S. 23 | America Invents Act | U.S. Senate Bill

S 23
3-8-11, Senate Passed Bill w/ Amendment, 95-5
3-9-11, Held at Desk

112th CONGRESS
1st Session

S. 23

AN ACT

To amend title 35, United States Code, to provide for patent reform.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title- This Act may be cited as the `America Invents Act'.

(b) Table of Contents- The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. First inventor to file.

Sec. 3. Inventor's oath or declaration.

Sec. 4. Virtual marking and advice of counsel.

Sec. 5. Post-grant review proceedings.

Sec. 6. Patent Trial and Appeal Board.

Sec. 7. Preissuance submissions by third parties.

Sec. 8. Venue.

Sec. 9. Fee setting authority.

Sec. 10. Supplemental examination.

Sec. 11. Residency of Federal Circuit judges.

Sec. 12. Micro entity defined.

Sec. 13. Funding agreements.

Sec. 14. Tax strategies deemed within the prior art.

Sec. 15. Best mode requirement.

Sec. 16. Technical amendments.

Sec. 17. Clarification of jurisdiction.

Sec. 18. Transitional program for covered business-method patents.

Sec. 19. Travel expenses and payment of administrative judges.

Sec. 20. Patent and Trademark Office funding.

Sec. 21. Satellite offices.

Sec. 22. Patent Ombudsman Program for small business concerns.

Sec. 23. Priority examination for technologies important to American competitiveness.

Sec. 24. Designation of Detroit satellite office.

Sec. 25. Effective date.

Sec. 26. Budgetary effects.

SEC. 2. FIRST INVENTOR TO FILE.

(a) Definitions- Section 100 of title 35, United States Code, is amended by adding at the end the following:

`(f) The term `inventor' means the individual or, if a joint invention, the individuals collectively who invented or discovered the subject matter of the invention.

`(g) The terms `joint inventor' and `coinventor' mean any 1 of the individuals who invented or discovered the subject matter of a joint invention.

`(h) The term `joint research agreement' means a written contract, grant, or cooperative agreement entered into by 2 or more persons or entities for the performance of experimental, developmental, or research work in the field of the claimed invention.

`(i)(1) The term `effective filing date' of a claimed invention in a patent or application for patent means--

`(A) if subparagraph (B) does not apply, the actual filing date of the patent or the application for the patent containing a claim to the invention; or

`(B) the filing date of the earliest application for which the patent or application is entitled, as to such invention, to a right of priority under section 119, 365(a), or 365(b) or to the benefit of an earlier filing date under section 120, 121, or 365(c).

`(2) The effective filing date for a claimed invention in an application for reissue or reissued patent shall be determined by deeming the claim to the invention to have been contained in the patent for which reissue was sought.

`(j) The term `claimed invention' means the subject matter defined by a claim in a patent or an application for a patent.'.

(b) Conditions for Patentability-

(1) IN GENERAL- Section 102 of title 35, United States Code, is amended to read as follows:

`Sec. 102. Conditions for patentability; novelty

`(a) Novelty; Prior Art- A person shall be entitled to a patent unless--

`(1) the claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention; or

`(2) the claimed invention was described in a patent issued under section 151, or in an application for patent published or deemed published under section 122(b), in which the patent or application, as the case may be, names another inventor and was effectively filed before the effective filing date of the claimed invention.

`(b) Exceptions-

`(1) DISCLOSURES MADE 1 YEAR OR LESS BEFORE THE EFFECTIVE FILING DATE OF THE CLAIMED INVENTION- A disclosure made 1 year or less before the effective filing date of a claimed invention shall not be prior art to the claimed invention under subsection (a)(1) if--

`(A) the disclosure was made by the inventor or joint inventor or by another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor; or

`(B) the subject matter disclosed had, before such disclosure, been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor.

`(2) DISCLOSURES APPEARING IN APPLICATIONS AND PATENTS- A disclosure shall not be prior art to a claimed invention under subsection (a)(2) if--

`(A) the subject matter disclosed was obtained directly or indirectly from the inventor or a joint inventor;

`(B) the subject matter disclosed had, before such subject matter was effectively filed under subsection (a)(2), been publicly disclosed by the inventor or a joint inventor or another who obtained the subject matter disclosed directly or indirectly from the inventor or a joint inventor; or

`(C) the subject matter disclosed and the claimed invention, not later than the effective filing date of the claimed invention, were owned by the same person or subject to an obligation of assignment to the same person.

`(c) Common Ownership Under Joint Research Agreements- Subject matter disclosed and a claimed invention shall be deemed to have been owned by the same person or subject to an obligation of assignment to the same person in applying the provisions of subsection (b)(2)(C) if--

`(1) the subject matter disclosed was developed and the claimed invention was made by, or on behalf of, 1 or more parties to a joint research agreement that was in effect on or before the effective filing date of the claimed invention;

`(2) the claimed invention was made as a result of activities undertaken within the scope of the joint research agreement; and

`(3) the application for patent for the claimed invention discloses or is amended to disclose the names of the parties to the joint research agreement.

`(d) Patents and Published Applications Effective as Prior Art- For purposes of determining whether a patent or application for patent is prior art to a claimed invention under subsection (a)(2), such patent or application shall be considered to have been effectively filed, with respect to any subject matter described in the patent or application--

`(1) if paragraph (2) does not apply, as of the actual filing date of the patent or the application for patent; or

`(2) if the patent or application for patent is entitled to claim a right of priority under section 119, 365(a), or 365(b), or to claim the benefit of an earlier filing date under section 120, 121, or 365(c), based upon 1 or more prior filed applications for patent, as of the filing date of the earliest such application that describes the subject matter.'.

(2) CONTINUITY OF INTENT UNDER THE CREATE ACT- The enactment of section 102(c) of title 35, United States Code, under the preceding paragraph is done with the same intent to promote joint research activities that was expressed, including in the legislative history, through the enactment of the Cooperative Research and Technology Enhancement Act of 2004 (Public Law 108-453; the `CREATE Act'), the amendments of which are stricken by subsection (c). The United States Patent and Trademark Office shall administer section 102(c) of title 35, United States Code, in a manner consistent with the legislative history of the CREATE Act that was relevant to its administration by the United States Patent and Trademark Office.

(3) CONFORMING AMENDMENT- The item relating to section 102 in the table of sections for chapter 10 of title 35, United States Code, is amended to read as follows:

`102. Conditions for patentability; novelty.'.

(c) Conditions for Patentability; Nonobvious Subject Matter- Section 103 of title 35, United States Code, is amended to read as follows:

`Sec. 103. Conditions for patentability; nonobvious subject matter

`A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains. Patentability shall not be negated by the manner in which the invention was made.'.

(d) Repeal of Requirements for Inventions Made Abroad- Section 104 of title 35, United States Code, and the item relating to that section in the table of sections for chapter 10 of title 35, United States Code, are repealed.

(e) Repeal of Statutory Invention Registration-

(1) IN GENERAL- Section 157 of title 35, United States Code, and the item relating to that section in the table of sections for chapter 14 of title 35, United States Code, are repealed.

(2) REMOVAL OF CROSS REFERENCES- Section 111(b)(8) of title 35, United States Code, is amended by striking `sections 115, 131, 135, and 157' and inserting `sections 131 and 135'.

(3) EFFECTIVE DATE- The amendments made by this subsection shall take effect 18 months after the date of the enactment of this Act, and shall apply to any request for a statutory invention registration filed on or after that date.

(f) Earlier Filing Date for Inventor and Joint Inventor- Section 120 of title 35, United States Code, is amended by striking `which is filed by an inventor or inventors named' and inserting `which names an inventor or joint inventor'.

(g) Conforming Amendments-

(1) RIGHT OF PRIORITY- Section 172 of title 35, United States Code, is amended by striking `and the time specified in section 102(d)'.

(2) LIMITATION ON REMEDIES- Section 287(c)(4) of title 35, United States Code, is amended by striking `the earliest effective filing date of which is prior to' and inserting `which has an effective filing date before'.

(3) INTERNATIONAL APPLICATION DESIGNATING THE UNITED STATES: EFFECT- Section 363 of title 35, United States Code, is amended by striking `except as otherwise provided in section 102(e) of this title'.

(4) PUBLICATION OF INTERNATIONAL APPLICATION: EFFECT- Section 374 of title 35, United States Code, is amended by striking `sections 102(e) and 154(d)' and inserting `section 154(d)'.

(5) PATENT ISSUED ON INTERNATIONAL APPLICATION: EFFECT- The second sentence of section 375(a) of title 35, United States Code, is amended by striking `Subject to section 102(e) of this title, such' and inserting `Such'.

(6) LIMIT ON RIGHT OF PRIORITY- Section 119(a) of title 35, United States Code, is amended by striking `; but no patent shall be granted' and all that follows through `one year prior to such filing'.

(7) INVENTIONS MADE WITH FEDERAL ASSISTANCE- Section 202(c) of title 35, United States Code, is amended--

(A) in paragraph (2)--

(i) by striking `publication, on sale, or public use,' and all that follows through `obtained in the United States' and inserting `the 1-year period referred to in section 102(b) would end before the end of that 2-year period'; and

(ii) by striking `the statutory' and inserting `that 1-year'; and

(B) in paragraph (3), by striking `any statutory bar date that may occur under this title due to publication, on sale, or public use' and inserting `the expiration of the 1-year period referred to in section 102(b)'.

(h) Derived Patents- Section 291 of title 35, United States Code, is amended to read as follows:

`Sec. 291. Derived patents

`(a) In General- The owner of a patent may have relief by civil action against the owner of another patent that claims the same invention and has an earlier effective filing date if the invention claimed in such other patent was derived from the inventor of the invention claimed in the patent owned by the person seeking relief under this section.

`(b) Filing Limitation- An action under this section may only be filed within 1 year after the issuance of the first patent containing a claim to the allegedly derived invention and naming an individual alleged to have derived such invention as the inventor or joint inventor.'.

(i) Derivation Proceedings- Section 135 of title 35, United States Code, is amended to read as follows:

`Sec. 135. Derivation proceedings

`(a) Institution of Proceeding- An applicant for patent may file a petition to institute a derivation proceeding in the Office. The petition shall set forth with particularity the basis for finding that an inventor named in an earlier application derived the claimed invention from an inventor named in the petitioner's application and, without authorization, the earlier application claiming such invention was filed. Any such petition may only be filed within 1 year after the first publication of a claim to an invention that is the same or substantially the same as the earlier application's claim to the invention, shall be made under oath, and shall be supported by substantial evidence. Whenever the Director determines that a petition filed under this subsection demonstrates that the standards for instituting a derivation proceeding are met, the Director may institute a derivation proceeding. The determination by the Director whether to institute a derivation proceeding shall be final and nonappealable.

`(b) Determination by Patent Trial and Appeal Board- In a derivation proceeding instituted under subsection (a), the Patent Trial and Appeal Board shall determine whether an inventor named in the earlier application derived the claimed invention from an inventor named in the petitioner's application and, without authorization, the earlier application claiming such invention was filed. The Director shall prescribe regulations setting forth standards for the conduct of derivation proceedings.

`(c) Deferral of Decision- The Patent Trial and Appeal Board may defer action on a petition for a derivation proceeding until 3 months after the date on which the Director issues a patent that includes the claimed invention that is the subject of the petition. The Patent Trial and Appeal Board also may defer action on a petition for a derivation proceeding, or stay the proceeding after it has been instituted, until the termination of a proceeding under chapter 30, 31, or 32 involving the patent of the earlier applicant.

`(d) Effect of Final Decision- The final decision of the Patent Trial and Appeal Board, if adverse to claims in an application for patent, shall constitute the final refusal by the Office on those claims. The final decision of the Patent Trial and Appeal Board, if adverse to claims in a patent, shall, if no appeal or other review of the decision has been or can be taken or had, constitute cancellation of those claims, and notice of such cancellation shall be endorsed on copies of the patent distributed after such cancellation.

`(e) Settlement- Parties to a proceeding instituted under subsection (a) may terminate the proceeding by filing a written statement reflecting the agreement of the parties as to the correct inventors of the claimed invention in dispute. Unless the Patent Trial and Appeal Board finds the agreement to be inconsistent with the evidence of record, if any, it shall take action consistent with the agreement. Any written settlement or understanding of the parties shall be filed with the Director. At the request of a party to the proceeding, the agreement or understanding shall be treated as business confidential information, shall be kept separate from the file of the involved patents or applications, and shall be made available only to Government agencies on written request, or to any person on a showing of good cause.

