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UNPRECEDENTED AND WE SHOULD GIVE
THIS ISSUE REGULAR PROCESS IN
THE JUDICIARY COMMITTEE.
I OPPOSE THE AMENDMENT AND URGE
MY COLLEAGUES TO DEFEAT IT AND I
TIME.
YIELD BACK THE BALANCE OF MY
THE GENTLEMAN YIELDS
BACK THE BALANCE OF HIS TIME.
THE GENTLEMAN FROM MICHIGAN.
I'D LIKE TO YIELD
TO THE DISTINGUISHED GENTLEMAN
FROM MASSACHUSETTS, ED MARKEY,
OF THE ENERGY COMMITTEE ONE
MINUTE.
THE GENTLEMAN FROM
MASSACHUSETTS IS RECOGNIZED FOR
ONE MINUTE.
THANK YOU, MR.
CHAIRMAN.
THIS AMENDMENT ELIMINATES
CONFUSION REGARDING THE DEADLINE
FOR FILING PATENT TERM
EXTENSIONS UNDER THE
HATCH-WAXMAN ACT AND PROVIDES
THE CERTAINTY NEEDED TO
ENCOURAGE CRITICAL MEDICAL
RESEARCH.
IT ALSO PROMOTES GOOD GOVERNMENT
BY ENSURING THAT THE PATENT
OFFICE AND THE F.D.A. ADOPT
CONSISTENT INTERPRETATIONS OF
THE VERY SAME STATUTORY
LANGUAGE.
AND FINALLY THIS AMENDMENT IS
CONSISTENT WITH THE ONLY COURT
DECISION ADDRESSING THIS ISSUE.
THE COURT STATED THAT THE
INTERPRETATION THAT IS REFLECTED
IN THIS AMENDMENT, THIS IS FROM
THE COURT, I QUOTE, IS
CONSISTENT WITH THE STATUTE'S
TEXT, STRUCTURE AND PURPOSE.
RIGHT NOW AMERICA'S NEXT LIPPER
TO OR PROZAC COULD BE BOTTLED UP
AT THE PATENT OFFICE AND NEVER
MADE AVAILABLE BECAUSE OF
UNCERTAINTY REGARDING THE PATENT
TERM EXTENSION PROCESS.
IN ORDER TO UNCORK AMERICAN
INNOVATION AND INVENTION, WE
NEED A PATENT EXTENSION PROCESS
FAIR.
THAT IS CLEAR, CONSISTENT AND
THAT'S EXACTLY WHAT THE CONYERS
AMENDMENT DOES.
IT ENJOYS BROAD BIPARTISAN
SUPPORT AND IT CONFIRMS AND
CLARIFIES EXISTING LAW.
IT IS COST NEUTRAL.
I URGE SUPPORT FOR THE
AMENDMENT.
THE GENTLEMAN FROM
MICHIGAN.
I YIELD MY GOOD
FRIEND ALSO FROM MASSACHUSETTS,
MR. RICHARD NEAL, UNFORTUNATELY
75 SECONDS.
THE GENTLEMAN FROM
75 SECONDS.
MASSACHUSETTS IS RECOGNIZED FOR
THANK YOU.
I UNDERSTAND MR. SMITH'S
POSITION HERE BUT THE TRUTH IS
THAT WHEN HE SUGGESTS THAT WE'RE
DOING THINGS THAT INTERFERING
WITH ONGOING COURT TESTS, THERE
HAVE BEEN A SERIES OF VOTES
ABOUT THE HEALTH CARE LAW AND
ARE MORE COMING IN THIS
INSTITUTION.
SO I'M NOT GOING TO SPEND A LOT
OF TIME ON THAT SUGGESTION, BUT
I RISE TODAY IN SUPPORT OF THE
AMENDMENT.
IT ADDRESSES THE DEADLINE FOR
FILING PATENT TERM EXTENSION
APPLICATIONS UNDER HATCH-WAXMAN.
BY ADOPTING A CLEAR STANDARD,
THE AMENDMENT WOULD PROVIDE THE
OPPORTUNITY AND CERTAINTY NEEDED
TO ALLOW INNOVATORS TO CONDUCT
TIME-CONSUMING EXPENSIVE MEDICAL
RESEARCH NECESSARY TO BRING NEW
LIFE-SAVING DRUGS TO MARKET.
THE AMENDMENT CLARIFIES THE LAW
IN A MANNER THAT TRACKS THE ONLY
COURT DECISION TO HAVE ADDRESSED
THIS PARTICULAR PROVISION.
IT WILL ENSURE THAT ALL
APPLICATIONS IN ALL CASES ARE
TREATED THE SAME.
BECAUSE THE AMENDMENT NEARLY
CONFIRMS THE EXISTING LAW, IT IS
BUDGET NEUTRAL.
THE AMENDMENT ENJOYS BROAD
SUPPORT ON BOTH SIDES OF THE
AISLE, I HOPE THAT MY COLLEAGUES
WILL JOIN ME IN SUPPORTING IT.
THE GENTLEMAN FROM
MICHIGAN.
MADAM SPEAKER, I AM
PROUD NOW TO RECOGNIZE MIKE
POMPEO, THE DISTINGUISHED
GENTLEMAN FROM KANSAS, FOR 30
SECONDS.
THE GENTLEMAN FROM
KANSAS IS RECOGNIZED FOR 30
SECONDS.
THANK YOU.
AS A FORMER BUSINESS OWN,
COMPLIANCE WITH SENSELESS
GOVERNMENT REGULATIONS WAS ONE
OF MY BIGGEST FRUSTRATIONS AND
OBVIOUSLY ONE OF THE REASONS I
RAN FOR CONGRESS.
BUT IT'S IMPOSSIBLE TO COMPLY
WITH REGULATIONS WHEN YOU GET
TWO DIFFERENT INTERPRETATIONS
FROM TWO DIFFERENT AGENCIES.
THAT'S WHAT WE HAVE THIS
INTELLECTUAL PROPERTY RULE.
THE P.T.O. AND F.D.A. HAD
ESTABLISHED TWO DIFFERENT
STANDARDS AND THIS AMENDMENT
SIMPLY SEEKS TO FIX THAT, TO
GIVE AN IDENTICAL OUTCOME FROM
TWO DIFFERENT AGENCIES THAT
RESULTED FROM DIFFERENT
INTERPRETATIONS OF THE
HATCH-WAXMAN ACT OF 1984.
INVENTORS SHOULD NOT HAVE TO
GUESS.
WE GIVE A CLEAN DEADLINE.
I ASK MY COLLEAGUES TO SUPPORT
THIS AMENDMENT.
THE GENTLEMAN FROM
MICHIGAN HAS 45 SECONDS
REMAINING.
I YIELD ALL THE
REST OF MY TIME TO SCOTT
GARRETT, THE DISTINGUISHED
GENTLEMAN FROM NEW JERSEY.
THE GENTLEMAN FROM
NEW JERSEY IS RECOGNIZED FOR
THE REMAINING TIME.
IT COVERS
DRUGS AND PRODUCTS THAT MUST BE
APPROVED BY THE F.D.A.
WITH THE EXTENSION WE'RE
TALKING ABOUT HERE, THE PATENT
OFFICE AND F.D.A. HAS
INTERPRETED IT IN TWO DIFFERENT
WAYS, CREATING UNCERTAINTY THAT
HAS LED TO MISCALCULATION.
IT IS CONSISTENT WITH THE COURT
RULING THAT WHEN THE F.D.A.
APPROVES -- PROVIDES FINAL
APPROVAL AFTER NORMAL BUSINESS
HOURS, THAT 60-DAY CLOCK BEGINS
ON THE NEXT DAY.
BY ENSURING THAT PATENT HOLDERS
DOES NOT -- IT WILL NOT ONLY
RESOLVE A LONG-STANDING PROBLEM
BUT WILL ENCOURAGE NEW DRUG
PRODUCTS.
I URGE ADOPTION OF THIS VERY
COMMONSENSE AMENDMENT.
I DO YIELD BACK.
ALL TIME HAS
EXPIRED.
THE QUESTION IS ON THE
AMENDMENT OFFERED BY THE
GENTLEMAN FROM MICHIGAN.
THOSE IN FAVOR SAY AYE.
IN THE OPINION OF THE CHAIR,
THOSE OPPOSED, NO.
THE NOES HAVE IT.
THE AMENDMENT IS --
MADAM SPEAKER, MAY
I HAVE A RECORD VOTE?
PURSUANT TO CLAUSE 6
OF RULE 18, FURTHER PROCEEDINGS
ON THE AMENDMENT OFFERED BY
MICHIGAN WILL BE POSTPONED.
OFFERED BY THE GENTLEMAN FROM
IT IS NOW IN ORDER TO CONSIDER
AMENDMENT NUMBER 10 PRINTED IN
PART B OF HOUSE REPORT 112- IS
11.
FOR WHAT PURPOSE DOES -- HOUSE
REPORT 112-111.
FOR WHAT PURPOSE DOES THE
GENTLEWOMAN FROM CALIFORNIA
SEEK RECOGNITION?
SPEIER SPEIER MADAM CHAIR, --
MADAM CHAIR, I HAVE
AN AMENDMENT AT THE DESK.
THE CLERK WILL
DESIGNATE THE AMENDMENT.
AMENDMENT NUMBER 10
PRINTED IN PART B OF HOUSE
REPORT 112-11 OFFERED BY MS.
SPEIER OF CALIFORNIA.
PURSUANT TO HOUSE
RESOLUTION 316, THE GENTLEWOMAN
FROM CALIFORNIA, MS. SPEIER,
AND A MEMBER OPPOSED, EACH WILL
CONTROL FIVE MINUTES.
THE CHAIR RECOGNIZES THE
GENTLEWOMAN FROM CALIFORNIA.
THANK YOU, MADAM
AS WE KNOW, THE U.S. PATENT
CHAIR.
OFFICE IS VITAL TO THE IF A --
FACILITATES UNIVERSITIES AND
BUSINESSES OF ALL SIZES, TO
TURN IDEAS AND DISCOVERIES INTO
SUCCESSFUL PRODUCTS.
HAVING SAID THAT, WE MUST
ENSURE THAT OUR PATENT SYSTEM
PROVIDES STRONG AND PREDICTABLE
INTELLECTUAL PROPERTY
PROTECTIONS.
THIS ACT CREATES A NEW PROCESS
CALLED DARE VATION BY WHICH --
DARIVATION WHICH WHICH THEY CAN
SHOW THE INVENTION IN THE
EARLIER APPLICATION WAS DERIVED
FROM THE PARTY'S INVENTION OR
CONCEPT.
THE BILL REQUIRES A PARTY TO
SUPPORT A DARIVATION.
THE DARIVATION PROCEEDINGS IN
THIS MUST BE A PROCESS THAT'S
FAIR, RELIABLE AND PERMITS THE
PATENT AND TRADEMARK OFFICE TO
MAKE A DECISION BASED ON SOLID
RECORD OF RELEVANT EVIDENCE.
THIS AMENDMENT HELPS TO
ACCOMPLISH THIS BY REQUIRING
THE P.T.O. TO PROVIDE RULES FOR
THE EXCHANGE OF RELEVANT
INFORMATION BY BOTH PARTIES.
THE SUBSTANTIAL EVIDENCE
THRESHOLD AT THE PETITION STAGE
OF THE PROCEEDINGS MAY NOT BE
REASONABLE IN SOME
CIRCUMSTANCES.
FOR EXAMPLE, CONSIDER A
SITUATION WHERE AN INVENTOR
DISCLOSES AN INVENTION TO A
CAPITALIST WHO DECLINES TO
INVEST IN IT.
THE VENTURE CAPITALISTS HAS
SKFERINGSES WITH SEVERAL OTHER
PEOPLE ABOUT THE INVENTION AND
EVENTUALLY A COMPANY FUNDED BY
ONE OF THOSE FILES A PATENT
APPLICATION FOR SOMETHING VERY
MUCH LIKE THE ORIGINAL
INVENTION.
