[Discussion Draft] F:\SLW\SLW_075.XML [DISCUSSION DRAFT] MAY 23, 2013 H. R. ll 113TH CONGRESS 1ST SESSION To amend title 35, United States Code, and the Leahy-Smith America Invents Act to make improvements and technical corrections, and for other purposes. IN THE HOUSE OF REPRESENTATIVES Ml. llllll introduced the following bill; which was referred to the Committee on llllllllllllll A BILL To amend title 35, United States Code, and the LeahySmith America Invents Act to make improvements and technical corrections, and for other purposes. 1 Be it enacted by the Senate and House of Representa- 2 tives of the United States of America in Congress assembled, 3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 4 (a) SHORT TITLE.--This Act may be cited as the 5 ?''lllllll Act of 2013''?. 6 (b) TABLE OF CONTENTS.--The table of contents for 7 this Act is as follows: Sec. 1. Short title; table of contents. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00001 Fmt 6652 Sfmt 6211 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 2 Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec. Sec. 2. 3. 4. 5. 6. Definitions. Incentivizing settlement in patent litigation. Transparency of Patent Ownership. Customer-suit exception. Procedures and Practices to Implement and Recommendations to the Judicial Conference. 7. Small Business Education, Outreach, and Information Access. 8. Studies on Patent Transactions, Quality, and Examination. 9. Improvements and Technical Corrections to the Leahy-Smith America Invents Act. 10. Effective Date. 1 SEC. 2. DEFINITIONS. 2 In this Act: 3 (1) DIRECTOR.--The term ''Director'' means 4 the Under Secretary of Commerce for Intellectual 5 Property and Director of the United States Patent 6 and Trademark Office. 7 (2) OFFICE.--The term ''Office'' means the 8 9 United States Patent and Trademark Office. SEC. 3. INCENTIVIZING SETTLEMENT IN PATENT LITIGA- 10 11 TION. (a) AMENDMENT.--Chapter 29 of title 35, United 12 States Code, is amended by inserting after section 285 the 13 following new section: 14 ''? 285A. Award of costs and attorney's fees after an 15 16 offer of settlement ''(a) SETTLEMENT OFFER.--In an action involving 17 the validity or infringement of a patent (including a coun18 terclaim or cross claim), any party may, at any time not 19 less than 10 days before trial, serve upon any adverse 20 party a written offer to settle a claim or claims for money f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 3 1 or property or to the effect specified in the offer, including 2 a motion to dismiss all claims, and to enter into a stipula3 tion dismissing the claim or claims or allowing judgment 4 to be entered according to the terms of the offer. Any such 5 offer, together with proof of service thereof, shall be filed 6 with the clerk of the court. 7 ''(b) NOTICE OF ACCEPTANCE.--If the party receiv- 8 ing an offer under subsection (a) serves written notice on 9 the offeror that the offer is accepted, either party may 10 then file with the clerk of the court the notice of accept11 ance, together with proof of service thereof. 12 ''(c) MULTIPLE OFFERS; INADMISSIBILITY.--The 13 fact that an offer under subsection (a) is made but not 14 accepted does not preclude a subsequent offer under sub15 section (a). Evidence of an offer is not admissible for any 16 purpose except in proceedings to enforce a settlement or 17 to determine costs and expenses under this section. 18 ''(d) CLAIM EXEMPTION.--At any time before judg- 19 ment is entered, the court, upon its own motion or upon 20 the motion of any party, may exempt from this section 21 any claim that the court finds presents a question of law 22 or fact that is novel or that substantially affects non23 parties. If a claim is exempted from this section, all offers 24 made by any party under subsection (a) with respect to 25 that claim shall be void and have no effect. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 4 1 2 ''(e) PETITION PENSES.--If FOR PAYMENT OF COSTS AND EX- all offers made by a party under subsection 3 (a) with respect to a claim or claims, including any motion 4 to dismiss all claims, are not accepted and the judgment, 5 verdict, or order finally issued (other than costs, expenses, 6 and attorney's fees incurred after judgment or trial) in 7 the action under this section is not more favorable to the 8 offeree with respect to the claim or claims than the last 9 such offer, the offeror may file with the court, within 10 10 days after the final judgment, verdict, or order is issued, 11 a petition for payment of costs and expenses, including 12 attorney's fees, incurred with respect to the claim or 13 claims on or after the date the last such offer was made 14 or, if the offeree made an offer under this section, on or 15 after the date the last such offer by the offeree was made. 16 ''(f) ORDER TO PAY COSTS AND EXPENSES.-- 17 ''(1) IN GENERAL.--Except as provided in para- 18 graph (2), if the court finds, pursuant to a petition 19 filed under subsection (e) with respect to a claim or 20 claims, that the judgment, verdict, or order finally 21 obtained is not more favorable to the offeree with re- 22 spect to the claim or claims than the last offer made 23 under this section, the court shall order the offeree 24 to pay the offeror's costs and expenses, including at- 25 torneys' fees, incurred with respect to the claim or f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 5 1 claims on or after the date the last offer was made 2 or, if the offeree made an offer under this section, 3 on or after the date the last such offer by the offeree 4 was made. 5 ''(2) EXCEPTIONS.--The court may not order 6 the offeree to pay the offeror's costs and expenses 7 described in paragraph (1) if the court finds that-- 8 ''(A) requiring the payment of such costs 9 and expenses would be manifestly unjust; or 10 ''(B) the offeree's rejection of the offer was 11 substantially justified. 