`(f) Arbitration- Parties to a proceeding instituted under subsection (a) may, within such time as may be specified by the Director by regulation, determine such contest or any aspect thereof by arbitration. Such arbitration shall be governed by the provisions of title 9, to the extent such title is not inconsistent with this section. The parties shall give notice of any arbitration award to the Director, and such award shall, as between the parties to the arbitration, be dispositive of the issues to which it relates. The arbitration award shall be unenforceable until such notice is given. Nothing in this subsection shall preclude the Director from determining the patentability of the claimed inventions involved in the proceeding.'.

(j) Elimination of References to Interferences- (1) Sections 41, 134, 145, 146, 154, 305, and 314 of title 35, United States Code, are each amended by striking `Board of Patent Appeals and Interferences' each place it appears and inserting `Patent Trial and Appeal Board'.

(2)(A) Sections 146 and 154 of title 35, United States Code, are each amended--

(i) by striking `an interference' each place it appears and inserting `a derivation proceeding'; and

(ii) by striking `interference' each additional place it appears and inserting `derivation proceeding'.

(B) The subparagraph heading for section 154(b)(1)(C) of title 35, United States Code, as amended by this paragraph, is further amended by--

(i) striking `OR' and inserting `OF'; and

(ii) striking `SECRECY ORDER' and inserting `SECRECY ORDERS'.

(3) The section heading for section 134 of title 35, United States Code, is amended to read as follows:

`Sec. 134. Appeal to the Patent Trial and Appeal Board'.

(4) The section heading for section 146 of title 35, United States Code, is amended to read as follows:

`Sec. 146. Civil action in case of derivation proceeding'.

(5) Section 154(b)(1)(C) of title 35, United States Code, is amended by striking `INTERFERENCES' and inserting `DERIVATION PROCEEDINGS'.

(6) The item relating to section 6 in the table of sections for chapter 1 of title 35, United States Code, is amended to read as follows:

`6. Patent Trial and Appeal Board.'.

(7) The items relating to sections 134 and 135 in the table of sections for chapter 12 of title 35, United States Code, are amended to read as follows:

`134. Appeal to the Patent Trial and Appeal Board.

`135. Derivation proceedings.'.

(8) The item relating to section 146 in the table of sections for chapter 13 of title 35, United States Code, is amended to read as follows:

`146. Civil action in case of derivation proceeding.'.

(k) False Marking-

(1) IN GENERAL- Section 292 of title 35, United States Code, is amended--

(A) in subsection (a), by adding at the end the following:

`Only the United States may sue for the penalty authorized by this subsection.'; and

(B) by striking subsection (b) and inserting the following:

`(b) Any person who has suffered a competitive injury as a result of a violation of this section may file a civil action in a district court of the United States for recovery of damages adequate to compensate for the injury.'.

(2) EFFECTIVE DATE- The amendments made by this subsection shall apply to all cases, without exception, pending on or after the date of the enactment of this Act.

(l) Statute of Limitations-

(1) IN GENERAL- Section 32 of title 35, United States Code, is amended by inserting between the third and fourth sentences the following: `A proceeding under this section shall be commenced not later than the earlier of either 10 years after the date on which the misconduct forming the basis for the proceeding occurred, or 1 year after the date on which the misconduct forming the basis for the proceeding is made known to an officer or employee of the Office as prescribed in the regulations established under section 2(b)(2)(D).'.

(2) REPORT TO CONGRESS- The Director shall provide on a biennial basis to the Judiciary Committees of the Senate and House of Representatives a report providing a short description of incidents made known to an officer or employee of the Office as prescribed in the regulations established under section 2(b)(2)(D) of title 35, United States Code, that reflect substantial evidence of misconduct before the Office but for which the Office was barred from commencing a proceeding under section 32 of title 35, United States Code, by the time limitation established by the fourth sentence of that section.

(3) EFFECTIVE DATE- The amendment made by paragraph (1) shall apply in all cases in which the time period for instituting a proceeding under section 32 of title 35, United State Code, had not lapsed prior to the date of the enactment of this Act.

(m) Small Business Study-

(1) DEFINITIONS- In this subsection--

(A) the term `Chief Counsel' means the Chief Counsel for Advocacy of the Small Business Administration;

(B) the term `General Counsel' means the General Counsel of the United States Patent and Trademark Office; and

(C) the term `small business concern' has the meaning given that term under section 3 of the Small Business Act (15 U.S.C. 632).

(2) STUDY-

(A) IN GENERAL- The Chief Counsel, in consultation with the General Counsel, shall conduct a study of the effects of eliminating the use of dates of invention in determining whether an applicant is entitled to a patent under title 35, United States Code.

(B) AREAS OF STUDY- The study conducted under subparagraph (A) shall include examination of the effects of eliminating the use of invention dates, including examining--

(i) how the change would affect the ability of small business concerns to obtain patents and their costs of obtaining patents;

(ii) whether the change would create, mitigate, or exacerbate any disadvantage for applicants for patents that are small business concerns relative to applicants for patents that are not small business concerns, and whether the change would create any advantages for applicants for patents that are small business concerns relative to applicants for patents that are not small business concerns;

(iii) the cost savings and other potential benefits to small business concerns of the change; and

(iv) the feasibility and costs and benefits to small business concerns of alternative means of determining whether an applicant is entitled to a patent under title 35, United States Code.

(3) REPORT- Not later than 1 year after the date of enactment of this Act, the Chief Counsel shall submit to the Committee on Small Business and Entrepreneurship and the Committee on the Judiciary of the Senate and the Committee on Small Business and the Committee on the Judiciary of the House of Representatives a report regarding the results of the study under paragraph (2).

(n) Report on Prior User Rights-

(1) IN GENERAL- Not later than 1 year after the date of the enactment of this Act, the Director shall report, to the Committee on the Judiciary of the Senate and the Committee on the Judiciary of the House of Representatives, the findings and recommendations of the Director on the operation of prior user rights in selected countries in the industrialized world. The report shall include the following:

(A) A comparison between patent laws of the United States and the laws of other industrialized countries, including members of the European Union and Japan, Canada, and Australia.

(B) An analysis of the effect of prior user rights on innovation rates in the selected countries.

(C) An analysis of the correlation, if any, between prior user rights and start-up enterprises and the ability to attract venture capital to start new companies.

(D) An analysis of the effect of prior user rights, if any, on small businesses, universities, and individual inventors.

(E) An analysis of legal and constitutional issues, if any, that arise from placing trade secret law in patent law.

(F) An analysis of whether the change to a first-to-file patent system creates a particular need for prior user rights.

(2) CONSULTATION WITH OTHER AGENCIES- In preparing the report required under paragraph (1), the Director shall consult with the United States Trade Representative, the Secretary of State, and the Attorney General.

(o) Effective Date-

(1) IN GENERAL- Except as otherwise provided by this section, the amendments made by this section shall take effect on the date that is 18 months after the date of the enactment of this Act, and shall apply to any application for patent, and to any patent issuing thereon, that contains or contained at any time--

(A) a claim to a claimed invention that has an effective filing date as defined in section 100(i) of title 35, United States Code, that is 18 months or more after the date of the enactment of this Act; or

(B) a specific reference under section 120, 121, or 365(c) of title 35, United States Code, to any patent or application that contains or contained at any time such a claim.

(2) INTERFERING PATENTS- The provisions of sections 102(g), 135, and 291 of title 35, United States Code, in effect on the day prior to the date of the enactment of this Act, shall apply to each claim of an application for patent, and any patent issued thereon, for which the amendments made by this section also apply, if such application or patent contains or contained at any time--

(A) a claim to an invention having an effective filing date as defined in section 100(i) of title 35, United States Code, earlier than 18 months after the date of the enactment of this Act; or

(B) a specific reference under section 120, 121, or 365(c) of title 35, United States Code, to any patent or application that contains or contained at any time such a claim.

SEC. 3. INVENTOR'S OATH OR DECLARATION.

(a) Inventor's Oath or Declaration-

(1) IN GENERAL- Section 115 of title 35, United States Code, is amended to read as follows:

`Sec. 115. Inventor's oath or declaration

`(a) Naming the Inventor; Inventor's Oath or Declaration- An application for patent that is filed under section 111(a) or commences the national stage under section 371 shall include, or be amended to include, the name of the inventor for any invention claimed in the application. Except as otherwise provided in this section, each individual who is the inventor or a joint inventor of a claimed invention in an application for patent shall execute an oath or declaration in connection with the application.

`(b) Required Statements- An oath or declaration under subsection (a) shall contain statements that--

`(1) the application was made or was authorized to be made by the affiant or declarant; and

`(2) such individual believes himself or herself to be the original inventor or an original joint inventor of a claimed invention in the application.

`(c) Additional Requirements- The Director may specify additional information relating to the inventor and the invention that is required to be included in an oath or declaration under subsection (a).

`(d) Substitute Statement-

`(1) IN GENERAL- In lieu of executing an oath or declaration under subsection (a), the applicant for patent may provide a substitute statement under the circumstances described in paragraph (2) and such additional circumstances that the Director may specify by regulation.

`(2) PERMITTED CIRCUMSTANCES- A substitute statement under paragraph (1) is permitted with respect to any individual who--

`(A) is unable to file the oath or declaration under subsection (a) because the individual--

`(i) is deceased;

`(ii) is under legal incapacity; or

`(iii) cannot be found or reached after diligent effort; or

`(B) is under an obligation to assign the invention but has refused to make the oath or declaration required under subsection (a).

`(3) CONTENTS- A substitute statement under this subsection shall--

`(A) identify the individual with respect to whom the statement applies;

`(B) set forth the circumstances representing the permitted basis for the filing of the substitute statement in lieu of the oath or declaration under subsection (a); and

`(C) contain any additional information, including any showing, required by the Director.

`(e) Making Required Statements in Assignment of Record- An individual who is under an obligation of assignment of an application for patent may include the required statements under subsections (b) and (c) in the assignment executed by the individual, in lieu of filing such statements separately.

`(f) Time for Filing- A notice of allowance under section 151 may be provided to an applicant for patent only if the applicant for patent has filed each required oath or declaration under subsection (a) or has filed a substitute statement under subsection (d) or recorded an assignment meeting the requirements of subsection (e).

`(g) Earlier-Filed Application Containing Required Statements or Substitute Statement-

`(1) EXCEPTION- The requirements under this section shall not apply to an individual with respect to an application for patent in which the individual is named as the inventor or a joint inventor and who claims the benefit under section 120, 121, or 365(c) of the filing of an earlier-filed application, if--

`(A) an oath or declaration meeting the requirements of subsection (a) was executed by the individual and was filed in connection with the earlier-filed application;

`(B) a substitute statement meeting the requirements of subsection (d) was filed in the earlier filed application with respect to the individual; or

`(C) an assignment meeting the requirements of subsection (e) was executed with respect to the earlier-filed application by the individual and was recorded in connection with the earlier-filed application.

`(2) COPIES OF OATHS, DECLARATIONS, STATEMENTS, OR ASSIGNMENTS- Notwithstanding paragraph (1), the Director may require that a copy of the executed oath or declaration, the substitute statement, or the assignment filed in the earlier-filed application be included in the later-filed application.

`(h) Supplemental and Corrected Statements; Filing Additional Statements-

`(1) IN GENERAL- Any person making a statement required under this section may withdraw, replace, or otherwise correct the statement at any time. If a change is made in the naming of the inventor requiring the filing of 1 or more additional statements under this section, the Director shall establish regulations under which such additional statements may be filed.

`(2) SUPPLEMENTAL STATEMENTS NOT REQUIRED- If an individual has executed an oath or declaration meeting the requirements of subsection (a) or an assignment meeting the requirements of subsection (e) with respect to an application for patent, the Director may not thereafter require that individual to make any additional oath, declaration, or other statement equivalent to those required by this section in connection with the application for patent or any patent issuing thereon.

`(3) SAVINGS CLAUSE- No patent shall be invalid or unenforceable based upon the failure to comply with a requirement under this section if the failure is remedied as provided under paragraph (1).

`(i) Acknowledgment of Penalties- Any declaration or statement filed pursuant to this section shall contain an acknowledgment that any willful false statement made in such declaration or statement is punishable under section 1001 of title 18 by fine or imprisonment of not more than 5 years, or both.'.

(2) RELATIONSHIP TO DIVISIONAL APPLICATIONS- Section 121 of title 35, United States Code, is amended by striking `If a divisional application' and all that follows through `inventor.'.

