Patents Depend on Quality Act of 2006 or PDQ Act - Allows a person to request that the grant or reissue of a patent be reconsidered by the United States Patent and Trademark Office (USPTO) by filing an opposition seeking to invalidate one or more claims in the patent.
Requires the Director of USPTO to issue and publish a certificate, in accordance with the final decision by the panel of three administrative patent judges, canceling any claim of the patent determined to be unpatentable and incorporating into the patent any new or amended claims determined to be patentable.
Allows a third party to submit for consideration, and for inclusion in the record, prior art to determine whether the invention was known, used, in public use, or on sale or would have been obvious.
Provides that a third party requester whose request for a reexamination results in an order is not estopped from asserting a claim which the third party requester could have raised during such reexamination proceedings.
Allows treble damages only upon a finding of willful infringement of a patent. (Current law allows treble damages for any patent infringement.) Sets forth the grounds for a finding of willful infringement.
Permits transfers of venue. Requires a court to stay an injunction pending appeal upon an affirmative showing that: (1) the stay would not result in irreparable harm to the owner of the patent; and (2) the balance of hardships from the stay does not favor the owner of the patent.
[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5096 Introduced in House (IH)]
109th CONGRESS
2d Session
H. R. 5096
To amend title 35, United States Code, to modify certain procedures
relating to patents.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 5, 2006
Mr. Berman (for himself and Mr. Boucher) introduced the following bill;
which was referred to the Committee on the Judiciary
_______________________________________________________________________
A BILL
To amend title 35, United States Code, to modify certain procedures
relating to patents.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Patents Depend on Quality Act of
2006'' or ``PDQ Act''.
SEC. 2. OPPOSITION PROCEDURES.
(a) In General.--Title 35, United States Code, is amended by
inserting after chapter 31 the following new chapter:
``CHAPTER 32--POST-GRANT OPPOSITION PROCEDURES
``Sec.
`` 321. Right to oppose patent; opposition request.
`` 322. Real party in interest.
`` 323. Timing of opposition request.
`` 324. Limits on scope of validity issues raised.
`` 325. Institution of the opposition proceeding.
`` 326. Patent owner response.
`` 327. Amendment of claims.
`` 328. Discovery and sanctions.
`` 329. Supplemental submissions.
`` 330. Hearing and briefs.
`` 331. Written decision.
`` 332. Burden of proof and evidence.
`` 333. Reconsideration.
`` 334. Appeal.
`` 335. Certificate.
`` 336. Estoppel.
`` 337. Duration of opposition.
`` 338. Settlement.
`` 339. Intervening rights.
`` 340. Relationship with reexamination proceedings.
``Sec. 321. Right to oppose patent; opposition request
``(a) Filing of Opposition.--A person may request that the grant or
reissue of a patent be reconsidered by the Patent and Trademark Office
by filing an opposition seeking to invalidate 1 or more claims in the
patent. The Director shall establish, by regulation, fees to be paid by
the person filing the opposition (in this chapter referred to as the
`opposer'). Copies of patents and printed publications to be relied
upon in support of the request must be filed with the request. If an
opposer relies on other factual evidence or on expert opinions in
support of the opposition, such evidence and opinions must be filed
with the request through one or more accompanying affidavits or
declarations.
``(b) Copies Provided to Patent Owner.--Copies of any documents
filed under subsection (a) must be provided to the patent owner or, if
applicable, the designated representative of the patent owner, at the
time of filing under subsection (a), except that if a request is made
that the identity of a real party in interest be kept separate pursuant
to section 322(b), then the identity of the real party in interest may
be redacted from the copies provided.
``(c) File Available to the Public.--The file of any opposition
proceeding shall be made available to the public, except as provided in
section 322.
``Sec. 322. Real party in interest
``(a) Identification.--The person making a request under section
321 shall identify in writing each real party in interest, and the
opposition pursuant to the request shall proceed in the name of the
real party in interest.
``(b) Identity Kept Separate Upon Request.--
``(1) In general.--Subject to paragraph (2), if requested
by the opposer, the identity of a real party in interest shall
be kept separate from the file of the opposition and made
available only to Government agencies upon written request, or
to any person upon a showing of good cause. If the identity of
a real party in interest is kept separate from the file under
this paragraph, then the opposition shall proceed in the name
of the individual filing the request as the representative of
the real party in interest.
