Bob Goodlatte

Mr. GOODLATTE

Mr. GOODLATTE. Mr. Chairman, in responding to the gentlewoman's comments earlier where she said we were helping foreign inventors, quite the opposite. Foreign inventors are helped right now under the current laws of their countries that publish the 75 percent of all patents filed in the U.S. Patent Office that are also filed in other countries.

Mr. GOODLATTE. Mr. Chairman, will the gentlewoman yield?

Mr. GOODLATTE. Mr. Chairman, will the gentleman yield?

Mr. GOODLATTE. Mr. Chairman, the point about publication is it is not just the choice of the individual inventor but, rather, the publication of everyone's patent applications. If no one else has published, then the entrepreneur has the assurance that that one being published is the one they can put their money behind. If they do not know, if everybody else has a choice of publishing or not, we are back to the same old submarining, gaming of the system.

Mr. GOODLATTE. Mr. Chairman, if the gentleman will continue to yield, just briefly, to say that that is because they do not have the protection of the U.S. patent system. Publication gives them the provisional right to protection that they do not have when they sign that stack of papers.

Mr. GOODLATTE. I yield to the gentlewoman from Ohio.

Mr. GOODLATTE. Mr. Chairman, I move to strike the requisite number of words, and I yield to the gentleman from Illinois [Mr. Hyde], the chairman of the committee. (Mr. HYDE asked and was given permission to revise and extend his remarks.)

Mr. GOODLATTE. Mr. Chairman, will the gentleman yield?

Mr. GOODLATTE. Mr. Chairman, I move to strike the last word, and I rise in opposition to the amendment offered by the gentleman from California [Mr. Campbell]. Mr. Chairman, I think the debate here has been wrongly focused on the whole idea that somehow the patent system operates to protect the work of inventors through secrecy. That is not the case at all. We protect the work of inventors through secrecy by using a trade secret process. Patents operate just the opposite. We protect the rights of American inventors through our patent system when the patent is issued today by telling the whole world that that particular individual is the first to patent that item. That is the protection they get, by publishing the work, by publishing the discovery of the invention. That is exactly what we are trying to improve in this process by publishing after 18 months. We are, if we simply look at this debate from the standpoint of how many of these can we continue to not publish, overlooking the fact that we are, in point of fact, having the opportunity to improve our system and improve the protection on those inventors through publication. The gentleman from North Carolina has rightly pointed out that if we do not change our system, the fact that 75 percent of all the patents filed in the United States are published after 18 months because they are also filed in Japan, in Germany, in France, and other places around the world, in the languages of those countries, in Japanese, in German, in French, so inventors in those countries, the little guys, have the opportunity to see in their own language exactly what everybody else in this process is doing. The small inventor, the major business, anybody in the United States, does not have that opportunity under our system because we do not publish. Of all the patents filed in the United States, 45 percent are filed by foreign inventors. We do not get the opportunity to see what they are doing in this country because it is not published in English for our inventors to see. If we adopt this amendment, we are going to miss out on what is a major reform in our patent law that improves the conditions, does not harm the conditions for the small inventor. The second thing that is harmful for the small inventor in our current process is the amount of time it takes that small inventor to get capital to get their product on the market. A major business does not have that problem. They have the capital. They are ready to go with their product, whether they have a patent issued or not. But the little guy has the problem of not being able to get that capital. Quite to the contrary of the criticism of this legislation by the opponents, the experience in Europe and other places around the world is that when you publish after 18 months, the entrepreneurial investor will be willing to put the money behind your invention sooner because you are being published, and not only are you being published, and this is the critical element, everybody else in the patent process is being published as well, so that entrepreneurial investor has the opportunity to know that you are the first one out of the box because you are the first one being published. If there is anybody else out there with a competing patent idea, that if they put their money behind you and somehow somebody else is going to get that patent, they now have the opportunity to know that you are the one because you are the first one out of the box with that publication. The experience in Europe and other places has been that the entrepreneurs put the money behind that little inventor sooner, get their product to market sooner as a result of having that publication. Finally, the amendment offered by the gentleman from California does not eliminate gaming of the system. As the gentleman from North Carolina [Mr. Coble] correctly pointed out, it simply changes the nature of the gaming. If somebody wants to force publication of somebody else's patent, then they go through the process of having a patent controversy in the Patent Office. The result is that there is a new way of gaming our system. That has not improved the system, that has simply changed the way that lawyers and those who want to game the system and take advantage of it, who do not want to bring a new idea to market, who do not want to get the capital to put an idea on the line but rather want to take advantage of somebody else, they will still be able to do it under the gentleman's amendment. Mr. Chairman, I urge opposition to the amendment and support of H.R. 400, which will truly improve the system not only for all American business but most especially for the little guy.