(3) REQUIREMENTS FOR NONPROVISIONAL APPLICATIONS- Section 111(a) of title 35, United States Code, is amended--

(A) in paragraph (2)(C), by striking `by the applicant' and inserting `or declaration';

(B) in the heading for paragraph (3), by inserting `OR DECLARATION' after `AND OATH'; and

(4) CONFORMING AMENDMENT- The item relating to section 115 in the table of sections for chapter 11 of title 35, United States Code, is amended to read as follows:

`115. Inventor's oath or declaration.'.

(b) Filing by Other Than Inventor-

(1) IN GENERAL- Section 118 of title 35, United States Code, is amended to read as follows:

`Sec. 118. Filing by other than inventor

`A person to whom the inventor has assigned or is under an obligation to assign the invention may make an application for patent. A person who otherwise shows sufficient proprietary interest in the matter may make an application for patent on behalf of and as agent for the inventor on proof of the pertinent facts and a showing that such action is appropriate to preserve the rights of the parties. If the Director grants a patent on an application filed under this section by a person other than the inventor, the patent shall be granted to the real party in interest and upon such notice to the inventor as the Director considers to be sufficient.'.

(2) CONFORMING AMENDMENT- Section 251 of title 35, United States Code, is amended in the third undesignated paragraph by inserting `or the application for the original patent was filed by the assignee of the entire interest' after `claims of the original patent'.

(1) in the first paragraph--

(A) by striking `The specification' and inserting `(a) In General- The specification'; and

(B) by striking `of carrying out his invention' and inserting `or joint inventor of carrying out the invention';

(2) in the second paragraph--

(A) by striking `The specification' and inserting `(b) Conclusion- The specification'; and

(B) by striking `applicant regards as his invention' and inserting `inventor or a joint inventor regards as the invention';

(3) in the third paragraph, by striking `A claim' and inserting `(c) Form- A claim';

(4) in the fourth paragraph, by striking `Subject to the following paragraph,' and inserting `(d) Reference in Dependent Forms- Subject to subsection (e),';

(5) in the fifth paragraph, by striking `A claim' and inserting `(e) Reference in Multiple Dependent Form- A claim'; and

(6) in the last paragraph, by striking `An element' and inserting `(f) Element in Claim for a Combination- An element'.

(d) Conforming Amendments-

(1) Sections 111(b)(1)(A) is amended by striking `the first paragraph of section 112 of this title' and inserting `section 112(a)'.

(2) Section 111(b)(2) is amended by striking `the second through fifth paragraphs of section 112,' and inserting `subsections (b) through (e) of section 112,'.

(e) Effective Date- The amendments made by this section shall take effect 1 year after the date of the enactment of this Act and shall apply to patent applications that are filed on or after that effective date.

SEC. 4. VIRTUAL MARKING AND ADVICE OF COUNSEL.

(a) Defense to Infringement Based on Earlier Inventor- Section 273(b)(6) of title 35, United States Code, is amended to read as follows:

`(6) PERSONAL DEFENSE- The defense under this section may be asserted only by the person who performed or caused the performance of the acts necessary to establish the defense as well as any other entity that controls, is controlled by, or is under common control with such person 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 as an ancillary and subordinate part of a good faith assignment or transfer for other reasons of the entire enterprise or line of business to which the defense relates. Notwithstanding the preceding sentence, any person may, on its own behalf, assert a defense based on the exhaustion of rights provided under paragraph (3), including any necessary elements thereof.'.

(b) Virtual Marking- Section 287(a) of title 35, United States Code, is amended by inserting `, or by fixing thereon the word `patent' or the abbreviation `pat.' together with an address of a posting on the Internet, accessible to the public without charge for accessing the address, that associates the patented article with the number of the patent' before `, or when'.

`Sec. 298. Advice of Counsel

`The failure of an infringer to obtain the advice of counsel with respect to any allegedly infringed patent or the failure of the infringer to present such advice to the court or jury may not be used to prove that the accused infringer willfully infringed the patent or that the infringer intended to induce infringement of the patent.'.

(d) Effective Date- The amendments made by this section shall apply to any civil action commenced on or after the date of the enactment of this Act.

SEC. 5. POST-GRANT REVIEW PROCEEDINGS.

(a) Inter Partes Review- Chapter 31 of title 35, United States Code, is amended to read as follows:

`CHAPTER 31--INTER PARTES REVIEW

`Sec.

`311. Inter partes review.

`312. Petitions.

`313. Preliminary response to petition.

`314. Institution of inter partes review.

`315. Relation to other proceedings or actions.

`316. Conduct of inter partes review.

`317. Settlement.

`318. Decision of the board.

`319. Appeal.

`Sec. 311. Inter partes review

`(a) In General- Subject to the provisions of this chapter, a person who is not the patent owner may file with the Office a petition to institute an inter partes review for a patent. The Director shall establish, by regulation, fees to be paid by the person requesting the review, in such amounts as the Director determines to be reasonable, considering the aggregate costs of the review.

`(b) Scope- A petitioner in an inter partes review may request to cancel as unpatentable 1 or more claims of a patent only on a ground that could be raised under section 102 or 103 and only on the basis of prior art consisting of patents or printed publications.

`(c) Filing Deadline- A petition for inter partes review shall be filed after the later of either--

`(1) 9 months after the grant of a patent or issuance of a reissue of a patent; or

`(2) if a post-grant review is instituted under chapter 32, the date of the termination of such post-grant review.

`Sec. 312. Petitions

`(a) Requirements of Petition- A petition filed under section 311 may be considered only if--

`(1) the petition is accompanied by payment of the fee established by the Director under section 311;

`(2) the petition identifies all real parties in interest;

`(3) the petition identifies, in writing and with particularity, each claim challenged, the grounds on which the challenge to each claim is based, and the evidence that supports the grounds for the challenge to each claim, including--

`(A) copies of patents and printed publications that the petitioner relies upon in support of the petition; and

`(B) affidavits or declarations of supporting evidence and opinions, if the petitioner relies on expert opinions;

`(4) the petition provides such other information as the Director may require by regulation; and

`(5) the petitioner provides copies of any of the documents required under paragraphs (2), (3), and (4) to the patent owner or, if applicable, the designated representative of the patent owner.

`(b) Public Availability- As soon as practicable after the receipt of a petition under section 311, the Director shall make the petition available to the public.

`Sec. 313. Preliminary response to petition

`(a) Preliminary Response- If an inter partes review petition is filed under section 311, the patent owner shall have the right to file a preliminary response within a time period set by the Director.

`(b) Content of Response- A preliminary response to a petition for inter partes review shall set forth reasons why no inter partes review should be instituted based upon the failure of the petition to meet any requirement of this chapter.

`Sec. 314. Institution of inter partes review

`(a) Threshold- The Director may not authorize an inter partes review to commence unless the Director determines that the information presented in the petition filed under section 311 and any response filed under section 313 shows that there is a reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims challenged in the petition.

`(b) Timing- The Director shall determine whether to institute an inter partes review under this chapter within 3 months after receiving a preliminary response under section 313 or, if none is filed, within three months after the expiration of the time for filing such a response.

`(c) Notice- The Director shall notify the petitioner and patent owner, in writing, of the Director's determination under subsection (a), and shall make such notice available to the public as soon as is practicable. Such notice shall list the date on which the review shall commence.

`(d) No Appeal- The determination by the Director whether to institute an inter partes review under this section shall be final and nonappealable.

`Sec. 315. Relation to other proceedings or actions

`(a) Infringer's Action- An inter partes review may not be instituted or maintained if the petitioner or real party in interest has filed a civil action challenging the validity of a claim of the patent.

`(b) Patent Owner's Action- An inter partes review may not be instituted if the petition requesting the proceeding is filed more than 6 months after the date on which the petitioner, real party in interest, or his privy is served with a complaint alleging infringement of the patent. The time limitation set forth in the preceding sentence shall not apply to a request for joinder under subsection (c).

`(c) Joinder- If the Director institutes an inter partes review, the Director, in his discretion, may join as a party to that inter partes review any person who properly files a petition under section 311 that the Director, after receiving a preliminary response under section 313 or the expiration of the time for filing such a response, determines warrants the institution of an inter partes review under section 314.

`(d) Multiple Proceedings- Notwithstanding sections 135(a), 251, and 252, and chapter 30, during the pendency of an inter partes review, if another proceeding or matter involving the patent is before the Office, the Director may determine the manner in which the inter partes review or other proceeding or matter may proceed, including providing for stay, transfer, consolidation, or termination of any such matter or proceeding.

`(e) Estoppel-

`(1) PROCEEDINGS BEFORE THE OFFICE- The petitioner in an inter partes review under this chapter, or his real party in interest or privy, may not request or maintain a proceeding before the Office with respect to a claim on any ground that the petitioner raised or reasonably could have raised during an inter partes review of the claim that resulted in a final written decision under section 318(a).

`(2) CIVIL ACTIONS AND OTHER PROCEEDINGS- The petitioner in an inter partes review under this chapter, or his real party in interest or privy, may not assert either 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 that a claim in a patent is invalid on any ground that the petitioner raised or reasonably could have raised during an inter partes review of the claim that resulted in a final written decision under section 318(a).

`Sec. 316. Conduct of inter partes review

`(a) Regulations- The Director shall prescribe regulations--

`(1) providing that the file of any proceeding under this chapter shall be made available to the public, except that any petition or document filed with the intent that it be sealed shall be accompanied by a motion to seal, and such petition or document shall be treated as sealed pending the outcome of the ruling on the motion;

`(2) setting forth the standards for the showing of sufficient grounds to institute a review under section 314(a);

`(3) establishing procedures for the submission of supplemental information after the petition is filed;

`(4) in accordance with section 2(b)(2), establishing and governing inter partes review under this chapter and the relationship of such review to other proceedings under this title;

`(5) setting a time period for requesting joinder under section 315(c);

`(6) 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; and

`(B) what is otherwise necessary in the interest of justice;

`(7) prescribing sanctions for abuse of discovery, abuse of process, or any other improper use of the proceeding, such as to harass or to cause unnecessary delay or an unnecessary increase in the cost of the proceeding;

`(8) providing for protective orders governing the exchange and submission of confidential information;

`(9) allowing the patent owner to file a response to the petition after an inter partes review has been instituted, and requiring that the patent owner file with such response, through affidavits or declarations, any additional factual evidence and expert opinions on which the patent owner relies in support of the response;

`(10) setting forth standards and procedures for allowing the patent owner to move to amend the patent under subsection (d) to cancel a challenged claim or propose a reasonable number of substitute claims, and ensuring that any information submitted by the patent owner in support of any amendment entered under subsection (d) is made available to the public as part of the prosecution history of the patent;

`(11) providing either party with the right to an oral hearing as part of the proceeding; and

`(12) requiring that the final determination in an inter partes review be issued not later than 1 year after the date on which the Director notices the institution of a review under this chapter, except that the Director may, for good cause shown, extend the 1-year period by not more than 6 months, and may adjust the time periods in this paragraph in the case of joinder under section 315(c).

`(b) Considerations- In prescribing regulations under this section, the Director shall consider the effect of any such regulation on the economy, the integrity of the patent system, the efficient administration of the Office, and the ability of the Office to timely complete proceedings instituted under this chapter.

`(c) Patent Trial and Appeal Board- The Patent Trial and Appeal Board shall, in accordance with section 6, conduct each proceeding authorized by the Director.

`(d) Amendment of the Patent-

`(1) IN GENERAL- During an inter partes review instituted under this chapter, the patent owner may file 1 motion to amend the patent in 1 or more of the following ways:

`(A) Cancel any challenged patent claim.

`(B) For each challenged claim, propose a reasonable number of substitute claims.

`(2) ADDITIONAL MOTIONS- Additional motions to amend may be permitted upon the joint request of the petitioner and the patent owner to materially advance the settlement of a proceeding under section 317, or as permitted by regulations prescribed by the Director.

`(3) SCOPE OF CLAIMS- An amendment under this subsection may not enlarge the scope of the claims of the patent or introduce new matter.

`(e) Evidentiary Standards- In an inter partes review instituted under this chapter, the petitioner shall have the burden of proving a proposition of unpatentability by a preponderance of the evidence.

`Sec. 317. Settlement

`(a) In General- An inter partes review instituted under this chapter shall be terminated with respect to any petitioner upon the joint request of the petitioner and the patent owner, unless the Office has decided the merits of the proceeding before the request for termination is filed. If the inter partes review is terminated with respect to a petitioner under this section, no estoppel under section 315(e) shall apply to that petitioner. If no petitioner remains in the inter partes review, the Office may terminate the review or proceed to a final written decision under section 318(a).