12 ''(3) LIMITATION ON ATTORNEY'S FEES.--At- 13 torney's fees under this subsection shall be a reason- 14 able attorney's fee attributable to the claim or 15 claims involved, calculated on the basis of an hourly 16 rate that may not exceed that which the court con- 17 siders acceptable in the community in which the at- 18 torney practices law, taking into account the attor- 19 ney's qualifications and experience and the com- 20 plexity of the case, except that the attorney's fees 21 under this subsection may not exceed-- 22 ''(A) the actual cost incurred by the offeree 23 for an attorney's fee payable to an attorney for 24 services in connection with the claim or claims; 25 or f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 6 1 ''(B) if no such cost was incurred by the 2 offeree due to a contingency fee agreement, a 3 reasonable cost that would have been incurred 4 by the offeree for an attorney's noncontingent 5 fee payable to an attorney for services in con- 6 nection with the claim or claims. 7 ''(g) EQUITABLE REMEDY.--This section does not 8 apply to any claim seeking an equitable remedy.''. 9 (b) CONFORMING AMENDMENT.--The table of sec- 10 tions for chapter 29 of title 35, United States Code, is 11 amended by inserting after the item relating to section 12 285 the following new item: ''285A. Award of costs and attorney's fees after an offer of settlement.''. 13 (c) EFFECTIVE DATE.--The amendments made by 14 this section shall take effect on the date of the enactment 15 of this Act and shall apply to any action for which a com16 plaint is filed on or after such date of enactment. 17 SEC. 4. TRANSPARENCY OF PATENT OWNERSHIP. 18 (a) REMEDY FOR INFRINGEMENT OF PATENT.-- 19 20 (1) AMENDMENTS.--Section 281 of title 35, United States Code, is amended-- 21 (A) by striking ''A patentee'' and inserting 22 ''(a) REMEDY.--A patentee''; and 23 (B) by adding at the end the following new 24 subsections: f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 7 1 ''(b) INITIAL DISCLOSURE.--A patentee filing a civil 2 action under subsection (a) shall disclose to the Patent 3 and Trademark Office, the court, and each adverse party 4 each person, parent corporation, or other entity, other 5 than the patentee, that the patentee knows to have, during 6 the 6-year period ending on the date on which the action 7 is filed-- 8 ''(1) a financial interest in-- 9 ''(A) the patent or patents at issue; or 10 ''(B) a party to the civil action; or 11 ''(2) any other interest that could be substan- 12 tially affected by the outcome of the proceeding. 13 ''(c) FINANCIAL INTEREST DEFINED.--In this sec- 14 tion, the term 'financial interest' has the meaning given 15 that term in section 455(d)(4) of title 28.''. 16 (2) EFFECTIVE DATE.--The amendments made 17 by this section shall take effect upon the expiration 18 of the 6-month period beginning on the date of the 19 enactment of this Act and shall apply to any action 20 for which a complaint is filed on or after such effec- 21 tive date. 22 (b) DISCLOSURE OF INFORMATION RELATED TO 23 PATENT OWNERSHIP.-- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 8 1 (1) AMENDMENT.--Chapter 26 of title 35, 2 United States Code, is amended by adding at the 3 end the following new section: 4 ''? 263. Disclosure of Information Related to Patent 5 6 Ownership ''(a) DEMAND LETTER DISCLOSURE.--Any entity 7 that sends 20 or more demand letters relating to a patent 8 issued under this title during a 365-day period shall, with9 in 30 days after the date on which the first such letter 10 is sent, submit to the Patent and Trademark Office with 11 respect to each patent that was the subject in each such 12 letter the following: 13 ''(1) Identification of the patent and confirma- 14 tion that the entity who sent the letter is the owner 15 of the patent (or a representative of such person) 16 and is the last recorded entity in the records of the 17 Patent and Trademark Office for purposes of as- 18 signment, grant, or conveyance under this chapter. 19 ''(2) Identification of the entity that has the 20 right to license the patent or, in the case of a patent 21 already exclusively licensed, the name of the exclu- 22 sive licensee. 23 ''(3) Identification of each entity asserting a 24 claim with regard to a patent in such letter in ac- 25 cordance with subsection (b). f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 9 1 2 ''(4) In the case of a patent that has been licensed, an identification of each licensee. 3 ''(5) Identification of each obligation to license 4 the patent on reasonable and nondiscriminatory 5 terms, including a copy of each letter of assurance 6 to each standard-setting organization with respect to 7 such obligation, and the financial terms, including 8 the rate, at which such patent has been licensed pur- 9 suant to such obligation. 10 11 ''(6) Identification of the ultimate parent entity of such entity. 12 ''(7) Any required registration fee established 13 with regard to this section. 14 ''(b) IDENTIFICATION.-- 15 ''(1) PUBLICLY TRADED.--For purposes of sub- 16 section (a)(3), if the entity to be identified is owned 17 or controlled by a corporation traded on a public 18 stock exchange, an identification of the publicly 19 traded corporation and the public stock exchange 20 shall be sufficient. 21 ''(2) NOT PUBLICLY TRADED.--For purposes of 22 subsection (a)(3), if the entity to be identified is not 23 owned or controlled by a publicly traded corporation, 24 the information shall identify-- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 10 1 ''(A) in the case of a partnership, the 2 name and address of each partner or other enti- 3 ty, holding more than a 5 percent share of that 4 partnership; 5 ''(B) in the case of a corporation, the loca- 6 tion of incorporation and the name of each offi- 7 cer of the corporation; 8 ''(C) in the case of an entity that is di- 9 rectly or indirectly controlled by another entity, 10 the name and address of the entity and each 11 other entity, and the name, address, location of 12 incorporation, and each officer or partner of the 13 entity and each other entity; and 14 ''(D) for each individual, the name and ad- 15 dress of that individual. 