17 term ‘Commissioner’’ means the Commissioner of Pat18 ents and Trademarks.’ and inserting ‘‘The term ‘Di19 rector’ means the Director of the United States Patent

20 and Trademark Office.’’.

21 (B) The Act of July 5, 1946 (commonly referred

22 to as the ‘‘Trademark Act of 1946’’; 15 U.S.C. 1051

23 and following), except for section 17, as amended by

24 section 617 of this Act, is amended by striking ‘‘Com-
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1 missioner’’ each place it appears and inserting ‘‘Di2 rector’’.

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

4 is amended by striking ‘‘Patent Office’’ and inserting

5 ‘‘United States Patent and Trademark Office’’.

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

7 Code, is amended to read as follows:

8 ‘‘(23) administrative patent judges and des9 ignated administrative patent judges in the United

10 States Patent and Trademark Office;’’.

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

12 (5 U.S.C. 5316) is amended by striking ‘‘Commis13 sioner of Patents, Department of Commerce.’’, ‘Dep14 uty Commissioner of Patents and Trademarks.’’, ‘‘As15 sistant Commissioner for Patents.’’, and ‘Assistant

16 Commissioner for Trademarks.’’.

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

18 (15 U.S.C. 638(p)(1)(B)) is amended to read as fol19 lows:

20 ‘‘(B) the Director of the United States Pat21 ent and Trademark Office; and’’.

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

23 (15 U.S.C. 1511) is amended by striking ‘‘(d) Patent

24 and Trademark Office;’’ and redesignating subsections

25 (a) through (g) as paragraphs (1) through (6), respec-
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1 tively and indenting the paragraphs as so redesig2 nated 2 ems to the right.

3 (7) Section 19 of the Tennessee Valley Authority

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

5 (A) by striking ‘‘Patent Office of the United

6 States’’ and inserting ‘‘United States Patent and

7 Trademark Office’’; and

8 (B) by striking ‘‘Commissioner of Patents’’

9 and inserting ‘‘Director of the United States

10 Patent and Trademark Office’’.

11 (8) Section 182(b)(2)(A) of the Trade Act of

12 1974 (19 U.S.C. 2242(b)(2)(A)) is amended by strik13 ing ‘‘Commissioner of Patents and Trademarks’’ and

14 inserting ‘‘Director of the United States Patent and

15 Trademark Office’’.

16 (9) Section 302(b)(2)(D) of the Trade Act of

17 1974 (19 U.S.C. 2412(b)(2)(D)) is amended by strik18 ing ‘‘Commissioner of Patents and Trademarks’’ and

19 inserting ‘‘Director of the United States Patent and

20 Trademark Office’’.

21 (10) The Act of April 12, 1892 (27 Stat. 395; 20

22 U.S.C. 91) is amended by striking ‘‘Patent Office’’

23 and inserting ‘‘United States Patent and Trademark

24 Office’’.
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1 (11) Sections 505(m) and 512(o) of the Federal

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

3 360b(o)) are each amended by striking ‘‘Patent and

4 Trademark Office of the Department of Commerce’’

5 and inserting ‘‘United States Patent and Trademark

6 Office’’.

7 (12) Section 702(d) of the Federal Food, Drug,

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

9 striking ‘‘Commissioner of Patents’’ and inserting

10 ‘‘Director of the United States Patent and Trademark

11 Office’’ and by striking ‘‘Commissioner’’ and insert12 ing ‘‘Director’’.

13 (13) Section 105(e) of the Federal Alcohol Ad14 ministration Act (27 U.S.C. 205(e)) is amended by

15 striking ‘‘United States Patent Office’’ and inserting

16 ‘‘United States Patent and Trademark Office’’.

17 (14) Section 1295(a)(4) of title 28, United States

18 Code, is amended—

19 (A) in subparagraph (A) by inserting

20 ‘‘United States’’ before ‘‘Patent and Trademark’’;

21 and

22 (B) in subparagraph (B) by striking ‘‘Com23 missioner of Patents and Trademarks’’ and in24 serting ‘‘Director of the United States Patent

25 and Trademark Office’’.
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1 (15) Chapter 115 of title 28, United States Code,

2 is amended—

3 (A) in the item relating to section 1744 in

4 the table of sections by striking ‘‘Patent Office’’

5 and inserting ‘‘United States Patent and Trade6 mark Office’’;

7 (B) in section 1744—

8 (i) by striking ‘‘Patent Office’’ each

9 place it appears in the text and section

10 heading and inserting ‘‘United States Pat11 ent and Trademark Office’’;

12 (ii) by striking ‘‘Commissioner of Pat13 ents’’ and inserting ‘‘Director of the United

14 States Patent and Trademark Office’’; and

15 (C) by striking ‘‘Commissioner’’ and insert16 ing ‘‘Director’’.