``(2) Exception.--No request under paragraph (1) to keep
the identity of a real party in interest separate from the file
of the opposition may be made or maintained if the opposer
relies upon factual evidence or expert opinions in the form of
affidavits or declarations during the opposition proceeding or
if the opposer exercises the right to appeal under section 141.
``Sec. 323. Timing of opposition request
``A person may not make an opposition request under section 321
later than 9 months after the grant of the patent or issuance of the
reissue patent, as the case may be, or later than 6 months after
receiving notice from the patent holder alleging infringement of the
patent, except that, if the patent owner consents in writing, an
opposition request may be filed anytime during the period of
enforceability of the patent. A court having jurisdiction over an issue
of validity of a patent may not require the patent owner to consent to
such a request.
``Sec. 324. Limits on scope of validity issues raised
``An opposition request under section 321 must identify with
particularity the claims that are alleged to be invalid and, as to each
claim, 1 or more issues of invalidity on which the opposition is based.
The issues of invalidity that may be considered during the opposition
proceeding are double patenting and any of the requirements for
patentability set forth in sections 101, 102, 103, and 112, and the
fourth paragraph of section 251, except for--
``(1) any requirement contained in the first paragraph of
section 112 relating to disclosing the best mode; and
``(2) any issue arising under subsection (c), (f), or (g)
of section 102.
``Sec. 325. Institution of the opposition proceeding
``(a) Dismissal; Institution.--
``(1) Dismissal.--The Director may dismiss an opposition
request that the Director determines lacks substantial merit.
The determination by the Director to dismiss an opposition
request shall not be appealable. The dismissal of an opposition
request shall not be admissible in any civil action related to
the patent against which a dismissed request was filed.
``(2) Institution.--If the Director receives 1 or more
requests that meet the requirements of section 321 regarding
the same patent by the Director and are not dismissed under
paragraph (1), an opposition proceeding shall be promptly
instituted pursuant to the request or requests, but not before
a period of 9 months has elapsed since the date on which the
patent was granted.
``(3) Consolidated proceeding.--If an opposition proceeding
is instituted based upon more than 1 opposition request, the
opposition shall proceed as a single consolidated proceeding,
unless later divided under subsection (c).
``(b) Parties.--The parties to an opposition proceeding under this
section shall be the patent owner and each opposer whose request meets
the requirements of section 321 and has not been dismissed under
subsection (a)(1).
``(c) Decision by Panel.--The Director shall assign the opposition
proceeding to a panel of three administrative patent judges (in this
chapter referred to as the `panel'). The panel shall decide the
questions of patentability raised in each opposition request for which
an opposition proceeding has been instituted. The decision shall be
based upon the prosecution record that was the basis for the grant of
the patent and the additional submissions by the parties to the
opposition proceeding authorized under this chapter. The panel may, in
appropriate cases, divide the opposition into separate proceedings if
the opposition involves multiple opposition requests by different
parties.
``Sec. 326. Patent owner response
``After the Director has instituted an opposition proceeding under
section 325, the patent owner shall have the right to file, within the
time period set by the panel, a response to each opposition request
that is the subject of the proceeding. The patent owner, in responding
to an opposition request, shall file with the response, through
affidavits or declarations, any additional factual evidence and expert
opinions on which the patent owner relies in support of the response.
``Sec. 327. Amendment of claims
``The patent owner is entitled to request amendment of any claims
that are the subject of an opposition proceeding under this chapter,
including by the addition of new claims. The patent owner shall file
any such request for amendment with the patent owner's response to an
opposition request under section 326. The panel may permit further
requests for amendment of the claims only upon good cause shown by the
patent owner. No amendment enlarging the scope of the claims of the
patent shall be permitted in the opposition proceeding.
``Sec. 328. Discovery and sanctions
``(a) Discovery.--After an opposition proceeding is instituted
under this chapter, the patent owner shall have the right to depose
each person submitting an affidavit or declaration on behalf of any
opposer, and each opposer shall have the right to depose each person
submitting an affidavit or declaration on behalf of the patent owner.
Such depositions shall be limited to cross-examination on matters
relevant to the affidavit or declaration. No other discovery shall be
permitted unless the panel determines that additional discovery is
required in the interest of justice. The panel shall determine the
schedule for the taking of discovery under this subsection.
``(b) Sanctions.--If any party to an opposition proceeding fails to
properly respond to any discovery under subsection (a), the panel may
draw appropriate adverse inferences and take other action permitted by
statute, rule, or regulation.