`(b) Agreements in Writing- Any agreement or understanding between the patent owner and a petitioner, including any collateral agreements referred to in such agreement or understanding, made in connection with, or in contemplation of, the termination of an inter partes review under this section shall be in writing and a true copy of such agreement or understanding shall be filed in the Office before the termination of the inter partes review as between the parties. If any party filing such agreement or understanding so requests, the copy shall be kept separate from the file of the inter partes review, and shall be made available only to Federal Government agencies upon written request, or to any other person on a showing of good cause.

`Sec. 318. Decision of the board

`(a) Final Written Decision- If an inter partes review is instituted and not dismissed under this chapter, the Patent Trial and Appeal Board shall issue a final written decision with respect to the patentability of any patent claim challenged by the petitioner and any new claim added under section 316(d).

`(b) Certificate- If the Patent Trial and Appeal Board issues a final written decision under subsection (a) and the time for appeal has expired or any appeal has terminated, the Director shall issue and publish a certificate canceling any claim of the patent finally determined to be unpatentable, confirming any claim of the patent determined to be patentable, and incorporating in the patent by operation of the certificate any new or amended claim determined to be patentable.

`(c) Data on Length of Review- The Patent and Trademark Office shall make available to the public data describing the length of time between the commencement of each inter partes review and the conclusion of that review.

`Sec. 319. Appeal

`A party dissatisfied with the final written decision of the Patent Trial and Appeal Board under section 318(a) may appeal the decision pursuant to sections 141 through 144. Any party to the inter partes review shall have the right to be a party to the appeal.'.

(b) Technical and Conforming Amendment- The table of chapters for part III of title 35, United States Code, is amended by striking the item relating to chapter 31 and inserting the following:

311.'.

(1) REGULATIONS- The Director shall, not later than the date that is 1 year after the date of the enactment of this Act, issue regulations to carry out chapter 31 of title 35, United States Code, as amended by subsection (a) of this section.

(2) APPLICABILITY-

(A) IN GENERAL- The amendments made by subsection (a) shall take effect on the date that is 1 year after the date of the enactment of this Act and shall apply to all patents issued before, on, or after the effective date of subsection (a).

(B) EXCEPTION- The provisions of chapter 31 of title 35, United States Code, as amended by paragraph (3), shall continue to apply to requests for inter partes reexamination that are filed prior to the effective date of subsection (a) as if subsection (a) had not been enacted.

(C) GRADUATED IMPLEMENTATION- The Director may impose a limit on the number of inter partes reviews that may be instituted during each of the first 4 years following the effective date of subsection (a), provided that such number shall in each year be equivalent to or greater than the number of inter partes reexaminations that are ordered in the last full fiscal year prior to the effective date of subsection (a).

(3) TRANSITION-

(A) IN GENERAL- Chapter 31 of title 35, United States Code, is amended--

(i) in section 312--

(I) in subsection (a)--

(aa) in the first sentence, by striking `a substantial new question of patentability affecting any claim of the patent concerned is raised by the request,' and inserting `the information presented in the request shows that there is a reasonable likelihood that the requester would prevail with respect to at least 1 of the claims challenged in the request,'; and

(bb) in the second sentence, by striking `The existence of a substantial new question of patentability' and inserting `A showing that there is a reasonable likelihood that the requester would prevail with respect to at least 1 of the claims challenged in the request'; and

(II) in subsection (c), in the second sentence, by striking `no substantial new question of patentability has been raised,' and inserting `the showing required by subsection (a) has not been made,'; and

(ii) in section 313, by striking `a substantial new question of patentability affecting a claim of the patent is raised' and inserting `it has been shown that there is a reasonable likelihood that the requester would prevail with respect to at least 1 of the claims challenged in the request'.

(B) APPLICATION- The amendments made by this paragraph shall apply to requests for inter partes reexamination that are filed on or after the date of the enactment of this Act, but prior to the effective date of subsection (a).

(d) Post-Grant Review- Part III of title 35, United States Code, is amended by adding at the end the following:

`CHAPTER 32--POST-GRANT REVIEW

`Sec.

`321. Post-grant review.

`322. Petitions.

`323. Preliminary response to petition.

`324. Institution of post-grant review.

`325. Relation to other proceedings or actions.

`326. Conduct of post-grant review.

`327. Settlement.

`328. Decision of the board.

`329. Appeal.

`Sec. 321. Post-grant review

`(a) In General- Subject to the provisions of this chapter, a person who is not the patent owner may file with the Office a petition to institute a post-grant review for a patent. The Director shall establish, by regulation, fees to be paid by the person requesting the review, in such amounts as the Director determines to be reasonable, considering the aggregate costs of the post-grant review.

`(b) Scope- A petitioner in a post-grant review may request to cancel as unpatentable 1 or more claims of a patent on any ground that could be raised under paragraph (2) or (3) of section 282(b) (relating to invalidity of the patent or any claim).

`(c) Filing Deadline- A petition for a post-grant review shall be filed not later than 9 months after the grant of the patent or issuance of a reissue patent.

`Sec. 322. Petitions

`(a) Requirements of Petition- A petition filed under section 321 may be considered only if--

`(1) the petition is accompanied by payment of the fee established by the Director under section 321;

`(2) the petition identifies all real parties in interest;

`(A) copies of patents and printed publications that the petitioner relies upon in support of the petition; and

`(B) affidavits or declarations of supporting evidence and opinions, if the petitioner relies on other factual evidence or on expert opinions;

`(4) the petition provides such other information as the Director may require by regulation; and

`(5) the petitioner provides copies of any of the documents required under paragraphs (2), (3), and (4) to the patent owner or, if applicable, the designated representative of the patent owner.

`(b) Public Availability- As soon as practicable after the receipt of a petition under section 321, the Director shall make the petition available to the public.

`Sec. 323. Preliminary response to petition

`(a) Preliminary Response- If a post-grant review petition is filed under section 321, the patent owner shall have the right to file a preliminary response within 2 months of the filing of the petition.

`(b) Content of Response- A preliminary response to a petition for post-grant review shall set forth reasons why no post-grant review should be instituted based upon the failure of the petition to meet any requirement of this chapter.

`Sec. 324. Institution of post-grant review

`(a) Threshold- The Director may not authorize a post-grant review to commence unless the Director determines that the information presented in the petition, if such information is not rebutted, would demonstrate that it is more likely than not that at least 1 of the claims challenged in the petition is unpatentable.

`(b) Additional Grounds- The determination required under subsection (a) may also be satisfied by a showing that the petition raises a novel or unsettled legal question that is important to other patents or patent applications.

`(c) Timing- The Director shall determine whether to institute a post-grant review under this chapter within 3 months after receiving a preliminary response under section 323 or, if none is filed, the expiration of the time for filing such a response.

`(d) Notice- The Director shall notify the petitioner and patent owner, in writing, of the Director's determination under subsection (a) or (b), and shall make such notice available to the public as soon as is practicable. The Director shall make each notice of the institution of a post-grant review available to the public. Such notice shall list the date on which the review shall commence.

`(e) No Appeal- The determination by the Director whether to institute a post-grant review under this section shall be final and nonappealable.

`Sec. 325. Relation to other proceedings or actions

`(a) Infringer's Action- A post-grant review may not be instituted or maintained if the petitioner or real party in interest has filed a civil action challenging the validity of a claim of the patent.

`(b) Preliminary Injunctions- If a civil action alleging infringement of a patent is filed within 3 months of the grant of the patent, the court may not stay its consideration of the patent owner's motion for a preliminary injunction against infringement of the patent on the basis that a petition for post-grant review has been filed or that such a proceeding has been instituted.

`(c) Joinder- If more than 1 petition for a post-grant review is properly filed against the same patent and the Director determines that more than 1 of these petitions warrants the institution of a post-grant review under section 324, the Director may consolidate such reviews into a single post-grant review.

`(d) Multiple Proceedings- Notwithstanding sections 135(a), 251, and 252, and chapter 30, during the pendency of any post-grant review, if another proceeding or matter involving the patent is before the Office, the Director may determine the manner in which the post-grant review or other proceeding or matter may proceed, including providing for stay, transfer, consolidation, or termination of any such matter or proceeding. In determining whether to institute or order a proceeding under this chapter, chapter 30, or chapter 31, the Director may take into account whether, and reject the petition or request because, the same or substantially the same prior art or arguments previously were presented to the Office.

`(e) Estoppel-

`(1) PROCEEDINGS BEFORE THE OFFICE- The petitioner in a post-grant review under this chapter, or his real party in interest or privy, may not request or maintain a proceeding before the Office with respect to a claim on any ground that the petitioner raised or reasonably could have raised during a post-grant review of the claim that resulted in a final written decision under section 328(a).

`(2) CIVIL ACTIONS AND OTHER PROCEEDINGS- The petitioner in a post-grant review under this chapter, or his real party in interest or privy, may not assert either 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 that a claim in a patent is invalid on any ground that the petitioner raised during a post-grant review of the claim that resulted in a final written decision under section 328(a).

`(f) Reissue Patents- A post-grant review may not be instituted if the petition requests cancellation of a claim in a reissue patent that is identical to or narrower than a claim in the original patent from which the reissue patent was issued, and the time limitations in section 321(c) would bar filing a petition for a post-grant review for such original patent.

`Sec. 326. Conduct of post-grant review

`(a) Regulations- The Director shall prescribe regulations--

`(2) setting forth the standards for the showing of sufficient grounds to institute a review under subsections (a) and (b) of section 324;

`(3) establishing procedures for the submission of supplemental information after the petition is filed;

`(4) in accordance with section 2(b)(2), establishing and governing a post-grant review under this chapter and the relationship of such review to other proceedings under this title;

`(5) setting forth standards and procedures for discovery of relevant evidence, including that such discovery shall be limited to evidence directly related to factual assertions advanced by either party in the proceeding;

`(6) prescribing sanctions for abuse of discovery, abuse of process, or any other improper use of the proceeding, such as to harass or to cause unnecessary delay or an unnecessary increase in the cost of the proceeding;

`(7) providing for protective orders governing the exchange and submission of confidential information;

`(8) allowing the patent owner to file a response to the petition after a post-grant review has been instituted, and requiring that the patent owner file with such response, through affidavits or declarations, any additional factual evidence and expert opinions on which the patent owner relies in support of the response;

`(9) setting forth standards and procedures for allowing the patent owner to move to amend the patent under subsection (d) to cancel a challenged claim or propose a reasonable number of substitute claims, and ensuring that any information submitted by the patent owner in support of any amendment entered under subsection (d) is made available to the public as part of the prosecution history of the patent;

`(10) providing either party with the right to an oral hearing as part of the proceeding; and

`(11) requiring that the final determination in any post-grant review be issued not later than 1 year after the date on which the Director notices the institution of a proceeding under this chapter, except that the Director may, for good cause shown, extend the 1-year period by not more than 6 months, and may adjust the time periods in this paragraph in the case of joinder under section 325(c).

`(c) Patent Trial and Appeal Board- The Patent Trial and Appeal Board shall, in accordance with section 6, conduct each proceeding authorized by the Director.

`(d) Amendment of the Patent-

`(1) IN GENERAL- During a post-grant review instituted under this chapter, the patent owner may file 1 motion to amend the patent in 1 or more of the following ways:

`(A) Cancel any challenged patent claim.

`(B) For each challenged claim, propose a reasonable number of substitute claims.

`(2) ADDITIONAL MOTIONS- Additional motions to amend may be permitted upon the joint request of the petitioner and the patent owner to materially advance the settlement of a proceeding under section 327, or upon the request of the patent owner for good cause shown.

`(3) SCOPE OF CLAIMS- An amendment under this subsection may not enlarge the scope of the claims of the patent or introduce new matter.

`(e) Evidentiary Standards- In a post-grant review instituted under this chapter, the petitioner shall have the burden of proving a proposition of unpatentability by a preponderance of the evidence.

`Sec. 327. Settlement

`(a) In General- A post-grant review instituted under this chapter shall be terminated with respect to any petitioner upon the joint request of the petitioner and the patent owner, unless the Office has decided the merits of the proceeding before the request for termination is filed. If the post-grant review is terminated with respect to a petitioner under this section, no estoppel under section 325(e) shall apply to that petitioner. If no petitioner remains in the post-grant review, the Office may terminate the post-grant review or proceed to a final written decision under section 328(a).