17 (16) Section 1745 of title 28, United States

18 Code, is amended by striking ‘‘United States Patent

19 Office’’ and inserting ‘‘United States Patent and

20 Trademark Office’’.

21 (17) Section 1928 of title 28, United States

22 Code, is amended by striking ‘‘Patent Office’’ and in23 serting ‘‘United States Patent and Trademark Of24 fice’’.
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1 (18) Section 151 of the Atomic Energy Act of

2 1954 (42 U.S.C. 2181) is amended in subsections c.

3 and d. by striking ‘‘Commissioner of Patents’’ and in4 serting ‘‘Director of the United States Patent and

5 Trademark Office’’.

6 (19) Section 152 of the Atomic Energy Act of

7 1954 (42 U.S.C. 2182) is amended by striking ‘‘Com8 missioner of Patents’’ each place it appears and in9 serting ‘‘Director of the United States Patent and

10 Trademark Office’’.

11 (20) Section 305 of the National Aeronautics

12 and Space Act of 1958 (42 U.S.C. 2457) is

13 amended—

14 (A) in subsection (c) by striking ‘‘Commis15 sioner of Patents’’ and inserting ‘‘Director of the

16 United States Patent and Trademark Office

17 (hereafter in this section referred to as the ‘Di18 rector’)’’; and

19 (B) by striking ‘‘Commissioner’’ each subse20 quent place it appears and inserting ‘‘Director’’.

21 (21) Section 12(a) of the Solar Heating and

22 Cooling Demonstration Act of 1974 (42 U.S.C.

23 5510(a)) is amended by striking ‘‘Commissioner of

24 the Patent Office’’ and inserting ‘‘Director of the

25 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 enemy

14 Act (50 U.S.C. App. 10(i)) is amended by striking

15 ‘‘Commissioner of Patents’’ and inserting ‘‘Director of

16 the United States Patent and Trademark Office’’.

17 (27) Section 11 of the Inspector General Act of

18 1978 (5 U.S.C. App.) is amended—

19 (A) in paragraph (1)—

20 (i) by striking ‘‘and’’ before ‘‘the chief

21 executive officer of the Resolution Trust

22 Corporation;’’;

23 (ii) by striking ‘‘and’’ before ‘‘the

24 Chairperson of the Federal Deposit Insur25 ance Corporation;’’;
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1 (iii) by striking ‘‘or’’ before ‘‘the Com2 missioner of Social Security,’’; and

3 (iv) by inserting ‘‘or the Director of the

4 United States Patent and Trademark Of5 fice;’’ after ‘‘Social Security Administra6 tion;’’; and

7 (B) in paragraph (2)—

8 (i) by striking ‘‘or’’ before ‘‘the Vet9 erans’ Administration,’’; and

10 (ii) by striking ‘‘or the Social Security

11 Administration’’ and inserting ‘‘the Social

12 Security Administration, or the United

13 States Patent and Trademark Office’’.

14 Subtitle C—Miscellaneous

15 Provisions

16 SEC. 641. REFERENCES.

17 (a) IN GENERAL.—Any reference in any other Federal

18 law, Executive order, rule, regulation, or delegation of au19 thority, or any document of or pertaining to a department

20 or office from which a function is transferred by this title—

21 (1) to the head of such department or office is

22 deemed to refer to the head of the department or office

23 to which such function is transferred; or
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1 (2) to such department or office is deemed to

2 refer to the department or office to which such func3 tion is transferred.

