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the case may be, that in the opinion of the Atomic
Energy Commission, the Secretary of Defense, or
such chief officer, as the case may be, publication or
disclosure of the invention by the granting of a pat-
ent would not be detrimental to the national security
of the United States.
‘‘(C) An application that is subject to a secrecy
order pursuant to section 181 of this title shall not
be published.
‘‘(D) An application filed by a small business
concern entitled to reduced fees under section
41(h)(1) of this title, by an individual who is an
independent inventor entitled to reduced fees under
such section, or by an institution of higher education
(as defined in section 1202 of the Higher Education
Act of 1965) entitled to reduced fees under such sec-
tion 41(h)(1) shall not be published until a patent
is issued thereon, except upon the request of the ap-
plicant, or in any of the following circumstances:
‘‘(i) In the case of an application under
section 111(a) for a patent for an invention for
which the applicant intends to file or has filed
an application for a patent in a foreign country,
the Commissioner may publish, at the discre-
tion of the Commissioner and by means deter-
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mined suitable for the purpose, no more than
that data from such application under section
111(a) which will be made or has been made
public in such foreign country. Such a publica-
tion shall be made only after the date of the
publication in such foreign country and shall be
made only if the data is not available, or cannot
be made readily available, in the English lan-
guage through commercial services.
‘‘(ii) If the Commissioner determines that
a patent application which is filed after the date
of the enactment of this paragraph—
‘‘(I) has been pending more than 5
years from the effective filing date of the
application,
‘‘(II) has not been previously pub-
lished by the Patent and Trademark Of-
fice,
‘‘(III) is not under any appellate re-
view by the Board of Patent Appeals and
Interferences,
‘‘(IV) is not under interference pro-
ceedings in accordance with section 135(a),
‘‘(V) is not under any secrecy order
pursuant to section 181,
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‘‘(VI) is not being diligently pursued
by the applicant in accordance with this
title, and
‘‘(VII) is not in abandonment,
the Commissioner shall notify the applicant of
such determination.
‘‘(iii) An applicant which received notice of
a determination described in clause (ii) may,
within 30 days of receiving such notice, petition
the Commissioner to review the determination
to verify that subclauses (I) through (VII) are
all applicable to the applicant’s application. If
the applicant makes such a petition, the Com-
missioner shall not publish the applicant’s ap-
plication before the Commissioner’s review of
the petition is completed. If the applicant does
not submit a petition, the Commissioner may
publish the applicant’s application no earlier
than 90 days after giving such a notice.
‘‘(iv) If after the date of the enactment of
this paragraph a continuing application has
been filed more than 6 months after the date of
the initial filing of an application, the Commis-
sioner shall notify the applicant under such ap-
plication. The Commissioner shall establish a
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procedure for an applicant which receives such
a notice to demonstrate that the purpose of the
continuing application was for reasons other
than to achieve a delay in the time of publica-
tion of the application. If the Commissioner
agrees with such a demonstration by the appli-
cant, the Commissioner shall not publish the
applicant’s application. If the Commissioner
does not agree with such a demonstration by
the applicant or if the applicant does not make
an attempt at such a demonstration within a
reasonable period of time as determined by the
Commissioner, the Commissioner shall publish
the applicant’s application.
‘‘(E)(i) Upon the request at the time of filing
by an applicant that is a small business concern or
an independent inventor entitled to reduced fees
under section 41(h)(1) of this title, the application
shall not be published in accordance with paragraph
(1) until 3 months after the Director makes a sec-
ond notification to such applicant on the merits of
the application under section 132 of this title. The
Director may require applicants that no longer have
the status of a small business concern or an inde-
pendent inventor to so notify the Director not later
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than 15 months after the earliest filing date for
which a benefit is sought under this title.
‘‘(ii) Applications filed pursuant to section 363
of this title, applications asserting priority under
section 119 or 365(a) of this title, and applications
asserting the benefit of an earlier application under
section 120 or 365(c) of this title shall not be eligi-
ble for a request pursuant to this subparagraph.
‘‘(iii) Applications asserting the benefit of an
earlier application under section 121 shall not be eli-
gible for a request pursuant to this subparagraph
unless filed within 2 months after the date on which
the Director required the earlier application to be re-
stricted to 1 of 2 or more inventions in the earlier
application.
‘‘(iv) In a request under this subparagraph, the
applicant shall certify that the invention disclosed in
the application was not and will not be the subject
of an application filed in a foreign country.
‘‘(v) The Director may establish appropriate
procedures and nominal fees for making a request
under this subparagraph.
‘‘(F)(i) In a case in which an applicant, after
making a request under subparagraph (E)(i), deter-
mines to file an application in a foreign country, the
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applicant shall notify the Director promptly. The ap-
plication shall then be published in accordance with
the provisions of paragraph (1).
‘‘(ii) The Director may establish appropriate
fees to cover the costs of processing notifications
under clause (i), including the costs of any special
handling of applications resulting from the initial re-
quest under subparagraph (E)(i).
‘‘(F) No fee established under this section shall
be collected nor shall be available for spending with-
out prior authorization in appropriations Acts.
‘‘(c) PRE-ISSUANCE OPPOSITION.—The provisions of
this section shall not operate to create any new oppor-
tunity for pre-issuance opposition. The Director may es-
tablish appropriate procedures to ensure that this section
does not create any new opportunity for pre-issuance op-
position.’’.
SEC. 203. TIME FOR CLAIMING BENEFIT OF EARLIER FIL-
ING DATE.