`(b) Agreements in Writing- Any agreement or understanding between the patent owner and a petitioner, including any collateral agreements referred to in such agreement or understanding, made in connection with, or in contemplation of, the termination of a post-grant review under this section shall be in writing, and a true copy of such agreement or understanding shall be filed in the Office before the termination of the post-grant review as between the parties. If any party filing such agreement or understanding so requests, the copy shall be kept separate from the file of the post-grant review, and shall be made available only to Federal Government agencies upon written request, or to any other person on a showing of good cause.

`Sec. 328. Decision of the board

`(a) Final Written Decision- If a post-grant review is instituted and not dismissed under this chapter, the Patent Trial and Appeal Board shall issue a final written decision with respect to the patentability of any patent claim challenged by the petitioner and any new claim added under section 326(d).

`(c) Data on Length of Review- The Patent and Trademark Office shall make available to the public data describing the length of time between the commencement of each post-grant review and the conclusion of that review.

`Sec. 329. Appeal

`A party dissatisfied with the final written decision of the Patent Trial and Appeal Board under section 328(a) may appeal the decision pursuant to sections 141 through 144. Any party to the post-grant review shall have the right to be a party to the appeal.'.

(e) Technical and Conforming Amendment- The table of chapters for part III of title 35, United States Code, is amended by adding at the end the following:

321.'.

(f) Regulations and Effective Date-

(1) REGULATIONS- The Director shall, not later than the date that is 1 year after the date of the enactment of this Act, issue regulations to carry out chapter 32 of title 35, United States Code, as added by subsection (d) of this section.

(2) APPLICABILITY- The amendments made by subsection (d) shall take effect on the date that is 1 year after the date of the enactment of this Act and, except as provided in section 18 and in paragraph (3), shall apply only to patents that are described in section 2(o)(1). The Director may impose a limit on the number of post-grant reviews that may be instituted during each of the 4 years following the effective date of subsection (d).

(3) PENDING INTERFERENCES- The Director shall determine the procedures under which interferences commenced before the effective date of subsection (d) are to proceed, including whether any such interference is to be dismissed without prejudice to the filing of a petition for a post-grant review under chapter 32 of title 35, United States Code, or is to proceed as if this Act had not been enacted. The Director shall include such procedures in regulations issued under paragraph (1). For purposes of an interference that is commenced before the effective date of subsection (d), the Director may deem the Patent Trial and Appeal Board to be the Board of Patent Appeals and Interferences, and may allow the Patent Trial and Appeal Board to conduct any further proceedings in that interference. The authorization to appeal or have remedy from derivation proceedings in sections 141(d) and 146 of title 35, United States Code, and the jurisdiction to entertain appeals from derivation proceedings in section 1295(a)(4)(A) of title 28, United States Code, shall be deemed to extend to final decisions in interferences that are commenced before the effective date of subsection (d) and that are not dismissed pursuant to this paragraph.

(g) Citation of Prior Art and Written Statements-

(1) IN GENERAL- Section 301 of title 35, United States Code, is amended to read as follows:

`Sec. 301. Citation of prior art and written statements

`(a) In General- Any person at any time may cite to the Office in writing--

`(1) prior art consisting of patents or printed publications which that person believes to have a bearing on the patentability of any claim of a particular patent; or

`(2) statements of the patent owner filed in a proceeding before a Federal court or the Office in which the patent owner took a position on the scope of any claim of a particular patent.

`(b) Official File- If the person citing prior art or written statements pursuant to subsection (a) explains in writing the pertinence and manner of applying the prior art or written statements to at least 1 claim of the patent, the citation of the prior art or written statements and the explanation thereof shall become a part of the official file of the patent.

`(c) Additional Information- A party that submits a written statement pursuant to subsection (a)(2) shall include any other documents, pleadings, or evidence from the proceeding in which the statement was filed that addresses the written statement.

`(d) Limitations- A written statement submitted pursuant to subsection (a)(2), and additional information submitted pursuant to subsection (c), shall not be considered by the Office for any purpose other than to determine the proper meaning of a patent claim in a proceeding that is ordered or instituted pursuant to section 304, 314, or 324. If any such written statement or additional information is subject to an applicable protective order, it shall be redacted to exclude information that is subject to that order.

`(e) Confidentiality- Upon the written request of the person citing prior art or written statements pursuant to subsection (a), that person's identity shall be excluded from the patent file and kept confidential.'.

(2) EFFECTIVE DATE- The amendment made by this subsection shall take effect 1 year after the date of the enactment of this Act and shall apply to patents issued before, on, or after that effective date.

(h) Reexamination-

(1) DETERMINATION BY DIRECTOR-

(A) IN GENERAL- Section 303(a) of title 35, United States Code, is amended by striking `section 301 of this title' and inserting `section 301 or 302'.

(B) EFFECTIVE DATE- The amendment made by this paragraph shall take effect 1 year after the date of the enactment of this Act and shall apply to patents issued before, on, or after that effective date.

(2) APPEAL-

(A) IN GENERAL- Section 306 of title 35, United States Code, is amended by striking `145' and inserting `144'.

(B) EFFECTIVE DATE- The amendment made by this paragraph shall take effect on the date of enactment of this Act and shall apply to appeals of reexaminations that are pending before the Board of Patent Appeals and Interferences or the Patent Trial and Appeal Board on or after the date of the enactment of this Act.

SEC. 6. PATENT TRIAL AND APPEAL BOARD.

(a) Composition and Duties- Section 6 of title 35, United States Code, is amended to read as follows:

`Sec. 6. Patent Trial and Appeal Board

`(a) There shall be in the Office a Patent Trial and Appeal Board. The Director, the Deputy Director, the Commissioner for Patents, the Commissioner for Trademarks, and the administrative patent judges shall constitute the Patent Trial and Appeal Board. The administrative patent judges shall be persons of competent legal knowledge and scientific ability who are appointed by the Secretary, in consultation with the Director. Any reference in any Federal law, Executive order, rule, regulation, or delegation of authority, or any document of or pertaining to the Board of Patent Appeals and Interferences is deemed to refer to the Patent Trial and Appeal Board.

`(b) The Patent Trial and Appeal Board shall--

`(1) on written appeal of an applicant, review adverse decisions of examiners upon applications for patents pursuant to section 134(a);

`(2) review appeals of reexaminations pursuant to section 134(b);

`(3) conduct derivation proceedings pursuant to section 135; and

`(4) conduct inter partes reviews and post-grant reviews pursuant to chapters 31 and 32.

`(c) Each appeal, derivation proceeding, post-grant review, and inter partes review shall be heard by at least 3 members of the Patent Trial and Appeal Board, who shall be designated by the Director. Only the Patent Trial and Appeal Board may grant rehearings.

`(d) The Secretary of Commerce may, in his discretion, deem the appointment of an administrative patent judge who, before the date of the enactment of this subsection, held office pursuant to an appointment by the Director to take effect on the date on which the Director initially appointed the administrative patent judge. It shall be a defense to a challenge to the appointment of an administrative patent judge on the basis of the judge's having been originally appointed by the Director that the administrative patent judge so appointed was acting as a de facto officer.'.

(b) Administrative Appeals- Section 134 of title 35, United States Code, is amended--

(1) in subsection (b), by striking `any reexamination proceeding' and inserting `a reexamination'; and

(2) by striking subsection (c).

(1) IN GENERAL- Section 141 of title 35, United States Code, is amended to read as follows:

`Sec. 141. Appeal to the Court of Appeals for the Federal Circuit

`(a) Examinations- An applicant who is dissatisfied with the final decision in an appeal to the Patent Trial and Appeal Board under section 134(a) may appeal the Board's decision to the United States Court of Appeals for the Federal Circuit. By filing such an appeal, the applicant waives his right to proceed under section 145.

`(b) Reexaminations- A patent owner who is dissatisfied with the final decision in an appeal of a reexamination to the Patent Trial and Appeal Board under section 134(b) may appeal the Board's decision only to the United States Court of Appeals for the Federal Circuit.

`(c) Post-Grant and Inter Partes Reviews- A party to a post-grant or inter partes review who is dissatisfied with the final written decision of the Patent Trial and Appeal Board under section 318(a) or 328(a) may appeal the Board's decision only to the United States Court of Appeals for the Federal Circuit.

`(d) Derivation Proceedings- A party to a derivation proceeding who is dissatisfied with the final decision of the Patent Trial and Appeal Board on the proceeding may appeal the decision to the United States Court of Appeals for the Federal Circuit, but such appeal shall be dismissed if any adverse party to such derivation proceeding, within 20 days after the appellant has filed notice of appeal in accordance with section 142, files notice with the Director that the party elects to have all further proceedings conducted as provided in section 146. If the appellant does not, within 30 days after the filing of such notice by the adverse party, file a civil action under section 146, the Board's decision shall govern the further proceedings in the case.'.

(2) JURISDICTION- Section 1295(a)(4)(A) of title 28, United States Code, is amended to read as follows:

`(A) the Patent Trial and Appeal Board of the United States Patent and Trademark Office with respect to patent applications, derivation proceedings, reexaminations, post-grant reviews, and inter partes reviews at the instance of a party who exercised his right to participate in a proceeding before or appeal to the Board, except that an applicant or a party to a derivation proceeding may also have remedy by civil action pursuant to section 145 or 146 of title 35. An appeal under this subparagraph of a decision of the Board with respect to an application or derivation proceeding shall waive the right of such applicant or party to proceed under section 145 or 146 of title 35;'.

(3) PROCEEDINGS ON APPEAL- Section 143 of title 35, United States Code, is amended--

(A) by striking the third sentence and inserting the following: `In an ex parte case, the Director shall submit to the court in writing the grounds for the decision of the Patent and Trademark Office, addressing all of the issues raised in the appeal. The Director shall have the right to intervene in an appeal from a decision entered by the Patent Trial and Appeal Board in a derivation proceeding under section 135 or in an inter partes or post-grant review under chapter 31 or 32.'; and

(B) by repealing the second of the two identical fourth sentences.

(d) Effective Date- The amendments made by this section shall take effect 1 year after the date of the enactment of this Act and shall apply to proceedings commenced on or after that effective date, except that--

(1) the extension of jurisdiction to the United States Court of Appeals for the Federal Circuit to entertain appeals of decisions of the Patent Trial and Appeal Board in reexaminations under the amendment made by subsection (c)(2) shall be deemed to take effect on the date of enactment of this Act and shall extend to any decision of the Board of Patent Appeals and Interferences with respect to a reexamination that is entered before, on, or after the date of the enactment of this Act;

(2) the provisions of sections 6, 134, and 141 of title 35, United States Code, in effect on the day prior to the date of the enactment of this Act shall continue to apply to inter partes reexaminations that are requested under section 311 prior to the date that is 1 year after the date of the enactment of this Act;

(3) the Patent Trial and Appeal Board may be deemed to be the Board of Patent Appeals and Interferences for purposes of appeals of inter partes reexaminations that are requested under section 311 prior to the date that is 1 year after the date of the enactment of this Act; and

(4) the Director's right under the last sentence of section 143 of title 35, United States Code, as amended by subsection (c)(3), to intervene in an appeal from a decision entered by the Patent Trial and Appeal Board shall be deemed to extend to inter partes reexaminations that are requested under section 311 prior to the date that is 1 year after the date of the enactment of this Act.

SEC. 7. PREISSUANCE SUBMISSIONS BY THIRD PARTIES.

(a) In General- Section 122 of title 35, United States Code, is amended by adding at the end the following:

`(e) Preissuance Submissions by Third Parties-

`(1) IN GENERAL- Any third party may submit for consideration and inclusion in the record of a patent application, any patent, published patent application, or other printed publication of potential relevance to the examination of the application, if such submission is made in writing before the earlier of--

`(A) the date a notice of allowance under section 151 is given or mailed in the application for patent; or

`(B) the later of--

`(i) 6 months after the date on which the application for patent is first published under section 122 by the Office, or

`(ii) the date of the first rejection under section 132 of any claim by the examiner during the examination of the application for patent.

`(2) OTHER REQUIREMENTS- Any submission under paragraph (1) shall--

`(A) set forth a concise description of the asserted relevance of each submitted document;

`(B) be accompanied by such fee as the Director may prescribe; and

`(C) include a statement by the person making such submission affirming that the submission was made in compliance with this section.'.

(b) Effective Date- The amendments made by this section shall take effect 1 year after the date of the enactment of this Act and shall apply to patent applications filed before, on, or after that effective date.

SEC. 8. VENUE.