16 ''(c) FAILURE TO COMPLY.-- 17 ''(1) MONETARY SANCTIONS.--Any entity that 18 does not meet the requirements of this section with 19 regard to a patent may be subject to monetary sanc- 20 tions by a court in an action brought by such entity 21 with regard to infringement or validity of such pat- 22 ent, for an amount to be awarded to the adverse 23 party that covers any cost incurred by the adverse 24 party resulting from the failure of such entity to 25 meet the requirements of this section, including any f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 11 1 reasonable cost incurred by such adverse party to 2 discover the correct and complete information de- 3 scribed under subsection (a) with regard to such 4 patent, unless such sanctions would be unjust. 5 ''(2) AWARD OF DAMAGES OR FEES.--A court 6 in a case involving monetary sanctions described in 7 paragraph (1) may not award treble damages under 8 the second undesignated paragraph of section 284 or 9 attorney's fees under section 285 to the entity de- 10 scribed in paragraph (1), unless the denial of such 11 damages or fees would be manifestly unjust. 12 ''(d) ONGOING DUTY 13 MENT.--An TO CORRECT OR SUPPLE- entity described in subsection (a) shall update 14 any filing made pursuant to such subsection with correct 15 information not later than 90 days after any change in 16 the information described under subsection (a). 17 ''(e) DEFINITIONS.--In this section: 18 ''(1) DEMAND LETTER RELATING TO A PAT- 19 ENT.--The 20 means any written communication directed to an un- 21 affiliated third party stating or indicating, directly 22 or indirectly, that the intended recipient or anyone 23 affiliated with that recipient is infringing a patent, 24 or may bear liability or owe compensation to another 25 because of such patent. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 term 'demand letter relating to a patent' (548657|20) PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 12 1 ''(2) ULTIMATE 2 ''(A) IN PARENT ENTITY.-- GENERAL.--Except as provided in 3 subparagraph (B), the term 'ultimate parent 4 entity' has the meaning given such term in sec- 5 tion 801.1(a)(3) of title 16, Code of Federal 6 Regulations, or any successor regulation. 7 ''(B) MODIFICATION OF DEFINITION.--The 8 Director may modify the definition of 'ultimate 9 parent entity' by regulation.''. 10 (2) CONFORMING AMENDMENT.--The table of 11 sections for chapter 26 of title 35, United States 12 Code, is amended by adding at the end the following 13 new item: ''263. Disclosure of Information Related to Patent Ownership.''. 14 (3) REGULATIONS.--The Director may promul- 15 gate such regulations as are necessary to establish 16 a registration fee in an amount sufficient to recover 17 the estimated costs of administering section 263 of 18 title 35, United States Code, as added by paragraph 19 (1), to facilitate the collection and maintenance of 20 the information required by such section, and to en- 21 sure the timely disclosure of such information to the 22 public. 23 (4) EFFECTIVE DATE.--The amendments made 24 by this section shall take effect upon the expiration 25 of the 6-month period beginning on the date of the f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 13 1 enactment of this Act and shall apply to any demand 2 letters relating to patents issued on or after that 3 date. 4 SEC. 5. CUSTOMER-SUIT EXCEPTION. 5 (a) AMENDMENT.--Section 296 of title 35, United 6 States Code, is amended to read as follows: 7 ''? 296. Stay of action against customer 8 ''(a) DEFINITIONS.--In this section: 9 ''(1) COVERED MANUFACTURER.--The term 10 'covered manufacturer' means a person that is the 11 manufacturer or principal supplier in the United 12 States of a product or the user of a manufacturing 13 process, and activity by another with respect to such 14 product or the useful end result of such process is 15 alleged to infringe a patent in a civil action. 16 ''(2) PRODUCT.--The term 'product' means any 17 machine, manufacture, or composition of matter, 18 and includes a component, material, or apparatus. 19 ''(b) INTERVENTION.--In any civil action in which a 20 party asserts a claim for relief arising under any Act of 21 Congress relating to patents, the court shall grant a mo22 tion by a covered manufacturer with respect to the patent 23 at issue to intervene as a defendant. 24 ''(c) STAY.-- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 14 1 ''(1) IN GENERAL.--In any civil action in which 2 a party asserts a claim for relief arising under any 3 Act of Congress relating to patents, if the require- 4 ment under paragraph (2) is met, the court shall 5 grant a motion filed by a party, that is not the cov- 6 ered manufacturer with respect to the patent at 7 issue or an entity that controls, is controlled by, or 8 is under common control with such manufacturer to 9 stay such a claim with regard to such party if the 10 party is accused of infringing the patent at issue 11 solely by-- 12 ''(A) using, selling, or offering to sell the 13 patented product that is made or supplied by 14 such manufacturer or the useful end result of 15 the patented process that is used by such man- 16 ufacturer; 17 ''(B) using the patented process that is im- 18 plemented by a product that is especially made 19 or adapted by such manufacturer to implement 20 the process and that lacks substantial non- 21 infringing use, or using the useful end result of 22 such process that is implemented by such prod- 23 uct; 24 ''(C) selling or offering to sell the product 25 that is especially made or adapted by such man- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00014 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 15 1 ufacturer to implement the patented process 2 and that lacks substantial noninfringing use, or 3 selling or offering to sell the useful end result 4 of such process that is implemented by such 5 product; 6 ''(D) making, importing, using, selling, or 7 offering to sell a product the manufacture, im- 8 portation, use, sale, or offer for sale (as the 9 case may be) of which would not infringe the 10 patent at issue but for its incorporation of a 11 product that is especially made or adapted by 12 such manufacturer for use in practicing the in- 13 vention and that lacks substantial noninfringing 14 use; or 15 ''(E) engaging only in an act described in 16 any of subparagraphs (A) through (D) while 17 also inducing others to make an infringing use, 18 sale, or offer to sell with respect to the patented 19 invention. 20 ''(2) REQUIREMENT FOR STAY OF ACTION.--A 21 stay may be granted under this subsection only if 22 the covered manufacturer with regard to the patent 23 at issue-- 24 ''(A) is a party to the action; or f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00015 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 16 1 ''(B) is not a party to the action to be 2 stayed and the same patent at issue that is 3 being asserted in the action to be stayed is the 4 subject of a second action that is either an ac- 5 tion for a declaratory judgment of invalidity or 6 noninfringement that was filed by such manu- 7 facturer or an infringement action that was 8 filed against such manufacturer, and such sec- 9 ond action was filed not later than six months 10 after the service of the complaint in the action 11 to be stayed. 12 ''(3) SATISFACTION OF JUDGMENT.--A motion 13 to stay an action under this section shall be denied 14 upon a showing that it is reasonably likely that the 15 covered manufacturer would not satisfy a judgment 16 of damages for infringement of the patent. 17 ''(d) INJUNCTION; DISCOVERY.--Notwithstanding a 18 stay entered under this section-- 19 ''(1) a court that issues injunctive relief against 20 a covered manufacturer may extend such relief to 21 other parties to the action; and 22 ''(2) a court may allow discovery directed solely 23 at identifying other parties, products, or processes 24 that may infringe a patent at issue. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00016 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 17 1 ''(e) REVIEW PROCEEDINGS.--If a stay is entered 2 under subsection (c)(2)(B), sections 315(a) and 325(a) 3 shall not apply to a petition filed by the covered manufac4 turer under section 311 or 321 (as the case may be) for 5 review of a patent claim the validity of which the manufac6 turer has challenged in the second action referred to in 7 subsection (c)(2)(B). 8 ''(f) LIFT OF STAY.--A stay entered under this sec- 9 tion shall be lifted upon the grant of a motion brought 10 by any party based upon a showing that a party other 11 than the covered manufacturer in the civil action that is 12 stayed is the principal developer or designer of the alleg13 edly infringing product or process. In the case of a stay 14 entered under subsection (c)(2)(B), a motion under this 15 subsection may be brought only in the court in which the 16 second action was filed. 17 ''(g) APPEAL.--The United States Court of Appeals 18 for the Federal Circuit may, in its discretion, permit an 19 interlocutory appeal of a stay entered under this section 20 in order to reconcile conflicting interpretations of this sec21 tion by the district courts or as is otherwise necessary in 22 the interests of justice.''. 23 (b) CONFORMING AMENDMENT.--The table of sec- 24 tions for chapter 29 of title 35, United States Code, is f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00017 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 18 1 amended by striking the item relating to section 296 and 2 inserting the following: ''296. Stay of action against customer.''. 3 (c) EFFECTIVE DATE.--The amendment made by 4 this section shall take effect on the date of the enactment 5 of this Act and shall apply to any action filed on or after 6 such date of enactment. 7 SEC. 6. PROCEDURES AND PRACTICES TO IMPLEMENT AND 8 RECOMMENDATIONS TO THE JUDICIAL CON- 9 FERENCE. 10 (a) JUDICIAL CONFERENCE RECOMMENDATIONS ON 11 DISCOVERY BURDENS AND COSTS.-- 12 (1) RECOMMENDATIONS.--Not later than 6 13 months after the date of the enactment of this Act, 14 the Judicial Conference of the United States shall 15 develop specific recommendations for rules and pro- 16 cedures for the requirements described in paragraph 17 (2) to address the asymmetries in discovery burdens 18 and costs in any civil action arising under any Act 19 of Congress relating to patents. Such rules and pro- 20 cedures shall include how and when payment for dis- 21 covery in addition to the discovery of core documen- 22 tary evidence is to occur, and what information must 23 be presented to demonstrate financial capacity be- 24 fore permitting discovery in addition to core docu- 25 mentary evidence. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00018 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 19 1 (2) RULES AND PROCEDURES TO BE CONSID- 2 ERED.--The 3 under paragraph (1) shall include each of the fol- 4 lowing requirements: 5 specific recommendations (A) DISCOVERY required OF CORE DOCUMENTARY 6 EVIDENCE.--Each 7 tled to receive core documentary evidence and 8 shall be responsible for the costs of producing 9 core documentary evidence within the posses- 10 party to the action is enti- sion or control of each such party. 11 (B) ADDITIONAL 12 (i) IN DISCOVERY.-- GENERAL.--Each party to the 13 action may seek any additional discovery 14 otherwise permitted under the Federal 15 Rules of Civil Procedure, if such party 16 bears the costs, including reasonable attor- 17 ney's fees, of the additional discovery. 