tioner raised or reasonably could have raised in the 
petition requesting or during the prior post-grant re-
view, unless— 
‘‘(A) after the filing of the initial petition, 
the petitioner, or a real party in interest or a 
privy of the petitioner, is charged with infringe-
ment of additional claims of the patent; 
‘‘(B) a subsequent petition requests an 
inter partes review of only the additional claims 
of the patent that the petitioner, or a real party 
in interest or a privy of the petitioner, is later 
charged with infringing; and 
‘‘(C) that subsequent petition is accom-
panied by a request for joinder to the prior 
post-grant review, which the Director shall 
grant if the Director authorizes a post-grant re-
view to be instituted on the subsequent petition 
under section 324. 
‘‘(2) JOINED PARTY.—Any person joined as a 
party to a post-grant review, and any real party in 
interest or any privy of such person, shall be es-
topped under this subsection and subsections (c)(1) 
and (e)(2) to the same extent as if that person, real 
party in interest, or privy had been the first peti-
tioner in that post-grant review.’’; and 
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(5) by adding at the end the following: 
‘‘(h) FEDERAL COURT AND INTERNATIONAL TRADE 
COMMISSION VALIDITY DETERMINATIONS.—A post-grant 
review of a patent claim may not be instituted or main-
tained if, in a civil action arising in whole or in part under 
section 1338 of title 28, or in a proceeding before the 
International Trade Commission under section 337 of the 
Tariff Act of 1930 (19 U.S.C. 1337), in which the peti-
tioner, a real party in interest, or a privy of the petitioner 
is a party, the court, or the International Trade Commis-
sion, as applicable, has entered a final judgment that de-
cides a challenge to the validity of the patent claim.’’. 
(d) CONDUCT
OF POST-GRANT REVIEW.—Section 
326 of title 35, United States Code, is amended— 
(1) in subsection (a)— 
(A) by amending paragraph (5) to read as 
follows: 
‘‘(5) setting forth standards and procedures for 
discovery of relevant evidence, including that such 
discovery shall be limited to— 
‘‘(A) the deposition of witnesses submitting 
affidavits or declarations; 
‘‘(B) evidence identifying the real parties 
in interest of the petitioner; and 
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‘‘(C) what is otherwise necessary in the in-
terest of justice;’’; 
(B) by amending paragraph (9) to read as 
follows: 
‘‘(9) setting forth standards and procedures 
for— 
‘‘(A) allowing the patent owner to move to 
amend the patent under subsection (d) to can-
cel a challenged claim or propose a reasonable 
number of substitute claims; 
‘‘(B) allowing the Patent Trial and Appeal 
Board to provide guidance on substitute claims 
proposed by the patent owner; 
‘‘(C) allowing the patent owner to further 
revise proposed substitute claims after the 
issuance of guidance described in subparagraph 
(B); and 
‘‘(D) ensuring that any information sub-
mitted by the patent owner in support of any 
amendment entered under subsection (d), and 
any guidance issued by the Patent Trial and 
Appeal Board, is made available to the public 
as part of the prosecution history of the pat-
ent;’’; 
(C) in paragraph (11)— 
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(i) by striking ‘‘section 325(c)’’ and 
inserting ‘‘section 325(d)’’; and 
(ii) by striking ‘‘and’’ at the end; 
(D) in paragraph (12), by striking the pe-
riod at the end and inserting ‘‘; and’’; and 
(E) by adding at the end the following: 
‘‘(13) setting forth the standards for dem-
onstrating exceptional circumstances under section 
325(e)(2).’’; 
(2) by amending subsection (e) to read as fol-
lows: 
‘‘(e) EVIDENTIARY STANDARDS.— 
‘‘(1) PRESUMPTION
OF
VALIDITY.—The pre-
sumption of validity under section 282(a) shall apply 
to previously issued claims of a patent that is chal-
lenged in a post-grant review under this chapter. 