(a) IN A FOREIGN COUNTRY.—Section 119(b) of title
35, United States Code, is amended to read as follows:
‘‘(b)(1) No application for patent shall be entitled to
this right of priority unless a claim is filed in the Patent
and Trademark Office, at such time during the pendency
of the application as is required by the Director, that iden-
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tifies the foreign application by specifying its application
number, the country in or for which the application was
filed, and the date of its filing.
‘‘(2) The Director may consider the failure of the ap-
plicant to file a timely claim for priority as a waiver of
any such claim, and may require the payment of a sur-
charge as a condition of accepting an untimely claim dur-
ing the pendency of the application.
‘‘(3) The Director may require a certified copy of the
original foreign application, specification, and drawings
upon which it is based, a translation if not in the English
language, and such other information as the Director con-
siders necessary. Any such certification shall be made by
the intellectual property authority in the foreign country
in which the foreign application was filed and show the
date of the application and of the filing of the specification
and other papers.’’.
(b) IN THE UNITED STATES.—Section 120 of title
35, United States Code, is amended by adding at the end
the following: ‘‘No application shall be entitled to the bene-
fit of an earlier filed application under this section unless
an amendment containing the specific reference to the ear-
lier filed application is submitted at such time during the
pendency of the application as is required by the Commis-
sioner. The Director may consider the failure to submit
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such an amendment within that time period as a waiver
of any benefit under this section. The Director may estab-
lish procedures, including the payment of a surcharge, to
accept unavoidably late submissions of amendments under
this section.’’.
SEC. 204. PROVISIONAL RIGHTS.
Section 154 of title 35, United States Code, is
amended—
(1) in the section caption by inserting ‘‘; pro-
visional rights’’ after ‘‘patent’’; and
(2) by adding at the end the following new sub-
section:
‘‘(d) PROVISIONAL RIGHTS.—
‘‘(1) IN GENERAL.—In addition to other rights
provided by this section, a patent shall include the
right to obtain a reasonable royalty from any person
who, during the period beginning on the date of pub-
lication of the application for such patent pursuant
to section 122(b) of this title, or in the case of an
international application filed under the treaty de-
fined in section 351(a) of this title designating the
United States under Article 21(2)(a) of such treaty,
the date of publication of the application, and ending
on the date the patent is issued—
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‘‘(A)(i) makes, uses, offers for sale, or sells
in the United States the invention as claimed in
the published patent application or imports
such an invention into the United States; or
‘‘(ii) if the invention as claimed in the pub-
lished patent application is a process, uses, of-
fers for sale, or sells in the United States or
imports into the United States products made
by that process as claimed in the published pat-
ent application; and
‘‘(B) had actual notice of the published
patent application and, where the right arising
under this paragraph is based upon an inter-
national application designating the United
States that is published in a language other
than English, a translation of the international
application into the English language.
‘‘(2) RIGHT BASED ON SUBSTANTIALLY IDEN-
TICAL INVENTIONS.—The right under paragraph (1)
to obtain a reasonable royalty shall not be available
under this subsection unless the invention as claimed
in the patent is substantially identical to the inven-
tion as claimed in the published patent application.
‘‘(3) TIME LIMITATION ON OBTAINING A REA-
SONABLE ROYALTY.—The right under paragraph (1)
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to obtain a reasonable royalty shall be available only
in an action brought not later than 6 years after the
patent is issued. The right under paragraph (1) to
obtain a reasonable royalty shall not be affected by
the duration of the period described in paragraph
(1).
‘‘(4) REQUIREMENTS FOR INTERNATIONAL AP-
PLICATIONS.—The right under paragraph (1) to ob-
tain a reasonable royalty based upon the publication
under the treaty defined in section 351(a) of this
title of an international application designating the
United States shall commence from the date that
the Patent and Trademark Office receives a copy of
the publication under such treaty of the inter-
national application, or, if the publication under the
treaty of the international application is in a lan-
guage other than English, from the date that the
Patent and Trademark Office receives a translation
of the international application in the English lan-
guage. The Director may require the applicant to
provide a copy of the international publication of the
international application and a translation thereof.’’.
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SEC. 205. PRIOR ART EFFECT OF PUBLISHED APPLICA-
TIONS.
Section 102(e) of title 35, United States Code, is
amended to read as follows:
‘‘(e) the invention was described in—
‘‘(1) an application for patent, published pursu-
ant to section 122(b) of this title, by another filed
in the United States before the invention by the ap-
plicant for patent, except that an international appli-
cation filed under the treaty defined in section
351(a) of this title shall have the effect under this
subsection of a national application published under
section 122(b) of this title only if the international
application designating the United States was pub-
lished under Article 21(2)(a) of such treaty in the
English language, or
‘‘(2) a patent granted on an application for pat-
ent by another filed in the United States before the
invention by the applicant for patent, or’’.
SEC. 206. COST RECOVERY FOR PUBLICATION.
The Director of the United States Patent and Trade-
mark Office shall recover the cost of early publication re-
quired by the amendment made by section 202 by adjust-
ing the filing, issue, and maintenance fees under title 35,
United States Code, by charging a separate publication
fee, or by any combination of these methods.
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SEC. 207. CONFORMING CHANGES.
The following provisions of title 35, United States
Code, are amended:
(1) Section 11 is amended in paragraph 1 of
subsection (a) by inserting ‘‘and published applica-
tions for patents’’ after ‘‘Patents’’.
(2) Section 12 is amended—
(A) in the section caption by inserting
‘‘and applications’’ after ‘‘patents’’; and
(B) by inserting ‘‘and published applica-
tions for patents’’ after ‘‘patents’’.