18 (ii) REQUIREMENTS FOR ADDITIONAL 19 DISCOVERY.--Unless 20 agree otherwise, no party shall be per- 21 mitted additional discovery unless such 22 party posts a bond, or provides other secu- 23 rity for payment of the costs, in an amount 24 sufficient to cover the expected costs of 25 such additional discovery. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 the parties mutually (548657|20) PO 00000 Frm 00019 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 20 1 (iii) LIMITS ON ADDITIONAL DIS- 2 COVERY.--A 3 termine that a request for additional dis- 4 covery is excessive, irrelevant, or otherwise 5 abusive and may set limits on such addi- 6 tional discovery. 7 (C) DISCOVERY court, upon motion, may de- SEQUENCE AND SCOPE.-- 8 The parties shall discuss and address in the 9 written report filed pursuant to Rule 26(f) of 10 the Federal Rules of Civil Procedure the views 11 and proposals of each party on the following: 12 (i) When the discovery of core docu- 13 mentary evidence should be completed. 14 (ii) Whether additional discovery will 15 be sought under subparagraph (B). 16 (iii) Any issues about infringement, 17 invalidity, or damages that, if resolved be- 18 fore the additional discovery described in 19 subsection (c) commences, might simplify 20 or streamline the case, including the iden- 21 tification of any terms or phrases relating 22 to any patent claim at issue to be con- 23 strued by the court and whether the early 24 construction of any of those terms or 25 phrases would be helpful. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00020 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 21 1 (3) CORE DOCUMENTARY 2 FINED.--In 3 EVIDENCE DE- mentary evidence''-- 4 this subsection, the term ''core docu- (A) means documents relating to-- 5 (i) the conception of, reduction to 6 practice of, and application for, the patent 7 or patents at issue; 8 (ii) the technical operation of the 9 product or process identified in the com- 10 plaint as infringing the patent or patents 11 at issue; 12 (iii) potentially invalidating prior art; 13 (iv) any licensing of the patent or pat- 14 ents at issue before the date on which the 15 complaint is filed; 16 (v) revenue generated by each product 17 or process allegedly infringing the patent 18 or patents at issue; 19 (vi) statements of the financial re- 20 sources of each party; 21 (vii) each party's organizational own- 22 ership and structure, including identifica- 23 tion of any person or entity that has any 24 financial interest in the patent or patents 25 at issue; f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00021 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 22 1 (viii) any knowledge by the accused 2 infringer of the patent or patents at issue 3 before the date on which the complaint is 4 filed; and 5 (ix) any marking or other notice pro- 6 vided of the patent or patents at issue; and 7 (B) does not include computer code or 8 electronic communication, including any email, 9 text message, instant message, or other form of 10 electronic communication. 11 (b) JUDICIAL CONFERENCE RECOMMENDATIONS ON 12 CASE MANAGEMENT.--Not later than 6 months after the 13 date of the enactment of this Act, the Judicial Conference 14 of the United States shall recommend case management 15 procedures to be implemented by the district courts for 16 any civil action arising under any Act of Congress relating 17 to patents, including initial disclosure and early case man18 agement conference practices-- 19 (1) that will identify any potential dispositive 20 issues of the case; and 21 (2) that focus on early summary judgment mo- 22 tions when resolution of issues may lead to expedited 23 disposition of the case. 24 (c) REVISION 25 FORM FOR PATENT INFRINGE- MENT.-- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 OF 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00022 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 23 1 (1) ELIMINATION OF FORM.--The Supreme 2 Court shall eliminate Form 18 in the Appendix to 3 the Federal Rules of Civil Procedure (relating to 4 Complaint for Patent Infringement), effective on the 5 date of the enactment of this Act. 6 (2) REVISED FORM.--The Supreme Court may 7 prescribe a new form or forms setting out model al- 8 legations of patent infringement that, at a minimum, 9 notify accused infringers of the asserted claim or 10 claims, the products or services accused of infringe- 11 ment, and the plaintiff's theory for how each ac- 12 cused product or service meets each limitation of 13 each asserted claim. The Judicial Conference should 14 exercise the authority under section 2073 of title 28, 15 United States Code, to make recommendations with 16 respect to such new form or forms. 17 (d) ATTORNEY FEES.--Section 285 of title 35, 18 United States Code, is amended by striking ''in excep19 tional cases''. 20 21 (e) PROTECTION CENSES IN 22 23 (1) IN GENERAL.--Section 1520(a) of title 11, United States Code, is amended-- (A) in paragraph (3), by striking ''; and'' 25 and inserting a semicolon; f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) 10:40 May 23, 2013 INTELLECTUAL-PROPERTY LI- BANKRUPTCY.-- 24 VerDate 0ct 09 2002 OF Jkt 000000 (548657|20) PO 00000 Frm 00023 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 24 1 (B) in paragraph (4), by striking the pe- 2 riod at the end and inserting ''; and''; and 3 (C) by inserting at the end the following 4 new paragraph: 5 ''(5) section 365(n) applies to intellectual prop- 6 erty of which the debtor is a licensor or which the 7 debtor has transferred.''. 8 (2) EFFECTIVE DATE.--The amendments made 9 by this subsection shall take effect on the date of the 10 enactment of this Act and shall apply to any case 11 that is filed on or after, or pending on, such date 12 of enactment. 13 SEC. 7. SMALL BUSINESS EDUCATION, OUTREACH, AND IN- 14 FORMATION ACCESS. 