Bob Goodlatte

Mr. GOODLATTE

Mr. GOODLATTE. Madam Chairman, I rise in strong opposition to this amendment, which is a bad idea. Post-grant review is one of the most important provisions in this bill. It allows third parties, for a limited window of 9 months after a patent is issued, to submit evidence that the patent should not have been granted in the first place. This allows third parties, many of whom will be small businesses themselves who are familiar with the subject matter, to provide a check on patent examiners. If the evidence shows that the patent is indeed invalid, then the patent applicant should never have received the patent in the first place. If the evidence shows that the patent is valid, then the patent is made stronger and more certain by surviving a post-grant review. The amendment would exempt small businesses from the post-grant opposition proceeding. However, the quality of a patent examination does not hinge on the size of the applicant, whether it was a small business, an independent inventor, or a large corporation. It hinges on the PTO job of scrutinizing that patent. A bogus patent held by an independent inventor is no less deserving of a second look than a bogus patent held by a Fortune 500 company. For these reasons, I urge opposition to this very bad amendment.

Mr. GOODLATTE. Mr. Chairman, I rise in opposition to this amendment. There is no doubt that the PTO has issued business method patents of questionable merit over the years. Many of these patents are still on the books. Unfortunately, many of these patents are being used by aggressive trial lawyers to extort money from deep pockets. Section 18 of the bill simply creates a process that allows experts at the PTO to reexamine the types of business method patents that the PTO believes to be of the poorest quality. This section was drafted in close coordination with the USPTO and is a pilot program that simply allows them to review certain business methods patents against the best prior art in a reexamination process. Why would anyone oppose a process that allows low-quality patents, as identified by the USPTO, to be reviewed by the experts? Business method patents on financial activities are the type of patents that are the subject of lawsuits and abuse most often. They are litigated at a rate 39 times greater than any other patents. Section 18 is designed to correct a fundamental flaw in the system that is costing consumers millions each year. The provision is supported by a broad bipartisan coalition that includes the U.S. Chamber of Commerce. I urge Members to reject this amendment, which strikes an important litigation reform provision in the underlying bill.

Mr. GOODLATTE. Madam Chairman, I rise in strong opposition to this amendment. Increasingly, individuals and companies are filing patents to protect tax strategies. When one individual or business is given the exclusive right to a particular method of complying with the Tax Code, it increases the costs and complexity for every other citizen or tax preparer to comply with the Tax Code. It is not difficult to foresee a situation where taxpayers are forced to choose between paying a royalty in order to reap the best tax treatment and complying with the Tax Code in another, less favorable way. Tax strategy patents add additional costs and complications to an already overly complex process, and this is not what Congress intended when it passed the Federal tax laws or the patent laws. The problem of tax strategy patents has been a growing concern for over a decade. Over 140 tax strategy patents have already been issued, and more applications are pending. Tax strategy patents have the potential to affect tens of millions of everyday taxpayers, many who do not even realize these patents exist. The Tax Code is already complicated enough without also expecting taxpayers and their advisers to become ongoing experts in patent law. That is why I advocated for inclusion in H.R. 1249 of a provision to ban tax strategy patents. H.R. 1249 contains such a provision which deems tax strategies insufficient to differentiate a claimed invention from the prior art. This will help ensure that no more tax strategy patents are granted by the PTO. Importantly, the House worked hard to find a compromise that will ensure Americans have equal access to the best methods of complying with the Tax Code, while also preserving the ability of U.S. technology companies to develop innovative tax preparation and financial management solutions. I believe the language in H.R. 1249 does just that. This amendment would allow any tax strategy patent that was filed as of the date of enactment of the bill to move toward issuance by the PTO. However, tax strategy patents are bad public policy whether they were filed the day before or the day after this bill happens to be enacted. The effective date in the underlying bill rightly applies to any patent applications pending on the date of enactment. In order to reduce the cost of filing taxes for all Americans and to restore common sense to our patent system, I urge my colleagues to oppose this amendment.

Mr. GOODLATTE. I thank the chairman for yielding. Madam Chairman, I rise in opposition to this amendment. The Senate-passed patent bill granted the PTO fee-setting authority into perpetuity. The Senate's goal was laudable. It wanted to allow the PTO to have control over the fees that it charges so that it would have more certainty about rolling out new programs and hiring new examiners to deal with pendency and quality issues. We have, as you know, a very long backlog--3 years, 1 million patents. However, I had strong concerns with granting this much authority to a government agency. Currently, the PTO must come before Congress to request any fee increases. This forces the PTO to use its current resources in the most efficient manner and also strengthens Congress' hand when it comes to oversight over the agency. Thus, I worked to get a provision into the House bill that would sunset the PTO's fee-setting authority. The bill now terminates the fee-setting authority after 7 years unless Congress proactively acts to extend it. This will allow the PTO sufficient time to structure its fees but will ensure that Congress continues to have a strong influence over that process. And I might add that the manager's amendment to the bill also strengthens Congress' hand and limits the objective of the PTO to arbitrarily raise its fees because the Congress still appropriates the funds and can only escrow funds--can't divert them to another purpose, but escrows them. PTO will have to come back to the Congress and justify additional funds it receives. I believe the bill, as it is written right now, strikes the right balance. And I urge Members to oppose this amendment, which would altogether eliminate PTO fee-setting authority.

