Date: 2011-06-23
Speaker: JACKSON LEE (democrat)
Chamber: H
State: Texas

Madam Chair. as I rise to offer my amendment. I take just a moment of personal privilege to say that. whatever side Members are on on this issue. I know that Members want to protect the genius of America. I would like to thank my ranking member. Mr. CONYERS. for that commitment. as he comes from one of the original genius proponents. and that is the auto industry that propelled America into the job creation of the century. and to the chairperson of the committee. Mr. SMITH. who ventured out in efforts to provide opportunities for protecting. again. the opportunities for invention and genius. My amendment speaks. I think. in particular to the vast population of startups and small businesses that are impacted by this legislation. In particular. it is a reinforcement of Congress position that indicates that the patent system should promote industries to continue to develop new technologies that spur growth and create jobs across the country. which includes protecting the rights of small businesses and inventors from predatory behavior that could result in the cutting off of innovation. We recognize that small and minority businesses and womenowned businesses. which dominate the landscape of America. are really major job creators. Small business is thriving in my own home State of Texas. as well. There were 386.422 small employers in Texas in 2006. accounting for 98.7 percent of the States employers and 46.8 of its private sector employment. We know that there are a large number of womenowned businesses and as well growing African American and Latino. But we need more growthwith Asian businesses. small businesses. Hispanic. Native American. African Americanall forms of businesses that are part of growing this economy. Small business makes up a large portion of our employer network. It is important to understand how they will be impacted as a result of patent reform. In this firsttofile. for example. small businesses may in fact be concerned about trying to get investors. As they get investors. they may have to disclose. This sense of Congress will put us on notice that we need to be careful that we allow at least the opportunity for these investors. and that we continue to look at the bill to ensure that it responds to that opportunity. We must recognize again. as I said. that small businesses create jobs. And the number of new jobs that they have created are 64 percent of net jobs over the past 15 years. My amendment. again. reinforces the idea that small businesses can survive in this climate. I did offer an amendment which provided for a transitional review program for 5 years or add for that to be sunsetted. It was all about trying to protect our small businesses. But I believe this amendment. with its firm statement. gathers Congress around the idea that nothing in this bill will inhibit small businesses from being creative. We can as well recognize all of the growth that has come about from the ideas of small businesses. I think my amendment also reinforces that we do not wish to engage in any undue taking of property because we indicate that we want to see the innovativeness of American businesses continue. I believe this is an important statement. because the bill is about innovation. genius. creation. job creation. and it should be about small businesses. Small businesses should be as comfortable with going to the Patent Office as our large businesses. In years to come. because of this major reform. we should see small businesses creating opportunity for growth as they develop not into smalland mediumsized but huge international companies. So I am asking my colleagues to support this amendment. and as well I am recognizing that we do have the opportunity to turn the corner and to put a stamp of new job creation on America. I rise today to offer an amendment to H.R. 1249. the "America Invents Act." My amendment adds a section to the end of the bill expressing the sense of Congress that "the patent system should promote industries to continue to develop new technologies that spur growth and create jobs across the country. which includes protecting the rights of small businesses and inventors from predatory behavior that could result in the cutting off of innovation." We must always be mindful of the importance of ensuring that small companies have the same opportunities to innovate and have their inventions patented and that the laws will continue to protect their valuable intellectual property. Several studies. including those by the National Academy of Sciences and the Federal Trade Commission. recommended reform of the patent system to address what they thought were deficiencies in how patents are currently issued. The U.S. Department of Commerce defines small businesses as businesses which employ less than 500 employees. According to the Department of Commerce in 2006 there were 6 million small employers representing around 99.7% of the nations employers and 50.2% of its privatesector employment. In 2002 the percentage of women who owned their business was 28% while black owned was around 5%. Between 2007 and 2008 the percent change for black females who were self employed went down 2.5% while the number for men went down 1.5%. Small business is thriving in my home state of Texas as well. There were 386.422 small employers in Texas in 2006. accounting for 98.7% of the states employers and 46.8% of its privatesector employment. In 2009. there were about 468.000 small womenowned small businesses compared to over 1 million owned by men. 88.000 small business owners are black. 77.000 are Asian. 319.000 are Hispanic. and 16.000 are Native Americans. Since small businesses make up such a large portion of our employer network. it is important to understand how they will be impacted as a result of patent reform. Given the current state of the economy. we cannot afford to overlook the opportunities for job growth that small businesses create. According to the Bureau of Labor Statistics. between the 1992 and 2005. small businesses accounted for 65% of quarterly net employment growth in the private sector. Even in unsteady economic times. small businesses can be counted on for job creation. Between 1992 and 2004. the net job creation rate was the highest at the smallest establishments. Small Businesses Create Jobs. It is a fact. According to the Small Business Administration. small businesses: Represent 99.7 percent of all employer firms. Employ just over half of all private sector employees. Generated 64 percent of net new jobs over the past 15 years. Create more than half of the nonfarm private gross domestic product (GDP). Hire 40 percent of high tech workers (such as scientists. engineers. and computer programmers). Made up 97.3 percent of all identified exporters and produced 30.2 percent of the known export value in FY 2007. Produce 13 times more patents per employee than large patenting firms. these patents are twice as likely as large firm patents to be among the one percent most cited. Many successful business owners will credit at least part of their success to the ability to innovatein technologies. in strategies. and in business models. A huge part of this innovation comes from the ability to create and patent ideas. According to a study conducted by Business Week. half of all business innovation resources are dedicated to creating new products or services. Patents are the driving force behind this product innovation. and without strong patent protection. businesses will lack the incentive to attract customers and contribute to economic growth. While I am happy to be here debating this all important amendment to this bill. it is unfortunate that some of my other amendments supporting small businesses and acknowledging the "takings clause" in the U.S. Constitution were not accepted. In yesterdays Rules Committee meeting. I offered a number of amendments: I offered amendments that ensure the inclusion of minority and women owned businesses in the definition of "small entities" to ensure they receive the benefits of reduced user fees. I also offered an amendment ensuring the inclusion of Historically Black Colleges and Universities and Hispanic Serving Institutions amongst entities that receive fee discounts. Another prosmall business amendment I offered would have extended the grace period for small businesses from one year to 18 months. enabling them enough time to secure financial support and develop their invention in order to bring it to market. Section 18 of the bill. which creates a transitional review program for business method patents. has raised concerns about the potential to create situations which could run afoul of the "takings clause" in the U.S. Constitution. To address these concerns. I offered a number of amendments: One of my amendments would have shortened the sunset on Section 18 from 10 years to 5 years. I also introduced an amendment that would have required the Director of the USPTO to make a determination of whether or not a condition causing an unlawful taking is created by this section. Lastly. I introduced a sense of Congress amendment that affirms that no provisions in this bill should create a unconstitutional taking. Despite my concerns with certain provisions in this bill. overall. I believe H.R. 1249 will usher in the reforms needed to improve the patent system. making it more effective and efficient. and therefore encouraging innovation and job creation. I yield back the balance of my time.