15 16 (a) SMALL BUSINESS EDUCATION AND OUT- REACH.-- 17 (1) RESOURCES FOR SMALL BUSINESS.--Using 18 existing resources, the Director shall develop edu- 19 cational resources for small businesses to address 20 concerns arising from patent infringement. 21 (2) SMALL BUSINESS PATENT OMBUDSMAN.-- 22 The Patent Ombudsman Program established under 23 section 28 of the Leahy-Smith America Invents Act 24 (Public Law 112-29; 125 Stat. 339; 35 U.S.C. 2 25 note) shall coordinate with the existing small busi- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00024 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 25 1 ness outreach programs of the Office to provide edu- 2 cation and awareness on abusive patent litigation 3 practices. 4 (b) IMPROVING INFORMATION TRANSPARENCY FOR 5 SMALL BUSINESS AND THE UNITED STATES PATENT AND 6 TRADEMARK OFFICE USERS.-- 7 (1) WEBSITE.--Using existing resources, the 8 Director shall create a user-friendly section on the 9 official website of the Office to notify the public 10 when a patent case is brought in Federal court and 11 with regard to each patent at issue in such case, the 12 Director shall include-- 13 (A) information disclosed pursuant to 14 paragraphs (1) through (6) of section 263(a) of 15 title 35, United States Code, as added by sec- 16 tion 4(b) of this Act; 17 (B) information disclosed pursuant to sub- 18 section (b) of section 281 of title 35, United 19 States Code, as added by section 4(a) of this 20 Act; and 21 (C) any other information the Director de- 22 termines to be relevant. Such information shall 23 be searchable by patent number, patent art 24 area, and entity to promote accessibility for the 25 public. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00025 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 26 1 (2) FORMAT.--The information described in 2 paragraph (1) shall be searchable by patent number, 3 patent art area, and entity to promote accessibility 4 for the public. 5 SEC. 8. STUDIES ON PATENT TRANSACTIONS, QUALITY, 6 AND EXAMINATION. 7 (a) STUDY ON SECONDARY MARKET OVERSIGHT FOR 8 PATENT TRANSACTIONS 9 AND TO PROMOTE TRANSPARENCY ETHICAL BUSINESS PRACTICES.-- 10 (1) STUDY REQUIRED.--The Director, in con- 11 sultation with the Secretary of Commerce, the Sec- 12 retary of the Treasury, the Chairman of the Securi- 13 ties and Exchange Commission, the heads of other 14 relevant agencies, and interested parties, shall, using 15 existing resources of the Office, carry out a study-- 16 (A) to develop legislative recommendations 17 to ensure greater transparency and account- 18 ability in patent transactions occurring on the 19 secondary market; 20 (B) to examine the economic impact that 21 the patent secondary market has on the United 22 States; 23 (C) to examine licensing and other over- 24 sight requirements that may be placed on the 25 patent secondary market, including the partici- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00026 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 27 1 pants of such markets, to ensure that the mar- 2 ket is a level playing field and that brokers 3 making the market have the requisite expertise 4 and adhere to ethical business practices; and 5 (D) to examine the requirements placed on 6 other markets. 7 (2) SUBMISSION OF STUDY.--Not later than 8 seven months after the date of the enactment of this 9 Act, the Director shall submit a report to the Com- 10 mittee on the Judiciary of the House of Representa- 11 tives and the Committee on the Judiciary of the 12 Senate on the findings and recommendations of the 13 Director from the study required under paragraph 14 (1). 15 (b) STUDY ON PATENTS OWNED BY THE UNITED 16 STATES GOVERNMENT.-- 17 (1) STUDY REQUIRED.--The Director, in con- 18 sultation with the heads of relevant agencies and 19 stakeholders, shall, using existing resources of the 20 Office, carry out a study on patents owned by the 21 United States Government that-- 22 (A) examines how such patents are li- 23 censed and sold, and any litigation relating to 24 the licensing or sale of such patents; f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00027 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 28 1 (B) provides legislative and administrative 2 recommendations on whether there should be 3 restrictions placed on patents acquired from the 4 United States Government; 5 (C) examines whether or not each relevant 6 agency maintains adequate records on the pat- 7 ents owned by such agency, specifically when 8 such agency addresses licensing, assignment, 9 and Government grants for technology related 10 to such patents; and 11 (D) provides recommendations to ensure 12 that each relevant agency has an adequate 13 point of contact that is responsible for man- 14 aging the patent portfolio of the agency. 15 (2) REPORT ON STUDY.--Not later than six 16 months after the date of the enactment of this Act, 17 the Director shall submit to the Committee on the 18 Judiciary of the House of Representatives and the 19 Committee on the Judiciary of the Senate a report 20 on the findings and recommendations of the Director 21 from the study required under paragraph (1). 22 (c) STUDY 23 THE (1) GAO 10:40 May 23, 2013 AND ACCESS TO STUDY.--The Comptroller General of the United States shall conduct a study on patent f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 PATENT QUALITY BEST INFORMATION DURING EXAMINATION.-- 24 25 ON Jkt 000000 (548657|20) PO 00000 Frm 00028 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 29 1 examination at the Office and the technologies avail- 2 able to improve examination and improve patent 3 quality. 4 (2) CONTENTS OF THE STUDY.--The study re- 5 quired under paragraph (1) shall include the fol- 6 lowing: 7 (A) An examination of patent quality at 8 the Office. 