II 

114TH CONGRESS 

1ST SESSION S. 632 

To strengthen the position of the United States as the world’s leading innovator by amending title 35, United States Code, to protect the property 

rights of the inventors that grow the country’s economy. 

IN THE SENATE OF THE UNITED STATES 

MARCH 3, 2015 

Mr. COONS (for himself, Mr. DURBIN, and Ms. HIRONO) introduced the following bill; which was read twice and referred to the Committee on the 

Judiciary 

A BILL 

To strengthen the position of the United States as the 

world’s leading innovator by amending title 35, United 

States Code, to protect the property rights of the inventors that grow the country’s economy. 

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; TABLE OF CONTENTS. 

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

5 ‘‘Support Technology and Research for Our Nation’s 

6 Growth Patents Act of 2015’’ or the ‘‘STRONG Patents 

7 Act of 2015’’. 


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

2 this Act is as follows: 

Sec. 1. Short title; table of contents. 

TITLE I—STRONG PATENTS ACT 

Sec. 101. Findings. 

Sec. 102. Inter partes review. 

Sec. 103. Post-grant review. 

Sec. 104. Composition of post-grant review and inter partes review panels. 

Sec. 105. Reexamination of patents. 

Sec. 106. Elimination of Form 18. 

Sec. 107. Elimination of USPTO fee diversion. 

Sec. 108. Willful infringement. 

Sec. 109. Divided infringement. 

Sec. 110. Institutions of higher education. 

Sec. 111. Assisting small businesses in the U.S. patent system. 

TITLE II—TARGETING ROGUE AND OPAQUE LETTERS 

Sec. 201. Definitions. 

Sec. 202. Unfair or deceptive acts or practices in connection with the assertion 

of a United States patent. 

Sec. 203. Enforcement by Federal Trade Commission. 

Sec. 204. Preemption of State laws on patent demand letters and enforcement 

by State attorneys general. 

3 TITLE I—STRONG PATENTS ACT 

4 SEC. 101. FINDINGS. 

5 Congress finds that— 

6 (1) the patent property rights enshrined in the 

7 Constitution of the United States provide the foun8 dation for the exceptional innovation environment in 

9 the United States; 

10 (2) strong patent rights encourage United 

11 States inventors to invest their resources in creating 

12 new inventions; 

13 (3) patent protection has led to patient cures, 

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1 ple in the United States, and improvements to the 

2 agricultural, telecommunications, and electronics in3 dustries, among others; 

4 (4) the United States patent system is an es5 sential part of the country’s economic success; 

6 (5) strong patent protection improves the 

7 chances of success for small companies and increases 

8 their chances of securing financing from investors; 

9 (6) intellectual property-intensive industries in 

10 the United States generate tens of millions of jobs 

11 for individuals in the United States; 

12 (7) intellectual property-intensive industries in 

13 the United States account for more than one-third 

14 of the country’s gross domestic product; 

15 (8) in the highly competitive global economy, 

16 the United States needs to uphold strong patent 

17 protections to maintain its position as the world’s 

18 premier innovative country; 

19 (9) Congress last enacted comprehensive re20 forms of the patent system only a few years ago, in 

21 2011; 

22 (10) unintended consequences of the com23 prehensive 2011 reform of patent laws are con24 tinuing to become evident, including the strategic filVerDate Sep 11 2014 03:56 Mar 11, 2015 Jkt 049200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S632.IS S632

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1 ing of post-grant review proceedings to depress stock 

2 prices and extort settlements; 

3 (11) the Judicial Conference of the United 

4 States is in the process of making significant revi5 sions to rules governing pleadings and discovery in 

6 the Federal Rules of Civil Procedure, with changes 

7 scheduled to take effect in December 2015; 

8 (12) the Supreme Court recently issued rulings 

9 in Octane Fitness, LLC v. Icon Health & Fitness, 

10 Inc., 134 S.Ct. 1749 (2014) and Highmark Inc. v. 

11 Allcare Health Management System, Inc., 134 S.Ct. 

12 1744 (2014) that significantly reduced the burden 

13 on an alleged infringer to recover attorney fees from 

14 the patent owner, and increased the incidence of fees 

15 shifted to the losing party; and 

16 (13) efforts by Congress to reform the patent 

17 system without careful scrutiny create a serious risk 

18 of making it more costly and difficult for legitimate 

19 innovators to protect their patents from infringe20 ment, thereby weakening United States companies 

21 and the United States economy. 

