106 
claims and application size fees), proc-
essing fee, and publication fee for that ap-
plication. 
(B) REGULATIONS; LIMITATIONS.— 
(i) REGULATIONS.—The Director may 
by regulation prescribe conditions for ac-
ceptance of a request under subparagraph 
(A) and a limit on the number of filings 
for prioritized examination that may be ac-
cepted. 
(ii) LIMITATION ON CLAIMS.— Until 
regulations are prescribed under clause (i), 
no application for which prioritized exam-
ination is requested may contain or be 
amended to contain more than 4 inde-
pendent claims or more than 30 total 
claims. 
(iii) LIMITATION ON TOTAL NUMBER 
OF REQUESTS.—The Director may not ac-
cept in any fiscal year more than 10,000 
requests for prioritization until regulations 
are prescribed under this subparagraph 
setting another limit. 
(2) REDUCTION
IN
FEES
FOR
SMALL
ENTI-
TIES.—The Director shall reduce fees for providing
107 
prioritized examination of nonprovisional applica-
tions for original utility and plant patents by 50 per-
cent for small entities that qualify for reduced fees 
under section 41(h)(1) of title 35, United States 
Code. 
(3) DEPOSIT
OF
FEES.—All fees paid under 
this subsection shall be credited to the United States 
Patent and Trademark Office Appropriation Ac-
count, shall remain available until expended, and 
may be used only for the purposes specified in sec-
tion 42(c)(3)(A) of title 35, United States Code. 
(4) EFFECTIVE DATE AND TERMINATION.— 
(A) EFFECTIVE
DATE.—This subsection 
shall take effect on the date that is 10 days 
after the date of the enactment of this Act. 
(B) 
TERMINATION.—The 
fee 
imposed 
under paragraph (1)(A)(i), and the reduced fee 
under paragraph (2), shall terminate on the ef-
fective date of the setting or adjustment of the 
fee under paragraph (1)(A)(i) pursuant to the 
exercise of the authority under section 10 for 
the first time with respect to that fee. 
(i) APPROPRIATION ACCOUNT TRANSITION FEES.— 
(1) SURCHARGE.—
108 
(A) IN GENERAL.—There shall be a sur-
charge of 15 percent, rounded by standard 
arithmetic rules, on all fees charged or author-
ized by subsections (a), (b), and (d)(1) of sec-
tion 41, and section 132(b), of title 35, United 
States Code. Any surcharge imposed under this 
subsection is, and shall be construed to be, sep-
arate from and in addition to any other sur-
charge imposed under this Act or any other 
provision of law. 
(B) DEPOSIT OF AMOUNTS.—Amounts col-
lected pursuant to the surcharge imposed under 
subparagraph (A) shall be credited to the 
United States Patent and Trademark Appro-
priation Account, shall remain available until 
expended, and may be used only for the pur-
poses specified in section 42(c)(3)(A) of title 
35, United States Code. 
(2) EFFECTIVE
DATE
AND
TERMINATION
OF 
SURCHARGE.—The surcharge provided for in para-
graph (1)— 
(A) shall take effect on the date that is 10 
days after the date of the enactment of this 
Act; and
109 
(B) shall terminate, with respect to a fee 
to which paragraph (1)(A) applies, on the effec-
tive date of the setting or adjustment of that 
fee pursuant to the exercise of the authority 
under section 10 for the first time with respect 
to that fee. 
(j) EFFECTIVE DATE.—Except as otherwise provided 
in this section, this section and the amendments made by 
this section shall take effect on the date of the enactment 
of this Act. 
SEC. 12. SUPPLEMENTAL EXAMINATION. 
(a) IN GENERAL.—Chapter 25 of title 35, United 
States Code, is amended by adding at the end the fol-
lowing: 
‘‘§ 257. Supplemental examinations to consider, re-
consider, or correct information 
‘‘(a) REQUEST
FOR
SUPPLEMENTAL
EXAMINA-
TION.—A patent owner may request supplemental exam-
ination of a patent in the Office to consider, reconsider, 
or correct information believed to be relevant to the pat-
ent, in accordance with such requirements as the Director 
may establish. Within 3 months after the date a request 
for supplemental examination meeting the requirements of 
this section is received, the Director shall conduct the sup-
plemental examination and shall conclude such examina-
110 
tion by issuing a certificate indicating whether the infor-
mation presented in the request raises a substantial new 
question of patentability. 
‘‘(b) REEXAMINATION ORDERED.—If the certificate 
issued under subsection (a) indicates that a substantial 
new question of patentability is raised by 1 or more items 
of information in the request, the Director shall order re-
examination of the patent. The reexamination shall be 
conducted according to procedures established by chapter 
30, except that the patent owner shall not have the right 
to file a statement pursuant to section 304. During the 
reexamination, the Director shall address each substantial 
new question of patentability identified during the supple-
mental examination, notwithstanding the limitations in 
chapter 30 relating to patents and printed publication or 
any other provision of such chapter. 