(3) Section 13 is amended—
(A) in the section caption by inserting
‘‘and applications’’ after ‘‘patents’’; and
(B) by inserting ‘‘and published applica-
tions for patents’’ after ‘‘patents’’.
(4) The items relating to sections 12 and 13 in
the table of sections for chapter 1, as amended by
section 132(a)(4) of this Act, are each amended by
inserting ‘‘and applications’’ after ‘‘patents’’.
(5) The item relating to section 122 in the table
of sections for chapter 11 is amended by inserting
‘‘; publication of patent applications’’ after ‘‘applica-
tions’’.
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(6) The item relating to section 154 in the table
of sections for chapter 14 is amended by inserting
‘‘; provisional rights’’ after ‘‘patent’’.
(7) Section 181 is amended—
(A) in the first paragraph—
(i) by inserting ‘‘by the publication of
an application or’’ after ‘‘disclosure’’; and
(ii) by inserting ‘‘the publication of
the application or’’ after ‘‘withhold’’;
(B) in the second paragraph by inserting
‘‘by the publication of an application or’’ after
‘‘disclosure of an invention’’;
(C) in the third paragraph—
(i) by inserting ‘‘by the publication of
the application or’’ after ‘‘disclosure of the
invention’’; and
(ii) by inserting ‘‘the publication of
the application or’’ after ‘‘withhold’’; and
(D) in the fourth paragraph by inserting
‘‘the publication of an application or’’ after
‘‘and’’ in the first sentence.
(8) Section 252 is amended in the first para-
graph by inserting ‘‘substantially’’ before ‘‘identical’’
each place it appears.
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(9) Section 284 is amended by adding at the
end of the second paragraph the following: ‘‘In-
creased damages under this paragraph shall not
apply to provisional rights under section 154(d) of
this title.’’.
(10) Section 374 is amended to read as follows:
‘‘§ 374. Publication of international application: Ef-
fect
‘‘The publication under the treaty defined in section
351(a) of this title of an international application des-
ignating the United States shall confer the same rights
and shall have the same effect under this title as an appli-
cation for patent published under section 122(b), except
as provided in sections 102(e) and 154(d) of this title.’’.
(11) Section 135(b) of title 35, United States
Code, is amended to read as follows:
‘‘(b)(1) A claim which is the same as, or for the same
or substantially the same subject matter as, a claim of
an issued patent may only be made in an application if—
‘‘(A) such a claim is made prior to 1 year after
the date on which the patent was granted; and
‘‘(B) the applicant files evidence which dem-
onstrates that the applicant is prima facie entitled to
a judgment relative to the patent.
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‘‘(2)(A) A claim which is the same as, or for the same
or substantially the same subject matter as, a claim of
a published application may only be made in an applica-
tion filed after the date of publication of the published
application if, except in a case to which subparagraph (B)
applies—
‘‘(i) such a claim is made prior to 1 year after
the date of publication of the published application;
and
‘‘(ii) the applicant of the application filed after
the date of publication of the published application
files evidence that demonstrates that the applicant is
prima facie entitled to a judgment relative to the
published application.
‘‘(B) If the applicant of the application filed after the
date of publication of the published application alleges
that the invention claimed in the published application was
derived from that applicant, such a claim may only be
made if that applicant files evidence which demonstrates
that the applicant is prima facie entitled to a judgment
relative to the published application.’’.
SEC. 208. PATENT TERM EXTENSION AUTHORITY.
Section 154(b) of title 35, United States Code, is
amended to read as follows:
‘‘(b) TERM EXTENSION.—
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‘‘(1) BASIS FOR PATENT TERM EXTENSION.—
‘‘(A) DELAY.—Subject to the limitations
set forth in paragraph (2), if the issue of an
original patent is delayed due to—
‘‘(i) a proceeding under section 135(a)
of this title, including any appeal under
section 141, or any civil action under sec-
tion 146, of this title,
‘‘(ii) the imposition of an order pursu-
ant to section 181 of this title,
‘‘(iii) review by the Board of Patent
Appeals and Interferences or by a Federal
court in a case in which the patent was is-
sued pursuant to a decision in the review
reversing an adverse determination of pat-
entability, or
‘‘(iv) an unusual administrative delay
by the Patent and Trademark Office in is-
suing the patent,
the term of the patent shall be extended for the
period of delay.
‘‘(B) ADMINISTRATIVE DELAY.—For pur-
poses of subparagraph (A)(iv), an unusual ad-
ministrative delay by the Patent and Trade-
mark Office is the failure to—
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‘‘(i) make a notification of the rejec-
tion of any claim for a patent or any objec-
tion or argument under section 132 of this
title or give or mail a written notice of al-
lowance under section 151 of this title not
later than 14 months after the date on
which the application was filed;
‘‘(ii) respond to a reply under section
132 of this title or to an appeal taken
under section 134 of this title not later
than 4 months after the date on which the
reply was filed or the appeal was taken;
‘‘(iii) act on an application not later
than 4 months after the date of a decision
by the Board of Patent Appeals and Inter-
ferences under section 134 or 135 of this
title or a decision by a Federal court under
section 141, 145, or 146 of this title in a
case in which allowable claims remain in
an application;
‘‘(iv) issue a patent not later than 4
months after the date on which the issue
fee was paid under section 151 of this title
and all outstanding requirements were sat-
isfied; or
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‘‘(v) issue a patent within 3 years
after the filing date of the application in
the United States, if the applicant—
‘‘(I) has not obtained further lim-
ited examination of the application
under section 209 of the Examining
Procedure Improvements Act;
‘‘(II) has not benefitted from an
extension of patent term under clause
(i), (ii), or (iii) of paragraph (1)(A);
‘‘(III) has not sought or obtained
appellate review by the Board of Pat-
ent Appeals and Interferences or by a
Federal Court other than in a case in
which the patent was issued pursuant
to a decision in the review reversing
an adverse determination of patent-
ability; and
‘‘(IV) has not requested any
delay in the processing of the applica-
tion by the Patent and Trademark Of-
fice.