``Sec. 329. Supplemental submissions
``The panel may permit one or more supplemental submissions to be
made by any party to an opposition proceeding under this chapter,
subject to the rights and limitations on discovery under section 328.
``Sec. 330. Hearing and briefs
``Any party to an opposition proceeding under this chapter may
request an oral hearing within the time set by the panel. If a hearing
is requested or the panel determines sua sponte that a hearing is
needed, the panel shall set a time for the hearing. The panel may
permit the partied to file briefs for the hearing, and shall permit
cross-examination of all affiants and declarants in the hearing, either
before the panel or by deposition taken under section 328.
``Sec. 331. Written decision
``The panel shall issue a written decision on each issue of
patentability with respect to each claim that is the subject of an
opposition proceeding under this chapter. The written decision shall
consist of findings of fact and conclusions of law. The written
decision shall become a final determination of the Office on the issues
raised in the opposition unless a party to the opposition files a
request for reconsideration and modification of the written decision
within a period set by the panel, which shall not be less than two
weeks from the date of the written decision.
``Sec. 332. Burden of proof and evidence
``(a) Burden of Proof.--The opposer in an opposition proceeding
under this chapter shall have the burden to prove the invalidity of a
claim by a preponderance of the evidence. The determination of
invalidity shall be based upon the broadest reasonable construction of
the claim.
``(b) Evidence.--The Federal Rules of Evidence shall apply to the
opposition proceeding, except to the extent inconsistent with any
provision of this chapter.
``Sec. 333. Reconsideration
``If a request is filed for reconsideration of the written decision
in an opposition proceeding under this chapter, the panel may authorize
a party to the proceeding who did not file such a request to file a
response to the request for reconsideration. Following any
reconsideration, the panel shall either deny the request for
modification of the written decision or grant the request and issue a
modified written decision, which shall constitute the final
determination of the Office on the issues raised in the opposition
proceeding.
``Sec. 334. Appeal
``A party dissatisfied with the final determination of the panel in
an opposition proceeding under this chapter may appeal the
determination under sections 141 through 144. Any party to the
opposition proceeding shall have the right to be a party to the appeal.
``Sec. 335. Certificate
``When a decision of a panel in an opposition proceeding under the
chapter has become final under section 331, 333, or 334, as the case
may be, the Director shall issue and publish a certificate in
accordance with the decision, canceling any claim of the patent
determined to be unpatentable, and shall incorporate into the patent
any new or amended claims determined to be patentable. The issuance of
the certificate shall terminate the opposition proceeding.
``Sec. 336. Estoppel
``(a) Estoppel.--
``(1) In general.--Subject to paragraph (2), after a
certificate has been issued under section 335 in accordance
with the decision of the panel in an opposition proceeding, the
determination with respect to an issue of invalidity raised by
an opposer shall bar that opposer from raising, in any
subsequent proceeding involving that opposer under this title,
any issue of fact or law actually decided and necessary to the
determination of that issue.
``(2) Exception.--If an opposer in an opposition proceeding
demonstrates, in a subsequent proceeding referred to in
paragraph (1), that there is additional factual evidence that
is material to an issue of fact actually decided in the
opposition proceeding, and necessary to the final determination
in the opposition proceeding, that could not reasonably have
been discovered or presented in the opposition proceeding by
that opposer, the opposer may raise, in that subsequent
proceeding, that issue of fact and any determined issue of law
for which the issue of fact was necessary.
``(b) Expanded Definition of Opposer.--For purposes of this
section, the term `opposer' includes the person making the request
under section 321, any real party in interest, and their successors in
interest.
``(c) New Party-in-Interest.--If a proceeding arising by reason of
additional factual evidence raised under subsection (a)(2) involves a
real party in interest not identified to the patent owner under section
322, the real party in interest shall notify the Director and the
patent owner of that fact and of the proceeding, within 30 days after
receiving notice that the proceeding has been filed.
``Sec. 337. Duration of opposition
``The determination of a panel in an opposition proceeding under
this chapter, including any determinations pursuant to a request for
reconsideration under section 133, shall be issued not later than 1
year after the date on which the opposition proceeding is instituted
under section 325. Upon good cause shown, the Director may extend the
1-year period by not more than 6 months.