22 SEC. 102. INTER PARTES REVIEW. 

23 (a) CLAIM CONSTRUCTION.—Section 316(a) of title 

24 35, United States Code, is amended— 


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1 (1) in paragraph (12), by striking ‘‘; and’’ and 

2 inserting a semicolon; 

3 (2) in paragraph (13), by striking the period at 

4 the end and inserting ‘‘; and’’; and 

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

6 ‘‘(14) providing that for all purposes under this 

7 chapter— 

8 ‘‘(A) each claim of a patent shall be con9 strued as the claim would be construed under 

10 section 282(b) in an action to invalidate a pat11 ent, including by construing each claim of the 

12 patent in accordance with— 

13 ‘‘(i) the ordinary and customary 

14 meaning of the claim as understood by a 

15 person having ordinary skill in the art to 

16 which the claimed invention pertains; and 

17 ‘‘(ii) the prosecution history per18 taining to the patent; and 

19 ‘‘(B) if a court has previously construed a 

20 claim of a patent or a claim term in a civil ac21 tion to which the patent owner was a party, the 

22 Office shall consider that claim construction.’’. 

23 (b) AMENDMENT OF CLAIMS.—Section 316(d) of title 

24 35, United States Code, is amended to read as follows: 

25 ‘‘(d) AMENDMENT OF THE PATENT.— 


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1 ‘‘(1) IN GENERAL.—During an inter partes re2 view instituted under this chapter, the patent owner 

3 may move to amend the patent in 1 or more of the 

4 following ways: 

5 ‘‘(A) Cancel any challenged patent claim. 

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

7 reasonable number of substitute claims. 

8 ‘‘(2) INITIAL AMENDMENT.—If the patent 

9 owner has not amended the patent under this sub10 section, a motion to amend filed by the patent owner 

11 shall be granted if the proposed number of sub12 stitute claims is reasonable. 

13 ‘‘(3) ADDITIONAL AMENDMENTS.— 

14 ‘‘(A) PERMISSION TO FILE MOTIONS.—If 

15 the patent owner has amended the patent under 

16 this subsection, additional motions to amend 

17 may be permitted upon— 

18 ‘‘(i) the joint request of the petitioner 

19 and the patent owner to materially advance 

20 the settlement of a proceeding under sec21 tion 317; or 

22 ‘‘(ii) the request of the patent owner 

23 for good cause shown. 

24 ‘‘(B) DISCRETION TO GRANT MOTIONS.— 

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1 mine, in its discretion, whether to grant or deny 

2 a motion filed under this paragraph. 

3 ‘‘(4) SCOPE OF CLAIMS.—An amendment to a 

4 patent under this subsection may not enlarge the 

5 scope of the claims of the patent or introduce new 

6 matter.’’. 

7 (c) BURDEN OF PROOF.—Section 316(e) of title 35, 

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

9 ‘‘(e) EVIDENTIARY STANDARDS.— 

10 ‘‘(1) PRESUMPTION OF VALIDITY.—The pre11 sumption of validity under section 282(a) shall apply 

12 to a previously issued claim that is challenged dur13 ing a proceeding under this chapter. 

14 ‘‘(2) BURDENS OF PROOF.—In an inter partes 

15 review instituted under this chapter, the petitioner 

16 shall have the burden of proving— 

17 ‘‘(A) a proposition of unpatentability of a 

18 previously issued claim by clear and convincing 

19 evidence; and 

20 ‘‘(B) a proposition of unpatentability of a 

21 proposed amended claim by a preponderance of 

22 the evidence.’’. 

23 (d) STANDING.—Section 311 of title 35, United 

24 States Code, is amended by adding at the end the fol25 lowing: 


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1 ‘‘(d) PERSONS THAT MAY PETITION.— 

2 ‘‘(1) DEFINITION.—In this subsection, the term 

3 ‘charged with infringement’ means a real and sub4 stantial controversy regarding infringement of a pat5 ent exists such that the petitioner would have stand6 ing to bring a declaratory judgment action in Fed7 eral court. 

8 ‘‘(2) NECESSARY CONDITIONS.—A person may 

9 not file with the Office a petition to institute an 

10 inter partes review of a patent unless the person, or 

11 a real party in interest or privy of the person, has 

12 been— 

13 ‘‘(A) sued for infringement of the patent; 

14 or 

15 ‘‘(B) charged with infringement under the 

16 patent.’’. 

17 (e) DISCOVERY OF REAL PARTY IN INTEREST.—Sec18 tion 316(a)(5) of title 35, United States Code, is amended 

19 to read as follows: 

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

21 discovery of relevant evidence, including that such 

22 discovery shall be limited to— 

23 ‘‘(A) the deposition of witnesses submitting 

24 affidavits or declarations; 


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1 ‘‘(B) evidence identifying the petitioner’s 

2 real parties in interest; and 

3 ‘‘(C) what is otherwise necessary in the in4 terest of justice;’’. 

5 (f) EVIDENCE SUPPORTING PRELIMINARY RE6 SPONSE.—Section 313 of title 35, United States Code, is 

7 amended— 

8 (1) by striking ‘‘If an’’ and inserting the fol9 lowing: 

10 ‘‘(a) IN GENERAL.—If an’’; and 

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

12 ‘‘(b) SUPPORTING EVIDENCE.—In filing a prelimi13 nary response under subsection (a), the patent owner may 

14 present any supporting evidence that the petitioner is per15 mitted to present under section 312(a)(3). 

16 ‘‘(c) REPLY AND SURREPLY.—If the Patent Trial 

17 and Appeal Board permits the petitioner to submit a reply 

18 to a preliminary response filed under subsection (a) and 

19 the petitioner presents additional evidence in that reply, 

20 the patent owner may submit a brief surreply, which shall 

21 be limited to addressing the additional evidence, including 

22 with appropriate rebuttal evidence.’’. 