Mr. GOODLATTE. I thank the chairman for yielding. Mr. Chairman, on that very point the fact of the matter is those inventors get the opportunity to get the capital behind their project, their invention, sooner with publication. Because not only are they published but their competition is published. So the inventor has the opportunity to say to that entrepreneur, that person who is going to put the dollars behind him, ``You can put them behind me with confidence.'' Right now many inventors are complaining to the gentleman from California [Mr. Rohrabacher] saying they are worried about the gap between 18 months and whenever they get their patent because they will not be able to get the capital during that time. The reason they cannot get the capital during that time is because they do not know, the entrepreneur does not know that they are the ones who are going to get it. Under this procedure, they will. But I want to address, if I may, the gentleman's very, very asserted message that somehow we are attempting to conform our patent laws to the Japanese, nothing could be further from the truth, when we take one concept that is held by many, many other countries and apply it in this legislation to say that somehow we are now harmonizing our patent law with the Japanese law. We most certainly are not. The United States is a first-to-invent nation. Japan is a first to file. The United States has immediate examination. Japan has deferred examination. The United States process their patents in 20 months, on average. Japan takes 8 years. We have protections for universities who publish early. There is no such protection in Japan. And we have, as the chairman noted, provisional rights that give additional protection for those inventors. They do not have those rights in Japan. We are not following the Japanese here. We are leading the way as we always have in patent law.

Mr. GOODLATTE. Mr. Chairman, if the gentleman will continue to yield, I want to make the point if this is some conspiracy that came up within the last 2 years, it is interesting that U.S. patent commissioners have been seeking this change. U.S. patent commissioners of both political parties have been seeking this change for 20 years. The Nixon administration, the Ford administration, the Reagan administration, the Bush administration all sought these changes long before there was any so-called secret agreement.

Mr. GOODLATTE. Mr. Chairman, will the gentleman yield?

Mr. GOODLATTE. Mr. Chairman, I thank the gentleman for yielding to me. I just want to make the point that the so-called agreement that the gentleman refers to is not something that has been honored in any way, shape, or form by this Congress or by the Committee on the Judiciary that comes forward with this legislation. We are a first to invent Nation, not a first to file Nation. That is what they want to have. We have always had a number of very significant differences in our patent system. All we are doing is saying that these are things that help us in this country, and we want to modify our system to engage small inventors and large inventors in having the opportunity to receive the benefits of publication. This is not a battle over trade secrets. There is a mechanism to protect trade secrets for anyone who wants to take advantage of it. Patents are protected by broadcasting to the whole world that an individual has the first to invent, and we should protect that by advancing publication where it helps.

Mr. GOODLATTE. Mr. Chairman, if the gentlewoman will continue to yield, the fact of the matter is we are advocating for the little inventor by pointing out the advantages of the system that we have elsewhere in the world that benefits them. We have seen how it benefits them. It will benefit them here as well. I have had many small inventors who have contacted me in support of this legislation and, yes, I have had some of those multinational corporations you talk about. They file an awful lot of patents as well and they want their patents protected under our system as well. That is exactly why we need to pass this legislation, to help both.

Mr. GOODLATTE. Mr. Chairman, if the gentlewoman will continue to yield, 45 percent of the patents that are filed in the U.S. Patent Office are filed by foreign inventors, and we do not have the opportunity to see in the English language what is published by those folks. Second, no one has addressed the whole point that we have made that these inventors get the capital to bring their product to market sooner, when you publish sooner, so that entrepreneurs who invest know sooner that this is the investment they should put their money behind because that is the person who is going to be getting the patent.

Mr. GOODLATTE

Mr. GOODLATTE. Mr. Chairman, reserving the right to object, and I will not object, but I would ask that the gentleman from California, if we are going to conduct this debate under the 5-minute rule, recognize that he can make unanimous-consent requests for additional time. No one here wants to do it, but if the gentleman is only going to recognize folks who agree with his opinion, he is not entering into a genuine debate, and I think we should have that. So I will not object, but I would make the point to the gentleman.

Mr. GOODLATTE. I yield to the gentleman from Massachusetts.