‘‘(c) EFFECT.— 
‘‘(1) IN GENERAL.—A patent shall not be held 
unenforceable on the basis of conduct relating to in-
formation that had not been considered, was inad-
equately considered, or was incorrect in a prior ex-
amination of the patent if the information was con-
sidered, reconsidered, or corrected during a supple-
mental examination of the patent. The making of a 
request under subsection (a), or the absence thereof,
111 
shall not be relevant to enforceability of the patent 
under section 282. 
‘‘(2) EXCEPTIONS.— 
‘‘(A) 
PRIOR
ALLEGATIONS.—Paragraph 
(1) shall not apply to an allegation pled with 
particularity in a civil action, or set forth with 
particularity in a notice received by the patent 
owner under section 505(j)(2)(B)(iv)(II) of the 
Federal Food, Drug, and Cosmetic Act (21 
U.S.C. 355(j)(2)(B)(iv)(II)), before the date of 
a supplemental examination request under sub-
section (a) to consider, reconsider, or correct in-
formation forming the basis for the allegation. 
‘‘(B) PATENT ENFORCEMENT ACTIONS.— 
In an action brought under section 337(a) of 
the Tariff Act of 1930 (19 U.S.C. 1337(a)), or 
section 281 of this title, paragraph (1) shall not 
apply to any defense raised in the action that 
is based upon information that was considered, 
reconsidered, or corrected pursuant to a supple-
mental examination request under subsection 
(a), unless the supplemental examination, and 
any reexamination ordered pursuant to the re-
quest, are concluded before the date on which 
the action is brought.
113 
for such further action as the Attorney General may deem 
appropriate. Any such referral shall be treated as con-
fidential, shall not be included in the file of the patent, 
and shall not be disclosed to the public unless the United 
States charges a person with a criminal offense in connec-
tion with such referral. 
‘‘(f) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed— 
‘‘(1) to preclude the imposition of sanctions 
based upon criminal or antitrust laws (including sec-
tion 1001(a) of title 18, the first section of the Clay-
ton Act, and section 5 of the Federal Trade Com-
mission Act to the extent that section relates to un-
fair methods of competition); 
‘‘(2) to limit the authority of the Director to in-
vestigate issues of possible misconduct and impose 
sanctions for misconduct in connection with matters 
or proceedings before the Office; or 
‘‘(3) to limit the authority of the Director to 
issue regulations under chapter 3 relating to sanc-
tions for misconduct by representatives practicing 
before the Office.’’. 
(b) CONFORMING AMENDMENT.—The table of sec-
tions for chapter 25 of title 35, United States Code, is 
amended by adding at the end the following new item:
114 
‘‘257. Supplemental examinations to consider, reconsider, or correct informa-
tion.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect upon the expiration of the 
1-year period beginning on the date of the enactment of 
this Act and shall apply to any patent issued before, on, 
or after that effective date. 
SEC. 13. FUNDING AGREEMENTS. 
(a) IN GENERAL.—Section 202(c)(7)(E)(i) of title 
35, United States Code, is amended— 
(1) by striking ‘‘75 percent’’ and inserting ‘‘15 
percent’’; 
(2) by striking ‘‘25 percent’’ and inserting ‘‘85 
percent’’; and 
(3) by striking ‘‘as described above in this 
clause (D);’’ and inserting ‘‘described above in this 
clause;’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of the enactment 
of this Act and shall apply to any patent issued before, 
on, or after that date. 
SEC. 14. TAX STRATEGIES DEEMED WITHIN THE PRIOR 
ART. 
(a) IN GENERAL.—For purposes of evaluating an in-
vention under section 102 or 103 of title 35, United States 
Code, any strategy for reducing, avoiding, or deferring tax
115 
liability, whether known or unknown at the time of the 
invention or application for patent, shall be deemed insuf-
ficient to differentiate a claimed invention from the prior 
art. 
(b) DEFINITION.—For purposes of this section, the 
term ‘‘tax liability’’ refers to any liability for a tax under 
any Federal, State, or local law, or the law of any foreign 
jurisdiction, including any statute, rule, regulation, or or-
dinance that levies, imposes, or assesses such tax liability. 
(c) EXCLUSIONS.—This section does not apply to 
that part of an invention that— 
(1) is a method, apparatus, technology, com-
puter program product, or system, that is used sole-
ly for preparing a tax or information return or other 
tax filing, including one that records, transmits, 
transfers, or organizes data related to such filing; or 
(2) is a method, apparatus, technology, com-
puter program product, or system used solely for fi-
nancial management, to the extent that it is sever-
able from any tax strategy or does not limit the use 
of any tax strategy by any taxpayer or tax advisor. 
(d) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed to imply that other business meth-
ods are patentable or that other business method patents 
are valid.
116 
(e) EFFECTIVE DATE; APPLICABILITY.—This section 
shall take effect on the date of the enactment of this Act 
and shall apply to any patent application that is pending 
on, or filed on or after, that date, and to any patent that 
is issued on or after that date. 