‘‘(2) BURDEN OF PROOF.—In a post-grant re-
view under this chapter— 
‘‘(A) the petitioner shall have the burden 
of proving a proposition of unpatentability of a 
previously issued claim of a patent by clear and 
convincing evidence; and 
‘‘(B) the petitioner shall have the burden 
of persuasion, by a preponderance of the evi-
dence, with respect to a proposition of 
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unpatentability for any substitute claim pro-
posed by the patent owner.’’; and 
(3) by adding at the end the following: 
‘‘(f) CLAIM CONSTRUCTION.—For the purposes of 
this chapter— 
‘‘(1) each challenged claim of a patent, and 
each substitute claim proposed in a motion to 
amend, shall be construed as the claim would be 
construed under section 282(b) in an action to inval-
idate a patent, including by construing each such 
claim in accordance with— 
‘‘(A) the ordinary and customary meaning 
of the claim as understood by a person having 
ordinary skill in the art to which the claimed 
invention pertains; and 
‘‘(B) the prosecution history pertaining to 
the patent; and 
‘‘(2) if a court has previously construed a chal-
lenged claim of a patent or a challenged claim term 
in a civil action to which the patent owner was a 
party, the Office shall consider that claim construc-
tion.’’. 
(e) SETTLEMENT.—Section 327(a) of title 35, United 
States Code, is amended by striking the second sentence. 
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(f) TIMING TO ISSUE TRIAL CERTIFICATES AND DE-
CISIONS ON REHEARING.—Section 328 of title 35, United 
States Code, is amended— 
(1) in subsection (b), by inserting ‘‘, not later 
than 60 days after the date on which the parties to 
the post-grant review have informed the Director 
that the time for appeal has expired or any appeal 
has terminated,’’ after ‘‘the Director shall’’; and 
(2) by adding at the end the following: 
‘‘(e) REHEARING.—Not later than 90 days after the 
date on which a request for rehearing of a final written 
decision issued by the Patent and Trial Appeal Board 
under subsection (a) is filed, the Board or the Director 
shall finally decide any request for reconsideration, rehear-
ing, or review that is submitted with respect to the deci-
sion, except that the Director may, for good cause shown, 
extend that 90-day period by not more than 60 days. 
‘‘(f) REVIEW BY DIRECTOR.— 
‘‘(1) IN GENERAL.—The Director may grant re-
hearing, reconsideration, or review of a decision by 
the Patent Trial and Appeal Board issued under this 
chapter. 
‘‘(2) REQUIREMENTS.—Any reconsideration, re-
hearing, or review by the Director, as described in 
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paragraph (1), shall be issued in a separate written 
opinion that— 
‘‘(A) is made part of the public record; and 
‘‘(B) sets forth the reasons for the recon-
sideration, rehearing, or review of the decision 
by the Patent Trial and Appeal Board. 
‘‘(g) RULE OF CONSTRUCTION.—For the purposes of 
an appeal permitted under section 141, any decision on 
rehearing, reconsideration, or review of a final written de-
cision of the Patent Trial and Appeal Board under sub-
section (a) of this section that is issued by the Director 
shall be deemed to be a final written decision of the Patent 
Trial and Appeal Board.’’. 
(g) TIMING TO ISSUE DECISIONS ON REMAND.—Sec-
tion 329 of title 35, United States Code, is amended— 
(1) by striking ‘‘A party’’ and inserting the fol-
lowing: 
‘‘(a) IN GENERAL.—A party’’; and 
(2) by adding at the end the following: 
‘‘(b) TIMING
ON REMAND AFTER APPEAL.—Not 
later than 120 days after the date on which a mandate 
issues from the court remanding to the Patent Trial and 
Appeal Board after an appeal under subsection (a), the 
Board or the Director shall finally decide any issue on re-
mand, except that the Director may, for good cause 
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shown, extend that 120-day period by not more than 60 
days.’’. 
SEC. 6. REEXAMINATION OF PATENTS. 
(a) REQUEST FOR REEXAMINATION.—Section 302 of 
title 35, United States Code, is amended by inserting after 
the second sentence the following: ‘‘The request must 
identify all real parties in interest and certify that reexam-
ination is not barred under section 303(d).’’. 
(b) REEXAMINATION BARRED.—Section 303 of title 
35, United States Code, is amended— 
(1) in subsection (a), by striking the third sen-
tence; and 
(2) by adding at the end the following: 
‘‘(d) An ex parte reexamination may not be ordered 
if the request for reexamination is filed more than 1 year 
after the date on which the requester or a real party in 
interest or a privy of the requester is served with a com-
plaint alleging infringement of the patent. For purposes 
of this chapter, a person that directly or through an affil-
iate, subsidiary, or proxy makes a financial contribution 
to the preparation for, or conduct during, an ex parte re-
examination on behalf of a requester shall be considered 
a real party in interest of the requester. 