IF THE COMPANY FUNDED BY THE
ORIGINAL V.C. HAS FILED THE
APPLICATION, THEY WOULD BE ABLE
TO SHOW SUBSTANTIAL EVIDENCE OF
DERIVATION THROUGH DISCLOSURE
OF THE V.C. AND THE LINK
BETWEEN THE V.C. AND THE
COMPANY FILING THE APPLICATION.
IN THE INSTANCE WHEN AN
INVENTOR DID NOT DISCLOSE IT
WOULD BE DIFFICULT FOR THE
INVENTOR TO SHOW SUBSTANTIAL
EVIDENCE.
PARTICULARLY RELEVANT
DISCLOSURES ABOUT WHICH THE
INVENTOR IS UNAWARE.
THE PUBLIC'S INTEREST IN
FOSTERING INNOVATION REQUIRES
THAT THE DERIVATION PROCEEDINGS
BE EQUITYIBLE TO BOTH PARTIES
AND THAT THEY HAVE A COMPLETE
EVIDENCE ON WHICH TO MAKE THE
DECISION.
INVENTORS MUST HAVE A FAIR
CHANCE TO PROVIDE THEIR CLAIM.
THIS AMENDMENT ACCOMPLISHES
THESE GOALS BY REQUIRING THE
P.T.O. TO HAVE RULES FOR THE
EXCHANGE OF RELEVANT
BOTH PARTIES.
INFORMATION AND EVIDENCE BY
MADAM CHAIR, I RESERVE THE
BALANCE OF MY TIME.
THE GENTLEWOMAN
RESERVES THE BALANCE OF HER
TIME.
THE GENTLEMAN FROM TEXAS.
MADAM CHAIR, I RISE
IN OPPOSITION -- TO CLAIM TIME
IN OPPOSITION BUT I SUPPORT IT.
THE GENTLEMAN IS
RECOGNIZED.
I SUPPORT IT AND I
YIELD BACK.
THE GENTLEWOMAN FROM
CALIFORNIA.
I YIELD WHATEVER
TIME I HAVE REMAINING TO THE
GENTLEMAN FROM MARYLAND, MR.
HOYER.
THE GENTLEMAN FROM
MARYLAND IS RECOGNIZED FOR 2
1/2 MINUTES.
I THANK YOU VERY
MUCH.
MADAM CHAIR, THANK YOU FOR
YIELDING.
I RISE IN SUPPORT OF THIS
LEGISLATION.
I AM A STRONG SUPPORTER, AS
MANY OF YOU KNOW, OF WHAT WE
AGENDA.
CALL IT OUR MAKE IT IN AMERICA
MAKE IT IN AMERICA SIMPLY MEANS
WE ARE GOING TO PROVIDE JOBS,
WE ARE GOING TO PROVIDE
OPPORTUNITIES AND WE ARE GOING
TO BUILD THE MANUFACTURING
SECTOR OF OUR ECONOMY.
IN ORDER TO DO THAT WE ALSO
NEED TO ENHANCE THE INVENTIVE,
INNOVATIVE AND DEVELOPMENT
PHASES OF OUR ECONOMY.
THIS BILL, I THINK, WILL
FACILITATE THIS.
I CONGRATULATE THE GENTLELADY
FROM CALIFORNIA FOR THIS
AMENDMENT AS WELL.
WHICH I THINK IMPROVES THIS
BILL.
I RISE IN STRONG SUPPORT AND
URGE MY COLLEAGUES TO SUPPORT
THIS PIECE OF LEGISLATION.
I CONGRATULATE ALL OF THOSE WHO
HAVE WORKED ON THIS
LEGISLATION.
IT IS OBVIOUSLY NOT PERFECT,
BUT THEN AGAIN NO PIECE OF
LEGISLATION THAT WE ADOPT IS
PERFECT.
IT IS, HOWEVER, A SIGNIFICANT
STEP FORWARD TO MAKE SURE THAT
AMERICA REMAINS THE INVENTIVE,
INNOVATIVE DEVELOPMENT CAPITAL
OF THE WORLD.
IN ORDER TO DO THAT WE NEED TO
MANUFACTURE GOODS HERE IN
AMERICA.
MANUFACTURE THE GOODS THAT WE
INVENT, INNOVATE AND DEVELOP
IT, BECAUSE IF WE CONTINUE TO
TAKE THEM TO SCALE OVERSEAS,
THEN THE INVENTORS, INNOVATORS
AND DEVELOPERS WILL THEMSELVES
MOVE OVERSEAS.
SO I THANK MR. SMITH, THANK MR.
WATT.
I THANK OTHERS WHO HAVE WORKED
SO *** THIS LEGISLATION.
MS. LOFGREN AS WELL.
WHO HAVE DEDICATED THEMSELVES
TO TRYING TO MAKE SURE THAT WE
HAVE A CONTEXT AND ENVIRONMENT
IN AMERICA WHICH WILL
FACILITATE THE INNOVATIVE
SECTOR OF OUR ECONOMY.
AND I YIELD BACK THE BALANCE OF
MY TIME.
THE GENTLEMAN YIELDS
BACK THE BALANCE OF HIS TIME.
ALL TIME HAS BEEN YIELDED BACK.
THE QUESTION IS ON THE
AMENDMENT OFFERED BY THE
GENTLEWOMAN FROM CALIFORNIA.
THOSE IN FAVOR SAY AYE.
THOSE OPPOSED, NO.
IN THE OPINION OF THE CHAIR,
THE AYES HAVE IT.
THE AMENDMENT IS AGREED TO.
IT IS NOW IN ORDER TO CONSIDER
AMENDMENT IN 11 PRINTED IN PART
B OF HOUSE REPORT 112-111.
FOR WHAT PURPOSE DOES THE
GENTLEWOMAN FROM CALIFORNIA
SEEK RECOGNITION?
DOES THE GENTLEMAN
FROM NORTH CAROLINA SEEK
RECOGNITION?
MADAM CHAIR, WE WERE
EXPECTING CONGRESSWOMAN WATERS.
I'D ASK UNANIMOUS CONSENT THAT
THIS AMENDMENT BE DELAYED UNTIL
WE CAN DETERMINE WHETHER SHE'S
STILL PLANNING TO OFFER IT.
THE COMMITTEE OF THE
AMENDMENTS.
WHOLE IS UNABLE TO REORDER THE
WELL, IN THAT CASE, I
WILL ASK UNANIMOUS CONSENT TO
OFFER THE AMENDMENT IN HER
PLACE.
IS GENTLEMAN A
DESIGNEE OF THE GENTLEWOMAN
FROM CALIFORNIA?
YES.
THE CLERK WILL
COLIN POWELL AMENDMENT --
DESIGNATE THE AMENDMENT.
AMENDMENT NUMBER 1
PRINTED IN PART B OF HOUSE
REPORT 112-111 OFFERED BY MR.
WATT OF CALIFORNIA.
PURSUANT TO HOUSE
RESOLUTION 316, THE GENTLEMAN
FROM NORTH CAROLINA, MR. WATT,
AND A MEMBER OPPOSED, EACH WILL
CONTROL FIVE MINUTES.
THE CHAIR RECOGNIZES THE
GENTLEMAN FROM NORTH CAROLINA.
THANK YOU, MADAM
CHAIR.
I YIELD MYSELF SUCH TIME AS I
MAY CONSUME.
THE GENTLEMAN IS
RECOGNIZED.
SOLELY TO SAY THAT
THIS IS A STRAIGHTFORWARD
AMENDMENT THAT PROVIDES THAT IF
ONE PART OF THE BILL IS
DETERMINED TO BE
UNCONSTITUTIONAL IT CAN BE
SEVERABLE FROM THE REST OF THE
BILL AND DOESN'T BRING THE REST
OF THE PROVISIONS DOWN.
THAT'S A STANDARD POLICY PUT IN
MOST LEGISLATION, AND WITH THAT
I RESERVE THE BALANCE OF MY
TIME.
THE GENTLEMAN
RESERVES THE BALANCE OF HIS
TIME.
THE GENTLEMAN FROM TEXAS.
MADAM CHAIR, I RISE
IN -- TO CLAIM THE TIME IN
OPPOSITION ALTHOUGH I SUPPORT
THE AMENDMENT.
THE GENTLEMAN IS
RECOGNIZED.
MADAM CHAIR, I THANK
THE GENTLEMAN FOR OFFERING THE
AMENDMENT AND URGE MY
COLLEAGUES TO SUPPORT IT AND I
TIME.
YIELD BACK THE BALANCE OF MY
THE GENTLEMAN YIELDS
BACK.
THE GENTLEMAN FROM NORTH
CAROLINA.
I'VE JUST BEEN
ADVISED THAT WE WERE MISTAKEN
IN THAT THE DESIRE OF MS.
WATERS TO OFFER THE AMENDMENT
SO SHE DIDN'T WANT ME TO OFFER
IT IN HER STEAD AND THAT'S WHY
SHE DIDN'T SHOW UP.
I'M NOT SURE WHAT THE
APPROPRIATE PROCEDURE IS TO --
I WOULD JUST ASK UNANIMOUS
CONSENT TO WITHDRAW THE
AMENDMENT UNLESS THE CHAIR HAS
OBJECTION.
WITHOUT OBJECTION,
THE AMENDMENT IS WITHDRAWN.
IT IS NOW IN ORDER TO CONSIDER
AMENDMENT NUMBER 12 PRINTED IN
PART B OF HOUSE REPORT 112-111.
FOR WHAT PURPOSE DOES THE
GENTLEMAN FROM WISCONSIN SEEK
RECOGNITION?
MADAM CHAIR,
I HAVE AN AMENDMENT AT THE DESK
MADE IN ORDER UNDER THE RULE.
THE CLERK WILL
DESIGNATE THE AMENDMENT.
AMENDMENT NUMBER 12
PRINTED IN PART B OF HOUSE
REPORT 112-111 OFFERED BY MR.
SENSENBRENNER OF WISCONSIN.
PURSUANT TO HOUSE
RESOLUTION 316, THE GENTLEMAN
FROM WISCONSIN, MR.
SENSENBRENNER, AND A MEMBER
OPPOSED, EACH WILL CONTROL FIVE
MINUTES.
THE CHAIR RECOGNIZES THE
GENTLEMAN FROM WISCONSIN.
MADAM CHAIR,
HALF.
I YIELD MYSELF A MINUTE AND A
THE GENTLEMAN IS
HALF.
RECOGNIZED FOR A MINUTE AND A
MADAM CHAIR,
SECTION 3 OF THIS BILL HAS A
FIRST TO FILE PATENT SYSTEM.
THE SPONSORS BELIEVE THE UNITED
STATES SHOULD HARMONIZE WITH
OTHER COUNTRIES FIRST TO FILE
SYSTEM.
THERE'S NO REASON TO DO THAT.
OUR PATENT SYSTEM IS THE
STRONGEST IN THE WORLD, AND
IT'S BASED UPON THE FIRST
RECOGNITION OF THE CONSTITUTION
IN ANY COUNTRY THAT INVENTORS
SHOULD BE PROTECTED.
I THINK THAT THE CONSTITUTION
EMPOWERS CONGRESS TO GIVE
PATENTS ONLY TO INVENTORS.
WE HAD A SIGNIFICANT
CONSTITUTIONAL ARGUMENT ON THIS
ISSUE YESTERDAY.
IF THE AMENDMENT IS NOT
ADOPTED, THE ISSUE WILL BE
LITIGATED ALL THE WAY UP TO THE
SUPREME COURT.
THE CURRENT FIRST-TO-INVENT
SYSTEM HAS BEEN KEY IN
ENCOURAGE ENTREPRENEURIAL
INNOVATION AND EVENS THE
PLAYING FIELD FOR INDIVIDUAL
INVENTORS WHO ARE NOT
REPRESENTED BY A MAJOR
INDUSTRY.
THE FIRST INVENTOR-TO-FILE
SYSTEM VIOLATES THE
CONSTITUTION BECAUSE IT WOULD
AWARD A PATENT TO THE WINNER OF
THE RACE TO THE P.T.O., AND NOT
THE ACTUAL INVENTOR WHO MAKES
THE FIRST DISCOVERY.