23 (g) COORDINATION OF PROCEEDINGS.—Section 

24 314(a) of title 35, United States Code, is amended— 


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1 (1) by striking ‘‘THRESHOLD.—The Director’’ 

2 and inserting the following: ‘‘REQUIREMENTS FOR

3 AUTHORIZATION BY DIRECTOR.— 

4 ‘‘(1) THRESHOLD.—The Director’’; and 

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

6 ‘‘(2) PATENTS THAT ARE SUBJECTS OF OTHER

7 PROCEEDINGS.—The Director may not institute an 

8 inter partes review of a patent while the patent is 

9 the subject of a— 

10 ‘‘(A) reissue proceeding under chapter 25; 

11 or 

12 ‘‘(B) reexamination proceeding under 

13 chapter 30.’’. 

14 SEC. 103. POST-GRANT REVIEW. 

15 (a) CLAIM CONSTRUCTION.—Section 326(a) of title 

16 35, United States Code, is amended— 

17 (1) in paragraph (11), by striking ‘‘; and’’ and 

18 inserting a semicolon; 

19 (2) in paragraph (12), by striking the period at 

20 the end and inserting ‘‘; and’’; and 

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

22 ‘‘(13) providing that for all purposes under this 

23 chapter— 

24 ‘‘(A) each claim of a patent shall be con25 strued as the claim would be construed under 


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1 section 282(b) in an action to invalidate a pat2 ent, including by construing each claim of the 

3 patent in accordance with— 

4 ‘‘(i) the ordinary and customary 

5 meaning of the claim as understood by a 

6 person having ordinary skill in the art to 

7 which the claimed invention pertains; and 

8 ‘‘(ii) the prosecution history per9 taining to the patent; and 

10 ‘‘(B) if a court has previously construed a 

11 claim of a patent or a claim term in a civil ac12 tion to which the patent owner was a party, the 

13 Office shall consider that claim construction.’’. 

14 (b) AMENDMENT OF CLAIMS.—Section 326(d) of title 

15 35, United States Code, is amended to read as follows: 

16 ‘‘(d) AMENDMENT OF THE PATENT.— 

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

18 instituted under this chapter, the patent owner may 

19 move to amend the patent in 1 or more of the fol20 lowing ways: 

21 ‘‘(A) Cancel any challenged patent claim. 

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

23 reasonable number of substitute claims. 

24 ‘‘(2) INITIAL AMENDMENT.—If the patent 

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1 section, a motion to amend filed by the patent owner 

2 shall be granted if the proposed number of sub3 stitute claims is reasonable. 

4 ‘‘(3) ADDITIONAL AMENDMENTS.— 

5 ‘‘(A) PERMISSION TO FILE MOTIONS.—If 

6 the patent owner has amended the patent under 

7 this subsection, additional motions to amend 

8 may be permitted upon— 

9 ‘‘(i) the joint request of the petitioner 

10 and the patent owner to materially advance 

11 the settlement of a proceeding under sec12 tion 327; or 

13 ‘‘(ii) the request of the patent owner 

14 for good cause shown. 

15 ‘‘(B) DISCRETION TO GRANT MOTIONS.— 

16 The Patent Trial and Appeal Board shall deter17 mine, in its discretion, whether to grant or deny 

18 a motion filed under this paragraph. 

19 ‘‘(4) SCOPE OF CLAIMS.—An amendment to a 

20 patent under this subsection may not enlarge the 

21 scope of the claims of the patent or introduce new 

22 matter.’’. 

23 (c) BURDEN OF PROOF.—Section 326(e) of title 35, 

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

25 ‘‘(e) EVIDENTIARY STANDARDS.— 


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1 ‘‘(1) PRESUMPTION OF VALIDITY.—The pre2 sumption of validity under section 282(a) shall apply 

3 to a previously issued claim that is challenged dur4 ing a proceeding under this chapter. 

5 ‘‘(2) BURDENS OF PROOF.—In a post-grant re6 view instituted under this chapter, the petitioner 

7 shall have the burden of proving— 

8 ‘‘(A) a proposition of unpatentability of a 

9 previously issue claim by clear and convincing 

10 evidence; and 

11 ‘‘(B) a proposition of unpatentability of a 

12 proposed amended claim by a preponderance of 

13 the evidence.’’. 

14 (d) STANDING.—Section 321 of title 35, United 

15 States Code, is amended by adding at the end the fol16 lowing: 

17 ‘‘(d) PERSONS THAT MAY PETITION.— 

18 ‘‘(1) DEFINITION.—In this subsection, the term 

19 ‘charged with infringement’ means a real and sub20 stantial controversy regarding infringement of a pat21 ent exists such that the petitioner would have stand22 ing to bring a declaratory judgment action in Fed23 eral court. 