(a) Technical Amendments Relating to Venue- Sections 32, 145, 146, 154(b)(4)(A), and 293 of title 35, United States Code, and section 21(b)(4) of the Act entitled `An Act to provide for 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 (commonly referred to as the `Trademark Act of 1946' or the `Lanham Act'; 15 U.S.C. 1071(b)(4)), are each amended by striking `United States District Court for the District of Columbia' each place that term appears and inserting `United States District Court for the Eastern District of Virginia'.

(b) Effective Date- The amendments made by this section shall take effect upon the date of the enactment of this Act and shall apply to civil actions commenced on or after that date.

SEC. 9. FEE SETTING AUTHORITY.

(a) Fee Setting-

(1) IN GENERAL- The Director shall have authority to set or adjust by rule any fee established, authorized, or charged under title 35, United States Code, and the Trademark Act of 1946 (15 U.S.C. 1051 et seq.), notwithstanding the fee amounts established, authorized, or charged thereunder, for all services performed by or materials furnished by, the Office, provided that patent and trademark fee amounts are in the aggregate set to recover the estimated cost to the Office for processing, activities, services, and materials relating to patents and trademarks, respectively, including proportionate shares of the administrative costs of the Office.

(2) SMALL AND MICRO ENTITIES- The fees established under paragraph (1) for filing, searching, examining, issuing, appealing, and maintaining patent applications and patents shall be reduced by 50 percent with respect to their application to any small entity that qualifies for reduced fees under section 41(h)(1) of title 35, United States Code, and shall be reduced by 75 percent with respect to their application to any micro entity as defined in section 123 of that title.

(3) REDUCTION OF FEES IN CERTAIN FISCAL YEARS- In any fiscal year, the Director--

(A) shall consult with the Patent Public Advisory Committee and the Trademark Public Advisory Committee on the advisability of reducing any fees described in paragraph (1); and

(B) after the consultation required under subparagraph (A), may reduce such fees.

(4) ROLE OF THE PUBLIC ADVISORY COMMITTEE- The Director shall--

(A) submit to the Patent Public Advisory Committee or the Trademark Public Advisory Committee, or both, as appropriate, any proposed fee under paragraph (1) not less than 45 days before publishing any proposed fee in the Federal Register;

(B) provide the relevant advisory committee described in subparagraph (A) a 30-day period following the submission of any proposed fee, on which to deliberate, consider, and comment on such proposal, and require that--

(i) during such 30-day period, the relevant advisory committee hold a public hearing related to such proposal; and

(ii) the Director shall assist the relevant advisory committee in carrying out such public hearing, including by offering the use of Office resources to notify and promote the hearing to the public and interested stakeholders;

(C) require the relevant advisory committee to make available to the public a written report detailing the comments, advice, and recommendations of the committee regarding any proposed fee;

(D) consider and analyze any comments, advice, or recommendations received from the relevant advisory committee before setting or adjusting any fee; and

(E) notify, through the Chair and Ranking Member of the Senate and House Judiciary Committees, the Congress of any final rule setting or adjusting fees under paragraph (1).

(5) PUBLICATION IN THE FEDERAL REGISTER-

(A) IN GENERAL- Any rules prescribed under this subsection shall be published in the Federal Register.

(B) RATIONALE- Any proposal for a change in fees under this section shall--

(i) be published in the Federal Register; and

(ii) include, in such publication, the specific rationale and purpose for the proposal, including the possible expectations or benefits resulting from the proposed change.

(C) PUBLIC COMMENT PERIOD- Following the publication of any proposed fee in the Federal Register pursuant to subparagraph (A), the Director shall seek public comment for a period of not less than 45 days.

(6) CONGRESSIONAL COMMENT PERIOD- Following the notification described in paragraph (3)(E), Congress shall have not more than 45 days to consider and comment on any final rule setting or adjusting fees under paragraph (1). No fee set or adjusted under paragraph (1) shall be effective prior to the end of such 45-day comment period.

(7) RULE OF CONSTRUCTION- No rules prescribed under this subsection may diminish--

(A) an applicant's rights under title 35, United States Code, or the Trademark Act of 1946; or

(B) any rights under a ratified treaty.

(b) Fees for Patent Services- Division B of Public Law 108-447 is amended in title VIII of the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act, 2005--

(1) in subsections (a), (b), and (c) of section 801, by--

(A) striking `During' and all that follows through ` 2006, subsection' and inserting `Subsection'; and

(B) striking `shall be administered as though that subsection reads' and inserting `is amended to read';

(2) in subsection (d) of section 801, by striking `During' and all that follows through ` 2006, subsection' and inserting `Subsection'; and

(3) in subsection (e) of section 801, by--

(A) striking `During' and all that follows through `2006, subsection' and inserting `Subsection'; and

(B) striking `shall be administered as though that subsection'.

(c) Adjustment of Trademark Fees- Division B of Public Law 108-447 is amended in title VIII of the Departments of Commerce, Justice and State, the Judiciary and Related Agencies Appropriations Act, 2005, in section 802(a) by striking `During fiscal years 2005, 2006 and 2007', and inserting `Until such time as the Director sets or adjusts the fees otherwise,'.

(d) Effective Date, Applicability, and Transition Provisions- Division B of Public Law 108-447 is amended in title VIII of the Departments of Commerce, Justice and State, the Judiciary and Related Agencies Appropriations Act, 2005, in section 803(a) by striking `and shall apply only with respect to the remaining portion of fiscal year 2005, 2006 and 2007'.

(e) Statutory Authority- Section 41(d)(1)(A) of title 35, United States Code, is amended by striking `, and the Director may not increase any such fee thereafter'.

(f) Rule of Construction- Nothing in this section shall be construed to affect any other provision of Division B of Public Law 108-447, including section 801(c) of title VIII of the Departments of Commerce, Justice and State, the Judiciary and Related Agencies Appropriations Act, 2005.

(g) Definitions- In this section, the following definitions shall apply:

(1) DIRECTOR- The term `Director' means the Director of the United States Patent and Trademark Office.

(2) OFFICE- The term `Office' means the United States Patent and Trademark Office.

(3) TRADEMARK ACT OF 1946- The term `Trademark Act of 1946' means an Act entitled `Act to provide for 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).

(h) Electronic Filing Incentive-

(1) IN GENERAL- Notwithstanding any other provision of this section, a fee of $400 shall be established for each application for an original patent, except for a design, plant, or provisional application, that is not filed by electronic means as prescribed by the Director. The fee established by this subsection shall be reduced 50 percent for small entities that qualify for reduced fees under section 41(h)(1) of title 35, United States Code. All fees paid under this subsection shall be deposited in the Treasury as an offsetting receipt that shall not be available for obligation or expenditure.

(2) EFFECTIVE DATE- This subsection shall become effective 60 days after the date of the enactment of this Act.

(i) Reduction in Fees for Small Entity Patents- The Director shall reduce fees for providing prioritized examination of utility and plant patent applications by 50 percent for small entities that qualify for reduced fees under section 41(h)(1) of title 35, United States Code, so long as the fees of the prioritized examination program are set to recover the estimated cost of the program.

(j) Effective Date- Except as provided in subsection (h), the provisions of this section shall take effect upon the date of the enactment of this Act.

SEC. 10. SUPPLEMENTAL EXAMINATION.

(a) In General- Chapter 25 of title 35, United States Code, is amended by adding at the end the following:

`Sec. 257. Supplemental examinations to consider, reconsider, or correct information

`(a) In General- A patent owner may request supplemental examination of a patent in the Office to consider, reconsider, or correct information believed to be relevant to the patent. Within 3 months of the date a request for supplemental examination meeting the requirements of this section is received, the Director shall conduct the supplemental examination and shall conclude such examination by issuing a certificate indicating whether the information presented in the request raises a substantial new question of patentability.

`(b) Reexamination Ordered- If a substantial new question of patentability is raised by 1 or more items of information in the request, the Director shall order reexamination of the patent. The reexamination shall be conducted according to procedures established by chapter 30, except that the patent owner shall not have the right to file a statement pursuant to section 304. During the reexamination, the Director shall address each substantial new question of patentability identified during the supplemental examination, notwithstanding the limitations therein relating to patents and printed publication or any other provision of chapter 30.

`(c) Effect-

`(1) IN GENERAL- A patent shall not be held unenforceable on the basis of conduct relating to information that had not been considered, was inadequately considered, or was incorrect in a prior examination of the patent if the information was considered, reconsidered, or corrected during a supplemental examination of the patent. The making of a request under subsection (a), or the absence thereof, shall not be relevant to enforceability of the patent under section 282.

`(2) EXCEPTIONS-

`(A) PRIOR ALLEGATIONS- This subsection shall not apply to an allegation pled with particularity, or set forth with particularity in a notice received by the patent owner under section 505(j)(2)(B)(iv)(II) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355(j)(2)(B)(iv)(II)), before the date of a supplemental-examination request under subsection (a) to consider, reconsider, or correct information forming the basis for the allegation.

`(B) PATENT ENFORCEMENT ACTIONS- In an action brought under section 337(a) of the Tariff Act of 1930 (19 U.S.C. 1337(a)), or section 281 of this title, this subsection shall not apply to any defense raised in the action that is based upon information that was considered, reconsidered, or corrected pursuant to a supplemental-examination request under subsection (a) unless the supplemental examination, and any reexamination ordered pursuant to the request, are concluded before the date on which the action is brought.

`(d) Fees and Regulations- The Director shall, by regulation, establish fees for the submission of a request for supplemental examination of a patent, and to consider each item of information submitted in the request. If reexamination is ordered pursuant to subsection (a), fees established and applicable to ex parte reexamination proceedings under chapter 30 shall be paid in addition to fees applicable to supplemental examination. The Director shall promulgate regulations governing the form, content, and other requirements of requests for supplemental examination, and establishing procedures for conducting review of information submitted in such requests.

`(e) Rule of Construction- Nothing in this section shall be construed--

`(1) to preclude the imposition of sanctions based upon criminal or antitrust laws (including section 1001(a) of title 18, the first section of the Clayton Act, and section 5 of the Federal Trade Commission Act to the extent that section relates to unfair methods of competition);

`(2) to limit the authority of the Director to investigate issues of possible misconduct and impose sanctions for misconduct in connection with matters or proceedings before the Office; or

`(3) to limit the authority of the Director to promulgate regulations under chapter 3 relating to sanctions for misconduct by representatives practicing before the Office.'.

(b) Effective Date- This section shall take effect 1 year after the date of the enactment of this Act and shall apply to patents issued before, on, or after that date.

SEC. 11. RESIDENCY OF FEDERAL CIRCUIT JUDGES.

(a) In General- Section 44(c) of title 28, United States Code, is amended--

(1) by repealing the second sentence; and

(2) in the third sentence, by striking `state' and inserting `State'.

(b) No Provision of Facilities Authorized- The repeal made by the amendment in subsection (a)(1) shall not be construed to authorize the provision of any court facilities or administrative support services outside of the District of Columbia.

SEC. 12. MICRO ENTITY DEFINED.

Chapter 11 of title 35, United States Code, is amended by adding at the end the following new section:

`Sec. 123. Micro entity defined

`(a) In General- For purposes of this title, the term `micro entity' means an applicant who makes a certification that the applicant--

`(1) qualifies as a small entity, as defined in regulations issued by the Director;

`(2) has not been named on 5 or more previously filed patent applications, not including applications filed in another country, provisional applications under section 111(b), or international applications filed under the treaty defined in section 351(a) for which the basic national fee under section 41(a) was not paid;

`(3) did not in the prior calendar year have a gross income, as defined in section 61(a) of the Internal Revenue Code (26 U.S.C. 61(a)), exceeding 3 times the most recently reported median household income, as reported by the Bureau of Census; and

`(4) has not assigned, granted, conveyed, and is not under an obligation by contract or law to assign, grant, or convey, a license or other ownership interest in the particular application to an entity that had a gross income, as defined in section 61(a) of the Internal Revenue Code (26 U.S.C. 61(a)), exceeding 3 times the most recently reported median household income, as reported by the Bureau of the Census, in the calendar year preceding the calendar year in which the fee is being paid, other than an entity of higher education where the applicant is not an employee, a relative of an employee, or have any affiliation with the entity of higher education.

`(b) Applications Resulting From Prior Employment- An applicant is not considered to be named on a previously filed application for purposes of subsection (a)(2) if the applicant has assigned, or is under an obligation by contract or law to assign, all ownership rights in the application as the result of the applicant's previous employment.