SEC. 15. BEST MODE REQUIREMENT. 
(a) IN GENERAL.—Section 282 of title 35, United 
States Code, is amended in the second undesignated para-
graph by striking paragraph (3) and inserting the fol-
lowing: 
‘‘(3) Invalidity of the patent or any claim in 
suit for failure to comply with— 
‘‘(A) any requirement of section 112, ex-
cept that the failure to disclose the best mode 
shall not be a basis on which any claim of a 
patent may be canceled or held invalid or other-
wise unenforceable; or 
‘‘(B) any requirement of section 251.’’. 
(b) CONFORMING AMENDMENT.—Sections 119(e)(1) 
and 120 of title 35, United States Code, are each amended 
by striking ‘‘the first paragraph of section 112 of this 
title’’ and inserting ‘‘section 112(a) (other than the re-
quirement to disclose the best mode)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect upon the date of the enact-
117 
ment of this Act and shall apply to proceedings com-
menced on or after that date. 
SEC. 16. MARKING. 
(a) VIRTUAL MARKING.— 
(1) IN GENERAL.—Section 287(a) of title 35, 
United States Code, is amended by striking ‘‘or 
when,’’ and inserting ‘‘or by fixing thereon the word 
‘patent’ or the abbreviation ‘pat.’ together with an 
address of a posting on the Internet, accessible to 
the public without charge for accessing the address, 
that associates the patented article with the number 
of the patent, or when,’’. 
(2) EFFECTIVE DATE.—The amendment made 
by this subsection shall apply to any case that is 
pending on, or commenced on or after, the date of 
the enactment of this Act. 
(3) REPORT.—Not later than the date that is 
3 years after the date of the enactment of this Act, 
the Director shall submit a report to Congress that 
provides— 
(A) an analysis of the effectiveness of ‘‘vir-
tual marking’’, as provided in the amendment 
made by paragraph (1) of this subsection, as an 
alternative to the physical marking of articles;
118 
(B) an analysis of whether such virtual 
marking has limited or improved the ability of 
the general public to access information about 
patents; 
(C) an analysis of the legal issues, if any, 
that arise from such virtual marking; and 
(D) an analysis of the deficiencies, if any, 
of such virtual marking. 
(b) FALSE MARKING.— 
(1) CIVIL
PENALTY.—Section 292(a) of title 
35, United States, Code, is amended by adding at 
the end the following: ‘‘Only the United States may 
sue for the penalty authorized by this subsection.’’. 
(2) CIVIL ACTION FOR DAMAGES.—Subsection 
(b) of section 292 of title 35, United States Code, 
is amended to read as follows: 
‘‘(b) A person who has suffered a competitive injury 
as a result of a violation of this section may file a civil 
action in a district court of the United States for recovery 
of damages adequate to compensate for the injury.’’. 
(3) EXPIRED PATENTS.—Section 292 of title 
35, United States Code, is amended by adding at 
the end the following: 
‘‘(c) The marking of a product, in a manner described 
in subsection (a), with matter relating to a patent that
119 
covered that product but has expired is not a violation of 
this section.’’. 
(4) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to all cases, without 
exception, that are pending on, or commenced on or 
after, the date of the enactment of this Act. 
SEC. 17. ADVICE OF COUNSEL. 
(a) IN GENERAL.—Chapter 29 of title 35, United 
States Code, is amended by adding at the end the fol-
lowing: 
‘‘§ 298. Advice of counsel 
‘‘The failure of an infringer to obtain the advice of 
counsel with respect to any allegedly infringed patent, or 
the failure of the infringer to present such advice to the 
court or jury, may not be used to prove that the accused 
infringer willfully infringed the patent or that the in-
fringer intended to induce infringement of the patent.’’. 
(b) CONFORMING AMENDMENT.—The table of sec-
tions for chapter 29 of title 35, United States Code, is 
amended by adding at the end the following: 
‘‘298. Advice of counsel.’’. 
SEC. 18. TRANSITIONAL PROGRAM FOR COVERED BUSI-
NESS METHOD PATENTS. 
(a) TRANSITIONAL PROGRAM.— 
(1) ESTABLISHMENT.—Not later than the date 
that is 1 year after the date of the enactment of this
121 
day before the effective date set forth in section 
3(n)(1), may support such ground only on the 
basis of— 
(i) prior art that is described by sec-
tion 102(a) of such title of such title (as 
in effect on the day before such effective 
date); or 
(ii) prior art that— 
(I) discloses the invention more 
than 1 year before the date of the ap-
plication for patent in the United 
States; and 
(II) would be described by section 
102(a) of such title (as in effect on 
the day before the effective date set 
forth in section 3(n)(1)) if the disclo-
sure had been made by another before 
the invention thereof by the applicant 
for patent. 