4 (b) SPECIFIC REFERENCES.—Any reference in any

5 other Federal law, Executive order, rule, regulation, or dele6 gation of authority, or any document of or pertaining to

7 the Patent and Trademark Office—

8 (1) to the Commissioner of Patents and Trade9 marks is deemed to refer to the Director of the United

10 States Patent and Trademark Office;

11 (2) to the Assistant Commissioner for Patents is

12 deemed to refer to the Commissioner for Patents; or

13 (3) to the Assistant Commissioner for Trade14 marks is deemed to refer to the Commissioner for

15 Trademarks.

16 SEC. 642. EXERCISE OF AUTHORITIES.

17 Except as otherwise provided by law, a Federal official

18 to whom a function is transferred by this title may, for

19 purposes of performing the function, exercise all authorities

20 under any other provision of law that were available with

21 respect to the performance of that function to the official

22 responsible for the performance of the function immediately

23 before the effective date of the transfer of the function under

24 this title.
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1 SEC. 643. SAVINGS PROVISIONS.

2 (a) LEGAL DOCUMENTS.—All orders, determinations,

3 rules, regulations, permits, grants, loans, contracts, agree4 ments, certificates, licenses, and privileges—

5 (1) that have been issued, made, granted, or al6 lowed to become effective by the President, the Sec7 retary of Commerce, any officer or employee of any

8 office transferred by this title, or any other Govern9 ment official, or by a court of competent jurisdiction,

10 in the performance of any function that is transferred

11 by this title, and

12 (2) that are in effect on the effective date of such

13 transfer (or become effective after such date pursuant

14 to their terms as in effect on such effective date), shall

15 continue in effect according to their terms until modi16 fied, terminated, superseded, set aside, or revoked in

17 accordance with law by the President, any other au18 thorized official, a court of competent jurisdiction, or

19 operation of law.

20 (b) PROCEEDINGS.—This title shall not affect any pro21 ceedings or any application for any benefits, service, license,

22 permit, certificate, or financial assistance pending on the

23 effective date of this title before an office transferred by this

24 title, but such proceedings and applications shall be contin25 ued. Orders shall be issued in such proceedings, appeals

26 shall be taken therefrom, and payments shall be made pur-
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1 suant to such orders, as if this title had not been enacted,

2 and orders issued in any such proceeding shall continue in

3 effect until modified, terminated, superseded, or revoked by

4 a duly authorized official, by a court of competent jurisdic5 tion, or by operation of law. Nothing in this subsection shall

6 be considered to prohibit the discontinuance or modification

7 of any such proceeding under the same terms and condi8 tions and to the same extent that such proceeding could have

9 been discontinued or modified if this title had not been en10 acted.

11 (c) SUITS.—This title shall not affect suits commenced

12 before the effective date of this title, and in all such suits,

13 proceedings shall be had, appeals taken, and judgments ren14 dered in the same manner and with the same effect as if

15 this title had not been enacted.

16 (d) NONABATEMENT OF ACTIONS.—No suit, action, or

17 other proceeding commenced by or against the Department

18 of Commerce or the Secretary of Commerce, or by or against

19 any individual in the official capacity of such individual

20 as an officer or employee of an office transferred by this

21 title, shall abate by reason of the enactment of this title.

22 (e) CONTINUANCE OF SUITS.—If any Government offi23 cer in the official capacity of such officer is party to a suit

24 with respect to a function of the officer, and under this title

25 such function is transferred to any other officer or office,
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1 then such suit shall be continued with the other officer or

2 the head of such other office, as applicable, substituted or

3 added as a party.

4 (f) ADMINISTRATIVE PROCEDURE AND JUDICIAL RE5 VIEW.—Except as otherwise provided by this title, any stat6 utory requirements relating to notice, hearings, action upon

7 the record, or administrative or judicial review that apply

8 to any function transferred by this title shall apply to the

9 exercise of such function by the head of the Federal agency,

10 and other officers of the agency, to which such function is

11 transferred by this title.

12 SEC. 644. TRANSFER OF ASSETS.

13 Except as otherwise provided in this title, so much of

14 the personnel, property, records, and unexpended balances

15 of appropriations, allocations, and other funds employed,

16 used, held, available, or to be made available in connection

17 with a function transferred to an official or agency by this

18 title shall be available to the official or the head of that

19 agency, respectively, at such time or times as the Director

20 of the Office of Management and Budget directs for use in

21 connection with the functions transferred.

22 SEC. 645. DELEGATION AND ASSIGNMENT.

23 Except as otherwise expressly prohibited by law or oth24 erwise provided in this title, an official to whom functions

25 are transferred under this title (including the head of any
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1 office to which functions are transferred under this title)

2 may delegate any of the functions so transferred to such

3 officers and employees of the office of the official as the offi4 cial may designate, and may authorize successive redelega5 tions of such functions as may be necessary or appropriate.