24 ‘‘(2) NECESSARY CONDITIONS.—A person may 

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1 grant review of the patent unless the person, or a 

2 real party in interest or privy of the person, dem3 onstrates— 

4 ‘‘(A) a reasonable possibility of being— 

5 ‘‘(i) sued for infringement of the pat6 ent; or 

7 ‘‘(ii) charged with infringement under 

8 the patent; or 

9 ‘‘(B) a competitive harm related to the va10 lidity of the patent.’’. 

11 (e) DISCOVERY OF REAL PARTY IN INTEREST.—Sec12 tion 326(a)(5) of title 35, United States Code, is amended 

13 to read as follows: 

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

15 discovery of relevant evidence, including that such 

16 discovery shall be limited to— 

17 ‘‘(A) the deposition of witnesses submitting 

18 affidavits or declarations; and 

19 ‘‘(B) evidence identifying the petitioner’s 

20 real parties in interest.’’. 

21 (f) EVIDENCE SUPPORTING PRELIMINARY RE22 SPONSE.—Section 323 of title 35, United States Code, is 

23 amended— 

24 (1) by striking ‘‘If a’’ and inserting the fol25 lowing: 


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1 ‘‘(a) IN GENERAL.—If a’’; and 

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

3 ‘‘(b) SUPPORTING EVIDENCE.—In filing a prelimi4 nary response under subsection (a), the patent owner may 

5 present any supporting evidence that the petitioner is au6 thorized to present under section 322(a)(3). 

7 ‘‘(c) REPLY AND SURREPLY.—If the Patent Trial 

8 and Appeal Board permits the petitioner to submit a reply 

9 to a preliminary response filed under subsection (a) and 

10 the petitioner presents additional evidence in that reply, 

11 the patent owner may submit a brief surreply, which shall 

12 be limited to addressing that evidence, including with ap13 propriate rebuttal evidence.’’. 

14 (g) COORDINATION OF PROCEEDINGS.—Section 

15 324(a) of title 35, United States Code, is amended— 

16 (1) by striking ‘‘THRESHOLD.—The Director’’ 

17 and inserting the following: ‘‘REQUIREMENTS FOR

18 AUTHORIZATION BY THE DIRECTOR.— 

19 ‘‘(1) THRESHOLD.—The Director’’; and 

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

21 ‘‘(2) PATENTS THAT ARE SUBJECTS OF OTHER

22 PROCEEDINGS.—The Director may not institute a 

23 post-grant review of a patent while the patent is the 

24 subject of a— 


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1 ‘‘(A) reissue proceeding under chapter 25; 

2 or 

3 ‘‘(B) reexamination proceeding under 

4 chapter 30.’’. 

5 SEC. 104. COMPOSITION OF POST-GRANT REVIEW AND 

6 INTER PARTES REVIEW PANELS. 

7 Section 6(c) of title 35, United States Code, is 

8 amended to read as follows: 

9 ‘‘(c) 3-MEMBER PANELS.— 

10 ‘‘(1) IN GENERAL.—Each appeal, derivation 

11 proceeding, post-grant review, and inter partes re12 view shall be heard by at least 3 members of the 

13 Patent Trial and Appeal Board, who shall be des14 ignated by the Director. 

15 ‘‘(2) INELIGIBILITY TO HEAR REVIEW.—A 

16 member of the Patent Trial and Appeal Board who 

17 participates in the decision to institute a post-grant 

18 review or an inter partes review of a patent shall be 

19 ineligible to hear the review. 

20 ‘‘(3) REHEARINGS.—Only the Patent Trial and 

21 Appeal Board may grant rehearings.’’. 

22 SEC. 105. REEXAMINATION OF PATENTS. 

23 (a) REQUEST FOR REEXAMINATION.—Section 302 of 

24 title 35, United States Code, is amended to read as fol25 lows: 


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1 ‘‘§ 302. Request for reexamination 

2 ‘‘Any person at any time may file a request for reex3 amination by the Office of any claim of a patent on the 

4 basis of any prior art cited under the provisions of section 

5 301. The request must be in writing and must be accom6 panied by payment of a reexamination fee established by 

7 the Director pursuant to the provisions of section 41. The 

8 request must identify all real parties in interest and certify 

9 that reexamination is not barred under section 303(d). 

10 The request must set forth the pertinency and manner of 

11 applying cited prior art to every claim for which reexam12 ination is requested. Unless the requesting person is the 

13 owner of the patent, the Director promptly will send a 

14 copy of the request to the owner of record of the patent.’’. 

15 (b) REEXAMINATION BARRED BY CIVIL ACTION.— 

16 Section 303 of title 35, United States Code, is amended 

17 by adding at the end the following: 

18 ‘‘(d) An ex parte reexamination may not be instituted 

19 if the request for reexamination is filed more than 1 year 

20 after the date on which the requester or a real party in 

21 interest or privy of the requester is served with a com22 plaint alleging infringement of the patent.’’. 

23 SEC. 106. ELIMINATION OF FORM 18. 

24 Effective 1 year after the date of enactment of this 

25 Act, the Supreme Court, using existing resources, shall 

26 eliminate Form 18 in the Appendix to the Federal Rules 


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1 of Civil Procedure (relating to Complaint for Patent In2 fringement), if Form 18 remains in existence at that time. 