‘‘(2) LIMITATIONS.—(A) The total duration of
any extensions granted pursuant to either clause (iii)
or (iv) of paragraph (1)(A) or both such clauses
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shall not exceed 10 years. To the extent that periods
of delay attributable to grounds specified in para-
graph (1) overlap, the period of any extension grant-
ed under this subsection shall not exceed the actual
number of days the issuance of the patent was de-
layed.
‘‘(B) The period of extension of the term of a
patent under clause (iv) of paragraph (1)(A), which
is based on the failure of the Patent and Trademark
Office to meet the criteria set forth in clause (v) of
paragraph (1)(B), shall be reduced by the cumu-
lative total of any periods of time that an applicant
takes to respond in excess of 3 months after the
date on which the Patent and Trademark Office
makes any rejection, objection, argument, or other
request.
‘‘(C) The period of extension of the term of a
patent under this subsection shall be reduced by a
period equal to the time in which the applicant failed
to engage in reasonable efforts to conclude prosecu-
tion of the application. The Director shall prescribe
regulations establishing the circumstances that con-
stitute a failure of an applicant to engage in reason-
able efforts to conclude processing or examination of
an application in order to ensure that applicants are
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appropriately compensated for any delays by the
Patent and Trademark Office in excess of the time
periods specified in paragraph (1)(B).
‘‘(D) No patent the term of which has been dis-
claimed beyond a specified date may be extended
under this section beyond the expiration date speci-
fied in the disclaimer.
‘‘(3) PROCEDURES.—The Director shall pre-
scribe regulations establishing procedures for the no-
tification of patent term extensions under this sub-
section and procedures for contesting patent term
extensions under this subsection.’’.
SEC. 209. FURTHER EXAMINATION OF PATENT APPLICA-
TIONS.
Section 132 of title 35, United States Code, is
amended—
(1) in the first sentence by striking ‘‘Whenever’’
and inserting ‘‘(a) Whenever’’; and
(2) by adding at the end the following:
‘‘(b) The Director shall prescribe regulations to pro-
vide for the further limited examination of applications for
patent at the request of the applicant. The Director may
establish appropriate fees for such further limited exam-
ination and shall be authorized to provide a 50 percent
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reduction on such fees for small entities that qualify for
reduced fees under section 41(h)(1) of this title.
SEC. 210. LAST DAY OF PENDENCY OF PROVISIONAL APPLI-
CATION.
Section 119(e) of title 35, United States Code, is
amended by adding at the end the following:
‘‘(3) If the day that is 12 months after the filing date
of a provisional application falls on a Saturday, Sunday,
or Federal holiday within the District of Columbia, the
period of pendency of the provisional application shall be
extended to the next succeeding secular or business day.’’.
SEC. 211. REPORTING REQUIREMENT.
The Director of the United States Patent and Trade-
mark Office shall report to the Congress not later than
April 1, 2001, and not later than April 1 of each year
thereafter, regarding the impact of publication on the pat-
ent applications filed by applicants who are independent
inventors entitled to reduced fees under section 41(h)(1)
of title 35, United States Code. The report shall include
information concerning the frequency and number of ini-
tial and continuing patent applications, pendency, inter-
ferences, reexaminations, rejection, abandonment rates,
fees, other expenses, and other relevant information relat-
ed to the prosecution of patent applications.
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SEC. 212. EFFECTIVE DATE.
(a) SECTIONS 202 THROUGH 207.—Sections 202
through 207, and the amendments made by such sections,
shall take effect on April 1, 1998, and shall apply to all
applications filed under section 111 of title 35, United
States Code, on or after that date, and all international
applications designating the United States that are filed
on or after that date.
(b) SECTIONS 208 THROUGH 210.—The amend-
ments made by sections 208 through 210 shall take effect
on the date of the enactment of this Act and, except for
a design patent application filed under chapter 16 of title
35, United States Code, shall apply to any application
filed on or after June 8, 1995.
TITLE 
III—PROTECTION 
FOR
PRIOR DOMESTIC USERS OF
PATENTED TECHNOLOGIES
SEC. 301. SHORT TITLE.
This title may be cited as the ‘‘Protection for Prior
Domestic Commercial and Research Users of Patented
Technologies Act’’.
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SEC. 302. DEFENSE TO PATENT INFRINGEMENT BASED ON
PRIOR 
DOMESTIC 
COMMERCIAL 
OR 
RE-
SEARCH 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 or research use;
defense to infringement
‘‘(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) in the case of activities performed by a
nonprofit research laboratory, or nonprofit entity
such as a university, research center, or hospital, a
use for which the public is the intended beneficiary
shall be considered to be a use described in para-
graph (1) if the use is limited to activity that oc-
curred within the laboratory or nonprofit entity or
by persons in privity with that laboratory or non-
profit entity before the effective filing date of the ap-
plication for patent at issue, except that the use—
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‘‘(A) may be asserted as a defense under
this section only by the laboratory or nonprofit
entity; and
‘‘(B) may not be asserted as a defense
with respect to any subsequent use by any en-
tity other than such laboratory, nonprofit en-
tity, or persons in privity;
‘‘(3) the terms ‘used in commerce’, and ‘use in
commerce’ mean that there has been an actual sale
or other arm’s-length commercial transfer of the
subject matter at issue or that there has been an ac-
tual sale or other arm’s-length commercial transfer
of a product or service resulting from the use of the
subject matter at issue; and
‘‘(4) 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
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 that would
otherwise infringe one or more claims in the patent being
asserted against such person, if such person had, acting
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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) 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.
‘‘(2) NOT A GENERAL LICENSE.—The defense
asserted by a person under this section is not a gen-
eral license under all claims of the patent at issue,
but extends only to the subject matter claimed in the
patent with respect to which the person can assert
a defense under this chapter, except that the defense
shall also extend to variations in the quantity or vol-
ume of use of the claimed subject matter, and to im-
provements in the claimed subject matter that do
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not infringe additional specifically claimed subject
matter of the patent.
‘‘(3) 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 actually reduced the subject
matter to practice in the United States, com-
pleted a significant portion of the total invest-
ment necessary to commercially use the subject
matter, and made an arm’s-length commercial
transaction in the United States in connection
with the preparation to use the subject matter;
and
‘‘(B) thereafter the person diligently com-
pleted the remainder of the activities and in-
vestments necessary to commercially use the
subject matter, and promptly began commercial
use of the subject matter, even if such activities
were conducted after the effective filing date of
the patent.
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‘‘(4) BURDEN OF PROOF.—A person asserting
the defense under this section shall have the burden
of establishing the defense.
‘‘(5) 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.
‘‘(6) 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.
‘‘(7) 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 actually reduced to prac-
tice more than one year prior to the effective filing
date of the patent by the person asserting the de-
fense or someone in privity with that person.
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‘‘(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 established under this section.’’.
(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:
‘‘273. Prior domestic commercial or research use; defense to infringement.’’.
SEC. 303. EFFECTIVE DATE AND APPLICABILITY.
This title and the amendments made by this title
shall take effect on the date of the enactment of this Act,
but shall not apply to any action for infringement that
is pending on such date of enactment or with respect to
any subject matter for which an adjudication of infringe-
ment, including a consent judgment, has been made before
such date of enactment.
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TITLE IV—ENHANCED PROTEC-
TION OF INVENTORS’ RIGHTS
SEC. 401. SHORT TITLE.
This title may be cited as the ‘‘Enhanced Protection
of Inventors’ Rights Act’’.
SEC. 402. INVENTION PROMOTION SERVICES.
Part I of title 35, United States Code, is amended
by adding after chapter 4 the following new chapter:
‘‘CHAPTER 5—INVENTION PROMOTION
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.
‘‘§ 51. Definitions
‘‘For purposes of this chapter—
‘‘(1) the term ‘contract for invention promotion
services’ means a contract by which an invention
promoter undertakes invention promotion services
for a customer;
‘‘(2) the term ‘customer’ means any person,
firm, partnership, corporation, or other entity who
enters into a financial relationship or a contract with
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an invention promoter for invention promotion serv-
ices;
‘‘(3) the term ‘invention promoter’ means any
person, firm, partnership, corporation, or other en-
tity who offers to perform or performs for, or on be-
half of, a customer any act described under para-
graph (4), but does not include—
‘‘(A) any department or agency of the Fed-
eral Government or of a State or local govern-
ment;
‘‘(B) any nonprofit, charitable, scientific,
or educational organization, qualified under ap-
plicable State law or described under section
170(b)(1)(A) of the Internal Revenue Code of
1986; or
‘‘(C) any person duly registered with, and
in good standing before, the United States Pat-
ent and Trademark Office acting within the
scope of that person’s registration to practice
before the Patent and Trademark Office; and
‘‘(4) the term ‘invention promotion services’
means, with respect to an invention by a customer,
any act involved in—
‘‘(A) evaluating the invention to determine
its protectability as some form of intellectual
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property, other than evaluation by a person li-
censed by a State to practice law who is acting
solely within the scope of that person’s profes-
sional license;
‘‘(B) evaluating the invention to determine
its commercial potential by any person for pur-
poses other than providing venture capital; or
‘‘(C) marketing, brokering, licensing, sell-
ing, or promoting the invention or a product or
service in which the invention is incorporated or
used, except that the display only of an inven-
tion at a trade show or exhibit shall not be con-
sidered to be invention promotion services.
‘‘§ 52. Contracting requirements
‘‘(a) IN GENERAL.—(1) Every contract for invention
promotion services shall be in writing and shall be subject
to the provisions of this chapter. A copy of the signed writ-
ten contract shall be given to the customer at the time
the customer enters into the contract.
‘‘(2) If a contract is entered into for the benefit of
a third party, such party shall be considered a customer
for purposes of this chapter.
‘‘(b) REQUIREMENTS OF INVENTION PROMOTER.—
The invention promoter shall—
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‘‘(1) state in a written document, at the time
a customer enters into a contract for invention pro-
motion services, whether the usual business practice
of the invention promoter is to—
‘‘(A) seek more than 1 contract in connec-
tion with an invention; or
‘‘(B) seek to perform services in connection
with an invention in 1 or more phases, with the
performance of each phase covered in 1 or more
subsequent contracts; and
‘‘(2) supply to the customer a copy of the writ-
ten document together with a written summary of
the usual business practices of the invention pro-
moter, including—
‘‘(A) the usual business terms of contracts;
and
‘‘(B) the approximate amount of the usual
fees or other consideration that may be required
from the customer for each of the services pro-
vided by the invention promoter.