(D) The petitioner in a transitional pro-
ceeding that results in a final written decision 
under section 328(a) of title 35, United States 
Code, with respect to a claim in a covered busi-
ness method patent, or the petitioner’s real 
party in interest, may not assert, either in a
122 
civil action arising in whole or in part under 
section 1338 of title 28, United States Code, or 
in a proceeding before the International Trade 
Commission under section 337 of the Tariff Act 
of 1930 (19 U.S.C. 1337), that the claim is in-
valid on any ground that the petitioner raised 
during that transitional proceeding. 
(E) The Director may institute a transi-
tional proceeding only for a patent that is a 
covered business method patent. 
(2) EFFECTIVE DATE.—The regulations issued 
under paragraph (1) shall take effect upon the expi-
ration of the 1-year period beginning on the date of 
the enactment of this Act and shall apply to any 
covered business method patent issued before, on, or 
after that effective date, except that the regulations 
shall not apply to a patent described in section 
6(f)(2)(A) of this Act during the period in which a 
petition for post-grant review of that patent would 
satisfy the requirements of section 321(c) of title 35, 
United States Code. 
(3) SUNSET.— 
(A) IN
GENERAL.—This subsection, and 
the regulations issued under this subsection, are 
repealed effective upon the expiration of the 8-
123 
year period beginning on the date that the reg-
ulations issued under to paragraph (1) take ef-
fect. 
(B) 
APPLICABILITY.—Notwithstanding 
subparagraph (A), this subsection and the regu-
lations issued under this subsection shall con-
tinue to apply, after the date of the repeal 
under subparagraph (A), to any petition for a 
transitional proceeding that is filed before the 
date of such repeal. 
(b) REQUEST FOR STAY.— 
(1) IN GENERAL.—If a party seeks a stay of a 
civil action alleging infringement of a patent under 
section 281 of title 35, United States Code, relating 
to a transitional proceeding for that patent, the 
court shall decide whether to enter a stay based 
on— 
(A) whether a stay, or the denial thereof, 
will simplify the issues in question and stream-
line the trial; 
(B) whether discovery is complete and 
whether a trial date has been set; 
(C) whether a stay, or the denial thereof, 
would unduly prejudice the nonmoving party or
124 
present a clear tactical advantage for the mov-
ing party; and 
(D) whether a stay, or the denial thereof, 
will reduce the burden of litigation on the par-
ties and on the court. 
(2) REVIEW.—A party may take an immediate 
interlocutory appeal from a district court’s decision 
under paragraph (1). The United States Court of 
Appeals for the Federal Circuit shall review the dis-
trict court’s decision to ensure consistent application 
of established precedent, and such review may be de 
novo. 
(c) ATM EXEMPTION FOR VENUE PURPOSES.—In 
an action for infringement under section 281 of title 35, 
United States Code, of a covered business method patent, 
an automated teller machine shall not be deemed to be 
a regular and established place of business for purposes 
of section 1400(b) of title 28, United States Code. 
(d) DEFINITION.— 
(1) IN GENERAL.—For purposes of this section, 
the term ‘‘covered business method patent’’ means a 
patent that claims a method or corresponding appa-
ratus for performing data processing or other oper-
ations used in the practice, administration, or man-
agement of a financial product or service, except
125 
that the term does not include patents for techno-
logical inventions. 
(2) REGULATIONS.—To assist in implementing 
the transitional proceeding authorized by this sub-
section, the Director shall issue regulations for de-
termining whether a patent is for a technological in-
vention. 
(e) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed as amending or interpreting cat-
egories of patent-eligible subject matter set forth under 
section 101 of title 35, United States Code. 
SEC. 19. JURISDICTION AND PROCEDURAL MATTERS. 
(a) STATE COURT JURISDICTION.—Section 1338(a) 
of title 28, United States Code, is amended by striking 
the second sentence and inserting the following: ‘‘No State 
court shall have jurisdiction over any claim for relief aris-
ing under any Act of Congress relating to patents, plant 
variety protection, or copyrights. For purposes of this sub-
section, the term ‘State’ includes any State of the United 
States, the District of Columbia, the Commonwealth of 
Puerto Rico, the United States Virgin Islands, American 
Samoa, Guam, and the Northern Mariana Islands.’’. 
(b) COURT OF APPEALS FOR THE FEDERAL CIR-
CUIT.—Section 1295(a)(1) of title 28, United States Code, 
is amended to read as follows:
126 
‘‘(1) of an appeal from a final decision of a dis-
trict court of the United States, the District Court 
of Guam, the District Court of the Virgin Islands, 
or the District Court of the Northern Mariana Is-
lands, in any civil action arising under, or in any 
civil action in which a party has asserted a compul-
sory counterclaim arising under, any Act of Con-
gress relating to patents or plant variety protec-
tion;’’. 
(c) REMOVAL.— 
(1) IN
GENERAL.—Chapter 89 of title 28, 
United States Code, is amended by adding at the 
end the following new section: 
‘‘§ 1454. Patent, plant variety protection, and copy-
right cases 
‘‘(a) IN GENERAL.—A civil action in which any party 
asserts a claim for relief arising under any Act of Con-
gress relating to patents, plant variety protection, or copy-
rights may be removed to the district court of the United 
States for the district and division embracing the place 
where the action is pending. 