3 SEC. 107. ELIMINATION OF USPTO FEE DIVERSION. 

4 (a) FUNDING.—Section 42 of title 35, United States 

5 Code, is amended— 

6 (1) in subsection (b), by striking ‘‘Patent and 

7 Trademark Office Appropriation Account’’ and in8 serting ‘‘United States Patent and Trademark Of9 fice Innovation Promotion Fund’’; 

10 (2) in subsection (c)— 

11 (A) in paragraph (1)— 

12 (i) by striking ‘‘To the extent’’ and all 

13 that follows through ‘‘fees’’ and inserting 

14 ‘‘Fees’’; and 

15 (ii) by striking ‘‘shall be collected by 

16 and shall, subject to paragraph (2), be 

17 available to the Director’’ and inserting 

18 ‘‘shall be collected by the Director and 

19 shall be available to the Director until ex20 pended’’; 

21 (B) by striking paragraph (2); and 

22 (C) by redesignating paragraph (3) as 

23 paragraph (2); 

24 (3) by redesignating subsections (d) and (e) as 

25 subsections (e) and (f), respectively; 


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1 (4) by inserting after subsection (c) the fol2 lowing: 

3 ‘‘(d) REVOLVING FUND.— 

4 ‘‘(1) DEFINITIONS.—In this subsection— 

5 ‘‘(A) the term ‘Fund’ means the United 

6 States Patent and Trademark Office Innovation 

7 Promotion Fund established under paragraph 

8 (2); and 

9 ‘‘(B) the term ‘Trademark Act of 1946’ 

10 means the Act entitled ‘An Act to provide for 

11 the registration and protection of trademarks 

12 used in commerce, to carry out the provisions 

13 of certain international conventions, and for 

14 other purposes’, approved July 5, 1946 (15 

15 U.S.C. 1051 et seq.) (commonly referred to as 

16 the ‘Trademark Act of 1946’ or the ‘Lanham 

17 Act’). 

18 ‘‘(2) ESTABLISHMENT.—There is established in 

19 the Treasury a revolving fund to be known as the 

20 ‘United States Patent and Trademark Office Inno21 vation Promotion Fund’. 

22 ‘‘(3) DERIVATION OF RESOURCES.—There shall 

23 be deposited into the Fund any fees collected 

24 under— 

25 ‘‘(A) this title; or 


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1 ‘‘(B) the Trademark Act of 1946. 

2 ‘‘(4) EXPENSES.—Amounts deposited into the 

3 Fund under paragraph (3) shall be available, with4 out fiscal year limitation, to cover— 

5 ‘‘(A) all expenses to the extent consistent 

6 with the limitation on the use of fees set forth 

7 in subsection (c), including all administrative 

8 and operating expenses, determined in the dis9 cretion of the Director to be ordinary and rea10 sonable, incurred by the Director for the contin11 ued operation of all services, programs, activi12 ties, and duties of the Office relating to patents 

13 and trademarks, as such services, programs, ac14 tivities, and duties are described under— 

15 ‘‘(i) this title; and 

16 ‘‘(ii) the Trademark Act of 1946; and 

17 ‘‘(B) all expenses incurred pursuant to any 

18 obligation, representation, or other commitment 

19 of the Office.’’; 

20 (5) in subsection (e), as redesignated, by strik21 ing ‘‘The Director’’ and inserting ‘‘REFUNDS.—The 

22 Director’’; and 

23 (6) in subsection (f), as redesignated, by strik24 ing ‘‘The Secretary’’ and inserting ‘‘REPORT.—The 

25 Secretary’’. 


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1 (b) EFFECTIVE DATE; TRANSFER FROM AND TERMI2 NATION OF OBSOLETE FUNDS.— 

3 (1) EFFECTIVE DATE.—The amendments made 

4 by subsection (a) shall take effect on the first day 

5 of the first fiscal year that begins on or after the 

6 date of enactment of this Act. 

7 (2) REMAINING BALANCES.—There shall be de8 posited in the Fund, on the effective date described 

9 in paragraph (1), any available unobligated balances 

10 remaining in the Patent and Trademark Office Ap11 propriation Account, and in the Patent and Trade12 mark Fee Reserve Fund established under section 

13 42(c)(2) of title 35, United States Code, as in effect 

14 on the date before the effective date. 

15 (3) TERMINATION OF RESERVE FUND.—Upon 

16 the payment of all obligated amounts in the Patent 

17 and Trademark Fee Reserve Fund under paragraph 

18 (2), the Patent and Trademark Fee Reserve Fund 

19 shall be terminated. 

20 SEC. 108. WILLFUL INFRINGEMENT. 

21 Section 284 of title 35, United States Code, is 

22 amended to read as follows: 

23 ‘‘§ 284. Damages 

24 ‘‘(a) Upon finding for the claimant the court shall 

25 award the claimant damages adequate to compensate for 


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1 the infringement, but in no event less than a reasonable 

2 royalty for the use made of the invention by the infringer, 

3 together with interest and costs as fixed by the court. 

4 When the damages are not found by a jury, the court shall 

5 assess them. 

