CRS Updates Report on Patent Reform To Include Revisions to Approved House Bill

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The Congressional Research Service published June 30 a report on the status of the pending patent law reform legislation, reflecting changes made to H.R. 1249, the bill approved by the House on a 304-117 margin June 23.

The CRS has now issued the report three times since March. The current report describes in detail the differences between H.R. 1249 and the bill approved in the Senate, S. 23, in March.

Updates Since March 4 Report

The CRS published a prior version of the report, “Patent Reform in the 112th Congress: Innovation Issues,” March 4, before the Senate vote on the legislation. S. 23, renamed the “America Invents Act,” was approved in a 95-5 vote March 8.

Debate on patent reform then proceeded to the House, and Judiciary Committee Chairman Lamar S. Smith (R-Texas) introduced H.R. 1249 on March 30. An April 7 CRS report added a discussion of the differences between the bills and additions in H.R. 1249 as of that point.

However, the House Judiciary Committee made amendments to H.R. 1249 and reported out the revised bill by a 32-3 vote. Smith then made additional significant changes in a manager's amendment when the bill reached the House floor, most notably in the provision as to funding for the Patent and Trademark Office. The legislation has also been renamed the “Leahy-Smith America Invents Act.”

The current CRS report addressed the provisions of the approved versions of both bills.

Report Describes PTO Funding Differences

The report identified the different approaches that the Senate and House measures take to funding the PTO as follows:


S. 23 establishes within the Treasury of the United States a “United States Patent and Trademark Office Public Enterprise Fund.” Most fees collected by the USPTO would be placed into this Fund. The USPTO would then be allowed to access this Fund to cover its administrative and operating expenses without fiscal year limitation. Not later than 60 days after the end of each fiscal year, the USPTO would be required to submit a report to Congress that summarizes previous operations and provides a detailed plan for the upcoming fiscal year.

H.R. 1249 does not remove the USPTO from the appropriations process as does S. 23. As passed by the House, the bill creates within the Treasury a “Patent and Trademark Fee Reserve Fund” into which fee collections above that “appropriated by the Office for that fiscal year” will be placed. These funds will be available to the USPTO “to the extent and in the amounts provided in appropriations Acts” and may only be used for the work of the Office.

The new report also included sections on two provisions added to H.R. 1249 late in the process that have no counterpart in the Senate version.

“The USPTO has interpreted the Thirteenth Amendment, which bans human slavery, as barring patents claiming human beings,” the report noteds. “H.R. 1249 would give statutory footing to this policy by stipulating that ‘no patent may issue on a claim directed to or encompassing a human organism.' ”

The other addition is a clarification of the timing of a request for a patent term extension under Hatch-Waxman Act provisions. “H.R. 1249 stipulates that if regulatory approval is transmitted after 4:30 PM Eastern time on a business day, or is transmitted on a day that is not a business day, then the product shall be deemed to have received such permission on the next business day,” according to the report. “No analogous provision appears in S. 23.”

The authors made no substantive changes to sections on “Current Issues and Concerns”—which includes subsections on patent quality; litigation costs; international harmonization; potential abuses by patent speculators; the role of individuals, universities, and small entities; and differing patent values in distinct industries—and “Concluding Observations.”

The report was coauthored by Wendy H. Schacht, a specialist in science and technology in the CRS's Resources, Science, and Industry Division, and John R. Thomas, a law professor at Georgetown University. Thomas is a member of this journal's advisory board.

By Tony Dutra

Report at  

H.R. 1249 as approved at  

S. 23 as approved at