‘‘(b) SPECIAL RULES.—The removal of an action 
under this section shall be made in accordance with sec-
tion 1446, except that if the removal is based solely on 
this section—
127 
‘‘(1) the action may be removed by any party; 
and 
‘‘(2) the time limitations contained in section 
1446(b) may be extended at any time for cause 
shown. 
‘‘(c) CLARIFICATION OF JURISDICTION IN CERTAIN 
CASES.—The court to which a civil action is removed 
under this section is not precluded from hearing and de-
termining any claim in the civil action because the State 
court from which the civil action is removed did not have 
jurisdiction over that claim. 
‘‘(d) REMAND.—If a civil action is removed solely 
under this section, the district court— 
‘‘(1) shall remand all claims that are neither a 
basis for removal under subsection (a) nor within 
the original or supplemental jurisdiction of the dis-
trict court under any Act of Congress; and 
‘‘(2) may, under the circumstances specified in 
section 1367(c), remand any claims within the sup-
plemental jurisdiction of the district court under sec-
tion 1367.’’. 
(2) CONFORMING AMENDMENT.—The table of 
sections for chapter 89 of title 28, United States 
Code, is amended by adding at the end the following 
new item: 
‘‘1454. Patent, plant variety protection, and copyright cases.’’.
128 
(d) PROCEDURAL MATTERS IN PATENT CASES.— 
(1) JOINDER OF PARTIES AND STAY OF AC-
TIONS.—Chapter 29 of title 35, United States Code, 
as amended by this Act, is further amended by add-
ing at the end the following new section: 
‘‘§ 299. Joinder of parties 
‘‘(a) JOINDER OF ACCUSED INFRINGERS.—With re-
spect to any civil action arising under any Act of Congress 
relating to patents, other than an action or trial in which 
an act of infringement under section 271(e)(2) has been 
pled, parties that are accused infringers may be joined in 
one action as defendants or counterclaim defendants, or 
have their actions consolidated for trial, or counterclaim 
defendants only if— 
‘‘(1) any right to relief is asserted against the 
parties jointly, severally, or in the alternative with 
respect to or arising out of the same transaction, oc-
currence, or series of transactions or occurrences re-
lating to the making, using, importing into the 
United States, offering for sale, or selling of the 
same accused product or process; and 
‘‘(2) questions of fact common to all defendants 
or counterclaim defendants will arise in the action. 
‘‘(b) ALLEGATIONS INSUFFICIENT FOR JOINDER.— 
For purposes of this subsection, accused infringers may
129 
not be joined in one action as defendants or counterclaim 
defendants, or have their actions consolidated for trial, 
based solely on allegations that they each have infringed 
the patent or patents in suit. 
‘‘(c) WAIVER.—A party that is an accused infringer 
may waive the limitations set forth in this section with 
respect to that party.’’. 
(2) CONFORMING AMENDMENT.—The table of 
sections for chapter 29 of title 35, United States 
Code, as amended by this Act, is further amended 
by adding at the end the following new item: 
‘‘299. Joinder of parties.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to any civil action commenced on 
or after the date of the enactment of this Act. 
SEC. 20. TECHNICAL AMENDMENTS. 
(a) JOINT INVENTIONS.—Section 116 of title 35, 
United States Code, is amended— 
(1) in the first undesignated paragraph, by 
striking ‘‘When’’ and inserting ‘‘(a) JOINT IN-
VENTIONS.—When’’; 
(2) in the second undesignated paragraph, 
by striking ‘‘If a joint inventor’’ and inserting 
‘‘(b) OMITTED INVENTOR.—If a joint inven-
tor’’; and 
(3) in the third undesignated paragraph—
130 
(A) by striking ‘‘Whenever’’ and in-
serting ‘‘(c) CORRECTION OF ERRORS IN 
APPLICATION.—Whenever’’; and 
(B) by striking ‘‘and such error arose 
without any deceptive intention on his 
part,’’. 
(b) FILING
OF APPLICATION
IN FOREIGN COUN-
TRY.—Section 184 of title 35, United States Code, is 
amended— 
(1) in the first undesignated paragraph— 
(A) by striking ‘‘Except when’’ and insert-
ing ‘‘(a) FILING IN FOREIGN COUNTRY.—Ex-
cept when’’; and 
(B) by striking ‘‘and without deceptive in-
tent’’; 
(2) in the second undesignated paragraph, by 
striking ‘‘The term’’ and inserting ‘‘(b) APPLICA-
TION.—The term’’; and 
(3) in the third undesignated paragraph, by 
striking ‘‘The scope’’ and inserting ‘‘(c) SUBSE-
QUENT MODIFICATIONS, AMENDMENTS, AND SUP-
PLEMENTS.—The scope’’. 
(c) FILING WITHOUT A LICENSE.—Section 185 of 
title 35, United States Code, is amended by striking ‘‘and 
without deceptive intent’’.