9 (B) An examination on ways to improve 10 quality, specifically through technology, that 11 shall include examining best practices at foreign 12 patent offices and the use of existing off-the- 13 shelf technologies to improve patent examina- 14 tion. 15 (C) A description of how patents are clas- 16 sified. 17 (D) Office procedures in place to prevent 18 double patenting through filing by applicants in 19 multiple art areas. 20 (E) An examination of the types of off-the- 21 shelf prior art databases and search software 22 used by foreign patent offices and governments, 23 particularly in Europe and Asia, and whether 24 those databases and search tools could be used 25 by the Office to improve patent examination. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00029 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 30 1 (F) Any other areas the Comptroller Gen- 2 eral determines to be relevant. 3 (3) REPORT TO CONGRESS.--Not later than 6 4 months after the date of the enactment of this Act, 5 the Comptroller General shall submit to the Com- 6 mittee on the Judiciary of the House of Representa- 7 tives and the Committee on the Judiciary of the 8 Senate a report on the results of the study required 9 by this subsection, including recommendations for 10 any changes to laws and regulations that will im- 11 prove the examination of patent applications. 12 SEC. 9. IMPROVEMENTS AND TECHNICAL CORRECTIONS TO 13 THE LEAHY-SMITH AMERICA INVENTS ACT. 14 15 (a) REPEAL OF CIVIL ACTION TO OBTAIN A PAT- ENT.-- 16 17 (1) REPEAL.--Section 145 of title 35, United States Code, is repealed. 18 (2) CONFORMING 19 AMENDMENTS.-- (A) FEDERAL CIRCUIT JURISDICTION.-- 20 Section 1295(a)(4) of title 28, United States 21 Code, is amended-- 22 (i) in subparagraph (A), by striking 23 ''except that an applicant or a party'' and 24 all that follows through the end of the sub- 25 paragraph and inserting the following: ''ex- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00030 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 31 1 cept that a party to a derivation pro- 2 ceeding may also have remedy by civil ac- 3 tion pursuant to section 146 of title 35; an 4 appeal under this subparagraph of a deci- 5 sion of the Board with respect to a deriva- 6 tion proceeding shall waive the right of 7 such party to proceed under section 146 of 8 title 35;''; and 9 (ii) in subparagraph (C), by striking 10 ''section 145, 146, or'' and inserting ''sec- 11 tion 146 or''. 12 (B) FEDERAL CIRCUIT APPEAL.--Section 13 141(a) of title 35, United States Code, is 14 amended-- 15 (i) by striking ''may appeal the 16 Board's decision to'' and inserting ''may 17 appeal the Board's decision only to''; and 18 (ii) by striking the second sentence. 19 (C) ADJUSTMENT OF PATENT TERM.--Sec- 20 tion 154(b)(1)(A)(iii) of title 35, United States 21 Code, is amended by striking ''section 141, 145, 22 or 146'' and inserting ''section 141 or 146''. 23 (D) CLERICAL 24 10:40 May 23, 2013 table of sections for chapter 13 of title 35, United f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 AMENDMENT.--The Jkt 000000 (548657|20) PO 00000 Frm 00031 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 32 1 States Code, is amended by repealing the item 2 relating to section 145. 3 (3) EFFECTIVE DATE.--The amendments made 4 by this subsection shall apply to any proceeding in 5 which a decision is made by the Patent Trial and 6 Appeal Board on or after the date of the enactment 7 of this Act. 8 (b) POST-GRANT REVIEW AMENDMENT.--Section 9 325(e)(2) of title 35, United States Code is amended by 10 striking ''or reasonably could have raised''. 11 12 (c) USE IN DISTRICT-COURT CLAIM CONSTRUCTION POST-GRANT AND INTER PARTES REVIEWS.-- 13 14 OF (1) INTER PARTES REVIEW.--Section 316(a) of title 35, United States Code, is amended-- 15 (A) in paragraph (12), by striking ''; and'' 16 and inserting a semicolon; 17 (B) in paragraph (13), by striking the pe- 18 riod at the end and inserting ''; and''; and 19 (C) by inserting at the end the following 20 new paragraph: 21 ''(14) providing that for all purposes under this 22 chapter, each claim of a patent shall be construed as 23 such claim has been or would be in a civil action to 24 invalidate a patent under section 282, including con- 25 struing each claim of the patent in accordance with f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00032 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 33 1 the ordinary and customary meaning of such claim 2 as understood by one of ordinary skill in the art, the 3 prosecution history pertaining to the patent, and 4 prior judicial determinations and stipulations relat- 5 ing to the patent.''. 6 7 (2) POST-GRANT REVIEW.--Section 326(a) of title 35, United States Code, is amended-- 8 (A) in paragraph (11), by striking ''; and'' 9 and inserting a semicolon; 10 (B) in paragraph (12), by striking the pe- 11 riod at the end and inserting ''; and''; and 12 (C) by inserting at the end the following 13 new paragraph: 14 ''(13) providing that for all purposes under this 15 chapter, each claim of a patent shall be construed as 16 such claim has been or would be in a civil action to 17 invalidate a patent under section 282, including con- 18 struing each claim of the patent in accordance with 19 the ordinary and customary meaning of such claim 20 as understood by one of ordinary skill in the art, the 21 prosecution history pertaining to the patent, and 22 prior judicial determinations and stipulations relat- 23 ing to the patent.''. 24 25 (3) EFFECTIVE 10:40 May 23, 2013 amendments made by this subsection shall take effect upon the expira- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 DATE.--The Jkt 000000 (548657|20) PO 00000 Frm 00033 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 34 1 tion of the 90-day period beginning on the date of 2 the enactment of this Act, and shall apply to any 3 proceeding under chapter 31 or 32 of title 35, 4 United States Code, for which the petition for review 5 is filed on or after such effective date. 6 (d) CODIFICATION OF THE DOUBLE-PATENTING 7 DOCTRINE FOR FIRST-INVENTOR-TO-FILE PATENTS.