IF WE CHANGE TO A FIRST-TO-FILE
SYSTEM, INVENTORS WHO BELIEVE
THEY DO NOT HAVE SUFFICIENT
RESOURCES TO WIN THE RACE TO
THE P.T.O. WILL NOT HAVE ANY
MOTIVATION AT ALL TO CONTINUE
DEVELOPING THE NEW INVENTION.
THIS WILL STIFLE INNOVATION AND
GIVEN THE CURRENT STATE OF OUR
ECONOMY THAT'S THE LAST THING
WE NEED.
I YIELD MYSELF AN ADDITIONAL 15
SECONDS.
FIRST-TO-FILE ALSO INVITES
EXCESSIVE FILING AND WILL ADD
TO THE BURDEN OF THE U.S.
P.T.O. I WILL INCREASING THE
EXAMINER'S WORKLOAD.
WE ALREADY HAVE FINANCING
PROBLEMS THERE.
IF THIS AMENDMENT IS NOT
ADOPTED, IT WILL BE WORSE.
I RESERVE THE BALANCE OF MY
TIME.
THE GENTLEMAN
RESERVES.
THE GENTLEMAN FROM TEXAS.
I CLAIM THE TIME IN
OPPOSITION.
THE GENTLEMAN IS
RECOGNIZED FOR FIVE MINUTES.
MADAM CHAIR, THE
GENTLEMAN'S AMENDMENT STRIKES
-- THE MOVE TO A FIRST-TO-FILE
INVENTOR SYSTEM BENEFITS ALL
INVENTORS INCLUDING INDEPENDENT
INVENTORS.
THIS PROINVESTIGATION PROVIDES
A MORE TRANSPARENT AND CERTAIN
GRACE PERIOD, A KEY FEATURE OF
U.S. LAW AND A MORE DEFINITE
FILING DATE THAT ENABLES
INVENTORS TO PROMOTE, FUND AND
MARKET THEIR TECHNOLOGY WHILE
MAKING THEM LESS VULNERABLE TO
COSTLY PATENT CHALLENGES AND
DISADVANTAGE INDEPENDENT
INVENTORS.
THE FIRST-TO-INVENT FILING
SYSTEM IS PART OF THE
CONSTITUTIONAL REQUIREMENTS
THAT PATENTS ARE REWARDED TO
THE FIRST INVENTOR.
THE PROVISION IS CONSTITUTIONAL
AND HELPS ASSURE THAT THE
PATENT LAWS OF THIS COUNTRY
ACCOMPLISH THE GOALS SET FORTH
IN THE CONSTITUTION TO PROMOTE
THE PROGRESS OF SCIENCE AND
USEFUL ARTS, END QUOTE.
UNDER FIRST INVENTOR TO FILE,
PATENTS ARE RESERVED TO THOSE
BEFORE IT WAS IN THE PUBLIC
DOMAIN.
IN THE CONSTITUTION THAT IS
INVENTOR.
WHAT IS REQUIRED TO BE AN
IN FACT, EARLIER AMERICAN
PATENT LAW, THAT OF OUR
FOUNDERS' GENERATION, DID NOT
CONCERN ITSELF WITH WHO WAS THE
FIRST TO INVENT.
THE U.S. OPERATED UNDER A FIRST
INVENTOR TO REGISTER SYSTEM FOR
NEARLY HALF A CENTURY STARTING
IN 1790.
THE FIRST TO REGISTER SYSTEM IS
THE LIKE FIRST TO FILE, A
SYSTEM THE FOUNDERS SUPPORTED
EARLIER IN OUR NATION'S
HISTORY.
THE COURTS DID NOT EVEN
CONCERNS THEMSELVES OF WHO WAS
THE FIRST PERSON TO INVENT
UNTIL 1870 WITH THE CREATION OF
INTERFERENCE PROCEEDINGS.
THOSE PROCEEDINGS ARE THE ONES
THAT DISADVANTAGE INDEPENDENT
INVENTORS AND SMALL BUSINESSES.
OVER THE YEARS AND IN SUBSEQUENT
REVISIONS OF THE LAW, THOSE
PROCEEDINGS HAVE MORPHED INTO A
COSTLY LITIGATION TACTIC.
UNDER FIRST INVENTOR TO FILE, AN
INVENTOR SUBMITS AN APPLICATION
TO THE PATENT OFFICE THAT
DESCRIBES THEIR INTENTION AND
HOW TO MAKE IT.
THAT ALONG WITH JUST $110 FEE
GETS THEM A PROVISIONAL
APPLICATION AND PRESERVES THEIR
FILING DATE.
THIS ALLOWS THE INVENTOR AN
ENTIRE YEAR TO COMPLETE THE
APPLICATION WHILE RETAINING THE
EARLIER FILING DATE.
BY CONTRAST, THE COST OF AN
INTERFERENCE PROCEEDING IN
TODAY'S LAW COULD RUN AN
INVENTOR $500,000.
ACCUSATIONS THAT THE BILL
DOESN'T PRESERVE THE ONE-YEAR
GRACE PERIOD ARE SIMPLY FALSE.
THIS BILL PROVIDES A STRONGER,
MORE TRANSPARENT AND CERTAIN
ONE-YEAR GRACE PERIOD FOR
DISCLOSURES.
THIS ENHANCES PROTECTION FOR
INVENTORS WHO HAVE MADE A PUBLIC
OR PRIVATE DISCLOSURE THEIR
INTENTION DURING THE GRACE
PERIOD.
THE GRACE PERIOD PROTECTS THE
ABILITY OF AN INVENTOR TO
DISCUSS OR WRITE ABOUT THEIR
IDEAS FOR A PATENT UP TO ONE
PROTECTION.
YEAR BEFORE THEY FILE FOR PATENT
THESE SIMPLE REQUIREMENTS CREATE
A PRIORITY DATE THAT IS FIXED
AND PUBLIC SO THAT EVERYONE IN
THE WORLD CAN MEASURE THE PATENT
AGAINST COMPETING APPLICATIONS
IN PATENTS AND RELATIVE PRIOR
ART.
IN ADDITION, MANY INVENTORS ALSO
WANT PROTECT FOR THEIR PATENTS
OUTSIDE THE UNITED STATES.
IF YOU PLAN ON SELLING YOUR
PRODUCT OVERSEAS, YOU NEED TO
SECURE AN EARLY FILING DATE.
IF YOU DON'T HAVE A CLEAR FILING
DATE, YOU CAN BE SHUT OUT FROM
THE OVERSEAS MARKET.
A CHANGE TO A FIRST INVENTOR TO
FILE SYSTEM WILL HELP OUR
BUSINESSES GROW AND ENSURE THAT
AMERICAN GOODS AND SERVICES WILL
BE AVAILABLE IN MARKETS ACROSS
THE GLOBE.
THE CURRENT FIRST TO INVENT
SYSTEM SERIOUSLY DISADVANTAGES
SMALL BUSINESSES AND INDEPENDENT
INVENTORS.
FOR P.T.O. COMMISSIONER
CONDUCTED A STUDY THAT PROVES
SMALLER ENTITIES ARE
DISADVANTAGED IN P.T.O.
INTERFERENCE PROCEEDINGS THAT
ARISE FROM DISPUTES OVER PATENT
OWNERSHIP UNDER THE CURRENT
SYSTEM.
IN THE LAST SEVEN YEARS, ONLY
ONE INDEPENDENT INVENTOR OUT OF
THREE MILLION PATENT
APPLICATIONS FILED HAS PROVED IN
EARLIER DATE OF INVENTION THAN
THE INVENTOR WHO FILED FIRST.
LET ME REPEAT THAT.
IN THE LAST SEVEN DAYS ONLY ONE
INDEPENDENT INVENTOR OUT OF
THREE MILLION PATENT
APPLICATIONS FILED HAS PROVED AN
EARLIER DATE OF INVENTION THAN
THE INVENTOR WHO FILED FIRST.
INDEPENDENT INVENTORS LOSE TO
OTHER APPLICATIONS WITH DEEPER
POCKETS THAT ARE BETTER EQUIPPED
TO EXPLOIT THE CURRENT COMPLEX
LEGAL ENVIRONMENT.
SO THE FIRST INVENTOR TO FILE
CHANGE MAKES IT EASIER AND LESS
COMPLICATED FOR U.S. INVENTORS
TO SECURE THEIR PATENT RIGHTS.
AND IT PROTECTS THEIR PATENTS
OVERSEAS.
AND IT ELIMINATES THE LEGAL
BILLS THAT COME WITH
INTERFERENCE PROCEEDINGS UNDER
THE CURRENT SYSTEM.
IT IS A KEY PROVISION OF THIS
BILL.
MADAM CHAIR, THE AMENDMENT
SHOULD NOT BE APPROVED AND I
URGE MY COLLEAGUES TO VOTE
AGAINST IT AND I'LL YIELD BACK
THE BALANCE OF MY TIME.
THE GENTLEMAN YIELDS
BACK THE BALANCE OF HIS TIME.
THE GENTLEMAN FROM WISCONSIN.
I YIELD A
CALIFORNIA, MR. SCHIFF.
MINUTE TO THE GENTLEMAN FROM
THE GENTLEMAN FROM
CALIFORNIA IS RECOGNIZED FOR ONE
MINUTE.
I THANK THE
FIND MYSELF IN RELUCTANT
GENTLEMAN FOR YIELDING AND I
OPPOSITION TO MY COLLEAGUE FROM
TEXAS, IN SUPPORT OF THE SENSE
BRENNER AMENDMENT.
SECTION 3 SHIFTS OUR PATENT
SYSTEM FROM THE UNIQUE FIRST TO
INVENT SYSTEM TO A FIRST TO FILE
SYSTEM.
AS I SPEAK TO INVENTORS,
STARTUP, VENTURE CAPITALISTS,
I'M CONVINCED THAT THE PROPOSED
TRANSITION TO FIRST TO FILE
WOULD BE HARMFUL TO INNOVATION
AND BURDEN SOVEPL TO THE MOST
DIE A NUMBER -- BURT SOD TO THE
MOST DYNAMIC AND INNOVATIVE
SECTOR OF OUR ECONOMY.
THE RUSH TO THE PATENT OFFICE
WILL LEAD TO NEW COTHSES --
COSTS FOR SMALL BUSINESSES AS
THEY PREPARE APPLICATIONS FOR
INVENTIONS THAT THEY MAY
ULTIMATELY FIND IMPRACTICAL.
FOR SMALL STARTUPS, THE COST OF
RETAINING OUTSIDE COUNSEL FOR
THIS PURPOSE WILL BE A DRAIN ON
THEIR LIMITED RESOURCES AND BE
LESS MONEY FOR HIRING.
SUPPORTERS OF FIRST TO FILE
ARGUE INVENTORS CAN TURN TO
PROVISIONAL APPLICATIONS TO
PROTECT THEIR PATENT RIGHTS, BUT
FROM TALKING TO SMALL INVENTORS,
I HAVE LEARNED THAT GOOD
PROVISIONAL APPLICATIONS REQUIRE
SUBSTANTIAL LEGAL FEES AND TIME
INVENTOR TO MAKE THEM
INVESTMENT ON THE PART OF THE
SUFFICIENTLY DETAILED TO BE OF
USE.
--
I APPRECIATE THE HARD WORK BUT
I YIELD
ANOTHER 15 SECONDS.
I APPRECIATE THE
HARD WORK THAT HAS GONE INTO THE
BILL BY THE GENTLEMAN FROM
TEXAS, HOWEVER I REMAIN
CONVINCED THAT THIS WILL HAVE
LASTING NEGATIVE CONSEQUENCES
FOR THE INVESTORS AND I URGE THE
HOUSE TO APPROVE THE BILL BY
ADOPSING THE SENSENBRENNER
AMENDMENT.
I YIELD TO
MS. LOFGREN.
I RISE IN SUPPORT
OF THE SENSENBRENNER AMENDMENT.