‘‘(c) RIGHT OF CUSTOMER TO CANCEL CONTRACT.—
(1) Notwithstanding any contractual provision to the con-
trary, a customer shall have the right to terminate a con-
tract for invention promotion services by sending a written
letter to the invention promoter stating the customer’s in-
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tent to cancel the contract. The letter of termination must
be deposited with the United States Postal Service on or
before 5 business days after the date upon which the cus-
tomer or the invention promoter executes the contract,
whichever is later.
‘‘(2) Delivery of a promissory note, check, bill of ex-
change, or negotiable instrument of any kind to the inven-
tion promoter or to a third party for the benefit of the
invention promoter, without regard to the date or dates
appearing in such instrument, shall be deemed payment
received by the invention promoter on the date received
for purposes of this section.
‘‘§ 53. Standard provisions for cover notice
‘‘(a) CONTENTS.—Every contract for invention pro-
motion services shall have a conspicuous and legible cover
sheet attached with the following notice imprinted in bold-
face type of not less than 12-point size:
‘‘ ‘YOU HAVE THE RIGHT TO TERMI-
NATE THIS CONTRACT. TO TERMINATE
THIS CONTRACT, YOU MUST SEND A WRIT-
TEN LETTER TO THE COMPANY STATING
YOUR INTENT TO CANCEL THIS CONTRACT.
THE LETTER OF TERMINATION MUST BE
DEPOSITED WITH THE UNITED STATES
POSTAL SERVICE ON OR BEFORE FIVE (5)
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BUSINESS DAYS AFTER THE DATE ON
WHICH YOU OR THE COMPANY EXECUTE
THE CONTRACT, WHICHEVER IS LATER.
‘‘ ‘THE TOTAL NUMBER OF INVENTIONS
EVALUATED 
BY 
THE 
INVENTION 
PRO-
MOTER FOR COMMERCIAL POTENTIAL IN
THE PAST FIVE (5) YEARS IS lllll. OF
THAT NUMBER, lllll RECEIVED POSI-
TIVE EVALUATIONS AND lllll RE-
CEIVED NEGATIVE EVALUATIONS.
‘‘ ‘IF YOU ASSIGN EVEN A PARTIAL IN-
TEREST IN THE INVENTION TO THE IN-
VENTION PROMOTER, THE INVENTION PRO-
MOTER MAY HAVE THE RIGHT TO SELL OR
DISPOSE OF THE INVENTION WITHOUT
YOUR CONSENT AND MAY NOT HAVE TO
SHARE THE PROFITS WITH YOU.
‘‘ ‘THE TOTAL NUMBER OF CUSTOMERS
WHO HAVE CONTRACTED WITH THE IN-
VENTION PROMOTER IN THE PAST FIVE (5)
YEARS IS lllll. THE TOTAL NUMBER
OF CUSTOMERS KNOWN BY THIS INVEN-
TION PROMOTER TO HAVE RECEIVED, BY
VIRTUE OF THIS INVENTION PROMOTER’S
PERFORMANCE, AN AMOUNT OF MONEY IN
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EXCESS OF THE AMOUNT PAID BY THE
CUSTOMER TO THIS INVENTION PROMOTER
IS lllllll.
‘‘ ‘THE OFFICERS OF THIS INVENTION
PROMOTER HAVE COLLECTIVELY OR INDI-
VIDUALLY BEEN AFFILIATED IN THE LAST
TEN (10) YEARS WITH THE FOLLOWING IN-
VENTION PROMOTION COMPANIES: (LIST
THE NAMES AND ADDRESSES OF ALL PRE-
VIOUS INVENTION PROMOTION COMPANIES
WITH WHICH THE PRINCIPAL OFFICERS
HAVE 
BEEN 
AFFILIATED 
AS 
OWNERS,
AGENTS, OR EMPLOYEES). YOU ARE EN-
COURAGED TO CHECK WITH THE UNITED
STATES PATENT AND TRADEMARK OFFICE,
THE FEDERAL TRADE COMMISSION, YOUR
STATE ATTORNEY GENERAL’S OFFICE, AND
THE BETTER BUSINESS BUREAU FOR ANY
COMPLAINTS 
FILED 
AGAINST 
ANY 
OF
THESE COMPANIES.
‘‘ ‘YOU ARE ENCOURAGED TO CONSULT
WITH AN ATTORNEY OF YOUR OWN CHOOS-
ING BEFORE SIGNING THIS CONTRACT. BY
PROCEEDING WITHOUT THE ADVICE OF AN
ATTORNEY REGISTERED TO PRACTICE BE-
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FORE THE UNITED STATES PATENT AND
TRADEMARK OFFICE, YOU COULD LOSE
ANY RIGHTS YOU MIGHT HAVE IN YOUR
IDEA OR INVENTION.’.
‘‘(b) OTHER REQUIREMENTS FOR COVER NOTICE.—
The cover notice shall contain the items required under
subsection (a) and the name, primary office address, and
local office address of the invention promoter, and may
contain no other matter.
‘‘(c) DISCLOSURE OF CERTAIN CUSTOMERS NOT RE-
QUIRED.—The requirement in the notice set forth in sub-
section (a) to include the ‘TOTAL NUMBER OF CUS-
TOMERS WHO HAVE CONTRACTED WITH THE
INVENTION PROMOTER IN THE PAST FIVE (5)
YEARS’ need not include information with respect to cus-
tomers who have purchased trade show services, research,
advertising, or other nonmarketing services from the in-
vention promoter, nor with respect to customers who have
defaulted in their payments to the invention promoter.