Mr. GOODLATTE. I thank the Chairman. The fact of the matter is the gentlewoman had 30 minutes of time, I have much less, and unfortunately, we have not had the opportunity to have that colloquy. But the fact of the matter is, under our legislation, they have that same amount of time, they have that time under the new legislation, and they will have, in most cases, more time than they have under current law. Furthermore, the average patent in this country today is issued after 19 months. This calls for publication after 18 months. So most patents are not going to experience any significant difference in how quickly they are published. But here is the important fact about this, and this is what is wrong about this entire debate by the opponents. We are not talking about trade secrets here, we are talking about publication of patents. Patents have always been protected in this country by publication. That is how we say to the world that an American inventor has put forward an idea that is entitled to be protected under our laws. We do not tell them to hide it under a rock. We do not tell them to lock it up in a safe. We tell them that the U.S. Government will publish their patent and say they were the first with that idea and they are entitled to 17-years-plus protection. That is what they get under this bill as well, only they get it better, because now they are going to be published sooner. When they are published sooner the world knows sooner that they were the first with that idea, and the capitalists who wanted to invest in that small inventor's opportunity to bring that unique idea that is so uniquely American, as the opponents have pointed out, that we lead the world in developing ideas, but we do not lead the world in getting those ideas to market, and one of the reasons why is because we do not get the capital to the inventor quickly enough. If we change the law so that we have the opportunity to publish after 18 months, and not yours published after 18 months, but anybody who might be competing with you, that is important, because if you do not know that somebody else is in the patent system with something hidden, something called a submarine patent, ready to surface up and take your claim and try to get royalties from you, what you wind up with is a system where the capitalist does not know when to put the money in until you get the patent. Under this change in the law, which has worked so well in Europe and other places, the money gets to the inventor from the entrepreneurial investor sooner because they know sooner that that person has the idea, and that is the one that is going to have the protection for 17 years. Now, the gentleman from California claims that submarine patents are eliminated by his substitute. Nothing could be further from the truth. While I have great respect for the CRS, they say both bills seek to curtail submarine patenting. But there is often ``many a slip twixt the wrist and the lip,'' and that is exactly what is true of the gentleman's substitute. It may seek to eliminate submarine patenting, but it certainly does not succeed, because it eliminates one form of delaying the patent process, and that is amending the application. But there are hundreds of ways that a good patent lawyer, who under the current laws makes a very good living with abusing our current system, there are hundreds of ways that one can delay the processing of a patent application that will not be covered by the gentleman's substitute. As a result, what we have is a situation where the only way to cure this very serious problem that costs American consumers and taxpayers hundreds of millions of dollars a year is to have publication, which, as I indicated earlier, is not bad, it is not detrimental to the small inventor, it is good for the small inventor, because publication is what tells the world that that small inventor was the first one out of the box. We also protect them by giving patent pending, a protection that it does not have now. That small inventor who has that idea that he turns into a product and puts on the shelf in the store and says patent pending, under the new law, they can get protection during the time that the patent is pending. If somebody wants to steal it and rip it off, they can get royalties for the entire time. Under the current law, they get no royalties except for the time that the patent is actually issued. The result of all of this is a vast improvement of our patent system. As we have on numerous occasions over the 200-plus years of our history, this committee and this Congress is what has created the wonderful patent system we have in this country, and no one should ever suggest that it has never been changed in the 200 years since we originally wrote our Constitution recognizing that patent system. We have to constantly look at it and improve it. When you do not, that is when you fall behind. If you want to look for examples of people who have said in the past that we are the best in the world and we do not have to worry about anybody outside, go talk to the big-three automobile makers and ask them what they thought back in the 1960's and 1970's about their superiority over the Japanese. They learned very quickly that if they did not change the way they do things to keep up with the times, they would fall behind. If you want to look for a place where there is strong, strong support for these patent reforms to protect American business, American jobs, and American technology, go to the big-three automakers, because all three of them support H.R. 400 because they want to make sure that our patent system remains the best in the world, and that is what this legislation does. Oppose Rohrabacher, support H.R. 400.

Mr. GOODLATTE. Mr. Chairman, I would ask for order.

Mr. GOODLATTE. Mr. Chairman, no, I will not yield.