``Sec. 338. Settlement
``(a) In General.--An opposition proceeding under this chapter
shall be terminated with respect to any opposer upon the joint request
of the opposer and the patent owner, unless the panel has issued a
written decision under section 331 before the request for termination
is filed. If the opposition is terminated with respect to an opposer
under this section, no estoppel under section 336 shall apply to that
opposer with respect to an issue of invalidity raised in the opposition
proceeding. The written decision under section 331 shall thereafter be
issued only with respect to issues of invalidity raised by opposers
that remain in the opposition proceeding.
``(b) Agreements in Writing.--Any agreement or understanding
between the patent owner and an opposer, including any collateral
agreements referred to therein, that is made in connection with or in
contemplation of the termination of an opposition proceeding under
subsection (a) shall be in writing. The opposition with respect to the
parties to the agreement or understanding shall not be terminated until
a true copy of the agreement or understanding, including any such
collateral agreements, has been filed in the Patent and Trademark
Office. If any party filing such an agreement or understanding
requests, the agreement or understanding shall be kept separate from
the file of the opposition, and shall be made available only to
Government agencies on written request, or to any person on a showing
of good cause.
``(c) Discretionary Actions Reviewable.--Any discretionary action
of the Director under subsection (b) shall be reviewable under chapter
7 of title 5.
``Sec. 339. Intervening rights
``Any proposed amended or new claim determined to be patentable and
incorporated into a patent following an opposition proceeding under
this chapter shall have the same effect as that specified in section
252 of this title for reissued patents on the right of any person who
made, purchased, or used within the United States, or imported into the
United States, anything patented by such proposed amended or new claim,
or who made substantial preparation therefor, before the certificate
issued under section 335 with respect to that amended or new claim.
``Sec. 340. Relationship with reexamination proceedings
``(a) Estoppel.--A patent for which an opposition proceeding has
been instituted under this chapter may not thereafter be made the
subject of a request under section 302 or 311 for reexamination, by the
same opposer or on behalf of the same real party in interest, on the
same claim and on the same issue that was the basis of the opposition
proceeding.
``(b) Staying of Other Proceedings.--[If, after an opposition
proceeding has been instituted under this chapter, a request for
reexamination under section 302 or section 311 is made by or on behalf
of a person other than the opposer or the same real party in interest,
such reexamination shall be stayed during the pendency of any
opposition proceeding under this chapter.]''.
(b) Clerical Amendment.--The table of chapters for part III of
title 35, United States Code, is amended by adding at the end the
following:
``32. Opposition Procedures................................. 321.''.
SEC. 3. PUBLICATION OF PATENT APPLICATIONS.
Section 122 of title 35, United States Code, is amended--
(1) in subsection (b)(2)--
(A) by striking subparagraph (B); and
(B) in subparagraph (A)--
(i) by striking ``(A) An application'' and
inserting ``An application''; and
(ii) by redesignating clauses (i) through
(iv) as subparagraphs (A) through (D),
respectively; and
(2) by striking subsection (c) and redesignating subsection
(d) as subsection (c).
SEC. 4. SUBMISSIONS BY THIRD PARTIES.
Section 131 of title 35, United States Code, is amended--
(1) by striking ``The Director'' and inserting ``(a) In
General.--The Director''; and
(2) by adding at the end the following:
``(b) Third Party Submissions.--Any party shall have the
opportunity to submit for consideration and for inclusion in the
record, prior art (including, but not limited to, evidence of knowledge
or use, or public use or sale, under section 102), to determine whether
the invention was known or used, or was in public use, or on sale,
under section 102 or would have been obvious under section 103. The
Director shall consider such submissions if the request--
``(1) is made in writing not later than--
``(A) 6 months after the date on which the patent
application is published under section 122, or
``(B) before the date on which a notice of
allowance is mailed under section 151 for a patent on
the invention,
whichever occurs first;
``(2) is accompanied by the payment of a fee established by
the Director under section 41 for third party submissions;
``(3) sets forth the teaching and applicability of each
reference and the basis on which the submission is offered; and
``(4) includes a sworn declaration attesting to the
relevance and accuracy of the submissions.
Information submitted under this subsection shall be considered during
the examination of the patent application.''.
SEC. 5. INTER PARTES REEXAMINATION.
(a) Estoppel Provision.--Section 315(c) of title 35, United States
Code, is amended by striking ``or could have raised''.
(b) Final Decision.--Section 317(b) of title 35, United States
Code, is amended--
(1) in the heading, by striking ``Final Decision'' and
inserting ``District Court Decision''; and
(2) in the first sentence, by striking ``final decision''
and inserting ``decision of a district court''.
