AMERICA INVENTS ACT; Congressional Record Vol. 157, No. 91
(House of Representatives – June 23, 2011)
Amendment No. 14 Offered by Mr. Rohrabacher
The Acting CHAIR. It is now in order to consider amendment No. 14 printed in part B of House Report 112-111.
Mr. ROHRABACHER. Madam Chairman, I have an amendment at the desk.
The Acting CHAIR. The Clerk will designate the amendment.
The text of the amendment is as follows:
Page 73, after line 2, insert the following new subsection:
(i) Inapplicability of Post-grant Review to Certain Small Entities.–
(1) In general.–Notwithstanding any other provision of law, a patent granted to a United States citizen, an individually lawfully admitted for permanent residence in the United States, or a United States company with less than 100 employees shall not be subject to any form of post-grant review or reexamination.
(2) Rulemaking.–The Director shall issue such regulations as may be necessary to carry out this subsection.
The Acting CHAIR. Pursuant to House Resolution 316, the gentleman from California (Mr. Rohrabacher) and a Member opposed each will control 5 minutes.
The Chair recognizes the gentleman from California.
Mr. ROHRABACHER. In this debate, Madam Chairman, we have heard over and over and over again about the gridlock at the Patent Office, which is supposedly what we’re trying to correct with this legislation, H.R. 1249, which I have been contending is not designed to help the Patent Office, but to harmonize American law with the rest of the world and make it weaker patent protection for our people.
But what does it do about the backlog, if that’s really what people are concerned about? H.R. 1249 would actually tremendously add to the PTO backlog by requiring further post-grant review proceedings at the Patent Office, proceedings which would consume even more limited personnel and money. Added procedures add to the gridlock at the PTO, at the Patent Office, and it will also do what? It will break the back of small inventors and startup companies who are trying to get a new product on the market.
It will empower the multinational and foreign corporations who can grind down the little guy, because what we are doing in this bill is adding even further procedures they have to go through, even after they have got their patent issued to them.
This is the big guy versus little guy legislation. That was even pointed out by the Hoover Institution, which did an analysis of this bill and said, “The American Invents Act will protect large entrenched companies at the expense of market challenging competitors.”
“A patent should be challenged in court, not in the U.S. Patent Office.”
“A politicized patent system will further entrench those companies with the largest lobbying shops on K Street.”
“The bill wreaks havoc on property rights, and predictable property rights are essential for economic growth.”
“If America weakens its patent enforcement at home, it will set a dangerous precedent overseas.”
“The America Invents Act would inject massive uncertainty into the patent system.”
This is a travesty. It is an attack on American well-being, because we depend on our small inventors to come up with the ideas. The Kaptur- Rohrabacher amendment limits this new burden. If we can’t get rid of it, at least we can limit this new burden of all these post-grant reviews they are going to add to companies that have more than 100 employees. It frees up the Patent Office personnel to do their job, helps with that gridlock, and protects the small business man and small inventors at the same time.
I would ask my colleagues to support the Kaptur-Rohrabacher amendment.
I yield such time as she may consume to the gentlewoman from Ohio (Ms. Kaptur).
Ms. KAPTUR. I thank the gentleman for yielding and urge my colleagues to support the Rohrabacher-Kaptur amendment, which ensures fairness for small and independent inventors. Without it, this bill will destroy American job creation and innovation since it throws out 220 years of patent protections for individual inventors.
Our amendment addresses a major shortcoming of the bill by eliminating the burden of post-grant reviews and reexaminations on individual inventors and small businesses with 100 or fewer employees.
The new procedures and regulations in this bill will make it extremely difficult for the average citizen to ever get a patent or defend one without our amendment. Our amendment clearly gives the Patent Office the authority to issue appropriate regulations that ensure that the new regulatory burdens in this bill do not disproportionately impact individual inventors. This amendment is about ensuring fairness for small inventors.
We urge our colleagues to support the Kaptur-Rohrabacher amendment so all inventors in America have a chance to realize their dreams, and, in realizing their dreams, assuring that we will have robust innovation and job creation in our country.
The Acting CHAIR. The gentleman from California has 1\1/2\ minutes remaining.
Mr. ROHRABACHER. Let me just note, our amendment empowers the Director of the Patent Office to extend this 100-employee standard to other small businesses and individual inventors overseas if this is required by a treaty; yes, small businesses and individual inventors overseas. So our amendment does nothing to violate any treaty obligations by giving our own people special rights over foreign individuals.
What it does do, however, is prevent foreign corporations from grinding down our inventors here, like they grind down their inventors overseas. This is what we are doing to prevent a harmonization of our laws, because we don’t want weaker patent protection for our people. They already got it overseas against their foreign corporations that grind them down. We want to protect our own people.
I reserve the balance of my time.
Mr. SMITH of Texas. Madam Chair, I rise in opposition to the amendment.
The Acting CHAIR. The gentleman is recognized for 5 minutes.
Mr. SMITH of Texas. Madam Chair, almost everyone in Congress wants to help small businesses. They are the foundation of our economy and are the primary job creators. But this amendment includes certain terms or phrases that have nothing to do with the underlying goal that it purports to achieve.