Mr. GOODLATTE. Mr. Chairman, I thank the gentleman for yielding this time to me, and I rise in strong opposition to the Rohrabacher substitute which would be a disastrous turn to take in American patent law. First I want to address some of the comments being made by some of the supporters of this substitute and the opponents of the bill. The gentlewoman from Ohio [Ms. Kaptur] said that we had not been fair and open in this process; and by the way, I will not yield to the gentlewoman because she refused to yield to me earlier, but I want to make this point. This bill has been more carefully studied and worked in this Congress in very public open hearings than any other legislation considered in this Congress this year. Hearings have been held in the Committee on Science, hearings have been held in the Committee on Small Business, hearings have been held in the Committee on International Relations, and eight public hearings have been held in the Committee on the Judiciary on this legislation. So there is absolutely no possibility that this legislation is not something that has been very fairly and openly debated throughout the process. Second, the gentlewoman made the point, which is totally inaccurate, that we were going from a 17-year protection for inventors down to 18 months. Well, that is hardly the case at all. Under our bill, any inventor gets a minimum of 17 years' protection, provided that they themselves do not cause a delay in the issuance of the patent. So they are going to get an increase.

Mr. GOODLATTE. The lawyers that the gentleman suggests will benefit by this work for the many, many, many American businesses who strongly support this legislation. And would the gentleman suggest, and I am sure the gentlewoman would not suggest, that those businesses are interested in legislation because it will give them the opportunity to pay more in legal fees? Of course not. They are interested in this legislation because it stops submarine patenting where one lawyer, one lawyer got $150 million in contingent fees. And do my colleagues know where that money came from? It came from American business. And do my colleagues know what it gets paid for? American business passes their costs on to the consumers and taxpayers in this country, and that is what this legislation is all about. It is not to help lawyers.

Mr. GOODLATTE. Mr. Chairman, I ask do we know how many hundreds of millions of dollars the attorney for Mr. Lemelson received in fees thus far for his submarine patenting?

Mr. GOODLATTE

Mr. GOODLATTE. Mr. Chairman, I rise in strong support of H.R. 400, the 21st Century Patent System Improvement Act. Just remember that title. That is what this is about, improving our patent system. I would like to thank the gentleman from North Carolina [Mr. Coble], chairman, for his hard work and dedication on this important issue. This legislation has been subject to a great deal of confusion in recent weeks, due largely to the blatant misrepresentations of its opponents. People who make their livings gaming our patent laws will stop at nothing in their effort to prevent meaningful and necessary reform of the system. Opponents of patent reform have engaged in a campaign of deliberate misrepresentation and confusion in the hopes that they might convince Members that H.R. 400 is an international sellout that will undermine the patent system created by our Founding Fathers. Nothing could be further from the truth. H.R. 400 is one of the most thoroughly debated bills to come before the House this year. The provisions contained in this bill have been developed over the last 2 years and have been the subject of 10 full days of hearings with over 80 witnesses. Patent and trademark commissioners who dedicate themselves to the integrity of our patent system, from the Nixon, Ford, Reagan, Bush, and Clinton administrations support the major provisions of H.R. 400. These experts also oppose the major provisions of the Rohrabacher substitute, which was written on behalf of those who ignore the intent of our Founding Fathers by using subterfuge to destroy the integrity of the U.S. patent system. Taking the word of patent submariners on patent reform is like asking a fox for advice on how to guard the henhouse. H.R. 400 is the unanimous product of the Committee on the Judiciary. Unanimous, 35 members of the committee. Not one voted against this, not one Democrat, not one Republican. Yet this issue has been demagogued by a very few. Through the legislative process, the committee has worked with independent inventors, small businesses, universities, industry groups, the White House Conference on Small Business, and the Senate. Over 75 U.S. companies, large and small alike, which employ 1.4 million American workers and hold 55,000 U.S. patents, support H.R. 400. This legislation is critical to ensuring that America maintains our position as the world leader in intellectual property. H.R. 400 benefits independent inventors, small businesses, and other Americans who utilize our patent system in four key areas. First, it guarantees diligent patent applicants at least 17 years of patent term and ensures that they will not lose their rights due to delays by the patent office. Second, the bill protects early domestic commercial inventors, including universities and researchers who use later patented technologies. Third, the legislation deters invention promoters from defrauding unsus-pecting inventors. Finally, H.R. 400 gives all Americans a new property right while their patents are pending before the Patent Office. Unfortunately, opponents of patent reform are unwilling to give up the loopholes through which they undermine the integrity of America's patent system. Their proposal, offered today by the gentleman from California [Mr. Rohrabacher] as a substitute to H.R. 400, would encourage abuses of our patent system that currently cost American taxpayers and consumers hundreds of millions of dollars. Although they may argue otherwise, the Rohrabacher substitute is nothing more than a recipe for economic disaster. Since opponents of meaningful patent reform allege that H.R. 400 is a huge corporate giveaway, I would like to respond by highlighting the ways in which H.R. 400 benefit small inventors. First, under H.R. 400, small inventors will be able to acquire venture capital to market their inventions more quickly and easily. This will put small inventors on a more level playing field with large multinational corporations, allowing individuals and small businesses to fully compete in the global marketplace. Mr. Chairman, H.R. 400 also gives small inventors greater protection against those who try to steal their ideas. Under current law, small inventors have no protection against would-be thieves that steal the subject of a patent and commercialize it before the patent is granted. These inventors are then helpless to stop the commercialization of their inventions or to share in the profits until the patents are granted. I should also note that the Rohrabacher substitute does nothing to help small inventors with this problem. H.R. 400, however, allows small inventors to receive fair compensation from any third party who commercializes their ideas between the time of publication and the time the patent issues. Every one of us has seen the words ``patent pending'' on a product, but in the current system, these words do not provide any legal protection. Under H.R. 400, small inventors will be given a new property right while their patents are pending, so they can punish intellectual property thieves who try to steal their ideas. Additionally, H.R. 400 gives small inventors longer patent protection than they receive under current law. Under the old system, which the Rohrabacher substitute seeks to resurrect, patent protection was only available for 17 years from the date a patent was granted. H.R. 400, however, guarantees good-faith patent applicants a minimum of 17 years of patent protection, with most applicants receiving more. The bill also provides extended protection for up to 10 years in cases where the Patent Office fails to give applicants firm rulings on their applications in a timely manner. Finally, H.R. 400 gives small inventors a special option to avoid publication of their patents. During the application process, some inventors may have second thoughts about publishing their applications, especially in cases where an initial Patent Office review is not favorable. Under H.R. 400, inventors may withdraw their applications prior to publication and either refile them in the future or seek protection under State trade secrecy law. Mr. Chairman, the Framers of our Constitution created a system in which the Government grants exclusive rights to inventors for a fixed period of time, in exchange for the prompt public disclosure of their inventions. This exchange allows all of American society to benefit from the creation of new ideas. H.R. 400 is exactly what our Founding Fathers intended. It promotes invention by guaranteeing longer patent terms, prevents fraud and abuse by stopping patent submariners from swindling American taxpayers out of hundreds of millions of dollars, and protects small inventors by giving them new property rights in their pending patent applications. I urge my colleagues to vote for H.R. 400 and against the misguided Rohrabacher substitute.