ACTUALLY, I DON'T AGREE THAT
FIRST TO FILE IS
UNCONSTITUTIONAL AND I IN
GENERAL AM NOT OPPOSED TO THE
IDEA OF FIRST TO FILE, BUT
UNFORTUNATELY THE BILL IS FLAWED
AND YOU CANNOT HAVE FIRST TO
FILE WITHOUT ROBUST PRIOR USER
RIGHTS AND A BROAD PRIOR USER
RIGHTS USED IN THE GRACE PERIOD.
WE DON'T HAVE THAT IN THIS BILL.
AND SO WHAT WE WILL HAVE ARE
ESTABLISHED BUSINESSES HAVING TO
EITHER REVEAL TRADE SECRETS OR
BE HELD UP, HAVE TO LICENSE
THEIR OWN TRADE SECRETS.
FOR STAR SCRT -- STARTUPS THIS
IS A VERY SERIOUS PROBLEM.
COMING FROM SILICON VALLEY, I'LL
TELL YOU, I'VE HEARD FROM A LOT
OF STARTUPS IN THE VENTURE WORLD
THAT SUPPORTS THEM THAT THIS
PROVISION IS DEFECTIVE.
THERE WERE OTHER REMEDIES, THEY
WERE NOT ADOPTED.
ALL WE CAN DO NOW IS TO STRIKE
THE FIRST TO FILE PROVISION.
I DO THAT WITHOUT ANY
RELUCTANCE.
IT WILL SERVE OUR ECONOMY BEST
AND I THANK THE GENTLEMAN FOR
OFFERING HIS AMENDMENT.
THE GENTLEMAN FROM
WISCONSIN HAS ONE MINUTE
REMAINING.
I YIELD
MYSELF THE BALANCE OF THE TIME.
THE GENTLEMAN IS
RECOGNIZED.
MADAM CHAIR,
THE REASON THAT FIRST TO INVENT
IS IMPORTANT IS THAT ALLOWS AN
INVENTOR TO TALK TO INVESTORS,
CONDUCT TRIAL AND ERROR
INNOVATIONS AND DEAL WITH LEAKS
BECAUSE COMMERCIALLY IMPORTANT
PATENT RIGHTS ARE DETERMINED BY
ORDINARY NONBURDENSOME BUSINESS
ACTIVITIES.
WHERE THIS HURTS THE ORDINARY
INVENTOR, BY GOING TO FIRST TO
FILE, IS THAT HE NEEDS TO GET
HIS VENTURE CAPITAL TOGETHER AND
THEN GO AHEAD AND FILE FOR A
PATENT.
WITH FIRST TO FILE HE HAS TO PUT
ALL OF THE MONEY UP FRONT TO
FILE IN ORDER TO PROTECT HIMSELF
AND WHAT THAT WILL DO IS HAVE A
CHILLING EFFECT ON THE SMALL
INVENTOR WHO NEEDS TO GET
CAPITAL IN ORDER TO PERFECT A
PATENT AND IN ORDER TO MARKET
IT.
BE ADOPTED.
THAT'S WHY THIS AMENDMENT SHOULD
I URGE THE MEMBERS TO DO SO AND
I YIELD BACK THE BALANCE OF MY
TIME.
THE GENTLEMAN YIELDS
BACK THE BALANCE OF HIS TIME.
THE QUESTION ISEN ON THE
AMENDMENT OFFERED BY THE
GENTLEMAN FROM WISCONSIN.
THOSE IN FAVOR SAY AYE.
THOSE OPPOSED, NO.
IN THE OPINION OF THE CHAIR, THE
NOES HAVE.
IT THE AMENDMENT IS NOT AGREED
TO.
I ASK FOR A
RECORDED VOTE.
PURSUANT TO CLAUSE 6
OF RULE 18, FURTHER PROCEEDINGS
ON THE AMENDMENT OFFERED BY THE
GENTLEMAN FROM WISCONSIN WILL BE
POSTPONED.
IT IS NOW IN ORDER TO CONSIDER
AMENDMENT NUMBER 13 PRINTED IN
PART B OF HOUSE REPORT 112-111.
FOR WHAT PURPOSE DOES THE
GENTLEMAN FROM ILLINOIS SEEK
RECOGNITION?
I HAVE AN AMENDMENT
AT THE DESK --
I HAVE AN
AMENDMENT AT THE DESK.
AMENDMENT NUMBER 13
PRINTED IN PART B OF HOUSE
REPORT 112-111 OFFERED BY MR.
MANZULLO OF ILLINOIS.
PURSUANT TO HOUSE
RESOLUTION 316, THE GENTLEMAN
FROM ILLINOIS, MR. MANZULLO, AND
A MEMBER OPPOSED EACH WILL
CONTROL FIVE MINUTES.
THE GENTLEMAN FROM ILLINOIS IS
RECOGNIZED FOR FIVE MINUTES.
MADAM CHAIR, THERE
ARE A LOT OF PROBLEMS WITH THIS
BILL, AS WE HAVE HEARD ABOUT
ALREADY.
IN FACT, ON THE WALL OF MY
OFFICE HERE IN WASHINGTON I HAVE
TWO PICTURES, AMONG MANY.
ONE IS A PICTURE OF W. EDWARDS
DEMOCRATTING AND MYSELF TAKEN
JUST BEFORE HE PASSED AWAY IN
1993, THE REAL INVENTOR OF LEAN
MANUFACTURING.
THE OTHER OF DR. RAY DEMADIUM,
THE INVENTOR OF THE M.R.I., WHO
EXAMINING THIS LEGISLATION SAID
IF THE NEW CHANGES HAD TAKEN
PLACE IN THE PATENT LAW, HAD
THEY BEEN PART OF THE PATENT
SYSTEM WHEN HE INVENTED THE
M.R.I., THE M.R.I. NEVER WOULD
HAVE BEEN INVENTED.
HE KNOWS MORE THAN ANYBODY HOW
FLAWED THIS BILL IS.
I WANT TO FOCUS THE PARTICULAR
SECTION 10 OF THE BILL WHICH
ALLOWS THE DIRECTOR OF THE
PATENT OFFICE TO SET FEES.
I'M VERY CONCERNED ABOUT THIS
BECAUSE IN THE LAST PATENT FIGHT
IN 2004 WHEN I CHAIRED THE HOUSE
INSTALL BUSINESS COMMITTEE, IN
RETURN FOR SUPPORTING HIGHER
FEES WITH REDUCED RATE STRUCTURE
FOR SMALL BUSINESSES, THE
PROVISION IN THAT BILL ALLOWING
THE P.T.O. DIRECTOR TO SET FEES
WAS REMOVED.
THIS NEW BILL ABROGATES THAT
HARD-WON COMPROMISE AND ALLOWS
THE DIRECTOR OF THE P.T.O. TO
SET THE FEES.
IT IS NOT WISE FOR THE
LEGISLATIVE BRANCH TO GIVE UP
MORE POWER AND AUTHORITY TO THE
EXECUTIVE BRANCH.
I NOTE IT'S INCONVENIENT TO HAVE
CONGRESS SET FEES BUT THAT'S THE
JOB OF CONGRESS.
NOT THE JOB OF AN UNELECTED
BUREAUCRAT.
WHEN I CHAIRED THE HOUSE SMALL
BUSINESS COMMITTEE, I CONTINUED
THE TRADITION OF PREVENTING THE
S.B.A. FROM UNILATERALLY BEING
ABLE TO SET FEES TO ANOTHER
LEVEL THEY SOUGHT.
I DON'T SEE WHY WE HAVE TO DO
THIS WITH THE P.T.O.
NOW, IN THE PRESENT BILL,
SECTION 11 ACTUALLY LOWERS FEES
FOR SMALL BUSINESS PEOPLE.
AND IT HAS A GOOD PATENT FEE
STRUCTURE.
HOWEVER, SECTION 10 WOULD ALLOW
THE P.T.O. DIRECTOR TO PROCEED
WITH ADMINISTRATOR PROCESS TO
EVISCERATE THAT SECTION AND
IMPOSE HIS OWN FEES.
TO COMPOUND THE PROBLEM, THE
PATENT OFFICE HAS BEEN SAYING
FOR YEARS THAT IF THEY HAD THE
AUTHORITY TO RAISE FEES, THEY
WOULD.
IN 2002 THE P.T.O.'S STRATEGIC
PLAN SAID THEY NEED TO HAVE A
FEE-BASED UPON -- FEE BASED UPON
A PROGRESSIVE SYSTEM AIMED AT
LIMITING APPLICATIONS.
AT 2010 THE PAPER ON PATENT
REFORM, THEY SAID THE SAME
THING.
THE PATENT OFFICE'S IDEA OF
CUTTING BACK ON THE BACKLOG IS
TO RAISE FEES.
THAT DOESN'T MAKE SENSE.
BUT LET'S ELIMINATE THAT
AUTHORITY FROM THE PATENT
OFFICE, LET'S LEAVE THAT
AUTHORITY WITH THE UNITED STATES
CONGRESS.
I RESERVE THE BALANCE OF MY
TIME.
THE GENTLEMAN
RESERVES THE BALANCE OF HIS
TIME.
THE GENTLEMAN FROM TEXAS.
I RISE IN OPPOSITION
TO THE AMENDMENT.
THE GENTLEMAN IS
RECOGNIZED FOR FIVE MINUTES.
MADAM CHAIR, I OPPOSE
STRIKE THE P.T.O. FEE-SETTING
THE GENTLEMAN'S AMENDMENT TO
AUTHORITY FROM H.R. 1249.
ALTHOUGH THE P.T.O. HAS THE
ABILITY TO SET CERTAIN FEES BY
CONGRESS.
REGULATION, MOST FEES ARE SET BY
HISTORY HAS SHOWN THAT SUCH A
SCHEME DOES NOT ALLOW THE P.T.O.
TO RESPOND TO THE CHALLENGES
THAT CONFRONT IT.
THE P.T.O., MOST STAKEHOLDERS
AND THE JUDICIARY COMMITTEE HAVE
ARGUED FOR YEARS THAT THE AGENCY
MUST HAVE FEE-SETTING AUTHORITY
TO ADDRESS ITS GROWING WORK
LOAD.
THIS NEED IS CRITICAL.
THE AGENCY'S BACKLOG EXCEEDS ONE
MILLION PATENT APPLICATIONS.
THIS MEANS IT TAKES THREE YEARS
TO GET A PATENT IN THE UNITED
STATES, FAR TOO LONG.
THE WASTED TIME LEADS TO LOST
COMMERCIAL OPPORTUNITIES, FEWER
JOBS AND FEWER NEW PRODUCTS FOR
AMERICAN CONSUMERS.
MOREOVER THE NEW FEE STRUCTURE
WILL NOT ONLY RETAIN THE 50%
DESK COUNT FOR SMALL BUSINESSES,
IT CREATES A NEW 75% DISCOUNT
FOR MICROENTITY.
THIS BENEFIT HELPS INDEPENDENT
INVENTORS AND SMALL BUSINESSES.
THE BILL ALLOWS THE P.T.O. TO
SET OR ASSESS ALL OF ITS FEES,
INCLUDING THOSE RELATED TO
PATENTS AND TRADEMARK, SO LONG
AS THEY DO NO MORE THAN
REASONABLY COMPENSATE THE AGENCY
FOR THE SERVICES PERFORMED.
THE CHOICE THAT WE ARE
ABANDONING THE OVERSIGHT OF OUR
PROCESS, I URGE THE MEMBERS TO
REVIEW THE OVERSIGHT MECHANISMS
IN THE BILL.
FOR EXAMPLE, PRIOR TO SETTING
SUCH FEES, THE DIRECTOR MUST
FROM THE PATENT OR TRADEMARK
GIVE NOTICE TO AND RECEIVE INPUT
PUBLIC ADVISORY COMMITTEE.
THE DIRECTOR MAY ALSO REDUCE
FEES FOR ANY GIVEN FISCAL YEAR,
BUT ONLY AFTER CONSULTATION WITH
THE ADVISORY COMMITTEE.