‘‘(e) In determining whether to order an ex parte re-
examination, the Director— 
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‘‘(1) shall, unless the Director determines that 
the requestor has demonstrated exceptional cir-
cumstances, reject any request that presents prior 
art or an argument that is the same or substantially 
the same as prior art or an argument that previously 
was presented to the Office; and 
‘‘(2) may reject any request that the Director 
determines has used a prior Office decision as a 
guide to correct or bolster a previous deficient re-
quest filed under this chapter or a previous deficient 
petition filed under chapter 31 or 32.’’. 
(c) REEXAMINATION ORDER BY DIRECTOR.—Section 
304 of title 35, United States Code, is amended, in the 
first sentence, by inserting after ‘‘resolution of the ques-
tion’’ the following: ‘‘, unless the Director determines that 
the request for reexamination should be rejected under 
subsection (d) or (e) of section 303, in which case the Di-
rector shall issue an order denying reexamination’’. 
SEC. 7. ELIMINATION OF USPTO FEE DIVERSION. 
(a) FUNDING.—Section 42 of title 35, United States 
Code, is amended— 
(1) in subsection (a), by striking ‘‘All fees’’ and 
inserting the following: 
‘‘(a) FEES FOR SERVICE BY PTO.—All fees’’; 
(2) in subsection (b)— 
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(A) by striking ‘‘All fees paid to the Direc-
tor and all appropriations’’ and inserting the 
following: 
‘‘(b) INNOVATION PROMOTION FUND.—All fees paid 
to the Director’’; and 
(B) by striking ‘‘Patent and Trademark 
Office Appropriation Account’’ and inserting 
‘‘United States Patent and Trademark Office 
Innovation Promotion Fund’’; 
(3) by striking subsection (c) and inserting the 
following: 
‘‘(c) COLLECTION
OF FUNDS
FOR PTO ACTIVI-
TIES.— 
‘‘(1) IN
GENERAL.—Fees authorized in this 
title or any other Act to be charged or established 
by the Director shall be collected by the Director 
and shall be available to the Director until expended 
to carry out the activities of the Patent and Trade-
mark Office. 
‘‘(2) USE OF FEES.— 
‘‘(A) PATENT
FEES.—Any fees that are 
collected under this title, and any surcharges on 
such fees, may only be used for expenses of the 
Office relating to the processing of patent appli-
cations and for other activities, services, and 
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materials relating to patents and to cover a pro-
portionate share of the administrative costs of 
the Office. 
‘‘(B) TRADEMARK
FEES.—Any fees that 
are collected under section 31 of the Trademark 
Act of 1946 (as defined in subsection (d)(1)) 
(15 U.S.C. 1113), and any surcharges on such 
fees, may only be used for expenses of the Of-
fice relating to the processing of trademark reg-
istrations and for other activities, services, and 
materials relating to trademarks and to cover a 
proportionate share of the administrative costs 
of the Office.’’; 
(4) by redesignating subsections (d) and (e) as 
subsections (e) and (f), respectively; 
(5) by inserting after subsection (c) the fol-
lowing: 
‘‘(d) REVOLVING FUND.— 
‘‘(1) DEFINITIONS.—In this subsection— 
‘‘(A) the term ‘Fund’ means the United 
States Patent and Trademark Office Innovation 
Promotion Fund established under paragraph 
(2); and 
‘‘(B) the term ‘Trademark Act of 1946’ 
means the Act entitled ‘An Act to provide for 
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the registration and protection of trademarks 
used in commerce, to carry out the provisions 
of certain international conventions, and for 
other purposes’, approved July 5, 1946 (15 
U.S.C. 1051 et seq.), (commonly referred to as 
the ‘Trademark Act of 1946’ or the ‘Lanham 
Act’). 
‘‘(2) ESTABLISHMENT.—There is established in 
the Treasury a revolving fund to be known as the 
‘United States Patent and Trademark Office Inno-
vation Promotion Fund’. 
‘‘(3) DERIVATION OF RESOURCES.—There shall 
be deposited into the Fund any fees collected 
under— 
‘‘(A) this title; or 
‘‘(B) the Trademark Act of 1946. 
‘‘(4) EXPENSES.—Amounts deposited into the 
Fund under paragraph (3) shall be available, with-
out fiscal year limitation, to cover— 
‘‘(A) to the extent consistent with the limi-
tation on the use of fees under subsection (c), 
all expenses, including all administrative and 
operating expenses, determined by the Director 
to be ordinary and reasonable, incurred by the 
Director for the continued operation of all serv-
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ices, programs, activities, and duties of the Of-
fice relating to patents and trademarks, as such 
services, programs, activities, and duties are de-
scribed under— 
‘‘(i) this title; and 
‘‘(ii) the Trademark Act of 1946; and 
‘‘(B) all expenses incurred pursuant to any 
obligation, representation, or other commitment 
of the Office.’’; 
(6) in subsection (e), as so redesignated, by 
striking ‘‘The Director’’ and inserting the following: 
‘‘(e) REFUNDS.—The Director’’; and 
(7) in subsection (f), as so redesignated, by 
striking ‘‘The Secretary’’ and inserting the fol-
lowing: 
‘‘(f) REPORT.—The Secretary’’. 