131 
(d) REISSUE OF DEFECTIVE PATENTS.—Section 251 
of title 35, United States Code, is amended— 
(1) in the first undesignated paragraph— 
(A) by striking ‘‘Whenever’’ and inserting 
‘‘(a) IN GENERAL.—Whenever’’; and 
(B) by striking ‘‘without any deceptive in-
tention’’; 
(2) in the second undesignated paragraph, by 
striking ‘‘The Director’’ and inserting ‘‘(b) MUL-
TIPLE REISSUED PATENTS.—The Director’’; 
(3) in the third undesignated paragraph, by 
striking ‘‘The provisions’’ and inserting ‘‘(c) APPLI-
CABILITY OF THIS TITLE.—The provisions’’; and 
(4) in the last undesignated paragraph, by 
striking ‘‘No reissued patent’’ and inserting ‘‘(d) 
REISSUE PATENT ENLARGING SCOPE OF CLAIMS.— 
No reissued patent’’. 
(e) EFFECT OF REISSUE.—Section 253 of title 35, 
United States Code, is amended— 
(1) in the first undesignated paragraph, by 
striking ‘‘Whenever, without any deceptive inten-
tion,’’ and inserting ‘‘(a) IN GENERAL.—Whenever’’; 
and 
(2) in the second undesignated paragraph, by 
striking ‘‘In like manner’’ and inserting ‘‘(b) ADDI-
132 
TIONAL DISCLAIMER OR DEDICATION.—In the man-
ner set forth in subsection (a),’’. 
(f) CORRECTION
OF NAMED INVENTOR.—Section 
256 of title 35, United States Code, is amended— 
(1) in the first undesignated paragraph— 
(A) by striking ‘‘Whenever’’ and inserting 
‘‘(a) CORRECTION.—Whenever’’; and 
(B) by striking ‘‘and such error arose with-
out any deceptive intention on his part’’; and 
(2) in the second undesignated paragraph, by 
striking ‘‘The error’’ and inserting ‘‘(b) PATENT 
VALID IF ERROR CORRECTED.—The error’’. 
(g) PRESUMPTION
OF VALIDITY.—Section 282 of 
title 35, United States Code, is amended— 
(1) in the first undesignated paragraph— 
(A) by striking ‘‘A patent’’ and inserting 
‘‘(a) IN GENERAL.—A patent’’; and 
(B) by striking the third sentence; 
(2) in the second undesignated paragraph— 
(A) by striking ‘‘The following’’ and insert-
ing ‘‘(b) DEFENSES.—The following’’; 
(B) 
in 
paragraph 
(1), 
by 
striking 
‘‘uneforceability,’’ and inserting ‘‘unenforce-
ability.’’; and
133 
(C) in paragraph (2), by striking ‘‘patent-
ability,’’ and inserting ‘‘patentability.’’ ; and 
(3) in the third undesignated paragraph— 
(A) by striking ‘‘In actions involving the 
validity or infringement of a patent’’ and insert-
ing ‘‘(c) NOTICE OF ACTIONS; ACTIONS DUR-
ING EXTENSION OF PATENT TERM.—In an ac-
tion involving the validity or infringement of a 
patent’’; and 
(B) by striking ‘‘Claims Court’’ and insert-
ing ‘‘Court of Federal Claims’’. 
(h) ACTION FOR INFRINGEMENT.—Section 288 of 
title 35, United States Code, is amended by striking ‘‘, 
without deceptive intention,’’. 
(i) REVISER’S NOTES.— 
(1) Section 3(e)(2) of title 35, United States 
Code, is amended by striking ‘‘this Act,’’ and insert-
ing ‘‘that Act,’’. 
(2) Section 202 of title 35, United States Code, 
is amended— 
(A) in subsection (b)(3), by striking ‘‘the 
section 203(b)’’ and inserting ‘‘section 203(b)’’; 
and 
(B) in subsection (c)(7)(D), by striking 
‘‘except where it proves’’ and all that follows
134 
through ‘‘small business firms; and’’ and insert-
ing: ‘‘except where it is determined to be infea-
sible following a reasonable inquiry, a pref-
erence in the licensing of subject inventions 
shall be given to small business firms; and’’. 
(3) Section 209(d)(1) of title 35, United States 
Code, is amended by striking ‘‘nontransferrable’’ 
and inserting ‘‘nontransferable’’. 
(4) Section 287(c)(2)(G) of title 35, United 
States Code, is amended by striking ‘‘any state’’ and 
inserting ‘‘any State’’. 
(5) Section 371(b) of title 35, United States 
Code, is amended by striking ‘‘of the treaty’’ and in-
serting ‘‘of the treaty.’’. 
(j) UNNECESSARY REFERENCES.— 
(1) IN
GENERAL.—Title 35, United States 
Code, is amended by striking ‘‘of this title’’ each 
place that term appears. 
(2) EXCEPTION.—The amendment made by 
paragraph (1) shall not apply to the use of such 
term in the following sections of title 35, United 
States Code: 
(A) Section 1(c). 
