I
104TH CONGRESS
1ST SESSION
H. R. 2235
To amend title 35, United States Code, to afford a personal defense to
infringement based on the commercialization of an invention in the
United States prior to the filing date of a patent claiming the same
invention.
IN THE HOUSE OF REPRESENTATIVES
AUGUST 4, 1995
Mr. MOORHEAD (for himself and Mrs. SCHROEDER) introduced the following
bill; which was referred to the Committee on the Judiciary
A BILL
To amend title 35, United States Code, to afford a personal
defense to infringement based on the commercialization
of an invention in the United States prior to the filing
date of a patent claiming the same invention.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Prior Domestic Com-
mercial Use Act of 1995’’.
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SEC. 2. DEFENSE TO PATENT INFRINGEMENT BASED ON
PRIOR DOMESTIC COMMERCIAL USE.
(a) DEFENSE.—Chapter 28 of title 35, United States
Code, is amended by adding at the end the following new
section:
‘‘§ 273. Prior domestic commercial use; defense to in-
fringement
‘‘(a) DEFINITIONS.—For purposes of this section—
‘‘(1) the terms ‘commercially used’, ‘commer-
cially use’, and ‘commercial use’ mean the use in the
United States in commerce or the use in the design,
testing, or production in the United States of a
product or service which is used in commerce,
whether or not the subject matter at issue is acces-
sible to or otherwise known to the public;
‘‘(2) the terms ‘used in commerce’, and ‘use in
commerce’ mean that there has been an actual sale
or other commercial transfer of the subject matter
at issue or that there has been an actual sale or
other commercial transfer of a product or service re-
sulting from the use of the subject matter at issue;
and
‘‘(3) the ‘effective filing date’ of a patent is the
earlier of the actual filing date of the application for
the patent or the filing date of any earlier United
States, foreign, or international application to which
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the subject matter at issue is entitled under section
119, 120, or 365 of this title.
‘‘(b) DEFENSE TO INFRINGEMENT.—(1) A person
shall not be liable as an infringer under section 271 of
this title with respect to any subject matter the manufac-
ture, use, sale, or offer for sale of which in the United
States or the importation of which into the United States
would otherwise infringe one or more claims in the patent
being asserted against such person, if such person had,
acting in good faith, commercially used the subject matter
before the effective filing date of such patent.
‘‘(2) The sale or other disposition of the subject mat-
ter of a patent by a person entitled to assert a defense
under this section with respect to that subject matter shall
exhaust the patent owner’s rights under the patent to the
extent such rights would have been exhausted had such
sale or other disposition been made by the patent owner.
‘‘(c) LIMITATIONS
AND QUALIFICATIONS
OF DE-
FENSE.—The defense to infringement under this section
is subject to the following:
‘‘(1) NOT A GENERAL LICENSE.—The defense
under this section is not a general license under all
claims of the patent at issue, but extends only to the
subject matter claimed in the patent that the person
asserting the defense had commercially used before
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the effective filing date of the patent, except that the
defense shall also extend to variations in the quan-
tity or volume of use of the claimed subject matter,
and to improvements in the claimed subject matter
that do not infringe additional specifically claimed
subject matter of the patent.
‘‘(2) EFFECTIVE
AND
SERIOUS
PREPARA-
TION.—With respect to subject matter that cannot
be commercialized without a significant investment
of time, money, and effort, a person shall be deemed
to have commercially used the subject matter if—
‘‘(A) before the effective filing date of the
patent, the person reduced the subject matter
to practice in the United States, completed a
significant portion of the total investment nec-
essary to commercially use the subject matter,
and made a commercial transaction in the
United States in connection with the prepara-
tion to use the subject matter, and
‘‘(B) after the effective filing date of the
patent, diligently completed the remainder of
the activities and investments necessary to com-
mercially use the subject matter, and promptly
began commercial use of the subject matter.
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‘‘(3) BURDEN OF PROOF.—A person asserting
the defense under this section shall have the burden
of establishing the defense.
‘‘(4) ABANDONMENT OF USE.—A person who
has abandoned commercial use of subject matter
may not rely on activities performed before the date
of such abandonment in establishing a defense under
subsection (b) with respect to actions taken after the
date of such abandonment.
‘‘(5) PERSONAL DEFENSE.—The defense under
this section may only be asserted by the person who
performed the acts necessary to establish the defense
and, except for any transfer to the patent owner, the
right to assert the defense shall not be licensed or
assigned or transferred to another person except in
connection with the good faith assignment or trans-
fer of the entire enterprise or line of business to
which the defense relates.
‘‘(6) ONE YEAR LIMITATION.—A person may
not assert a defense under this section unless the
subject matter on which the defense is based had
been commercially used or reduced to practice more
than one year prior to the effective filing date of the
patent by the person asserting the defense or some-
one in privity with that person.
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‘‘(7) DERIVATION.—A person may not assert
the defense under this section if the subject matter
on which the defense is based was derived from the
patentee or persons in privity with the patentee.
‘‘(d) UNSUCCESSFUL ASSERTION OF DEFENSE.—If
the defense under this section is pleaded by a person who
is found to infringe the patent and who subsequently fails
to demonstrate a reasonable basis for asserting the de-
fense, the court shall find the case exceptional for the pur-
pose of awarding attorney’s fees under section 285 of this
title.
‘‘(e) INVALIDITY.—A patent shall not be deemed to
be invalid under section 102 or 103 of this title solely be-
cause a defense is raised or established under this sec-
tion.’’.
(b) CONFORMING AMENDMENT.—The table of sec-
tions at the beginning of chapter 28 of title 35, United
States Code, is amended by adding at the end the follow-
ing new item:
‘‘Sec. 273. Prior domestic commercial use; defense to infringement.’’.
SEC. 3. EFFECTIVE DATE AND APPLICABILITY.
This Act and the amendments made by this Act shall
take effect on the date of the enactment of this Act, but
shall not apply to any action for infringement that is pend-
ing on such date of enactment or with respect to any sub-
ject matter for which an adjudication of infringement, in-