‘‘§ 54. Reports to customer required
‘‘With respect to every contract for invention pro-
motion services, the invention promoter shall deliver to the
customer at the address specified in the contract, at least
once every 3 months throughout the term of the contract,
a written report that identifies the contract and includes—
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‘‘(1) a full, clear, and concise description of the
services performed to the date of the report and of
the services yet to be performed and names of all
persons who it is known will perform the services;
and
‘‘(2) the name and address of each person,
firm, corporation, or other entity to whom the sub-
ject matter of the contract has been disclosed, the
reason for each such disclosure, the nature of the
disclosure, and complete and accurate summaries of
all responses received as a result of those disclo-
sures.
‘‘§ 55. Mandatory contract terms
‘‘(a) MANDATORY TERMS.—Each contract for inven-
tion promotion services shall include in boldface type of
not less than 12-point size—
‘‘(1) the terms and conditions of payment and
contract termination rights required under section
52;
‘‘(2) a statement that the customer may avoid
entering into the contract by not making a payment
to the invention promoter;
‘‘(3) a full, clear, and concise description of the
specific acts or services that the invention promoter
undertakes to perform for the customer;
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‘‘(4) a statement as to whether the invention
promoter undertakes to construct, sell, or distribute
one or more prototypes, models, or devices embody-
ing the invention of the customer;
‘‘(5) the full name and principal place of busi-
ness of the invention promoter and the name and
principal place of business of any parent, subsidiary,
agent, independent contractor, and any affiliated
company or person who it is known will perform any
of the services or acts that the invention promoter
undertakes to perform for the customer;
‘‘(6) if any oral or written representation of es-
timated or projected customer earnings is given by
the invention promoter (or any agent, employee, offi-
cer, director, partner, or independent contractor of
such invention promoter), a statement of that esti-
mation or projection and a description of the data
upon which such representation is based;
‘‘(7) the name and address of the custodian of
all records and correspondence relating to the con-
tracted for invention promotion services, and a state-
ment that the invention promoter is required to
maintain all records and correspondence relating to
performance of the invention promotion services for
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such customer for a period of not less than 2 years
after expiration of the term of such contract; and
‘‘(8) a statement setting forth a time schedule
for performance of the invention promotion services,
including an estimated date in which such perform-
ance is expected to be completed.
‘‘(b) INVENTION PROMOTER AS FIDUCIARY.—To the
extent that the description of the specific acts or services
affords discretion to the invention promoter with respect
to what specific acts or services shall be performed, the
invention promoter shall be deemed a fiduciary.
‘‘(c) AVAILABILITY OF INFORMATION.—Records and
correspondence described under subsection (a)(7) shall be
made available after 7 days written notice to the customer
or the representative of the customer to review and copy
at a reasonable cost on the invention promoter’s premises
during normal business hours.
‘‘§ 56. Remedies
‘‘(a) IN GENERAL.—(1) Any contract for invention
promotion services that does not comply with the applica-
ble provisions of this chapter shall be voidable at the op-
tion of the customer.
‘‘(2) Any contract for invention promotion services
entered into in reliance upon any material false, fraudu-
lent, or misleading information, representation, notice, or
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advertisement of the invention promoter (or any agent,
employee, officer, director, partner, or independent con-
tractor of such invention promoter) shall be voidable at
the option of the customer.
‘‘(3) Any waiver by the customer of any provision of
this chapter shall be deemed contrary to public policy and
shall be void and unenforceable.
‘‘(4) Any contract for invention promotion services
which provides for filing for and obtaining utility, design,
or plant patent protection shall be voidable at the option
of the customer unless the invention promoter offers to
perform or performs such act through a person duly reg-
istered to practice before, and in good standing with, the
Patent and Trademark Office.
‘‘(b) CIVIL ACTION.—(1) Any customer who is in-
jured by a violation of this chapter by an invention pro-
moter or by any material false or fraudulent statement
or representation, or any omission of material fact, by an
invention promoter (or any agent, employee, director, offi-
cer, partner, or independent contractor of such invention
promoter) or by failure of an invention promoter to make
all the disclosures required under this chapter, may re-
cover in a civil action against the invention promoter (or
the officers, directors, or partners of such invention pro-
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moter) in addition to reasonable costs and attorneys’ fees,
the greater of—
‘‘(A) $5,000; or
‘‘(B) the amount of actual damages sustained
by the customer.
‘‘(2) Notwithstanding paragraph (1), the court may
increase damages to not more than 3 times the amount
awarded.
‘‘(c) REBUTTABLE PRESUMPTION OF INJURY.—For
purposes of this section, substantial violation of any provi-
sion of this chapter by an invention promoter or execution
by the customer of a contract for invention promotion
services in reliance on any material false or fraudulent
statements or representations or omissions of material
fact shall establish a rebuttable presumption of injury.
‘‘§ 57. Records of complaints
‘‘(a) RELEASE OF COMPLAINTS.—The Director shall
make all complaints received by the United States Patent
and Trademark Office involving invention promoters pub-
licly available, together with any response of the invention
promoters.
‘‘(b) REQUEST
FOR COMPLAINTS.—The Director
may request complaints relating to invention promotion
services from any Federal or State agency and include
such complaints in the records maintained under sub-
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section (a), together with any response of the invention
promoters.
‘‘§ 58. Fraudulent representation by an invention pro-
moter
‘‘Whoever, in providing invention promotion services,
knowingly provides any false or misleading statement, rep-
resentation, or omission of material fact to a customer or
fails to make all the disclosures required under this chap-
ter, shall be guilty of a misdemeanor and fined not more
than $10,000 for each offense.