`(c) Foreign Currency Exchange Rate- If an applicant's or entity's gross income in the preceding year is not in United States dollars, the average currency exchange rate, as reported by the Internal Revenue Service, during the preceding year shall be used to determine whether the applicant's or entity's gross income exceeds the threshold specified in paragraphs (3) or (4) of subsection (a).

`(d) State Institutions of Higher Education-

`(1) IN GENERAL- For purposes of this section, a micro entity shall include an applicant who certifies that--

`(A) the applicant's employer, from which the applicant obtains the majority of the applicant's income, is a State public institution of higher education, as defined in section 102 of the Higher Education Act of 1965 (20 U.S.C. 1002); or

`(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 application to such State public institution.

`(2) Director'S AUTHORITY- The Director may, in the Director's discretion, impose income limits, annual filing limits, or other limits on who may qualify as a micro entity pursuant to this subsection if the Director determines that such additional limits are reasonably necessary to avoid an undue impact on other patent applicants or owners or are otherwise reasonably necessary and appropriate. At least 3 months before any limits proposed to be imposed pursuant to this paragraph shall take effect, the Director shall inform the Committee on the Judiciary of the House of Representatives and the Committee on the Judiciary of the Senate of any such proposed limits.'.

SEC. 13. FUNDING AGREEMENTS.

(a) In General- Section 202(c)(7)(E)(i) of title 35, United States Code, is amended--

(1) by striking `75 percent' and inserting `15 percent'; and

(2) by striking `25 percent' and inserting `85 percent'.

(b) Effective Date- The amendments made by this section shall take effect on the date of enactment of this Act and shall apply to patents issued before, on, or after that date.

SEC. 14. TAX STRATEGIES DEEMED WITHIN THE PRIOR ART.

(a) In General- For purposes of evaluating an invention under section 102 or 103 of title 35, United States Code, any strategy for reducing, avoiding, or deferring tax liability, whether known or unknown at the time of the invention or application for patent, shall be deemed insufficient to differentiate a claimed invention from the prior art.

(b) Definition- For purposes of this section, the term `tax liability' refers to any liability for a tax under any Federal, State, or local law, or the law of any foreign jurisdiction, including any statute, rule, regulation, or ordinance that levies, imposes, or assesses such tax liability.

(c) Rule of Construction- Nothing in this section shall be construed to imply that other business methods are patentable or that other business-method patents are valid.

(d) Effective Date; Applicability- This section shall take effect on the date of enactment of this Act and shall apply to any patent application pending and any patent issued on or after that date.

(e) Exclusion- This section does not apply to that part of an invention that is a method, apparatus, computer program product, or system, that is used solely for preparing a tax or information return or other tax filing, including one that records, transmits, transfers, or organizes data related to such filing.

SEC. 15. BEST MODE REQUIREMENT.

(a) In General- Section 282 of title 35, United State Code, is amended in its second undesignated paragraph by striking paragraph (3) and inserting the following:

`(3) Invalidity of the patent or any claim in suit for failure to comply with--

`(A) any requirement of section 112, except that the failure to disclose the best mode shall not be a basis on which any claim of a patent may be canceled or held invalid or otherwise unenforceable; or

`(B) any requirement of section 251.'.

(b) Conforming Amendment- Sections 119(e)(1) and 120 of title 35, United States Code, are each amended by striking `the first paragraph of section 112 of this title' and inserting `section 112(a) (other than the requirement to disclose the best mode)'.

(c) Effective Date- The amendments made by this section shall take effect upon the date of the enactment of this Act and shall apply to proceedings commenced on or after that date.

SEC. 16. TECHNICAL AMENDMENTS.

(a) Joint Inventions- Section 116 of title 35, United States Code, is amended--

(1) in the first paragraph, by striking `When' and inserting `(a) Joint Inventions- When';

(2) in the second paragraph, by striking `If a joint inventor' and inserting `(b) Omitted Inventor- If a joint inventor'; and

(3) in the third paragraph--

(A) by striking `Whenever' and inserting `(c) Correction of Errors in Application- Whenever'; and

(B) by striking `and such error arose without any deceptive intent on his part,'.

(b) Filing of Application in Foreign Country- Section 184 of title 35, United States Code, is amended--

(1) in the first paragraph--

(A) by striking `Except when' and inserting `(a) Filing in Foreign Country- Except when'; and

(B) by striking `and without deceptive intent';

(2) in the second paragraph, by striking `The term' and inserting `(b) Application- The term'; and

(3) in the third paragraph, by striking `The scope' and inserting `(c) Subsequent Modifications, Amendments, and Supplements- The scope'.

(c) Filing Without a License- Section 185 of title 35, United States Code, is amended by striking `and without deceptive intent'.

(d) Reissue of Defective Patents- Section 251 of title 35, United States Code, is amended--

(1) in the first paragraph--

(A) by striking `Whenever' and inserting `(a) In General- Whenever'; and

(B) by striking `without any deceptive intention';

(2) in the second paragraph, by striking `The Director' and inserting `(b) Multiple Reissued Patents- The Director';

(3) in the third paragraph, by striking `The provisions' and inserting `(c) Applicability of This Title- The provisions'; and

(4) in the last paragraph, by striking `No reissued patent' and inserting `(d) Reissue Patent Enlarging Scope of Claims- No reissued patent'.

(e) Effect of Reissue- Section 253 of title 35, United States Code, is amended--

(1) in the first paragraph, by striking `Whenever, without any deceptive intention' and inserting `(a) In General- Whenever'; and

(2) in the second paragraph, by striking `in like manner' and inserting `(b) Additional Disclaimer or Dedication- In the manner set forth in subsection (a),'.

(f) Correction of Named Inventor- Section 256 of title 35, United States Code, is amended--

(1) in the first paragraph--

(A) by striking `Whenever' and inserting `(a) Correction- Whenever'; and

(B) by striking `and such error arose without any deceptive intention on his part'; and

(2) in the second paragraph, by striking `The error' and inserting `(b) Patent Valid if Error Corrected- The error'.

(g) Presumption of Validity- Section 282 of title 35, United States Code, is amended--

(1) in the first undesignated paragraph--

(A) by striking `A patent' and inserting `(a) In General- A patent'; and

(B) by striking the third sentence;

(2) in the second undesignated paragraph, by striking `The following' and inserting `(b) Defenses- The following'; and

(3) in the third undesignated paragraph, by striking `In actions' and inserting `(c) Notice of Actions; Actions During Extension of Patent Term- In actions'.

(h) Action for Infringement- Section 288 of title 35, United States Code, is amended by striking `, without deceptive intention,'.

(i) Reviser's Notes-

(1) Section 3(e)(2) of title 35, United States Code, is amended by striking `this Act,' and inserting `that Act,'.

(2) Section 202 of title 35, United States Code, is amended--

(A) in subsection (b)(3), by striking `the section 203(b)' and inserting `section 203(b)'; and

(B) in subsection (c)(7)--

(i) in subparagraph (D), by striking `except where it proves' and all that follows through `; and' and inserting: `except where it is determined to be infeasible following a reasonable inquiry, a preference in the licensing of subject inventions shall be given to small business firms; and'; and

(ii) in subparagraph (E)(i), by striking `as described above in this clause (D);' and inserting `described above in this clause;'.

(3) Section 209(d)(1) of title 35, United States Code, is amended by striking `nontransferrable' and inserting `nontransferable'.

(4) Section 287(c)(2)(G) of title 35, United States Code, is amended by striking `any state' and inserting `any State'.

(5) Section 371(b) of title 35, United States Code, is amended by striking `of the treaty' and inserting `of the treaty.'.

(j) Unnecessary References-

(1) IN GENERAL- Title 35, United States Code, is amended by striking `of this title' each place that term appears.

(2) EXCEPTION- The amendment made by paragraph (1) shall not apply to the use of such term in the following sections of title 35, United States Code:

(A) Section 1(c).

(B) Section 101.

(D) The first instance of the use of such term in section 111(b)(8).

(E) Section 157(a).

(F) Section 161.

(G) Section 164.

(H) Section 171.

(I) Section 251(c), as so designated by this section.

(J) Section 261.

(K) Subsections (g) and (h) of section 271.

(L) Section 287(b)(1).

(M) Section 289.

(N) The first instance of the use of such term in section 375(a).

(k) Effective Date- The amendments made by this section shall take effect 1 year after the date of the enactment of this Act and shall apply to proceedings commenced on or after that effective date.

SEC. 17. CLARIFICATION OF JURISDICTION.

(a) Short Title- This section may be cited as the `Intellectual Property Jurisdiction Clarification Act of 2011'.

(b) State Court Jurisdiction- Section 1338(a) of title 28, United States Code, is amended by striking the second sentence and inserting the following: `No State court shall have jurisdiction over any claim for relief arising under any Act of Congress relating to patents, plant variety protection, or copyrights.'.

(c) Court of Appeals for the Federal Circuit- Section 1295(a)(1) of title 28, United States Code, is amended to read as follows:

`(1) of an appeal from a final decision of a district court of the United States, the District Court of Guam, the District Court of the Virgin Islands, or the District Court of the Northern Mariana Islands, in any civil action arising under, or in any civil action in which a party has asserted a compulsory counterclaim arising under, any Act of Congress relating to patents or plant variety protection;'.

(d) Removal-

(1) IN GENERAL- Chapter 89 of title 28, United States Code, is amended by adding at the end the following new section:

`Sec. 1454. Patent, plant variety protection, and copyright cases

`(a) In General- A civil action in which any party asserts a claim for relief arising under any Act of Congress relating to patents, plant variety protection, or copyrights may be removed to the district court of the United States for the district and division embracing the place where such action is pending.

`(b) Special Rules- The removal of an action under this section shall be made in accordance with section 1446 of this chapter, except that if the removal is based solely on this section--

`(1) the action may be removed by any party; and

`(2) the time limitations contained in section 1446(b) may be extended at any time for cause shown.

`(c) Derivative Jurisdiction Not Required- The court to which a civil action is removed under this section is not precluded from hearing and determining any claim in such civil action because the State court from which such civil action is removed did not have jurisdiction over that claim.

`(d) Remand- If a civil action is removed solely under this section, the district court--

`(1) shall remand all claims that are neither a basis for removal under subsection (a) nor within the original or supplemental jurisdiction of the district court under any Act of Congress; and

`(2) may, under the circumstances specified in section 1367(c), remand any claims within the supplemental jurisdiction of the district court under section 1367.'.

(2) CONFORMING AMENDMENT- The table of sections for chapter 89 of title 28, United States Code, is amended by adding at the end the following new item:

`1454. Patent, plant variety protection, and copyright cases.'.

(e) Transfer by Court of Appeals for the Federal Circuit-

(1) IN GENERAL- Chapter 99 of title 28, United States Code, is amended by adding at the end the following new section:

`Sec. 1632. Transfer by the Court of Appeals for the Federal Circuit

`When a case is appealed to the Court of Appeals for the Federal Circuit under section 1295(a)(1), and no claim for relief arising under any Act of Congress relating to patents or plant variety protection is the subject of the appeal by any party, the Court of Appeals for the Federal Circuit shall transfer the appeal to the court of appeals for the regional circuit embracing the district from which the appeal has been taken.'.

(2) CONFORMING AMENDMENT- The table of sections for chapter 99 of title 28, United States Code, is amended by adding at the end the following new item:

`1632. Transfer by the Court of Appeals for the Federal Circuit.'.

(f) Effective Date- The amendments made by this section shall apply to any civil action commenced on or after the date of the enactment of this Act.

SEC. 18. TRANSITIONAL PROGRAM FOR COVERED BUSINESS-METHOD PATENTS.

(a) References- Except as otherwise expressly provided, wherever in this section language is expressed in terms of a section or chapter, the reference shall be considered to be made to that section or chapter in title 35, United States Code.

(b) Transitional Program-

(1) ESTABLISHMENT- Not later than 1 year after the date of enactment of this Act, the Director shall issue regulations establishing and implementing a transitional post-grant review proceeding for review of the validity of covered business-method patents. The transitional proceeding implemented pursuant to this subsection shall be regarded as, and shall employ the standards and procedures of, a post-grant review under chapter 32, subject to the following exceptions and qualifications:

(A) Section 321(c) and subsections (e)(2), (f), and (g) of section 325 shall not apply to a transitional proceeding.

(B) A person may not file a petition for a transitional proceeding with respect to a covered business-method patent unless the person or his real party in interest has been sued for infringement of the patent or has been charged with infringement under that patent.