Mr. GOODLATTE. Mr. Speaker, I thank the gentleman from Colorado for yielding me this time. I rise in support of the rule and in strong support of H.R. 400. This is a very good bill and a very, very important bill to protect the competitiveness of American business and American inventors, large and small. Let me make that point very, very clear. I commend the gentleman from North Carolina [Mr. Coble], my good conservative friend, and the gentleman from Illinois, the chairman of the Committee on the Judiciary, for pushing this legislation forward. Mr. Hyde and Mr. Coble know how important this legislation is for the American people. We are not dealing with what the opponents would tell us is the Steal American Technologies Act. We are dealing with a situation where we have got to act and act now to protect American inventors from a situation where that technology is being stolen under current law. Under current law, every single patent that is filed in the other major industrial countries around the world is published after 18- months, in Japanese, in German, in French, for those inventors and those countries to see. Forty-five percent of all the patents filed with the U.S. Patent Office are filed by foreign inventors, and U.S. inventors do not get to see that technology filed here in the United States. This bill provides greater protection for the small inventor by improving the patent pending provisions of the law. This bill protects the small inventor in this country by giving them the opportunity to get capital behind those inventions much sooner than they get under current law. The opponents would tell us that under the 18 month publication, they are going to have a gap between that publication, when they get the patent, and somebody is going to steal their ideas. That is not the experience they have had in Europe. In Europe they get that capital sooner because the entrepreneurial investors in Europe know that that particular inventor is the lead inventor on that item because it has been published, published ahead of anybody else who might be in the system ahead of them. We have no way of knowing that in this country. So the capital does not come here until the patent is issued. In Europe that has changed. This will help small inventors by giving them the opportunity to get that capital, get that product on the market sooner. It will give them the opportunity not to have to reinvent the wheel because they will know whether somebody else is already in the marketplace with that idea. This is a good bill. It is a good bill for the little guy, and we should vote for the rule and vote for the bill and get this major improvement, major improvement to competitiveness in the United States against our foreign competition done. Mr. Speaker, I thank the gentleman for yielding me the time.