6 No delegation of functions under this section or under any

7 other provision of this title shall relieve the official to whom

8 a function is transferred under this title of responsibility

9 for the administration of the function.

10 SEC. 646. AUTHORITY OF DIRECTOR OF THE OFFICE OF

11 MANAGEMENT AND BUDGET WITH RESPECT

12 TO FUNCTIONS TRANSFERRED.

13 (a) DETERMINATIONS.—If necessary, the Director of

14 the Office of Management and Budget shall make any deter15 mination of the functions that are transferred under this

16 title.

17 (b) INCIDENTAL TRANSFERS.—The Director of the Of18 fice of Management and Budget, at such time or times as

19 the Director shall provide, may make such determinations

20 as may be necessary with regard to the functions transferred

21 by this title, and to make such additional incidental dis22 positions of personnel, assets, liabilities, grants, contracts,

23 property, records, and unexpended balances of appropria24 tions, authorizations, allocations, and other funds held,

25 used, arising from, available to, or to be made available
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1 in connection with such functions, as may be necessary to

2 carry out the provisions of this title. The Director shall pro3 vide for the termination of the affairs of all entities termi4 nated by this title and for such further measures and dis5 positions as may be necessary to effectuate the purposes of

6 this title.

7 SEC. 647. CERTAIN VESTING OF FUNCTIONS CONSIDERED

8 TRANSFERS.

9 For purposes of this title, the vesting of a function in

10 a department or office pursuant to reestablishment of an

11 office shall be considered to be the transfer of the function.

12 SEC. 648. AVAILABILITY OF EXISTING FUNDS.

13 Existing appropriations and funds available for the

14 performance of functions, programs, and activities termi15 nated pursuant to this title shall remain available, for the

16 duration of their period of availability, for necessary ex17 penses in connection with the termination and resolution

18 of such functions, programs, and activities, subject to the

19 submission of a plan to the Committees on Appropriations

20 of the House and Senate in accordance with the procedures

21 set forth in section 605 of the Departments of Commerce,

22 Justice, and State, the Judiciary, and Related Agencies Ap23 propriations Act, 1999, as contained in Public Law 105–

24 277.
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1 SEC. 649. DEFINITIONS.

2 For purposes of this title—

3 (1) the term ‘‘function’’ includes any duty, obli4 gation, power, authority, responsibility, right, privi5 lege, activity, or program; and

6 (2) the term ‘‘office’’ includes any office, admin7 istration, agency, bureau, institute, council, unit, or8 ganizational entity, or component thereof.

9 TITLE VII—MISCELLANEOUS

10 PATENT PROVISIONS

11 SEC. 701. PROVISIONAL APPLICATIONS.

12 (a) ABANDONMENT.—Section 111(b)(5) of title 35,

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

14 ‘‘(5) ABANDONMENT.—Notwithstanding the ab15 sence of a claim, upon timely request and as pre16 scribed by the Commissioner, a provisional applica17 tion may be treated as an application filed under

18 subsection (a). Subject to section 119(e)(3) of this

19 title, if no such request is made, the provisional ap20 plication shall be regarded as abandoned 12 months

21 after the filing date of such application and shall not

22 be subject to revival thereafter.’’.

23 (b) TECHNICAL AMENDMENT RELATING TO WEEKENDS

24 AND HOLIDAYS.—Section 119(e) of title 35, United States

25 code, is amended by adding at the end the following:
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1 ‘‘(3) If the day that is 12 months after the filing date

2 of a provisional application falls on a Saturday, Sunday,

3 or Federal holiday within the District of Columbia, the pe4 riod of pendency of the provisional application shall be ex5 tended to the next succeeding secular or business day.’’.

6 (c) ELIMINATION OF COPENDENCY REQUIREMENT.—

7 Section 119(e)(2) of title 35, United States Code, is amend8 ed by striking ‘‘and the provisional application was pend9 ing on the filing date of the application for patent under

10 section 111(a) or section 363 of this title’’.

11 (d) EFFECTIVE DATE.—The amendments made by this

12 section shall take effect on the date of the enactment of this

13 Act and shall apply to any provisional application filed

14 on or after June 8, 1995, except that the amendments made

15 by subsections (b) and (c) shall have no effect with respect

16 to any patent which is the subject of litigation in an action

17 commenced before such date of enactment.

18 SEC. 702. INTERNATIONAL APPLICATIONS.

19 Section 119 of title 35, United States Code, is

20 amended—

21 (1) in subsection (a)—

22 (A) by inserting ‘‘in a WTO member coun23 try or’’ after ‘‘patent for the same invention’’;

24 and
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1 (B) by inserting ‘‘such WTO member coun2 try or’’ after ‘‘first filed in’’;

3 (2) in subsection (c), by inserting ‘‘WTO member

4 country or’’ after ‘‘application in the same’’; and

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

6 ‘‘(f) Applications for plant breeder’s rights filed in a

7 WTO member country (or in a foreign UPOV Contracting

8 Party) shall have the same effect for the purpose of the right

9 of priority under subsections (a) through (c) of this section

10 as applications for patent, subject to the same conditions

11 and requirements of this section as apply to applications

12 for patents.

13 ‘‘(g) As used in this section—

14 ‘‘(1) the term ‘WTO member country’ has the

15 meaning given that term in section 2(10) of the Uru16 guay Round Agreements Act; and

17 ‘‘(2) the term ‘UPOV Contracting Party’ means

18 a member of the International Convention for the

19 Protection of New Varieties of Plants.’’.

20 SEC. 703. CERTAIN LIMITATIONS ON DAMAGES FOR PATENT

21 INFRINGEMENT NOT APPLICABLE.

22 Section 287(c)(4) of title 35, United States Code, is

23 amended by striking ‘‘before the date of enactment of this

24 subsection’’ and inserting ‘‘based on an application the ear-
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1 liest effective filing date of which is prior to September 30,

2 1996’’.

3 SEC. 704. ELECTRONIC FILING.

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

5 by striking ‘‘printed or typewritten’’ and inserting ‘‘print6 ed, typewritten, or on an electronic medium’’.

7 SEC. 705. STUDY AND REPORT ON BIOLOGICAL DEPOSITS

8 IN SUPPORT OF BIOTECHNOLOGY PATENTS.

9 (a) IN GENERAL.—No later than 6 months after the

10 date of the enactment of this Act, the Comptroller General

11 of the United States, in consultation with the Director of

12 the United States Patent and Trademark Office, shall con13 duct a study and submit a report to the Congress on the

14 potential risks to the United States biotechnology industry

15 relating to biological deposits in support of biotechnology

16 patents.

17 (b) CONTENTS.—The study conducted under this sec18 tion shall include—

19 (1) an examination of the risk of export and the

20 risk of transfers to third parties of biological deposits,

21 and the risks posed by the change to 18-month publi22 cation requirements made by this Act;

23 (2) an analysis of comparative legal and regu24 latory regimes; and

25 (3) any related recommendations.
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1 (c) CONSIDERATION OF REPORT.—In drafting regula2 tions affecting biological deposits (including any modifica3 tion of title 37, Code of Federal Regulations, section 1.801

4 et seq.), the Patent and Trademark Office shall consider the

5 recommendations of the study conducted under this section.

6 SEC. 706. PRIOR INVENTION.

7 Section 102(g) of title 35, United States Code, is

8 amended to read as follows:

9 ‘‘(g)(1) during the course of an interference conducted

10 under section 135 or section 291, another inventor involved

11 therein establishes, to the extent permitted in section 104,

12 that before such person’s invention thereof the invention was

13 made by such other inventor and not abandoned, sup14 pressed, or concealed, or (2) before such person’s invention

15 thereof, the invention was made in this country by another

16 inventor who had not abandoned, suppressed, or concealed

17 it. In determining priority of invention under this sub18 section, there shall be considered not only the respective

19 dates of conception and reduction to practice of the inven20 tion, but also the reasonable diligence of one who was first

21 to conceive and last to reduce to practice, from a time prior

22 to conception by the other.’’.
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1 SEC. 707. PRIOR ART EXCLUSION FOR CERTAIN COMMONLY

2 ASSIGNED PATENTS.

3 (a) PRIOR ART EXCLUSION.—Section 103(c) of title

4 35, United States Code, is amended by striking ‘‘subsection

5 (f) or (g)’’ and inserting ‘‘one or more of subsections (e),

6 (f), and (g)’’.

7 (b) EFFECTIVE DATE.—The amendment made by sub8 section (a) shall apply to any application for patent filed

9 on or after the date of the enactment of this Act.