THE BILL DETAILS THE PROCEDURES
FOR HOW THE DIRECTOR SHALL
CONSULT WITH THE ADVISORY
COMMITTEES WHICH INCLUDE
PROVIDES FOR PUBLIC HEARINGS AND
THE DISSEMINATION TO THE PUBLIC
OF ANY RECOMMENDATIONS MADE BY
EITHER ADVISORY COMMITTEE.
FEES SHALL BE PRESCRIBED BY
RULE.
ANY PROPOSED FEE CHANGE SHALL BE
PUBLISHED IN THE FEDERAL
REGISTER AND INCLUDE THE
SPECIFIC RATIONALE AND PURPOSE
FOR OTHER PURPOSES THE PROPOSED
CHANGE.
THE DIRECTOR MUST SEEK PUBLIC
COMMENTS FOR NO LESS THAN 45
DAYS.
THE DIRECTOR MUST ALSO NOTIFY
CONGRESS OF ANY FINAL DECISION
REGARDING PROPOSED FEES.
45 DAYS TO CONSIDER AND COMMENT
CONGRESS SHALL HAVE NO MORE THAN
ON ANY PROPOSED FEE, BUT NO
PROPOSED FEE SHALL BE EFFECTIVE
PRIOR TO THE EXPIRATION OF THIS
45-DAY PERIOD.
CONGRESS WILL REMAIN PART OF THE
PROCESS.
BUT P.T.O. IS BETTER AGE TO
RESPOND TO THEIR OWN RESOURCE --
IS BETTER ABLE TO RESPOND TO
THEIR OWN RESOURCE NEEDS WHICH
AFTER ALL WILL BENEFIT PATENT
HOLDERS AND SUBSEQUENTLY THE
ECONOMY.
SO I URGE MY COLLEAGUES TO
OPPOSE THE AMENDMENT AND I YIELD
YIELD -- I YIELD THE BALANCE OF
MOOVE MY TIME TO THE GENTLEMAN
FROM VIRGINIA, MR. GOODLATTE.
THE GENTLEMAN FROM
VIRGINIA VOICED FOR 2 1/2
MINUTES.
I THANK THE
CHAIRMAN FOR YIELDING AND, MADAM
CHAIRMAN, I RISE IN OPPOSITION
TO THIS AMENDMENT.
THE SENATE-PASSED PATENT BILL
GRANTED THE P.T.O. FEE-SETTING
AUTHORITY IN THE PERT FOUGHT TO.
SENATE THE -- THE SENATE'S GOAL
WAS LAUDABLE.
IT WANTED THE P.T.O. TO HAVE
CONTROL OVER THE FEES IT CHARGES
SO IT HAVE HAVE MORE CERTAINTY
ABOUT HIRING NEW EXAMINERS TO
DEAL WITH PATENT FEE AND QUALITY
ISSUES.
WE HAVE, AS YOU KNOW, A VERY
LONG BACKLOG, THREE YEARS, ONE
MILLION PATENTS.
HOWEVER, I HAD STRONG CONCERNS
WITH GRANTING THIS MUCH
AUTHORITY TO A GOVERNMENT
AGENCY.
CURRENTLY THE P.T.O. MUST COME
BEFORE CONGRESS TO REQUEST ANY
FEE INCREASES.
THIS FORCES THE P.T.O. TO USE
ITS CURRENT RESOURCES IN THE
MOST EFFICIENT MANNER AND ALSO
STRENGTHENS CONGRESS' HAND WHEN
IT COMES TO OVERSIGHT OVER THE
AGENCY.
THUS I WORKED TO GET A PROVISION
INTO THE HOUSE BILL THAT WOULD
SUNSET THE P.T.O.'S FEE-SETTING
AUTHORITY.
THE BILL NOW TERMINATES THE
FEE-SETTING AUTHORITY AFTER
SEVEN YEARS UNLESS CONGRESS
PROACTIVELY ACTS TO EXTEND IT.
THIS WILL ALLOW THE P.T.O.
SUFFICIENT TIME TO STRUCTURE ITS
FEES BUT WILL ENSURE THAT
CONGRESS CONTINUES TO HAVE A
STRONG INFLUENCE OVER THAT
PROCESS.
AND I MIGHT ADD THAT THE
MANAGER'S AMENDMENT TO THE BILL
ALSO STRENGTHENS CONGRESS' HAND
AND LIMITS THE OBJECTIVE OF THE
P.T.O. TO ARBITRARILY RAISE ITS
FEES BECAUSE THE CONGRESS STILL
APPROPRIATES THE FUNDS AND CAN
ONLY ESCROW FUNDS, CAN'T DIVERT
THEM, TO ANOTHER PURPOSE, BUT
ESCROWS THEM.
P.T.O. WILL HAVE TO COME BACK TO
THE CONGRESS AND JUSTIFY
ADDITIONAL FUNDS IT RECEIVES.
I BELIEVE THE BILL, AS WRITTEN
RIGHT NOW, STRIKES THE RIGHT
BALANCE AND I URGE MEMBERS TO
OPPOSE THIS AMENDMENT WHICH
WOULD ALTOGETHER ELIMINATE
P.T.O. FEE-SETTING AUTHORITY.
THE GENTLEMAN FROM
ILLINOIS.
MADAM CHAIR, YOU
DON'T STRIKE THE RIGHT BALANCE
BETWEEN INVENTOR'S
CONSTITUTIONAL RIGHT TO FILE
FOR AN INVENTION AND GIVING A
PATENT CZAR THE AUTHORITY TO
KEEP THEM OUT OF THE BOX BY
ALLOWING THEM TO RAISE THE FEE.
MR. SMITH FROM TEXAS SED IT
HIMSELF.
HE COUPLED PATENT BACKLOG WITH
THE ABILITY OF THE PATENT
DIRECTOR TO SET THE FEES.
THAT CAN LEAD TO ONE
CONCLUSION, THEY ARE GOING TO
RAISE THE FEES IN ORDER TO CUT
DOWN ON A PATENT BACKLOG.
IT DOESN'T MAKE SENSE.
THIS IS THE PEOPLE'S HOUSE.
THE PATENT OFFICE IS THE
PEOPLE'S HOUSE FOR THE LITTLE
INVENTOR.
HE MUST HAVE EVERY OPPORTUNITY
TO EXERCISE HIS CONSTITUTIONAL
RIGHT AND FILE THAT PATENT.
BUT IF CONGRESS SEES THE
AUTHORITY TO SET THOSE FEES TO
A NEW AUTHORITY OF THE PATENT
DIRECTOR, CALL HIM NOW THE
PATENT CZAR, THAT PATENT CZAR
WILL CONTROL FOR SEVEN YEARS AT
THE MINIMUM THE FLOW OF TRAFFIC
COMING THROUGH HIS OFFICE.
YOU KNOW WHO GETS SLOWED, YOU
KNOW WHO GETS HURT?
IT'S THE LITTLE GUY.
THE PURPOSE OF MY AMENDMENT IS
TO PROTECT THE LITTLE GUY TO
MAKE SURE THOSE FEES ARE NOT
RAISED AND ALSO TO MAKE SURE
THAT THE PEOPLE IN THIS COUNTRY
, -- IN THIS COUNTRY ELECT
REPRESENTATIVES TO SET THE
FEES, AND I WOULD URGE MY
COLLEAGUES TO VOTE FOR THE
MANZULLO AMENDMENT TO SUPPORT
THE LITTLE INVENTOR, TO SUPPORT
THE SPIRIT OF ENTREPRENEURSHIP
IN THIS COUNTRY.
DOES THE GENTLEMAN
YIELD BACK?
I YIELD BACK.
THE QUESTION IS ON
THE AMENDMENT OFFERED BY THE
GENTLEMAN FROM ILLINOIS.
THOSE IN FAVOR SAY AYE.
THOSE OPPOSED, NO.
IN THE OPINION OF THE CHAIR,
THE NOES HAVE IT.
THE AMENDMENT IS NOT AGREED TO.
MADAM CHAIR, I
REQUEST A RECORDED VOTE.
PURSUANT TO CLAUSE 6
OF RULE 18, FURTHER PROCEEDINGS
ON THE AMENDMENT OFFERED BY THE
GENTLEMAN FROM ILLINOIS WILL BE
POSTPONED.
IT IS NOW IN ORDER TO CONSIDER
AMENDMENT NUMBER 14 PRINTED IN
PART B OF HOUSE REPORT 112-111.
FOR WHAT PURPOSE DOES THE
GENTLEMAN FROM CALIFORNIA SEEK
RECOGNITION?
I HAVE AN
THE CLERK WILL
AMENDMENT AT THE DESK.
DESIGNATE THE AMENDMENT.
AMENDMENT NUMBER 14
PRINTED IN PART B OF HOUSE
REPORT 112-111 OFFERED BY MR.
ROHRABACHER OF CALIFORNIA.
PURSUANT TO HOUSE
RESOLUTION 316, THE GENTLEMAN
FROM CALIFORNIA, MR.
ROHRABACHER, AND A MEMBER
OPPOSED, EACH WILL CONTROL FIVE
MINUTES.
THE CHAIR RECOGNIZES THE
GENTLEMAN FROM CALIFORNIA.
THANK YOU VERY
MUCH.
IN THIS DEBATE, MADAM CHAIRMAN,
WE HAVE HEARD OVER AND OVER AND
OVER AGAIN ABOUT THE GRIDLOCK
AT THE PARENT OFFICE WHICH IS
SUPPOSEDLY -- AT THE PATENT
OFFICE WHICH IS SUPPOSEDLY WHAT
WE'RE TRYING TO CORRECT WITH
THIS LEGISLATION, H.R. 1249,
WHICH I HAVE BEEN CONTENDING IT
DOES NOT HELP THE PATENT OFFICE
BUT TO HARMONIZE AMERICAN LAW
WITH THE REST OF THE WORLD AND
MAKE IT WEAKER PATENT
PROTECTION FOR OUR PEOPLE.
WHAT DOES IT DO ABOUT THE
BACKLOG IF THAT'S REALLY WHAT
PEOPLE ARE CONCERNED ABOUT?
H.R. 1249 WOULD ACTUALLY
TREMENDOUSLY ADD TO THE P.T.O.
BACKLOG BY REQUIRING FURTHER
POSTGRANT REVIEW PROCEEDINGS AT
THE PATENT OFFICE.
PROCEEDINGS WHICH WOULD CONSUME
EVEN MORE LIMITED PERSONNEL AND
MONEY.
ADDED PROCEDURES AT THE P.T.O.,
AT THE P.T.O., AT THE PATENT
OFFICE, AND IT WOULD ALSO DO
WHAT?
IT WOULD BREAK THE BACKS OF
SMALL INVENTORS AND STARTUP
COMPANIES WHO ARE TRYING TO GET
A NEW PRODUCT ON THE MARKET.
IT WOULD EMPURE POWER THE
MULTINATIONAL -- EMPOWER THE
MULTINATIONAL AND FOREIGN
CORPORATIONS.
WE ARE ADDING MORE PROCEDURES
TO GO THROUGH EVEN AFTER THEY
GET THEIR PATENT ISSUED TO
THEM.
THIS IS THE MOST -- THIS IS THE
BIG GUY VERSUS LITTLE GUY
LEGISLATION.
THAT WAS EVEN POINTED OUT BY
THE HOOVER INSTITUTION WHICH
DID AN ANALYSIS OF THIS BILL
AND SAID, AND I QUOTE, THE
AMERICAN INVENTS ACT WILL
PROTECT LARGE ENTRENCHED
COMPANIES AT THE EXPENSE OF
MARKET-CHALLENGING COMPETITORS,
END OF QUOTE.
THIS IS A TRAVESTY.
IT'S AN ATTACK ON AMERICA'S
WELL-BEING BECAUSE WE DEPEND ON
OUR SMALL INVENTORS.
THE KAPTUR-ROHRABACHER LIMITS
THIS NEW BURDEN.
IF WE CAN'T GET RID OF IT WE
CAN DECREASE SOME OF IT TO
COMPANIES WHO HAVE MORE THAN
100 EMPLOYEES.
IT FREES UP THE PATENT OFFICE
PERSON TOLL DO THEIR JOB.