6 ‘‘(b) In either event the court may exercise its discre7 tion to increase the damages up to 3 times the amount 

8 found or assessed upon determining, by a preponderance 

9 of the evidence, that the infringement was willful or in 

10 bad faith. 

11 ‘‘(c) Increased damages under this section shall not 

12 apply to provisional rights under section 154(d).’’. 

13 SEC. 109. DIVIDED INFRINGEMENT. 

14 Section 271 of title 35, United States Code, is 

15 amended by adding at the end the following: 

16 ‘‘(j) For a finding of liability for actively inducing in17 fringement of a process patent under subsection (b), or 

18 for contributory infringement of a process patent under 

19 subsection (c), it shall not be a requirement that the steps 

20 of the patented process be practiced by a single entity.’’. 

21 SEC. 110. INSTITUTIONS OF HIGHER EDUCATION. 

22 Section 123(d) of title 35, United States Code, is 

23 amended to read as follows: 


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1 ‘‘(d) INSTITUTIONS OF HIGHER EDUCATION.—For 

2 purposes of this section, a micro entity shall include an 

3 applicant who certifies that— 

4 ‘‘(1) the applicant’s employer, from which the 

5 applicant obtains the majority of the applicant’s in6 come, is an institution of higher education as de7 fined in section 101(a) of the Higher Education Act 

8 of 1965 (20 U.S.C. 1001(a)); 

9 ‘‘(2) the applicant has assigned, granted, con10 veyed, or is under an obligation by contract or law, 

11 to assign, grant, or convey, a license or other owner12 ship interest in the particular applications to such 

13 an institution of higher education; 

14 ‘‘(3) the applicant is an institution of higher 

15 education as defined in section 101(a) of the Higher 

16 Education Act of 1965 (20 U.S.C. 1001(a)); or 

17 ‘‘(4) the applicant is an organization described 

18 in section 501(c)(3) of the Internal Revenue Code of 

19 1986 and exempt from taxation under section 

20 501(a) of such Code that holds title to patents and 

21 patent applications on behalf of such an institution 

22 of higher education for the purpose of facilitating 

23 commercialization of the technologies of the patents 

24 and patent applications.’’. 


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1 SEC. 111. ASSISTING SMALL BUSINESSES IN THE U.S. PAT2 ENT SYSTEM. 

3 (a) DEFINITION.—In this section, the term ‘‘small 

4 business concern’’ has the meaning given the term in sec5 tion 3 of the Small Business Act (15 U.S.C. 632). 

6 (b) SMALL BUSINESS ADMINISTRATION REPORT.— 

7 Not later than 1 year after the date of enactment of this 

8 Act, the Small Business Administration, using existing re9 sources, shall submit to the Committee on Small Business 

10 and Entrepreneurship of the Senate and the Committee 

11 on Small Business of the House of Representatives a re12 port analyzing the impact of— 

13 (1) patent ownership by small business con14 cerns; and 

15 (2) civil actions against small business concerns 

16 arising under title 35, United States Code, relating 

17 to patent infringement. 

18 (c) EXPANSION OF PATENT PILOT PROGRAM IN CER19 TAIN DISTRICT COURTS.— 

20 (1) IN GENERAL.—Not later than 6 months 

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

22 of the Administrative Office of the United States 

23 Courts shall designate not fewer than 6 of the dis24 trict courts of the United States that are partici25 pating in the patent cases pilot program established 

26 under section 1 of Public Law 111–349 (28 U.S.C. 


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1 137 note) for the purpose of expanding that pro2 gram to address special issues raised in patent in3 fringement suits against individuals or small busi4 ness concerns. 

5 (2) PROCEDURES FOR SMALL BUSINESSES.— 

6 Not later than 2 years after the date of enactment 

7 of this Act, each district court designated under 

8 paragraph (1) shall develop procedures for expe9 diting cases in which an individual or small business 

10 concern is accused of patent infringement. 

11 (3) PARTICIPATING JUDGES.— 

12 (A) IN GENERAL.—In each district court 

13 designated under paragraph (1), each district 

14 court judge participating in the patent cases 

15 pilot program established under section 1 of 

16 Public Law 111–349 may appoint 1 additional 

17 law clerk or secretary in excess of any other 

18 limitation on the number of such employees. 

19 (B) EDUCATION AND TRAINING.—The 

20 Federal Judicial Center, using existing re21 sources, shall prepare educational and training 

22 materials to assist district court judges de23 scribed in subparagraph (A) in developing ex24 pertise in patent and plant variety protection 

25 cases. 


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1 (4) FUNDS.—There are authorized to be appro2 priated such sums as may be necessary to carry out 

3 paragraph (3)(A). 

4 (d) FREE ONLINE AVAILABILITY OF PUBLIC SEARCH

5 FACILITY MATERIALS.—Section 41(i) of title 35, United 

6 States Code, is amended by adding at the end the fol7 lowing: 

8 ‘‘(5) FREE ONLINE AVAILABILITY OF PUBLIC

9 SEARCH FACILITY MATERIALS.—The Director shall 

10 make available online and at no charge all patent 

11 and trademark information that is available at the 

12 Public Search Facility of the Office located in Alex13 andria, Virginia, including— 

14 ‘‘(A) search tools and databases; 

15 ‘‘(B) informational materials; and 

16 ‘‘(C) training classes and materials.’’. 