This amendment appears to focus on small businesses, but in reality the amendment attempts to provide the trial lawyer lobby and patent trolls with an exemption from PTO reexamination, allowing them to continue suing job creators using frivolous or questionable patents. This amendment has nothing to do with small businesses and everything to do with providing an exemption for some of the worst offenders of our patent system.
This amendment will not help independent inventors or small businesses. Small businesses need the PTO reexamination proceedings. Those proceedings strengthen patents, and strong patents are what investors look for when making decisions about whether or not to provide venture capital funding.
The argument that reexam proceedings harass or hurt small businesses is just plain wrong. The reexam proceedings are a cheaper, quicker, better alternative to resolve questions of patentability than costly litigation in Federal court, which can run into the millions of dollars and last for years. This amendment is an immunity agreement for patent trolls, those entities who do not create jobs or innovation but simply game the legal system.
Additionally, this amendment appears to violate our international obligations under the TRIPS agreement. Under TRIPS, we are obligated not to discriminate against any field of technology or categories of patent holders. By providing an exemption from all reexamination proceedings for technological patents granted to patent trolls or nonpracticing entities, this would create a clear violation of our legal obligations.
Our patent system should be designed to ensure that it produces strong patents and patent certainty. The PTO reexamination proceedings help ensure that these important goals are accomplished. This amendment bars any form of reexam for U.S.-owned patents and, thus, would also prevent U.S. inventors themselves from using supplemental examination to even be able to correct errors in the record about their own patents.
This amendment creates a huge loophole in our patent system by exempting entities with 100 or fewer employees. This will not help small businesses but will allow patent troll entities, foreign companies, and foreign governments to manipulate our patent system. It would bar use of the business-methods transitional proceeding against most business-method patents.
This amendment is a recipe for allowing patent trolls and foreign companies and their governments to bypass normal post-grant challenges and enables weak or questionable patents to bypass further scrutiny. There is no legitimate public policy objective in exempting large numbers of those who manipulate our patent system from the rules of the road. It is for these reasons that I strongly oppose this amendment.
I yield the balance of my time to the gentleman from Virginia (Mr. Goodlatte).
The Acting CHAIR. The gentleman from Virginia is recognized for 2 minutes.
Mr. GOODLATTE. Madam Chairman, I rise in strong opposition to this amendment, which is a bad idea. Post-grant review is one of the most important provisions in this bill. It allows third parties, for a limited window of 9 months after a patent is issued, to submit evidence that the patent should not have been granted in the first place.
This allows third parties, many of whom will be small businesses themselves who are familiar with the subject matter, to provide a check on patent examiners. If the evidence shows that the patent is indeed invalid, then the patent applicant should never have received the patent in the first place. If the evidence shows that the patent is valid, then the patent is made stronger and more certain by surviving a post-grant review.
The amendment would exempt small businesses from the post-grant opposition proceeding. However, the quality of a patent examination does not hinge on the size of the applicant, whether it was a small business, an independent inventor, or a large corporation. It hinges on the PTO job of scrutinizing that patent. A bogus patent held by an independent inventor is no less deserving of a second look than a bogus patent held by a Fortune 500 company.
For these reasons, I urge opposition to this very bad amendment.
The Acting CHAIR. The gentleman from California has 30 seconds remaining.
Mr. ROHRABACHER. I yield the balance of my time to the gentlewoman from Ohio (Ms. Kaptur).
Ms. KAPTUR. I would like to refute Mr. Smith’s argument. In fact, he has manufactured an argument against our amendment that says it will violate WTO obligations, specifically citing TRIPS. He seems to object to the use of references to American citizens and U.S. companies, but obviously failed to read the entire amendment which allows the Patent Office to issue relevant regulations for properly implementing this amendment. And if he was so concerned about WTO compliance, he should strike section 18 of his own bill which is clearly WTO noncompliant because it creates a special class for only one industry, the banking industry.
I urge my colleagues to vote against the bill and for the Rohrabacher-Kaptur amendment.
The Acting CHAIR. The question is on the amendment offered by the gentleman from California (Mr. Rohrabacher).
The question was taken; and the Acting Chair announced that the noes appeared to have it.
Mr. ROHRABACHER. Madam Chair, I demand a recorded vote.
The Acting CHAIR. Pursuant to clause 6 of rule XVIII, further proceedings on the amendment offered by the gentleman from California will be postponed.
Amendment No. 14 Offered by Mr. Rohrabacher
The Acting CHAIR. The unfinished business is the demand for a recorded vote on the amendment offered by the gentleman from California (Mr. Rohrabacher) on which further proceedings were postponed and on which the noes prevailed by voice vote.
The Clerk will redesignate the amendment.
The Clerk redesignated the amendment.
The Acting CHAIR. A recorded vote has been demanded.
A recorded vote was ordered.
The Acting CHAIR. This will be a 2-minute vote.
The vote was taken by electronic device, and there were–ayes 81, noes 342, not voting 8, as follows: