clo·ture.  noun /ˈklōCHər/  (in a legislative assembly) A procedure for ending a debate and taking a vote; a cloture motion.

(*update: The Senate voted 93-5 to end debate on a motion to proceed with the bill, limiting debate to 30 hours.) 

The Leahy-Smith America Invents Act, H.R. 1249 passed the House in June by 304-117, in June.  Now, Senate Majority Leader Harry Reid (D-Nev.) has filed for cloture on the patent reform bill, setting up a vote today.

The Senate is scheduled to vote on the motion to end debate on the America Invents Act of 2011 and then vote on the bill itself. The bill to be voted on by the Senate is word for word from HR 1249, the patent reform measure passed by the House of Representatives on June 23.

By adopting the House version of patent reform, the Senate loses on some provisions of the bill.

Funding

The patent bill passed by the Senate in March ended the practice of fee diversion — diverting USPTO revenues to other parts of the government, and allowed the USPTO to keep the fees collected. It is estimated that Congress has diverted about $1 billion in fees since 1992.

The House version creates a sequestered account for USPTO revenue in excess of appropriated funds, for use exclusively by the USPTO.  As pointed out by Patrick Anderson of Gametime IP, the excess funds may be used by the USPTO if, and only if, provided in appropriations Acts by Congress.  That meaning there is no guarantee how much in excess funds will be available, if any amount at all.  To access that money, the USPTO must submit requests to the House Appropriations Committee. However, the fund give the USPTO a 15% fee surcharge and the authority to set rates going forward.

Clarification:

Earlier this year, the Senate voted 95-5 to approve legislation guaranteeing funds collected by the US Patent and Trademark Office (USPTO) would be used to pay for patent examination and related expenses (S.23 Section 20).  That is, providing that “amounts deposited into the Fund under paragraph (2) shall be available, without fiscal year limitation.” (emphasis added)

In contrast, the House of Representatives amended this such that any user fees that exceed the USPTO’s allocated funding would be placed into a special account, Congress could then appropriate to the USPTO. (H.R. 1249 Section 22), if it felt moved to do so.  It remains to be seen if the Senate decides to press for the end to fee diversion.

Supporters of the bill point out that there has been no significant fee diversion in the past decade.

Post-grant Review

A petition for a post-grant review must be filed no later than 9 months after the grant of the patent or issuance of a reissue patent  (correction via Prof. John Villasenor, UCLA).  Post-grant proceedings would be conducted by a new Patent Trial and Appeal Board, with the current Board of Patent Appeals and Interferences abolished.

The House bill also creates a new inter partes review allowing third-party challenges to patents after they have been granted, limited to prior art consisting of patents and printed publications. Inter partes review may only be sought after a post-grant review, or after the one-year time period expires for requesting third-party review.

Money, Money, Money

According to the Congressional Budget Office, the House bill is projected to cost $446 million between FY 2011–2016, but will ultimately cut $717 million from future budget deficits, mostly since USPTO fees will be reclassified from offsets to discretionary spending to offsetting receipts.

At 5:00 PM, the Senate will proceed to an Executive Session to consider Cal. #109 (Bernice Bouie Donald to be United States Circuit Judge for the 6th Circuit).  There will be 30 minutes of debate followed by a vote on the nomination.  Immediately following the judicial nomination vote, the Senate will proceed to a cloture vote on the Motion to Proceed to H.R. 1249 (Patent Reform Bill).

I’m sure you’ll be glued to C-SPAN.

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4 Comments

  1. “The House version creates a sequestered account for USPTO revenue in excess of appropriated funds, for use exclusively by the USPTO.”

    I disagree with your interpretation of the bill. The funds, if appropriated, may be exclusively used for the purposes set forth in the act. However, the decision of whether to appropriate the funds to the USPTO or elsewhere is solely at the discretion of the Appropriations committee.

  2. “patent reform”

    Just because they call it “reform” doesn’t mean it is.

    The patent bill is nothing less than another monumental federal giveaway for banks, huge multinationals, and China and an off shoring job killing nightmare for America. Even the leading patent expert in China has stated the bill will help them steal our inventions. Who are the supporters of this bill working for??

    Patent reform is a fraud on America. This bill will not do what they claim it will. What it will do is help large multinational corporations maintain their monopolies by robbing and killing their small entity and startup competitors (so it will do exactly what the large multinationals paid for) and with them the jobs they would have created. The bill will make it harder and more expensive for small firms to get and enforce their patents. Without patents we cant get funded. Yet small entities create the lion’s share of new jobs. According to recent studies by the Kauffman Foundation and economists at the U.S. Census Bureau, “startups aren’t everything when it comes to job growth. They’re the only thing.” This bill is a wholesale slaughter of US jobs. Those wishing to help in the fight to defeat this bill should contact us as below.

    Small entities and inventors have been given far too little voice on this bill when one considers that they rely far more heavily on the patent system than do large firms who can control their markets by their size alone. The smaller the firm, the more they rely on patents -especially startups and individual inventors. Yet Congress has almost completely ignored the testimony of inventors. Congress tinkering with patent law while gagging inventors is like a surgeon operating before examining the patient.

    Please see http://truereform.piausa.org/default.html for a different/opposing view on patent reform.
    http://docs.piausa.org/

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