(B) Section 101. 
(C) Subsections (a) and (b) of section 105.
135 
(D) The first instance of the use of such 
term in section 111(b)(8). 
(E) Section 161. 
(F) Section 164. 
(G) Section 171. 
(H) Section 251(c), as so designated by 
this section. 
(I) Section 261. 
(J) Subsections (g) and (h) of section 271. 
(K) Section 287(b)(1). 
(L) Section 289. 
(M) The first instance of the use of such 
term in section 375(a). 
(k) ADDITIONAL TECHNICAL AMENDMENTS.—Sec-
tions 155 and 155A of title 35, United States Code, and 
the items relating to those sections in the table of sections 
for chapter 14 of such title, are repealed. 
(l) EFFECTIVE DATE.—The amendments made by 
this section shall take effect upon the expiration of the 
1-year period beginning on the date of the enactment of 
this Act and shall apply to proceedings commenced on or 
after that effective date.
136 
SEC. 21. TRAVEL EXPENSES AND PAYMENT OF ADMINIS-
TRATIVE JUDGES. 
(a) AUTHORITY TO COVER CERTAIN TRAVEL RE-
LATED EXPENSES.—Section 2(b)(11) of title 35, United 
States Code, is amended by inserting ‘‘, and the Office 
is authorized to expend funds to cover the subsistence ex-
penses and travel-related expenses, including per diem, 
lodging costs, and transportation costs, of persons attend-
ing such programs who are not Federal employees’’ after 
‘‘world’’. 
(b) PAYMENT OF ADMINISTRATIVE JUDGES.—Sec-
tion 3(b) of title 35, United States Code, is amended by 
adding at the end the following: 
‘‘(6) ADMINISTRATIVE
PATENT
JUDGES
AND 
ADMINISTRATIVE TRADEMARK JUDGES.—The Direc-
tor may fix the rate of basic pay for the administra-
tive patent judges appointed pursuant to section 6 
and the administrative trademark judges appointed 
pursuant to section 17 of the Trademark Act of 
1946 (15 U.S.C. 1067) at not greater than the rate 
of basic pay payable for level III of the Executive 
Schedule under section 5314 of title 5. The payment 
of a rate of basic pay under this paragraph shall not 
be subject to the pay limitation under section 
5306(e) or 5373 of title 5.’’.
137 
SEC. 22. PATENT AND TRADEMARK OFFICE FUNDING. 
(a) IN GENERAL.—Section 42(c) of title 35, United 
States Code, is amended— 
(1) by striking ‘‘(c)’’ and inserting ‘‘(c)(1)’’; 
(2) in the first sentence, by striking ‘‘shall be 
available’’ and inserting ‘‘shall, subject to paragraph 
(3), be available’’; 
(3) by striking the second sentence; and 
(4) by adding at the end the following: 
‘‘(2) There is established in the Treasury a Patent 
and Trademark Fee Reserve Fund. If fee collections by 
the Patent and Trademark Office for a fiscal year exceed 
the amount appropriated to the Office for that fiscal year, 
fees collected in excess of the appropriated amount shall 
be deposited in the Patent and Trademark Fee Reserve 
Fund. To the extent and in the amounts provided in ap-
propriations Acts, amounts in the Fund shall be made 
available until expended only for obligation and expendi-
ture by the Office in accordance with paragraph (3). 
‘‘(3)(A) Any fees that are collected under sections 41, 
42, and 376, and any surcharges on such fees, may only 
be used for expenses of the Office relating to the proc-
essing of patent applications and for other activities, serv-
ices, and materials relating to patents and to cover a share 
of the administrative costs of the Office relating to pat-
ents.
138 
‘‘(B) Any fees that are collected under section 31 of 
the Trademark Act of 1946, and any surcharges on such 
fees, may only be used for expenses of the Office relating 
to the processing of trademark registrations and for other 
activities, services, and materials relating to trademarks 
and to cover a share of the administrative costs of the 
Office relating to trademarks.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on October 1, 2011. 
SEC. 23. SATELLITE OFFICES. 
(a) ESTABLISHMENT.—Subject to available re-
sources, the Director shall, by not later than the date that 
is 3 years after the date of the enactment of this Act, 
establish 3 or more satellite offices in the United States 
to carry out the responsibilities of the Office. 
(b) PURPOSES.—The purposes of the satellite offices 
established under subsection (a) are to— 
(1) increase outreach activities to better connect 
patent filers and innovators with the Office; 
(2) enhance patent examiner retention; 
(3) improve recruitment of patent examiners; 
(4) decrease the number of patent applications 
waiting for examination; and 
(5) improve the quality of patent examination. 