(c) Applicability.--Notwithstanding section 4608(a) of the
Intellectual Property and Communications Reform Act of 1999, as enacted
by section 1000(a)(9) of Public Law 106-113 (41 U.S.C. note), sections
311 through 318 of title 35, United States Code, as amended by this
section, shall apply to any patent that issues from an original
application filed before, on, or after November 29, 1999.
SEC. 6. WILLFUL INFRINGEMENT.
Section 284 of title 35, United States Code, is amended--
(1) in the first paragraph, by striking ``Upon'' and
inserting ``(a) Award of Damages.--Upon''; and
(2) by amending the second paragraph to read as follows:
``(b) Willful Infringement.--
``(1) Increased damages.--A court that has determined that
the infringer has willfully infringed a patent or patents may
increase the damages up to three times the amount of damages
found or assessed under subsection (a), except that increased
damages under this paragraph shall not apply to provisional
rights under section 154(d) of this title.
``(2) Permitted grounds for willfulness.--A court may find
that an infringer has willfully infringed a patent only if the
patent owner presents clear and convincing evidence that--
``(A) after receiving written notice from the
patentee--
``(i) alleging acts of infringement in a
manner sufficient to give the infringer an
objectively reasonable apprehension of suit on
such patent, and
``(ii) identifying with particularity each
claim of the patent, each product or process
that the patent owner alleges infringes the
patent, and the relationship of such product or
process to such claim,
the infringer, after a reasonable opportunity to
investigate, thereafter performed one or more of the
alleged acts of infringement;
``(B) the infringer intentionally copied the
patented invention with knowledge that it was patented;
or
``(C) after having been found by a court to have
infringed that patent, the infringer engaged in conduct
that was not colorably different from the conduct
previously found to have infringed the patent, and
which resulted in a separate finding of infringement of
the same patent.
``(3) Limitations on willfulness.--(A) A court shall not
find that an infringer has willfully infringed a patent under
paragraph (2) for any period of time during which the infringer
had an informed good faith belief that the patent was invalid
or unenforceable, or would not be infringed by the conduct
later shown to constitute infringement of the patent.
``(B) An informed good faith belief within the meaning of
subparagraph (A) may be established by reasonable reliance on
advice of counsel.
``(C) The decision of the infringer not to present evidence
of advice of counsel shall have no relevance to a determination
of willful infringement under paragraph (2).
``(4) Limitation on pleading.--Before the date on which a
determination has been made that the patent in suit is not
invalid, is enforceable, and has been infringed by the
infringer, a patentee may not plead, and a court may not
determine, that an infringer has willfully infringed the
patent. The court's determination of an infringer's willfulness
shall be made without a jury.''; and
(3) in the third paragraph, by striking ``The court'' and
inserting ``(c) Expert Testimony.--The court''.
SEC. 7. VENUE.
Section 1400 of title 28, United States Code, is amended by adding
at the end the following new subsection:
``(c) A court shall grant a motion to transfer an action to a
judicial district or division in which the action could have been
brought if--
``(1) such judicial district or division is a more
appropriate forum for the action, including any judicial
district or division where a party to the action has
substantial evidence or witnesses;
``(2) the action was not brought in a district or
division--
``(A) in which the patentee resides or maintains
its principal place of business;
``(B) in which an accused infringer maintains its
principal place of business; or
``(C) in the State in which an accused infringer,
if a domestic corporation, is incorporated;
``(3) at the time the action was brought, neither the
patentee nor an accused infringer had substantial evidence or
witnesses in the judicial district in which the action was
brought; and
``(4) the action has not been previously transferred under
this subsection.
``(d) For purposes of subsection (c), the use or sale of allegedly
infringing subject matter in a judicial district shall not, by itself,
establish the existence of substantial evidence or witnesses in such a
judicial district.''.
SEC. 8. INJUNCTION.
Section 283 of title 35, United States Code, is amended by adding
at the end the following: ``In determining equity, the court shall
consider the fairness of the remedy in light of all the facts and the
relevant interest of the parties associated with the invention. Unless
an injunction is entered pursuant to a nonappealable judgment of
infringement, a court shall stay the injunction pending an appeal upon
an affirmative showing that the stay would not result in irreparable
harm to the owner of the patent and that the balance of hardships from
the stay does not favor the owner of the patent.''.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on the Judiciary.
Sponsor introductory remarks on measure. (CR E524-525)
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