HELPS WITH THAT GRIDLOCK AND
PROTECTS THE SMALL BUSINESS MAN
AND SMALL INVENTORS AT THE SAME
TIME.
I WOULD ASK MY COLLEAGUES TO
SUPPORT THE KAPTUR-ROHRABACHER
AMENDMENT AND YIELD THE BALANCE
OF MY TIME TO MS. KAPTUR.
THE GENTLEWOMAN FROM
OHIO IS RECOGNIZED FOR 2 3/4
MINUTES.
I THANK THE
GENTLEMAN, MR. ROHRABACHER, FOR
YIELDING.
I ASK MY COLLEAGUES TO SUPPORT
THE KAPTUR-ROHRABACHER
AMENDMENT.
THIS LEGISLATION THROWS OUT 220
YEARS OF PATENT PROTECTIONS FOR
INDIVIDUAL INVENTORS.
OUR AMENDMENT ADDRESSES A MAJOR
SHORTCOMING OF THE BILL BY
ELIMINATING THE BURDEN OF
RE-EXAMINATIONS ON INDIVIDUAL
-- INDIVIDUAL INVENTORS AND
SMALL BUSINESSES WITH 100 OR
FEWER EMPLOYEES.
THE NEW PROCEDURES AND
REGULATIONS IN THIS BILL WILL
MAKE IT EXTREMELY DIFFICULT FOR
THE AVERAGE CITIZEN TO EVER GET
A PATENT OR DEFEND ONE WITHOUT
OUR AMENDMENT.
OUR AMENDMENT CLEARLY GIVES THE
PATENT OFFICE THE AUTHORITY TO
ISSUE APPROPRIATE REGULATIONS
THAT ENSURE THAT THE NEW
REGULATORY BURDENS ON THIS BILL
DO NOT DISPROPORTIONATELY
IMPACT INDIVIDUAL INVENTORS.
THIS IS ABOUT ENSURING FAIRNESS
FOR SMALL INVENTORS.
WE URGE OUR COLLEAGUES TO
SUPPORT THE KAPTUR-ROHRABACHER
AMENDMENT SO THAT EVERYONE IN
AMERICA CAN REALIZE THEIR
DREAMS.
IN REALIZING THEIR DREAMS,
ASSURING THAT WE WILL HAVE
ROBUST INNOVATION AND JOB
CREATION IN OUR COUNTRY, AND
I'D LIKE TO YIELD BACK MY
REMAINING TIME TO THE FINE
GENTLEMAN FROM CALIFORNIA.
HOW MUCH TIME
IS LEFT, MADAM CHAIR?
THE GENTLEMAN HAS 1
1/2 MINUTES REMAINING.
LET ME NOTE,
THIS AMENDMENT EMPOWERS OUR
AMENDMENT EMPOWERS THE DIRECTOR
OF THE PATENT OFFICE TO HAVE
THIS 100-EMPLOYEE STANDARD TO
OTHER SMALL BUSINESSES AND
INDIVIDUAL INVENTORS OVERSEAS.
IF IT REQUIRES -- IF THIS IS
REQUIRED BY A TREATY, YES,
INVENTORS OVERSEAS.
SMALL BUSINESSES AND INDIVIDUAL
SO OUR AMENDMENT DOES NOTHING
TO VIOLATE ANY TREATY
OBLIGATIONS BY GIVING OUR OWN
PEOPLE SPECIAL RIGHTS OVER
FOREIGN INDIVIDUALS.
WHAT IT DOES DO, HOWEVER, IS
PREVENT FOREIGN CORPORATIONS
FROM GRINDING DOWN OUR
INVENTORS HERE LIKE THEY GRIND
DOWN THEIR INVENTORS OVERSEAS.
THIS IS WHAT WE'RE DOING TO
PREVENT A HARMONIZATION OF OUR
LAWS BECAUSE WE DON'T WANT
WEAKER PATENT PROTECTION FOR
OUR PEOPLE AGAINST -- THEY
ALREADY GOT IT OVERSEAS AGAINST
THEIR FOREIGN CORPORATIONS THAT
GRIND THEM DOWN.
WE WANT TO PROTECT OUR OWN
PEOPLE, AND I RESERVE THE
BALANCE OF MY TIME.
THE GENTLEMAN
RESERVES THE BALANCE OF HIS
TIME.
THE GENTLEMAN FROM TEXAS.
MADAM CHAIR, I RISE
IN OPPOSITION TO THE AMENDMENT.
THE GENTLEMAN IS
RECOGNIZED.
MADAM CHAIR, ALMOST
EVERYONE IN CONGRESS WANTS TO
HELP SMALL BUSINESSES.
THEY HAVE A FOUNDATION OF OUR
ECONOMY AND THE PRIMARY JOB
CREATORS.
BUT THIS AMENDMENT INCLUDES
CERTAIN TERMS OR PHRASES THAT
HAVE NOTHING TO DO WITH THE
UNDERLYING GOAL THAT IT
PURPORTS TO ACHIEVE.
THIS AMENDMENT APPEARS TO FOCUS
ON THE SMALL BUSINESSES, BUT IN
REALITY THE AMENDMENT ATTEMPTS
TO HAVE THE TRIAL LAWYER AND
LOBBY WITH EXEMPTION FROM
P.T.O. RE-EXAMINATION, ALLOWING
THEM TO CONTINUE SUING JOB
CREATORS USING FRIVOLOUS OR
QUESTIONABLE PATENTS.
THIS AMENDMENT HAS NOTHING TO
DO WITH SMALL BUSINESSES AND
EVERYTHING TO DO WITH PROVIDING
AN EXEMPTION FROM SOME OF THE
WORST OFFENDERS OF OUR PATENT
SYSTEM.
THIS AMENDMENT WILL NOT HELP
INDEPENDENT INVENTORS OR SMALL
BUSINESSES.
SMALL BUSINESSES NEED THE
P.T.O. RE-EXAMINATION
PROCEEDINGS.
THOSE PROCEEDINGS STRENGTHENS
PATENTS AND THEY ARE WHAT THEY
LOOK FOR WHEN DECIDING WHETHER
OR NOT TO PROVIDE CAPITAL
VENTURE FUNDING.
IT HARASSES OR HURTS SMALL
BUSINESSES IS JUST PLAIN WRONG.
THE RE-EXAMINED PROCEEDINGS ARE
A QUICKER, CHEAPER WAY.
IF IS RUN INTO THE MILLIONS OF
DOLLARS AND LAST FOR YEARS.
THIS AMENDMENT IS AN IMMUNITY
AGREEMENT FOR PATENT CONTROLS,
THOSE ENTITIES WHO DO NOT
CREATE JOBS OR INNOVATION BUT
SIMPLY GAIN THE LEGAL SYSTEM.
ADDITIONALLY, THIS AMENDMENT
APPEARS TO VIOLATE OUR
INTERNATIONAL OBLIGATION UNDER
THE TRIPS AGREEMENT.
WE ARE SAID TO NOT DISCRIMINATE
OF ANY CATEGORIES OF PATENT
HOLDERS.
BY PROVIDING AN EXEMPTION FROM
ALL RE-EXAMINATION PROCEEDINGS
FOR TECH KNOWINGLOGICAL PATENTS
OR NONPRACTICING ENTITIES THIS
WOULD CREATE A CLEAR VIOLATION
OF OUR LEGAL OBLIGATIONS.
OUR PATENT SYSTEM SHOULD BE
DESIGNED TO ENSURE THAT IT
PRODUCES STRONG PATENTS AND
PATENT CERTAINTY.
THE P.T.O. RE-EXAMINATION
PROCEEDINGS HELP ENSURE THAT
THESE IMPORTANT GOALS ARE
ACCOMPLISHED.
THIS AMENDMENT BARS ANY FORM OF
RE-EXAMINE FOR U.S.-OWNED
PATENTS AND THUS WOULD ALSO
PREVENT U.S. INVENTORS
THEMSELVES FROM USING
SUPPLEMENTAL EXAMINATION TO
EVEN BE ABLE TO CORRECT ERRORS
IN THE RECORD ABOUT THEIR OWN
PATENTS.
THIS AMENDMENT CREATES A HUGE
LOOPHOLE IN OUR PATENT SYSTEM
BY ENTITY WITH 100 OR FEWER
EMPLOYEES.
THIS WOULD NOT HELP SMALL
BUSINESSES BUT WILL ALLOW
PATENT TROL ENTITIES, FOREIGN
COMPANIES AND FOREIGN
GOVERNMENTS TO MANIPULATE OUR
PATENT SYSTEM.
IT WOULD BAR USE OF THE
BUSINESS METHOD'S TRANSITIONAL
PROCEEDINGS AGAINST MOST
PATENTS.
THIS AMENDMENT IS A RECIPE FOR
ALLOWING PATENT TROLS AND
FOREIGN COMPANIES AND
GOVERNMENTS TO BYPASS NORMAL,
POSTGRANT CHALLENGES AND
ENABLES WEAK OR QUESTIONABLE
PATENTS TO BYPASS FURTHER
SCRUTINY.
THERE IS NO LEGITIMATE PUBLIC
POLICY OBJECTIVE IN EXEMPTING
LARGE NUMBERS OF THOSE WHO
MANIPULATE OUR PATENT SYSTEM
FROM THE RULES OF THE ROAD.
IT IS FOR THESE REASONS THAT I
STRONGLY OPPOSE THIS AMENDMENT.
AND, MADAM CHAIR, I'LL NOW
YIELD THE BALANCE OF MY TIME TO
THE GENTLEMAN FROM VIRGINIA,
MR. GOODLATTE.
THE GENTLEMAN FROM
VIRGINIA IS RECOGNIZED FOR TWO
MINUTES.
MADAM CHAIRMAN,
I RISE IN STRONG OPPOSITION TO
THIS AMENDMENT WHICH IS A BAD
IDEA.
POSTGRANT REVIEW IS ONE OF THE
MOST IMPORTANT PROVISIONS IN
THIS BILL.
IT ALLOWS THIRD PARTIES FOR A
LIMITED WINDOW OF NINE MONTHS
AFTER A PATENT IS ISSUED TO
SUBMIT EVIDENCE THAT THE PATENT
SHOULD NOT HAVE BEEN GRANTED IN
THE FIRST PLACE.
THIS ALLOWS THIRD PARTIES, MANY
OF WHOM WILL BE SMALL
BUSINESSES THEMSELVES WHO ARE
FAMILIAR WITH THE SUBJECT
MATTER TO PROVIDE A CHECK ON
PATENT EXAMINERS.
IF THE EVIDENCE SHOWS THAT THE
PATENT IS INDEED INVALID, THEN
THE PANT APPLICANT SHOULD HAVE
NEVER -- THEN THE PATENT
APPLICANT SHOULD HAVE NEVER
RECEIVED THE PATENT IN THE
FIRST PLACE.
IT IS MADE STRONGER BY
SURVIVING A POSTGRANT REVIEW.
THE AMENDMENT WOULD EXEMPT
SMALL BUSINESSES FROM THE
POSTGRANT OPPOSITION
PROCEEDING.
HOWEVER, THE QUALITY OF A
PATENT EXAMINATION DOES NOT
HINGE ON THE SIZE OF THE
APPLICANT.
WHETHER IT'S A SMALL BUSINESS,
AN INDEPENDENT INVENTOR OR A
LARGE CORPORATION.
IT HINGES ON THE P.T.O.'S JOB
OF SCRUTINIZING THAT PATENT.
A BOGUS PATENT HELD BY AN
INDEPENDENT INVENTOR IS NO LESS
DESERVING OF A SECOND LOOK THAN
A BOGUS PATENT HELD BY A
FORTUNE 500 COMPANY.
FOR THESE REASONS I URGE
OPPOSITION TO THIS VERY BAD
AMENDMENT.
AND I RESERVE THE BALANCE OF MY
TIME.
I YIELD BACK.
THE GENTLEMAN YIELDS
BACK.
THE GENTLEMAN FROM CALIFORNIA
HAS 30 SECONDS REMAINING.
I YIELD 30
SECONDS TO MS. KAPTUR.