(C) A petitioner in a transitional proceeding who challenges the validity of 1 or more claims in a covered business-method patent on a ground raised under section 102 or 103 as in effect on the day prior to the date of enactment of this Act may support such ground only on the basis of--

(i) prior art that is described by section 102(a) (as in effect on the day prior to the date of enactment of this Act); or

(ii) prior art that--

(I) discloses the invention more than 1 year prior to the date of the application for patent in the United States; and

(II) would be described by section 102(a) (as in effect on the day prior to the date of enactment of this Act) if the disclosure had been made by another before the invention thereof by the applicant for patent.

(D) The petitioner in a transitional proceeding, or his real party in interest, may not assert either in a civil action arising in whole or in part under section 1338 of title 28, United States Code, or in a proceeding before the International Trade Commission that a claim in a patent is invalid on any ground that the petitioner raised during a transitional proceeding that resulted in a final written decision.

(E) The Director may institute a transitional proceeding only for a patent that is a covered business-method patent.

(2) EFFECTIVE DATE- The regulations issued pursuant to paragraph (1) shall take effect on the date that is 1 year after the date of enactment of this Act and shall apply to all covered business-method patents issued before, on, or after such date of enactment, except that the regulations shall not apply to a patent described in the first sentence of section 5(f)(2) of this Act during the period that a petition for post-grant review of that patent would satisfy the requirements of section 321(c).

(3) SUNSET-

(A) IN GENERAL- This subsection, and the regulations issued pursuant to this subsection, are repealed effective on the date that is 4 years after the date that the regulations issued pursuant to paragraph (1) take effect.

(B) APPLICABILITY- Notwithstanding subparagraph (A), this subsection and the regulations implemented pursuant to this subsection shall continue to apply to any petition for a transitional proceeding that is filed prior to the date that this subsection is repealed pursuant to subparagraph (A).

(1) IN GENERAL- If a party seeks a stay of a civil action alleging infringement of a patent under section 281 in relation to a transitional proceeding for that patent, the court shall decide whether to enter a stay based on--

(A) whether a stay, or the denial thereof, will simplify the issues in question and streamline the trial;

(B) whether discovery is complete and whether a trial date has been set;

(C) whether a stay, or the denial thereof, would unduly prejudice the nonmoving party or present a clear tactical advantage for the moving party; and

(D) whether a stay, or the denial thereof, will reduce the burden of litigation on the parties and on the court.

(2) REVIEW- A party may take an immediate interlocutory appeal from a district court's decision under paragraph (1). The United States Court of Appeals for the Federal Circuit shall review the district court's decision to ensure consistent application of established precedent, and such review may be de novo.

(d) Definition- For purposes of this section, the term `covered business method patent' means a patent that claims a method or corresponding apparatus for performing data processing operations utilized in the practice, administration, or management of a financial product or service, except that the term shall not include patents for technological inventions. Solely for the purpose of implementing the transitional proceeding authorized by this subsection, the Director shall prescribe regulations for determining whether a patent is for a technological invention.

(e) Rule of Construction- Nothing in this section shall be construed as amending or interpreting categories of patent-eligible subject matter set forth under section 101.

SEC. 19. TRAVEL EXPENSES AND PAYMENT OF ADMINISTRATIVE JUDGES.

(a) Authority To Cover Certain Travel Related Expenses- Section 2(b)(11) of title 35, United States Code, is amended by inserting `, and the Office is authorized to expend funds to cover the subsistence expenses and travel-related expenses, including per diem, lodging costs, and transportation costs, of non-federal employees attending such programs' after `world'.

(b) Payment of Administrative Judges- Section 3(b) of title 35, United States Code, is amended by adding at the end the following:

`(6) ADMINISTRATIVE PATENT JUDGES AND ADMINISTRATIVE TRADEMARK JUDGES- The Director has the authority to fix the rate of basic pay for the administrative patent judges appointed pursuant to section 6 of this title and the administrative trademark judges appointed pursuant to section 17 of the Trademark Act of 1946 (15 U.S.C. 1067) at not greater than the rate of basic pay payable for Level III of the Executive Schedule. The payment of a rate of basic pay under this paragraph shall not be subject to the pay limitation of section 5306(e) or 5373 of title 5.'.

SEC. 20. PATENT AND TRADEMARK OFFICE FUNDING.

(a) Definitions- In this section, the following definitions shall apply:

(1) DIRECTOR- The term `Director' means the Director of the United States Patent and Trademark Office.

(2) FUND- The term `Fund' means the public enterprise revolving fund established under subsection (c).

(3) OFFICE- The term `Office' means the United States Patent and Trademark Office.

(4) TRADEMARK ACT OF 1946- The term `Trademark Act of 1946' means an Act entitled `Act to provide for 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').

(5) UNDER SECRETARY- The term `Under Secretary' means the Under Secretary of Commerce for Intellectual Property.

(b) Funding-

(1) IN GENERAL- Section 42 of title 35, United States Code, is amended--

(A) in subsection (b), by striking `Patent and Trademark Office Appropriation Account' and inserting `United States Patent and Trademark Office Public Enterprise Fund'; and

(B) in subsection (c), in the first sentence--

(i) by striking `To the extent' and all that follows through `fees' and inserting `Fees'; and

(ii) by striking `shall be collected by and shall be available to the Director' and inserting `shall be collected by the Director and shall be available until expended'.

(2) EFFECTIVE DATE- The amendments made by paragraph (1) shall take effect on the later of--

(A) October 1, 2011; or

(B) the first day of the first fiscal year that begins after the date of the enactment of this Act.

(1) ESTABLISHMENT- There is established in the Treasury of the United States a revolving fund to be known as the `United States Patent and Trademark Office Public Enterprise Fund'. Any amounts in the Fund shall be available for use by the Director without fiscal year limitation.

(2) DERIVATION OF RESOURCES- There shall be deposited into the Fund on or after the effective date of subsection (b)(1)--

(A) any fees collected under sections 41, 42, and 376 of title 35, United States Code, provided that notwithstanding any other provision of law, if such fees are collected by, and payable to, the Director, the Director shall transfer such amounts to the Fund, provided, however, that no funds collected pursuant to section 9(h) of this Act or section 1(a)(2) of Public Law 111-45 shall be deposited in the Fund; and

(B) any fees collected under section 31 of the Trademark Act of 1946 (15 U.S.C. 1113).

(3) EXPENSES- Amounts deposited into the Fund under paragraph (2) shall be available, without fiscal year limitation, to cover--

(A) all expenses to the extent consistent with the limitation on the use of fees set forth in section 42(c) of title 35, United States Code, including all administrative and operating expenses, determined in the discretion of the Under Secretary to be ordinary and reasonable, incurred by the Under Secretary and the Director for the continued operation of all services, programs, activities, and duties of the Office relating to patents and trademarks, as such services, programs, activities, and duties are described under--

(i) title 35, United States Code; and

(ii) the Trademark Act of 1946; and

(B) all expenses incurred pursuant to any obligation, representation, or other commitment of the Office.

(d) Annual Report- Not later than 60 days after the end of each fiscal year, the Under Secretary and the Director shall submit a report to Congress which shall--

(1) summarize the operations of the Office for the preceding fiscal year, including financial details and staff levels broken down by each major activity of the Office;

(2) detail the operating plan of the Office, including specific expense and staff needs for the upcoming fiscal year;

(3) describe the long term modernization plans of the Office;

(4) set forth details of any progress towards such modernization plans made in the previous fiscal year; and

(5) include the results of the most recent audit carried out under subsection (f).

(e) Annual Spending Plan-

(1) IN GENERAL- Not later than 30 days after the beginning of each fiscal year, the Director shall notify the Committees on Appropriations of both Houses of Congress of the plan for the obligation and expenditure of the total amount of the funds for that fiscal year in accordance with section 605 of the Science, State, Justice, Commerce, and Related Agencies Appropriations Act, 2006 (Public Law 109-108; 119 Stat. 2334).

(2) CONTENTS- Each plan under paragraph (1) shall--

(A) summarize the operations of the Office for the current fiscal year, including financial details and staff levels with respect to major activities; and

(B) detail the operating plan of the Office, including specific expense and staff needs, for the current fiscal year.

(f) Audit- The Under Secretary shall, on an annual basis, provide for an independent audit of the financial statements of the Office. Such audit shall be conducted in accordance with generally acceptable accounting procedures.

(g) Budget- The Fund shall prepare and submit each year to the President a business-type budget in a manner, and before a date, as the President prescribes by regulation for the budget program.

SEC. 21. SATELLITE OFFICES.

(a) Establishment- Subject to available resources, the Director may establish 3 or more satellite offices in the United States to carry out the responsibilities of the Patent and Trademark Office.

(b) Purpose- The purpose of the satellite offices established under subsection (a) are to--

(1) increase outreach activities to better connect patent filers and innovators with the Patent and Trademark Office;

(2) enhance patent examiner retention;

(3) improve recruitment of patent examiners; and

(4) decrease the number of patent applications waiting for examination and improve the quality of patent examination.

(c) Required Considerations- In selecting the locale of each satellite office to be established under subsection (a), the Director--

(1) shall ensure geographic diversity among the offices, including by ensuring that such offices are established in different States and regions throughout the Nation;

(2) may rely upon any previous evaluations by the Patent and Trademark Office of potential locales for satellite offices, including any evaluations prepared as part of the Patent and Trademark Office's Nationwide Workforce Program that resulted in the 2010 selection of Detroit, Michigan as the first ever satellite office of the Patent and Trademark Office; and

(3) nothing in the preceding paragraph shall constrain the Patent and Trademark Office to only consider its prior work from 2010. The process for site selection shall be open.

(d) Phase-in- The Director shall satisfy the requirements of subsection (a) over the 3-year period beginning on the date of enactment of this Act.

(e) Report to Congress- Not later than the end of the first fiscal year that occurs after the date of the enactment of this Act, and each fiscal year thereafter, the Director shall submit a report to Congress on--

(1) the rationale of the Director in selecting the locale of any satellite office required under subsection (a);

(2) the progress of the Director in establishing all such satellite offices; and

(3) whether the operation of existing satellite offices is achieving the purposes required under subsection (b).

(f) Definitions- In this section, the following definitions shall apply:

(1) DIRECTOR- The term `Director' means the Director of the United States Patent and Trademark Office.

(2) PATENT AND TRADEMARK OFFICE- The term `Patent and Trademark Office' means the United States Patent and Trademark Office.

SEC. 22. PATENT OMBUDSMAN PROGRAM FOR SMALL BUSINESS CONCERNS.

Subject to available resources, the Director may establish in the United States Patent and Trademark Office a Patent Ombudsman Program. The duties of the Program's staff shall include providing support and services relating to patent filings to small business concerns.

SEC. 23. PRIORITY EXAMINATION FOR TECHNOLOGIES IMPORTANT TO AMERICAN COMPETITIVENESS.

Section 2(b)(2) of title 35, United States Code, is amended--

(1) in subparagraph (E), by striking `; and' and inserting a semicolon;

(2) in subparagraph (F), by striking the semicolon and inserting `; and'; and

(3) by adding at the end the following:

`(G) may, subject to any conditions prescribed by the Director and at the request of the patent applicant, provide for prioritization of examination of applications for products, processes, or technologies that are important to the national economy or national competitiveness without recovering the aggregate extra cost of providing such prioritization, notwithstanding section 41 or any other provision of law;'.

SEC. 24. DESIGNATION OF DETROIT SATELLITE OFFICE.

(a) Designation- The satellite office of the United States Patent and Trademark Office to be located in Detroit, Michigan shall be known and designated as the `Elijah J. McCoy United States Patent and Trademark Office'.

(b) References- Any reference in a law, map, regulation, document, paper, or other record of the United States to the satellite office of the United States Patent and Trademark Office to be located in Detroit, Michigan referred to in subsection (a) shall be deemed to be a reference to the `Elijah J. McCoy United States Patent and Trademark Office'.

SEC. 25. EFFECTIVE DATE.

Except as otherwise provided in this Act, the provisions of this Act shall take effect 1 year after the date of the enactment of this Act and shall apply to any patent issued on or after that effective date.

SEC. 26. BUDGETARY EFFECTS.

The budgetary effects of this Act, for the purpose of complying with the Statutory Pay-As-You-Go-Act of 2010, shall be determined by reference to the latest statement titled `Budgetary Effects of PAYGO Legislation' for this Act, submitted for printing in the Congressional Record by the Chairman of the Senate Budget Committee, provided that such statement has been submitted prior to the vote on passage.

Passed the Senate March 8, 2011.

Attest:

Secretary.

112th CONGRESS

1st Session

S. 23

AN ACT

To amend title 35, United States Code, to provide for patent reform.

END