-- 8 (1) AMENDMENT.--Chapter 10 of title 35, 9 United States Code, is amended by adding at the 10 end the following new section: 11 ''? 106. Prior art in cases of double patenting 12 ''A claimed invention of a patent issued under section 13 151 (referred to as the 'first patent') that is not prior art 14 to a claimed invention of another patent (referred to as 15 the 'second patent') shall be considered prior art to the 16 claimed invention of the second patent for the purpose of 17 determining the non-obviousness of the claimed invention 18 of the second patent under section 103 if-- 19 ''(1) the effective filing date of the claimed in- 20 vention of the first patent is on or before the effec- 21 tive filing date of the claimed invention of the second 22 patent; 23 ''(2) the-- 24 ''(A) first and second patents name the 25 same inventor; or f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00034 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 35 1 ''(B) claimed invention of the first patent 2 would constitute prior art to the claimed inven- 3 tion of the second patent under section 4 102(a)(2) 5 102(b)(2) did not apply and, if applicable, if 6 both claimed inventions did not have the same 7 effective filing date; and 8 ''(3) the patentee of the second patent has not 9 disclaimed the rights to enforce the second patent 10 independently from, and beyond the statutory term 11 of, the first patent.''. if an exception under section 12 (2) REGULATIONS.--The Director shall promul- 13 gate regulations setting forth the form and content 14 of any disclaimer required for a patent to be issued 15 in compliance with section 106 of title 35, United 16 States Code, as added by paragraph (1). 17 (3) CONFORMING AMENDMENT.--The table of 18 sections for chapter 10 of title 35, United States 19 Code, is amended by adding at the end the following 20 new item: ''106. Prior art in cases of double patenting.''. 21 (4) EFFECTIVE DATE.--The amendments made 22 by this subsection shall take effect on the date of the 23 enactment of this Act and shall apply only if both 24 the first and second patents described in section 106 25 of title 35, United States Code, as added by para- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00035 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 36 1 graph (1), are patents that are described in section 2 3(n)(1) of the Leahy-Smith America Invents Act (35 3 U.S.C. 100 note). 4 (e) 5 DEFINITION CONSTRUCTION AND AMEND- MENT.-- 6 (1) DEFINITION CONSTRUCTION.--Section 7 18(d) of the Leahy-Smith America Invents Act shall 8 be construed consistently with the institution deci- 9 sion of the Patent Trial and Appeal Board of the 10 United States Patent and Trademark Office in SAP 11 America, 12 CBM2012-00001, Paper 36 (January 9, 2013). 13 Inc. v. (2) EFFECTIVE Versata Dev. Group, DATE.--Paragraph Inc., (1) shall 14 take effect on the date of the enactment of this Act 15 and shall apply in all proceedings filed on or after, 16 or pending on, such date of enactment. 17 (3) SECTION 18(A).--Section 18(a) of the 18 Leahy-Smith America Invents Act (35 U.S.C. 321 19 note) is amended by striking paragraph (3), effective 20 on the date of the enactment of this Act. 21 (f) CLARIFICATION OF LIMITS ON PATENT TERM AD- 22 JUSTMENT.-- 23 24 (1) AMENDMENTS.--Section 154(b)(1)(B) of title 35, United States Code, is amended-- f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00036 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 37 1 (A) in the matter preceding clause (i), by 2 striking ''not including--'' and inserting ''the 3 term of the patent shall be extended 1 day for 4 each day after the end of that 3-year period 5 until the patent is issued, not including--''; 6 (B) in clause (i), by striking ''consumed by 7 continued examination of the application re- 8 quested by the applicant'' and inserting ''con- 9 sumed after continued examination of the appli- 10 cation is requested by the applicant''; 11 (C) in clause (iii), by striking the comma 12 at the end and inserting a period; and 13 (D) by striking the matter following clause 14 (iii). 15 (2) EFFECTIVE DATE.--The amendments made 16 by this subsection shall apply to all applications and 17 patents that are filed or pending on or after the date 18 of the enactment of this Act. 19 (g) TECHNICAL CORRECTIONS.-- 20 (1) NOVELTY.-- 21 (A) AMENDMENT.--Section 102(b)(1)(A) 22 of title 35, United States Code, is amended by 23 striking ''the inventor or joint inventor or by 24 another'' and inserting ''the inventor or a joint 25 inventor or another''. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00037 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H [Discussion Draft] F:\SLW\SLW_075.XML 38 1 (B) EFFECTIVE DATE.--The amendment 2 made by subparagraph (A) shall be effective as 3 if included in the amendment made by section 4 3(b) of the Leahy-Smith America Invents Act 5 (Public Law 112-29). 6 (2) SPECIFICATION.--Notwithstanding section 7 4(e) of the Leahy-Smith America Invents Act (Pub- 8 lic Law 112-29; 125 Stat. 297), the amendments 9 made by subsections (c) and (d) of section 4 of such 10 Act shall apply to all applications and patents, and 11 in all proceedings and matters, that are filed on or 12 after, or pending on, the date of the enactment of 13 this Act. 14 SEC. 10. EFFECTIVE DATE. 15 Except as otherwise provided in this Act, the provi- 16 sions of this Act shall take effect on the date of the enact17 ment of this Act, and shall apply to any patent issued on 18 or after that effective date. f:\VHLC\052313\052313.043.xml May 23, 2013 (10:40 a.m.) VerDate 0ct 09 2002 10:40 May 23, 2013 Jkt 000000 (548657|20) PO 00000 Frm 00038 Fmt 6652 Sfmt 6201 C:\DOCUME~1\SLWALKER\APPLIC~1\SOFTQUAD\XMETAL\5.5\GEN\C\SLW_075.XML H