17 TITLE II—TARGETING ROGUE 

18 AND OPAQUE LETTERS 

19 SEC. 201. DEFINITIONS. 

20 In this title: 

21 (1) BAD FAITH.—The term ‘‘bad faith’’ means, 

22 with respect to section 202(a), that the sender— 

23 (A) made knowingly false or knowingly 

24 misleading statements, representations, or omis25 sions; 


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1 (B) made statements, representations, or 

2 omissions with reckless indifference as to the 

3 false or misleading nature of such statements, 

4 representations, or omissions; or 

5 (C) made statements, representations, or 

6 omissions with awareness of the high prob7 ability of the statements, representations, or 

8 omissions to deceive and the sender inten9 tionally avoided the truth. 

10 (2) COMMISSION.—The term ‘‘Commission’’ 

11 means the Federal Trade Commission. 

12 (3) FINAL DETERMINATION.—The term ‘‘final 

13 determination’’ means, with respect to the invalidity 

14 or unenforceability of a patent, that the invalidity or 

15 unenforceability has been determined by a court of 

16 the United States or the United States Patent and 

17 Trademark Office in a final decision that is 

18 unappealable or for which any opportunity for ap19 peal is no longer available. 

20 SEC. 202. UNFAIR OR DECEPTIVE ACTS OR PRACTICES IN 

21 CONNECTION WITH THE ASSERTION OF A 

22 UNITED STATES PATENT. 

23 (a) IN GENERAL.—It shall be an unfair or deceptive 

24 act or practice within the meaning of section 5(a)(1) of 

25 the Federal Trade Commission Act (15 U.S.C. 45(a)(1)) 


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1 for a person, in connection with the assertion of a United 

2 States patent, to engage in a pattern or practice of send3 ing written communications that state or represent that 

4 the recipients are or may be infringing, or have or may 

5 have infringed, the patent and bear liability or owe com6 pensation to another, if— 

7 (1) the sender of the communications, in bad 

8 faith, states or represents in the communications 

9 that— 

10 (A) the sender is a person with the right 

11 to license or enforce the patent at the time the 

12 communications are sent, and the sender is not 

13 a person with such a right; 

14 (B) a civil action asserting a claim of in15 fringement of the patent has been filed against 

16 the recipient; 

17 (C) a civil action asserting a claim of in18 fringement of the patent has been filed against 

19 other persons; 

20 (D) legal action for infringement of the 

21 patent will be taken against the recipient; 

22 (E) the sender is the exclusive licensee of 

23 the patent asserted in the communications; 


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1 (F) persons other than the recipient pur2 chased a license for the patent asserted in the 

3 communications; 

4 (G) persons other than the recipient pur5 chased a license, and the sender does not dis6 close that such license is unrelated to the al7 leged infringement or the patent asserted in the 

8 communications; 

9 (H) an investigation of the recipient’s al10 leged infringement occurred; or 

11 (I) the sender or an affiliate of the sender 

12 previously filed a civil action asserting a claim 

13 of infringement of the patent based on the ac14 tivity that is the subject of the written commu15 nication when the sender knew such activity 

16 was held, in a final determination, not to in17 fringe the patent; 

18 (2) the sender of the communications, in bad 

19 faith, seeks compensation for— 

20 (A) a patent claim that has been held to 

21 be unenforceable due to inequitable conduct, in22 valid, or otherwise unenforceable against the re23 cipient, in a final determination; 


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1 (B) activities undertaken by the recipient 

2 after expiration of the patent asserted in the 

3 communications; or 

4 (C) activity of the recipient that the sender 

5 knew was authorized, with respect to the patent 

6 claim or claims that are the subject of the com7 munications, by a person with the right to li8 cense the patent; or 

9 (3) the sender of the communications, in bad 

10 faith, fails to include— 

11 (A) the identity of the person asserting a 

12 right to license the patent to, or enforce the 

13 patent against, the recipient, including the iden14 tity of any parent entity and the ultimate par15 ent entity of such person, unless such person is 

16 a public company and the name of the public 

17 company is identified; 

18 (B) an identification of at least one patent 

19 issued by the United States Patent and Trade20 mark Office alleged to have been infringed; 

21 (C) an identification, to the extent reason22 able under the circumstances, of at least one 

23 product, service, or other activity of the recipi24 ent that is alleged to infringe the identified pat25 ent; 


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1 (D) a description, to the extent reasonable 

2 under the circumstances, of how the product, 

3 service, or other activity of the recipient in4 fringes an identified patent and patent claim; or 

5 (E) a name and contact information for a 

6 person the recipient may contact about the as7 sertions or claims relating to the patent con8 tained in the communications. 