THE GENTLEWOMAN IS
RECOGNIZED.
I'D LIKE TO REFUTE
MR. SMITH'S ARGUMENT.
IT SAYS IT WILL VIOLATE W.T.O.
OBLIGATIONS, SPECIFICALLY
CITING TRIP.
HE SEEMS TO OBJECT TO THE USE
OF REFERENCES TO AMERICAN
CITIZENS AND U.S. COMPANIES,
BUT OBVIOUSLY FAILED TO READ
THE ENTIRE AMENDMENT WHICH
ALLOWS THE PATENT OFFICE TO
ISSUE RELEVANT REGULATIONS.
AND IF HE WAS CONCERNED ABOUT
W.T.O. COMPLIANCE HE SHOULD
STRIKE A SECTION OF HIS BILL
WHICH IS W.T.O. NONCOMPLIANT
BECAUSE IT CREATES A SPECIAL
CLASS FOR ONLY ONE INDUSTRY,
THE BANKING INDUSTRY.
I URGE MY COLLEAGUES TO VOTE
AGAINST THE BILL AND FOR THE
ROHRABACHER-KAPTUR AMENDMENT.
ALL TIME HAS
EXPIRED.
THE QUESTION IS ON THE
AMENDMENT OFFERED BY THE
GENTLEMAN FROM CALIFORNIA.
THOSE IN FAVOR SAY AYE.
IN THE OPINION OF THE CHAIR,
THOSE OPPOSED, NO.
THE NOES HAVE IT.
THE AMENDMENT IS NOT ADOPTED.
I'D ASK FOR A
RECORDED VOTE.
PURSUANT TO CLAUSE 6
OF RULE 18, FURTHER PROCEEDINGS
ON THE AMENDMENT OFFERED BY THE
BE POSTPONED.
GENTLEMAN FROM CALIFORNIA WILL
IT IS NOW IN ORDER TO CONSIDER
AMENDMENT NUMBER 15 PRINTED IN
PART B OF HOUSE REPORT 112-111.
FOR WHAT PURPOSE DOES THE
GENTLEMAN FROM ILLINOIS RISE?
THANK YOU, MADAM
CHAIR WOMAN.
DESK.
I HAVE AN AMENDMENT AT THE
THE CLERK WILL
DESIGNATE THE AMENDMENT.
AMENDMENT NUMBER 15
PRINTED IN PART B OF HOUSE
REPORT 112-111 OFFERED BY MR.
SCHOCK OF ILLINOIS.
PURSUANT TO HOUSE
RESOLUTION 316, THE GENTLEMAN
FROM ILLINOIS, MR. SCHOCK, AND
A MEMBER OPPOSED, EACH WILL
CONTROL FIVE MINUTES.
THE CHAIR RECOGNIZES THE
GENTLEMAN FROM ILLINOIS.
THANK YOU, MADAM
CHAIR WOMAN.
WELL, I THOUGHT WHEN WE STARTED
THIS CONGRESS WE'D AGREE TO NO
MORE EARMARKS, NO MORE
HANDOUTS, NO MORE SPECIAL
PRIVILEGES FOR ANY SPECIFIC
INDUSTRY.
BASED ON READING HOUSE
RESOLUTION 249, IT'S OBVIOUS TO
SEE IT INCLUDES CONTROVERSIAL
LANGUAGE WHICH DOES JUST THAT.
SECTION 18, WHICH SETS FORWARD
A NEW AND DIFFERENT PROCESS FOR
CERTAIN BUSINESS METHOD PATENTS
FOR ANY OTHER PATENT SEEKING
APPROVAL.
SECTION 18 CARVES OUT A NICHE
OF BUSINESS METHOD PATENTS
COVERING TECHNOLOGY USED
SPECIFICALLY IN THE FINANCIAL
INDUSTRY AND WOULD CREATE A
SPECIAL CLASS OF PATENTS IN THE
FINANCIAL SERVICES FIELD
SUBJECT TO THEIR OWN
DISTINCTIVE POSTGRANT
ADMINISTRATIVE REVIEW.
THIS NEW PROCESS ALLOWS FOR
RETROACT OF REVIEWS OF ALREADY
PROVEN PATENTS THAT HAVE
UNDERGONE INITIAL SCRUTINY,
IN COURT.
REVIEW AND HAVE EVEN BEEN UPHELD
NOW THESE PATENTS WILL BE
SUBJECTED TO AN UNPRECEDENTED
NEW LEVEL OF INTERROGATION.
NOW, THE OTHER SIDE WILL ARGUE
THAT SOMEHOW MAGICALLY A NUMBER
OF THESE FINANCIALLY RELATED
PATENTS BREEZE THROUGH THE
PATENT OFFICE AND THUS MUST BE
REVIEWED.
WELL, NOTHING COULD BE FURTHER
FROM THE TRUTH.
IN FACT, THE ALLOWANCE RATE FOR
THESE BUSINESS METHOD PATENTS IS
THE SMALLEST OF ANY OF THE ART
FORMS.
IN FACT, ROUGHLY 10% OF THOSE
BUSINESS PATENTS APPLIED FOR ARE
ACTUALLY APPROVED.
AT A TIME WHEN THESE SMALL
ENTREPRENEURS AND INNOVATORS
NEED TO BE DEDICATING THE
RESOURCES AND NEW ADVANCEMENTS
TO INNOVATION, THEY WILL INSTEAD
BECAUSE OF SECTION 18 BE
REQUIRED TO DIVERT RESEARCH
FUNDS TO LAWYERS TO FIGHT THE
DEEP POCKETS OF WALL STREET WHO
WILL NOW ATTEMPT TO ATTACK THEIR
RIGHT TO HOLD THESE FINANCIALLY
RELATED PATENTS.
WITH THAT, MADAM CHAIR, I WOULD
THE GENTLEMAN
RESERVE THE BALANCE OF MY TIME.
RESERVES THE BALANCE OF HIS
TIME.
THE GENTLEMAN FROM TEXAS.
I CLAIM THE TIME IN
OPPOSITION TO THIS AMENDMENT.
THE GENTLEMAN IS
RECOGNIZED FOR FIVE MINUTES.
MADAM CHAIR, LET ME
YIELD MYSELF ONE MINUTE.
THE GENTLEMAN IS
RECOGNIZED FOR ONE MINUTE.
I STRONGLY OPPOSE
THIS AMENDMENT.
IT STRIKES A USEFUL PROVISION
THAT WOULD PROVIDE A WAY TO
REVIEW THE VALIDITY OF CERTAIN
BUSINESS PATENTS.
THE PROCEEDING WOULD CREATE AN
INEXPENSIVE AND FASTER
ALTERNATIVE TO LITIGATION,
ALLOWING PARTIES TO RESOLVE
THEIR DISPUTES RATHER THAN
SPENDING MILLIONS OF DOLLARS
THAT LITIGATION NOW COST.
IN THE PROCESS, THE PROCEEDING
WOULD ALSO PREVENT NUISANCE OR
EXTORTION LAWSUITS.
THIS PROVISION IS STRONGLY
SUPPORTED BY COMMUNITY BANKS,
CREDIT UNIONS AND OTHER
INSTITUTIONS THAT ARE AN
IMPORTANT SOURCE OF LENDING TO
HOMEOWNERS AND SMALL BUSINESSES.
FINDING THIS BILL ONLY CREATES A
NEW MECHANISM FOR REVIEWING THE
VALIDITY OF BUSINESS METHOD
PATENTS.
IT DOES NOT ALTER THE VALIDITY
OF THOSE PATENTS.
UNDER SETTLED PRECEDENT, THE
TRANSITIONAL REVIEW PROGRAM IS
ABSOLUTELY CONSTITUTIONAL.
I NOW YIELD ONE MINUTE TO THE
GENTLEMAN FROM NEW YORK, MR.
GRIMM, WHO IS A MEMBER OF THE
FINANCIAL SERVICES COMMITTEE.
THE GENTLEMAN FROM
NEW YORK IS RECOGNIZED FOR ONE
MINUTE.
THANK YOU.
I RISE TODAY TO ENCOURAGE MY
COLLEAGUES TO OPPOSE THE SCHOCK
AMENDMENT.
A CRACKDOWN ON LOW QUALITY
BUSINESS METHOD PATENTS WHICH
HAVE WEAKENED THE PATENT SYSTEM
AND COST COMPANIES AND THEIR
CUSTOMERS MILLIONS OF DOLLARS.
INFAMOUS PATENT PETROLEUMS,
PEOPLE WHO AGGRESSIVELY TRY TO
ENFORCE PATENTS THROUGH COURTS
AND FRIENDLY VENUES HAVE MADE
BUSINESS METHOD PATENTS THEIR
SPECIALTY IN RECENT YEARS.
THESE SAME PATENT TROLLS HAVE
FUNDED AN ELABORATE PROPAGANDA.
LET US SIMPLY SET THE RECORD
STRAIGHT, SECTION 18 ALLOWS
PATENT EXPERTS TO RE-EXAMINE
THROUGH TEMPORARY PILOT PROGRAMS
LEGALLY QUESTIONABLE BUSINESS
METHOD PATENTS.
A PROBLEM THAT THE PATENT OFFICE
HAS ALREADY SAID IT IS READY AND
WILLING TO TACKLE.
OPPONENTS HAVE ASSERTED THAT THE
MEASURE WOULD HELP ONLY THE
BANKS.
THIS ISN'T TRUE.
NATIONAL RETAIL FEDERATION AND
THE U.S. CHAMBER OF COMMERCE
HAVE ENDORSED THIS PROVISION.
COMPANIES IMPACTED INCLUDE
MCDONALD'S, WAL-MART, COSTCO,
HOME DEE TOE, BEST BUY AND LOWS
-- LOWES.
THESE DON'T SOUND LIKE BANKS TO
ME.
OPPONENTS ALSO CLAIM THIS
SECTION IS UNCONSTITUTIONAL.
I YIELD THE GENTLEMAN
AN ADDITIONAL 15 SECONDS.
THE GENTLEMAN IS
RECOGNIZED FOR AN ADDITIONAL 15
SECONDS.
THANK YOU.
AGAIN, THERE HAS BEEN A
TREMENDOUS PROPAGANDA CAMPAIGN
BASICALLY TO SELL UNTRUTHS THAT
WE SIMPLY NEED TO GET PAST.
THE TRUTH IS THIS IS BEST FOR
THE SMALL GUY.
IF WE REALLY CARE ABOUT THE
SMALL INVENTORS THAT CREATE
INNOVATION IN THIS COUNTRY, THEN
WE SHOULD OPPOSE THIS AMENDMENT.
THANK YOU AND I YIELD BACK.
THE GENTLEMAN'S TIME
HAS EXPIRED.
THE GENTLEMAN FROM ILLINOIS.
I YIELD ONE MINUTE
TO MY FRIEND, THE CO-SPONSOR OF
THIS AMENDMENT, MS. WATERS FROM
CALIFORNIA.
THE GENTLEWOMAN FROM
CALIFORNIA IS RECOGNIZED FOR ONE
MINUTE.
THANK YOU VERY MUCH,
MADAM CHAIR.
AS A MEMBER OF THE JUDICIARY
COMMITTEE, I RISE IN STRONG
SUPPORT OF THE SCHOCK-
BOREN-WATERS-SENSENBRENNER-FRANK
S-CAPTURE AMENDMENT.
FOR YEARS THE BANKS HAVE TRIED
TO ELIMINATE ABILITIES TO
SMALLER COMPANIES AND INVENTS
THAT ARE HAD PATENTED FINANCIAL
SERVICES RELATED BUSINESS METHOD
PATENTS.
THEY ARE NOW COMING TO CONGRESS
IN HOPES THAT YOU WILL HELP THEM
STEAL A SPECIFIC TYPE OF
INNOVATION AND LEGISLATIVELY
TAKE OTHER FINANCIAL SERVICES
RELATED BUSINESS METHOD PATENTS
18.
REFERENCED IN H.R. 1249, SECTION
THIS IS SIMPLY WRONG.