(c) REQUIRED CONSIDERATIONS.—
139 
(1) IN GENERAL.—In selecting the location of 
each satellite office to be established under sub-
section (a), the Director— 
(A) shall ensure geographic diversity 
among the offices, including by ensuring that 
such offices are established in different States 
and regions throughout the Nation; 
(B) may rely upon any previous evalua-
tions by the Office of potential locales for sat-
ellite offices, including any evaluations prepared 
as part of the Office’s Nationwide Workforce 
Program that resulted in the 2010 selection of 
Detroit, Michigan, as the first satellite office of 
the Office; 
(C) shall evaluate and consider the extent 
to which the purposes of satellite offices listed 
under subsection (b) will be achieved; 
(D) shall consider the availability of sci-
entific and technically knowledgeable personnel 
in the region from which to draw new patent 
examiners at minimal recruitment cost; and 
(E) shall consider the economic impact to 
the region. 
(2) OPEN
SELECTION
PROCESS.—Nothing in 
paragraph (1) shall constrain the Office to only con-
140 
sider its evaluations in selecting the Detroit, Michi-
gan, satellite office. 
(d) REPORT TO CONGRESS.—Not later than the end 
of the third fiscal year that begins after the date of the 
enactment of this Act, the Director shall submit a report 
to Congress on— 
(1) the rationale of the Director in selecting the 
location of any satellite office required under sub-
section (a), including an explanation of how the se-
lected location will achieve the purposes of satellite 
offices listed under subsection (b) and how the re-
quired considerations listed under subsection (c) 
were met; 
(2) the progress of the Director in establishing 
all such satellite offices; and 
(3) whether the operation of existing satellite 
offices is achieving the purposes under subsection 
(b). 
SEC. 24. DESIGNATION OF DETROIT SATELLITE OFFICE. 
(a) DESIGNATION.—The satellite office of the United 
States Patent and Trademark Office to be located in De-
troit, Michigan, shall be known and designated as the 
‘‘Elijah J. McCoy United States Patent and Trademark 
Office’’.
141 
(b) REFERENCES.—Any reference in a law, map, reg-
ulation, document, paper, or other record of the United 
States to the satellite office of the United States Patent 
and Trademark Office to be located in Detroit, Michigan, 
referred to in subsection (a) shall be deemed to be a ref-
erence to the ‘‘Elijah J. McCoy United States Patent and 
Trademark Office’’. 
SEC. 25. PRIORITY EXAMINATION FOR IMPORTANT TECH-
NOLOGIES. 
Section 2(b)(2) of title 35, United States Code, is 
amended— 
(1) in subparagraph (E), by striking ‘‘and’’ 
after the semicolon; 
(2) in subparagraph (F), by inserting ‘‘and’’ 
after the semicolon; and 
(3) by adding at the end the following: 
‘‘(G) may, subject to any conditions pre-
scribed by the Director and at the request of 
the patent applicant, provide for prioritization 
of examination of applications for products, 
processes, or technologies that are important to 
the national economy or national competitive-
ness without recovering the aggregate extra cost 
of 
providing 
such 
prioritization, 
notwith-
142 
standing section 41 or any other provision of 
law;’’. 
SEC. 26. STUDY ON IMPLEMENTATION. 
(a) PTO STUDY.—The Director shall conduct a study 
on the manner in which this Act and the amendments 
made by this Act are being implemented by the Office, 
and on such other aspects of the patent policies and prac-
tices of the Federal Government with respect to patent 
rights, innovation in the United States, competitiveness of 
United States markets, access by small businesses to cap-
ital for investment, and such other issues, as the Director 
considers appropriate. 
(b) REPORT TO CONGRESS.—The Director shall, not 
later than the date that is 4 years after the date of the 
enactment of this Act, submit to the Committees on the 
Judiciary of the House of Representatives and the Senate 
a report on the results of the study conducted under sub-
section (a), including recommendations for any changes to 
laws and regulations that the Director considers appro-
priate. 
SEC. 27. STUDY ON GENETIC TESTING. 
(a) IN GENERAL.—The Director shall conduct a 
study on effective ways to provide independent, confirming 
genetic diagnostic test activity where gene patents and ex-
clusive licensing for primary genetic diagnostic tests exist.
143 
(b) ITEMS INCLUDED IN STUDY.—The study shall in-
clude an examination of at least the following: 
(1) The impact that the current lack of inde-
pendent second opinion testing has had on the abil-
ity to provide the highest level of medical care to pa-
tients and recipients of genetic diagnostic testing, 
and on inhibiting innovation to existing testing and 
diagnoses. 
(2) The effect that providing independent sec-
ond opinion genetic diagnostic testing would have on 
the existing patent and license holders of an exclu-
sive genetic test. 
(3) The impact that current exclusive licensing 
and patents on genetic testing activity has on the 
practice of medicine, including but not limited to: 
the interpretation of testing results and performance 
of testing procedures. 
(4) The role that cost and insurance coverage 
have on access to and provision of genetic diagnostic 
tests. 
(c) CONFIRMING GENETIC DIAGNOSTIC TEST ACTIV-
ITY DEFINED.—For purposes of this section, the term 
‘‘confirming genetic diagnostic test activity’’ means the 
performance of a genetic diagnostic test, by a genetic diag-
nostic test provider, on an individual solely for the purpose