‘‘§ 59. Rule of construction
‘‘Except as expressly provided in this chapter, no pro-
vision of this chapter shall be construed to affect any obli-
gation, right, or remedy provided under any other Federal
or State law.’’.
SEC. 403. TECHNICAL AND CONFORMING AMENDMENT.
The table of chapters for part I of title 35, United
States Code, is amended by adding after the item relating
to chapter 4 the following:
‘‘5. Invention Promotion Services ...............................................
51’’.
SEC. 404. EFFECTIVE DATE.
This title and the amendments made by this title
shall take effect 60 days after the date of the enactment
of this Act.
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TITLE V—MISCELLANEOUS
IMPROVEMENTS
SEC. 501. PROVISIONAL APPLICATIONS.
(a) ABANDONMENT.—Section 111(b)(5) of title 35,
United States Code, is amended to read as follows:
‘‘(5) ABANDONMENT.—Notwithstanding the ab-
sence of a claim, upon timely request and as pre-
scribed by the Director, a provisional application
may be treated as an application filed under sub-
section (a). Subject to section 119(e)(3) of this title,
if no such request is made, the provisional applica-
tion shall be regarded as abandoned 12 months after
the filing date of such application and shall not be
subject to revival thereafter.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) applies to any provisional application filed
on or after June 8, 1995.
SEC. 502. INTERNATIONAL APPLICATIONS.
Section 119 of title 35, United States Code, is
amended—
(1) in subsection (a), by inserting ‘‘or in a
WTO member country,’’ after ‘‘or to citizens of the
United States,’’; and
(2) by adding at the end the following new sub-
sections:
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‘‘(f) 
APPLICATIONS
FOR
PLANT
BREEDER’S
RIGHTS.—Applications for plant breeder’s rights filed in
a WTO member country (or in a UPOV Contracting
Party) shall have the same effect for the purpose of the
right of priority under subsections (a) through (c) of this
section as applications for patents, subject to the same
conditions and requirements of this section as apply to ap-
plications for patents.
‘‘(g) DEFINITIONS.—As used in this section—
‘‘(1) the term ‘WTO member country’ has the
same meaning as the term is defined in section
104(b)(2) of this title; and
‘‘(2) the term ‘UPOV Contracting Party’ means
a member of the International Convention for the
Protection of New Varieties of Plants.’’.
SEC. 503. PLANT PATENTS.
(a) TUBER PROPAGATED PLANTS.—Section 161 of
title 35, United States Code, is amended by striking ‘‘a
tuber propagated plant or’’.
(b) RIGHTS IN PLANT PATENTS.—The text of section
163 of title 35, United States Code, is amended to read
as follows: ‘‘In the case of a plant patent, the grant shall
include the right to exclude others from asexually repro-
ducing the plant, and from using, offering for sale, or sell-
ing the plant so reproduced, or any of its parts, through-
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out the United States, or from importing the plant so re-
produced, or any parts thereof, into the United States.’’.
(c) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply on the date of the enactment
of this Act. The amendment made by subsection (b) shall
apply to any plant patent issued on or after the date of
the enactment of this Act.
SEC. 504. ELECTRONIC FILING.
Section 22 of title 35, United States Code, is amend-
ed by striking ‘‘printed or typewritten’’ and inserting
‘‘printed, typewritten, or on an electronic medium’’.
SEC. 505. DIVISIONAL APPLICATIONS.
(a) IN GENERAL.—Section 121 of title 35, United
States Code, is amended—
(1) in the first sentence by striking ‘‘If’’ and in-
serting ‘‘(a) If’’; and
(2) by adding at the end the following new sub-
sections:
‘‘(b) In a case in which restriction is required on the
ground that two or more independent and distinct inven-
tions are claimed in an application, the applicant shall be
entitled to submit an examination fee and request exam-
ination for each independent and distinct invention in ex-
cess of one. The examination fee shall be equal to the filing
fee, including excess claims fees, that would have applied
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had the claims corresponding to the asserted independent
and distinct inventions been presented in a separate appli-
cation for patent. For each of the independent and distinct
inventions in excess of one for which the applicant pays
an examination fee within two months after the require-
ment for restriction, the Director shall cause an examina-
tion to be made and a notification of rejection or written
notice of allowance provided to the applicant within the
time period specified in section 154(b)(1)(B)(i) of this title
for the original application. Failure to meet this or any
other time limit set forth in section 154(b)(1)(B) of this
title shall be treated as an unusual administrative delay
under section 154(b)(1)(A)(iv) of this title.
‘‘(c) An applicant who requests reconsideration of a
requirement for restriction under this section and submits
examination fees pursuant to such requirement shall, if
the requirement is determined to be improper, be entitled
to a refund of any examination fees determined to have
been paid pursuant to the requirement.’’.
(b) EFFECTIVE DATE.—The amendments made by
subsection (a) shall take effect on the date that is 2 years
after the date of the enactment of this Act and shall apply
to applications for patent filed on or after such effective
date.
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SEC. 506. PUBLICATIONS.
Section 11 of title 35, United States Code, is amend-
ed by adding at the end the following:
‘‘(c) The Patent and Trademark Office shall make
available for public inspection during regular business
hours all solicitations issued by the Office for contracts
for goods or services, and all contracts entered into by the
Office for goods or services.’’.
Passed the House of Representatives April 24, 1997.
Attest:
ROBIN H. CARLE,
Clerk.