EELECTED MEMBERS OF CONGRESS
SHOULD NOT ALLOW THE BANKS TO
USE US TO STEAL LEGALLY ISSUED
AND VALID PATENTS.
FINANCIAL SERVICES RELATED
BUSINESS METHOD PATENTS HAVE
SAVED FINANCIAL SERVICES
COMPANIES BILLIONS OF DOLLARS
BUT THAT'S NOT ENOUGH FOR THE
BANKS.
BECAUSE THE BANKS HAVE FAILED AT
EVERY ATTEMPT TO VOID THESE
PATENTS, THEY'RE ATTEMPTING TO
USE THEIR POWER TO WRITE INTO
LAW WHAT THEY COULD NOT ACHIEVE
AT P.T.O. OR IN THE COURT.
DON'T BE TRICKED, DON'T BE
FOOLED AND DON'T BE USED.
I URGE MY COLLEAGUES TO LISTEN
TO THE FLOOR DEBATES.
I YIELD BACK THE BALANCE OF MY
TIME.
THE GENTLEMAN FROM
TEXAS.
I YIELD 1 1/2 MINUTES
TO THE GENTLEMAN FROM NEW YORK,
MR. CROWLEY, WHO IS A MEMBER OF
THE WAYS AND MEANS COMMITTEE.
THE GENTLEMAN FROM
NEW YORK IS RECOGNIZED FOR A
THANK YOU.
MINUTE AND A HALF.
I THANK THE GENTLEMAN FOR
YIELDING ME SUCH TIME.
MADAM SPEAKER, I RISE IN STRONG
OPPOSITION TO THE AMENDMENT THAT
WOULD ELIMINATE SECTION 18 OF
BILL.
THE UNDERLYING PATENT REFORM
SECTION 18 EMPOWERS THE PATENT
AND TRADEMARK OFFICE TO REVIEW
THE VALIDITY OF SO-CALLED
BUSINESS METHOD PATENTS.
THIS LANGUAGE WAS DRAFTED IN
CLOSE COOPERATION WITH THE
PATENT AND TRADEMARK OFFICE AND
THE DEPARTMENT OF COMMERCE.
IT ALSO ENJOYS THE WIDE
BIPARTISAN SUPPORT OF THE
JUDICIARY COMMITTEE WHICH
DEFEATED THE SIMILAR AMENDMENT
DURING COMMITTEE CONSIDERATION
OF THIS BILL.
FURTHER, THIS AMENDMENT DOES NOT
HURT ANY LEGITIMATE INVENTORS.
IT ONLY ALLOWS FOR THE REVIEW OF
ABSTRACT PATENTS ISSUED SINCE
1998, WHEN THE FEDERAL COURT
RULED THAT BUSINESS METHODS
COULD BE PATENTED.
A RULING WHICH THE U.S. SUPREME
COURT LIMITED SIGNIFICANTLY LAST
YEAR.
WERE THESE -- WHAT ARE THESE
METHODS I'M TALKING ABOUT?
IN ONE CASE A BUSINESS METHOD
PATENT WAS ISSUED FOR A DATA
PACT TRANSFERRING COMPUTER
NETWORK.
ONCE OBTAINED, THE PATENT HOLDER
SUED THE RED CROSS FOR
SOLICITING CHARITABLE
CONTRIBUTIONS ON THE INTERNET.
ANOTHER EXAMPLE, A PATENT WAS
GRANTED COVERING THE PRINTING OF
MARKETING MATERIALS ON BUILDING
STATEMENTS.
THESE PATENTS AND OTHERS IN THIS
SPACE ARE NOT LEGITIMATE PATENTS
THAT HELP ADVANCE AMERICA.
THEY ARE NUISANCE PATENTS USED
TO SEAL LEGITIMATE BUSINESSES
AND NONPROFIT ORGANIZATIONS LIKE
THE RED CROSS OR ANY OTHER
MERCHANTS WHO ENGAGE IN NORMAL
ACTIVITY THAT SHOULD NEVER BE
PATENTED.
IN FACT, THIS LANGUAGE WILL NOT
GO AFTER ANY LEGITIMATE PATENT,
ONLY ALLOW A REVIEW OF THE
ILLEGITIMATE PATENTS LIKE THOSE
LOOKING TO PATENT THE OFFICE
WATER COOLER DISCUSSION.
NO LEGITIMATE INVENTOR NEEDS TO
WORRY ABOUT A POST GRANT REVIEW
AND I SUBMIT THE REST OF MY
STATEMENT FOR THE RECORD.
THANK YOU.
WITHOUT OBJECTION.
THE GENTLEMAN'S TIME HAS
EXPIRED.
THE CHAIR RECOGNIZES THE
GENTLEMAN FROM ILLINOIS.
THANK YOU, MR.
CHAIRMAN.
I YIELD 30 SECONDS TO MY FRIEND
AND CO-SPONSOR OF THIS
AMENDMENT, MR. BOREN OF
OKLAHOMA.
THE GENTLEMAN FROM
OKLAHOMA IS RECOGNIZED FOR 30
SECONDS.
MR. CHAIRMAN, I RISE
TODAY IN SUPPORT OF THE
AMENDMENT THAT I HAVE
CO-AUTHORED WITH MR. SCHOCK.
DURING MY TIME IN CONGRESS I
HAVE BEEN A CONSISTENT SUPPORTER
OF SMALL BUSINESSES.
HERE ON THE HOUSE FLOOR WE ARE
TOLD NEARLY EVERY DAY THAT SMALL
BUSINESSES ARE THE ENGINE OF OUR
NATION'S ECONOMY.
AND THERE'S NO DISCOUNTING THAT
FACT.
IF INCLUDED IN THE FINAL BILL, I
BELIEVE SECTION 18 WILL POSE A
DEVASTATING THREAT TO AMERICA'S
SMALL BUSINESS COMMUNITY.
BUSINESS METHOD PATENTS ALREADY
ENDURE A LENGTHY APPROVAL
PROCESS.
AND SECTION 18 WOULD ONLY MAKE
IT MORE DIFFICULT FOR INVENTERS
TO DEFEND THEIR PATENTS.
I ASK MY COLLEAGUES TO SUPPORT
THIS AMENDMENT AND I YIELD BACK.
THE GENTLEMAN'S TIME
HAS EXPIRED.
GENTLEMAN FROM TEXAS.
THE CHAIR RECOGNIZES THE
MR. CHAIRMAN, I YIELD
THE BALANCE OF MY TIME TO THE
GENTLEMAN FROM VIRGINIA, MR.
GOODLATTE.
THE GENTLEMAN FROM
VIRGINIA IS RECOGNIZED FOR 1 1/2
--
MINUTES.
1 1/4 MINUTES.
I RISE IN
OPPOSITION TO THIS AMENDMENT.
THERE'S NO DOUBT THAT THE P.T.O.
HAS ISSUED BUSINESS METHOD
OVER THE YEARS.
PATENTS OF QUESTIONABLE MERIT
MANY OF THESE PATENTS ARE STILL
ON THE BOOKS.
UNFORTUNATELY MANY OF THESE
PATENTS ARE BEING USED BY
AGGRESSIVE TRIAL LAWYERS TO
EXTORT MONEY FROM DEEP POCKETS.
SECTION 18 OF THE BILL SIMPLY
CREATES A PROCESS THAT ALLOWS
EXPERTS AT THE P.T.O. TO
RE-EXAMINE THE TYPES OF BUSINESS
METHOD PATENTS THAT THE P.T.O.
BELIEVES TO BE OF THE POOREST
QUALITY.
THIS SECTION WAS DRAFTED IN
CLOSE COORDINATION WITH THE U.S.
P.T.O. AND IS A PILOT PROGRAM
THAT ALLOWS THEM TO REVIEW
CERTAIN BUSINESS METHOD PATENTS
AGAINST THE BEST PRIOR ART IN A
RE-EXAMINATION PROCESS.
WHY WOULD ANYONE OPPOSE A
PROCESS THAT ALLOWS LOW QUALITY
PATENTS TO BE REVIEWED BY THE
EXPERTS?
BUSINESS METHOD PATENTS ON
FINANCIAL ACTIVITIES ARE THE
TYPE OF PATENTS THAT ARE THE
SUBJECT OF LAWSUITS AND ABUSE
MOST OFTEN.
THEY ARE LITIGATED AT A RATE 39
TIMES GREATER THAN ANY OTHER
PATENT.
SECTION 18 IS DESIGNED TO
CORRECT A FUNDAMENTAL FLAW IN
THE SYSTEM THAT IS COSTING
CONSUMERS MILLIONS EACH YEAR.
THE PROVISION IS SUPPORTED BY A
BROAD BIPARTISAN COALITION THAT
INCLUDES THE U.S. CHAMBER OF
COMMERCE AND I URGE MEMBERS TO
REJECT THIS AMENDMENT WHICH
STRIKES AN IMPORTANT LITIGATION
REFORM PROVISION OF THE
UNDERLYING BILL.
THE GENTLEMAN YIELDS
BACK THE BALANCE OF HIS TIME.
MARRIAGE, I YIELD
BACK THE BALANCE OF MY TIME.
THE GENTLEMAN FROM
TEXAS YIELDS BACK THE BALANCE OF
HIS TIME.
THE CHAIR RECOGNIZES THE
GENTLEMAN FROM ILLINOIS.
I'D LIKE TO INQUIRE
ABOUT MY TIME REMAINING.
THE GENTLEMAN FROM
ILLINOIS HAS 1 1/2 MINUTES
REMAINING.
THANK YOU.
I WOULD NOW YIELD ONE MINUTE TO
MY FRIEND FROM CALIFORNIA, MR.
LUNGREN.
THE GENTLEMAN FROM
CALIFORNIA IS RECOGNIZED FOR ONE
MINUTE.
THANK YOU VERY
MUCH, MR. CHAIRMAN.
I MIGHT JUST SAY THAT IN ANSWER
TO THE QUESTION RAISED BY MY
FRIEND FROM VIRGINIA, WHY WOULD
ANYBODY OPPOSE THIS, IT IS
BECAUSE OF THE CONSTITUTION.
THIS PROVISION, SECTION 18, IS
CLEARLY VIALTIVE OF THE
CONSTITUTION.
IT WOULD HAVE YOU BELIEVE THAT
YOU CAN GO TO COURT, GO TO COURT
, AN ARTICLE 3 COURT, AND HAVE A
FINAL DECISION, A FINAL JUDGMENT
RENDERED BY A COURT, INCLUDING A
JURY, AND THEN AFTER THAT, NOT
AN APPEAL TO AN APPELLATE COURT
BUT AN APPEAL SOMEHOW BACK TO
THE ADMINISTRATIVE AGENCY?
DOES ANYBODY SENSE THERE'S A
VIOLATION OF THE SEPARATION OF
POWERS?
DOES ANYBODY UNDERSTAND WHAT THE
COURT SAID IN THE PLOUT CASE
WHICH SAID THE CONSTITUTION
GIVES THE FEDERAL JUDICIARY THE
POWER TO NOT MERELY RULE ON
CASES BUT DECIDE THEM SUBJECT TO
REVIEW ONLY BY SUPERIOR COURTS
IN ARTICLE 3 HIERARCHY?
YOU CAN ARGUE ALL YOU WANT, BUT
SAYS.
THAT'S WHAT THE SUPREME COURT
THIS IS AN OBVIOUS PLATENT
VIOLATION OF THE CONSTITUTION --
CONSTITUTION.
PLATENT VIOLATION OF THE
THAT'S THE ANSWER TO MY FRIENDS
WHO SAY WE HAVE TO HAVE THIS
PROVISION.
YES, IT MAY BE THAT THE U.S.
CONSTITUTION IS THE INCONVENIENT
TRUTH HERE.
WE'RE NOT ALLOWED TO VIOLATE IT
EVEN THOUGH WE DO IT WITH BEST
OF INTENTIONINGS.
THE GENTLEMAN'S TIME
HAS EXPIRED.
RECOGNIZED.
THE GENTLEMAN FROM ILLINOIS IS
THANK YOU, MR.
CHAIRMAN.
I YIELD MYSELF THE BALANCE OF
THE TIME.