H.R. 1561 - U.S. Patent and Trademark Fee Modernization Act of 2003

COMMITTEE ACTION: REPORTED BY RECORD VOTE of 8-1 on Tuesday, March 2, 2004.
FLOOR ACTION:ADOPTED BY VOICE VOTE on Wednesday, March 3, 2004.
MANAGERS: LINDER/HASTINGS (FL)
108th Congress
2nd Session

H.R. 1561 - U.S. Patent and Trademark Fee Modernization Act of 2003

1. Structured rule.

2. Provides one hour of general debate equally divided and controlled by the chairman and ranking minority member of the Committee on the Judiciary.

3. Provides that the amendment in the nature of a substitute recommended by the Committee on the Judiciary now printed in the bill shall be considered as an original bill for the purpose of amendment, and shall be considered as read.

4. Waives all points of order against the Committee amendment in the nature of a substitute.

5. Makes in order only those amendments to the Committee amendment in the nature of a substitute which are printed in the Rules Committee report accompanying the resolution.

6. Provides that the amendments made in order may be offered only in the order printed in the report, may be offered only by a Member designated in the report, shall be considered as read, shall be debatable for the time specified in the report equally divided and controlled by the proponent and an opponent, shall not be subject to amendment, and shall not be subject to a demand for division of the question in the House or in the Committee of the Whole.

7. Waives all points of order against the amendments printed in the report.

8. Provides one motion to recommit with or without instructions.

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RESOLUTION

Resolved, That at any time after the adoption of this resolution the Speaker may, pursuant to clause 2(b) of rule XVIII, declare the House resolved into the Committee of the Whole House on the state of the Union for consideration of the bill (H.R. 1561) to amend title 35, United States Code, with respect to patent fees, and for other purposes. The first reading of the bill shall be dispensed with. General debate shall be confined to the bill and shall not exceed one hour equally divided and controlled by the chairman and ranking minority member of the Committee on the Judiciary. After general debate the bill shall be considered for amendment under the five-minute rule. It shall be in order to consider as an original bill for the purpose of amendment under the five-minute rule the amendment in the nature of a substitute recommended by the Committee on the Judiciary now printed in the bill. The committee amendment in the nature of a substitute shall be considered as read. All points of order against the committee amendment in the nature of a substitute are waived. No amendment to the committee amendment in the nature of a substitute shall be in order except those printed in the report of the Committee on Rules accompanying this resolution. Each such amendment may be offered only in the order printed in the report, may be offered only by a Member designated in the report, shall be considered as read, shall be debatable for the time specified in the report equally divided and controlled by the proponent and an opponent, shall not be subject to amendment, and shall not be subject to a demand for division of the question in the House or in the Committee of the Whole. All points of order against such amendments are waived. At the conclusion of consideration of the bill for amendment the Committee shall rise and report the bill to the House with such amendments as may have been adopted. Any Member may demand a separate vote in the House on any amendment adopted in the Committee of the Whole to the bill or to the committee amendment in the nature of a substitute. The previous question shall be considered as ordered on the bill and amendments thereto to final passage without intervening motion except one motion to recommit with or without instructions.


SUMMARY OF AMENDMENT MADE IN ORDER

(summaries derived from information provided by sponsors)

1. Sensenbrenner #5
The amendment creates a "refund" program to eliminate the potential incentive for diverting PTO revenue to non-PTO programs. If fee collections in a given fiscal year exceed the amount appropriated to the agency, the excess or overage shall be deposited in a PTO "Reserve Fund." At the end of the fiscal year the Director determines if there are sufficient funds to make payments to persons who paid fees during that year. The Director is empowered to determine which recipients qualify and in what amounts, except that the payments in aggregate must equal the amount of revenue in the Reserve Fund during that fiscal year, less the cost of administering the program. The amendment changes the basic effective date from October 1, 2003, to October 1, 2004, or the date of enactment, whichever is later. Under existing law, the Director may raise most fees based on the CPI. The amendment supplements this authority by allowing the Director to raise fees based on the CPI for "processing, services, or materials relating to patents not specified" in the fee schedule. Recovery of these administrative costs will help the agency with its funding shortfall. The bill as reported contains a pilot program to determine the efficacy of allowing commercial entities to perform the search function, thereby relieving the agency of the burden and freeing up examiners to do other work. The amendment specifies that participation in the pilot program will be restricted to American businesses and American citizens. The amendment limits the Director's discretion to prescribe the search fee for commercial entities. For the first three years, he may not establish a fee in excess of $500 (or less in some cases) and for the next three years this figure may not increase by more than 20% annually. Finally, in furtherance of the ongoing modernization efforts at PTO, the Director shall reduce the filing fee for any small entity, independent inventor, or nonprofit organization by 75% provided those so qualified file their applications electronically. (20 minutes)

2. Manzullo #1
The amendment: (1) establishes an inflation-adjusted freeze on all fees for micro-entities defined as firms or independent inventors with up to 15 employees and net worth not exceeding $2 million (without regard to bona fide pensions and similar retirement accounts); (2) makes the traditional small entity 50% discount under Patent Law applicable to search fees for intermediate small entities defined as having between 16 and 500 employees and a net worth not exceeding $7 million; this category also establishes a cap on outsourced patent search fees at $500, equal to the cap established by the bill on search fees performed by the PTO in-house; and (3) includes a certification requirement, in addition to the certification on each PTO application as to small entity fee eligibility, preventing large entities from qualifying for the small entity discount illegitimately. (20 minutes)

3. Jackson-Lee #8
Requires that a substantial number of the outsource contracts be awarded to: (1) American businesses, and (2) small, minority-owned businesses, or businesses owned by women. (20 minutes)

TEXT OF THE AMENDMENT(.pdf)

Sensenbrenner

Manzullo

Jackson-Lee