9 (b) AFFIRMATIVE DEFENSE.—With respect to sub10 section (a), there shall be an affirmative defense that 

11 statements, representations, or omissions were not made 

12 in bad faith (as defined in subparagraphs (B) and (C) of 

13 section 201(1)) if the sender can demonstrate that such 

14 statements, representations, or omissions were mistakes 

15 made in good faith. Evidence that the sender in the usual 

16 course of business sends written communications that do 

17 not violate the provisions of this title shall be sufficient 

18 to demonstrate good faith. Good faith may also be dem19 onstrated by other evidence. 

20 (c) RULE OF CONSTRUCTION.—For purposes of sec21 tions 203 and 204, the commission of an act or practice 

22 that is declared under this section to be an unfair or de23 ceptive act or practice within the meaning of section 

24 5(a)(1) of the Federal Trade Commission Act (15 U.S.C. 


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1 45(a)(1)) shall be considered to be a violation of this sec2 tion. 

3 SEC. 203. ENFORCEMENT BY FEDERAL TRADE COMMIS4 SION. 

5 (a) VIOLATION OF RULE.—A violation of section 202 

6 shall be treated as a violation of a rule defining an unfair 

7 or deceptive act or practice prescribed under section 

8 18(a)(1)(B) of the Federal Trade Commission Act (15 

9 U.S.C. 57a(a)(1)(B)). 

10 (b) POWERS OF COMMISSION.—The Commission 

11 shall enforce this title in the same manner, by the same 

12 means, and with the same jurisdiction, powers, and duties 

13 as though all applicable terms and provisions of the Fed14 eral Trade Commission Act (15 U.S.C. 41 et seq.) were 

15 incorporated into and made a part of this title. Any person 

16 who violates section 202 shall be subject to the penalties 

17 and entitled to the privileges and immunities provided in 

18 the Federal Trade Commission Act. 

19 (c) EFFECT ON OTHER LAWS.—Nothing in this title 

20 shall be construed in any way to limit or affect the author21 ity of the Commission under any other provision of law. 

22 SEC. 204. PREEMPTION OF STATE LAWS ON PATENT DE23 MAND LETTERS AND ENFORCEMENT BY 

24 STATE ATTORNEYS GENERAL. 

25 (a) PREEMPTION.— 


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1 (1) IN GENERAL.—This title preempts any law, 

2 rule, regulation, requirement, standard, or other pro3 vision having the force and effect of law of any 

4 State, or political subdivision of a State, expressly 

5 relating to the transmission or contents of commu6 nications relating to the assertion of patent rights. 

7 (2) EFFECT ON OTHER STATE LAWS.—Except 

8 as provided in paragraph (1), this title shall not be 

9 construed to preempt or limit any provision of any 

10 State law, including any State consumer protection 

11 law, any State law relating to acts of fraud or decep12 tion, and any State trespass, contract, or tort law. 

13 (b) ENFORCEMENT BY STATE ATTORNEYS GEN14 ERAL.— 

15 (1) IN GENERAL.—In any case in which the at16 torney general of a State has reason to believe that 

17 an interest of the residents of that State has been 

18 adversely affected by any person who violates section 

19 202, the attorney general of the State, may bring a 

20 civil action on behalf of such residents of the State 

21 in a district court of the United States of appro22 priate jurisdiction— 

23 (A) to enjoin further such violation by the 

24 defendant; or 


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1 (B) to obtain civil penalties on behalf of 

2 recipients who suffered actual damages as a re3 sult of such violation. 

4 (2) MAXIMUM CIVIL PENALTY.—Notwith5 standing the number of actions which may be 

6 brought against a person under this subsection, a 

7 person may not be liable for a total of more than 

8 $5,000,000 for a series of related violations of sec9 tion 202. 

10 (3) INTERVENTION BY THE FTC.— 

11 (A) NOTICE AND INTERVENTION.—The at12 torney general of a State shall provide prior 

13 written notice of any action under paragraph 

14 (1) to the Commission and provide the Commis15 sion with a copy of the complaint in the action, 

16 except in any case in which such prior notice is 

17 not feasible, in which case the attorney general 

18 shall serve such notice immediately upon insti19 tuting such action. The Commission shall have 

20 the right— 

21 (i) to intervene in the action; 

22 (ii) upon so intervening, to be heard 

23 on all matters arising therein; and 

24 (iii) to file petitions for appeal. 


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1 (B) LIMITATION ON STATE ACTION WHILE

2 FEDERAL ACTION IS PENDING.—If the Commis3 sion has instituted a civil action for violation of 

4 section 202, no State attorney general may 

5 bring an action under this subsection during 

6 the pendency of that action against any defend7 ant named in the complaint of the Commission 

8 for any violation of such section alleged in the 

9 complaint. 

10 (4) CONSTRUCTION.—For purposes of bringing 

11 any civil action under paragraph (1), nothing in this 

12 title shall be construed to prevent the attorney gen13 eral of a State from exercising the powers conferred 

14 on the attorney general by the laws of that State 

15 to— 

16 (A) conduct investigations; 

17 (B) administer oaths or affirmations; or 

18 (C) compel the attendance of witnesses or 

19 the production of documentary and other evi20 dence. 

Æ 


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