(b) EFFECTIVE DATE; TRANSFER FROM AND TERMI-
NATION OF OBSOLETE FUNDS.— 
(1) EFFECTIVE DATE.—The amendments made 
by subsection (a) shall take effect on the first day 
of the first fiscal year that begins on or after the 
date of enactment of this Act. 
(2) REMAINING
BALANCES.—On the effective 
date described in paragraph (1), there shall be de-
posited in the United States Patent and Trademark 
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Office Innovation Promotion Fund established under 
section 42(d)(2) of title 35, United States Code (as 
added by subsection (a)), any available unobligated 
balances remaining in the Patent and Trademark 
Office Appropriation Account, and in the Patent and 
Trademark Fee Reserve Fund established under sec-
tion 42(c)(2) of title 35, United States Code, as in 
effect on the day before that effective date. 
(3) TERMINATION OF RESERVE FUND.—Upon 
the payment of all obligated amounts in the Patent 
and Trademark Fee Reserve Fund under paragraph 
(2), the Patent and Trademark Fee Reserve Fund 
shall be terminated. 
SEC. 8. INSTITUTIONS OF HIGHER EDUCATION. 
Section 123(d) of title 35, United States Code, is 
amended to read as follows: 
‘‘(d) INSTITUTIONS OF HIGHER EDUCATION.— 
‘‘(1) DEFINITION.—In this subsection, the term 
‘institution of higher education’ has the meaning 
given the term in section 101(a) of the Higher Edu-
cation Act of 1965 (20 U.S.C. 1001(a)). 
‘‘(2) INCLUSIONS.—For purposes of this sec-
tion, a micro entity shall include an applicant who 
certifies that— 
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‘‘(A) the applicant’s employer, from which 
the applicant obtains the majority of the appli-
cant’s income, is an institution of higher edu-
cation; 
‘‘(B) the applicant has assigned, granted, 
conveyed, or is under an obligation by contract 
or law to assign, grant, or convey, a license or 
other ownership interest in the particular appli-
cations to an institution of higher education; 
‘‘(C) the applicant is an institution of 
higher education; or 
‘‘(D) the applicant is an organization de-
scribed in section 501(c)(3) of the Internal Rev-
enue Code of 1986 and exempt from taxation 
under section 501(a) of such Code that holds 
title to patents and patent applications on be-
half of an institution of higher education for the 
purpose of facilitating commercialization of the 
technologies of the patents and patent applica-
tions.’’. 
SEC. 9. ASSISTING SMALL BUSINESSES IN THE UNITED 
STATES PATENT SYSTEM. 
(a) DEFINITION.—In this section, the term ‘‘small 
business concern’’ has the meaning given the term in sec-
tion 3 of the Small Business Act (15 U.S.C. 632). 
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(b) SMALL BUSINESS ADMINISTRATION REPORT.— 
Not later than 1 year after the date of the enactment of 
this Act, the Administrator of the Small Business Admin-
istration, using existing resources, shall submit to the 
Committee on Small Business and Entrepreneurship of 
the Senate and the Committee on Small Business of the 
House of Representatives a report analyzing the impact 
of— 
(1) patent ownership by small business con-
cerns; and 
(2) civil actions against small business concerns 
arising under title 35, United States Code, relating 
to patent infringement. 
(c) FREE ONLINE AVAILABILITY OF PUBLIC SEARCH 
FACILITY MATERIALS.—Section 41(i) of title 35, United 
States Code, is amended by adding at the end the fol-
lowing: 
‘‘(5) FREE ONLINE AVAILABILITY OF PUBLIC 
SEARCH FACILITY MATERIALS.—The Director shall 
make available online and at no charge all patent 
and trademark information that is available at the 
Public Search Facility of the Office located in Alex-
andria, Virginia, including, except to the extent that 
licenses with third-party contractors would make 
such provision financially unviable— 
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‘‘(A) search tools and databases; 
‘‘(B) informational materials; and 
‘‘(C) training classes and materials.’’. 
Æ 
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