Mr. GOODLATTE

Mr. GOODLATTE. Mr. Speaker, I rise today to introduce a resolution celebrating the 75th anniversary of the Shenandoah National Park. The Shenandoah National Park is the crown jewel of Virginia's natural resources. Through the Shenandoah National Park, I believe that we have preserved a vast, beautiful piece of land for the enjoyment of American families. Additionally, Shenandoah National Park is an exemplary example of the efforts of the United States Government and the Commonwealth of Virginia in preserving our country's natural resources. Shenandoah National Park has a rich history and showcases the conservation work of the Civilian Conservation Corps (CCC). The park has been committed to adhering to these principles of stewardship and conservation, and thus allowing the legacy of the CCC to inspire many generations of Americans. Additionally, Shenandoah National Park is the home of Skyline Drive, one of America's treasured byways. Skyline Drive winds along the crest of the Blue Ridge Mountains for 105 miles in the Shenandoah National Park. The 75 overlooks along the route afford travelers extraordinary vistas of the Shenandoah Valley and the Piedmont region in Virginia. No other road in the northeast provides access to 80,000 acres of wilderness. What the Park's visitors take away from their visit to Shenandoah National Park and their drive along Skyline Drive is that the hills and valleys are directly connected to the character and aesthetics of the Park and its neighboring cities, towns, and counties. By conservative estimates, Shenandoah National Park has a $70 million impact on the counties surrounding the park. The health of the Shenandoah's resources and the health of its neighbors will forever be entwined. The 75th anniversary of the Shenandoah National Park is an important milestone. For 75 years the Shenandoah National Park has been a treasure for all Americans, but there are many stories waiting to be told. We must all be diligent to make sure that the Park's views and natural areas are around for tomorrow's visitors and for future generations to enjoy. I hope that we can continue to preserve the beauty of the Park, a world of beauty that can renew and bring peace to the spirit.

Mr. GOODLATTE

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

Mr. GOODLATTE. I would be happy to yield to the gentleman from Kentucky.

Mr. GOODLATTE. I thank the gentleman for yielding, and I rise in support of the rule but also in support of the manager's amendment. I think the gentleman from Kentucky, the chairman of one of the two committees that you have referred to here, is absolutely right, that these funds are sequestered and cannot be used for any other purpose. The Appropriations Committee may not appropriate all of the funds at one time, but they can only hold those funds in trust for the Patent Office. And then the Patent Office as they identify needs that need to be worked on will come to the appropriators, will come to you and your committee, and get approval for them. That maintains congressional oversight of the Patent Office. This is supported by the Commissioner of the Patent Office.

Mr. GOODLATTE

Mr. GOODLATTE. Madam Chairman, the gentlewoman has expressed concern about the fee diversion provision in the manager's amendment. I think it is actually a very good provision; and it will, for the first time, end fee diversion at the Patent and Trademark Office by statute. It accomplishes both our overarching policy goals and maintains congressional oversight. For the first time, we are establishing an exclusive PTO reserve fund that will collect all excess PTO fees and bring an end to fee diversion. It's been expressed on the other side of the aisle that maybe with the authority to set fees that is granted for a limited period of time in this bill, there will be an abuse in the Patent Office. But it can't be abused very much because the fees will still be subject to appropriations here in the Congress. They can't spend them on other things. They can't divert them, but they can put them in escrow, and they can require the PTO to come in and justify those fees before they're authorized. There will be no incentive to have excess fees if there can't be excess expenditures because of congressional oversight. Patent reform has been a long road; and with the inclusion of this provision, we have ensured that all funds collected by the PTO will remain available to them and may not be diverted to any other use. Ending fee diversion has been an important goal for all of us; and as we crafted legislation, our ultimate policy goal was to ensure that PTO funds are not diverted for other uses, such as earmarks or for other agencies. Working with leadership and the Appropriations Committee, we developed a compromise provision that accomplishes our shared policy goal through a statutorily created PTO reserve fund. This compromise was carefully brokered by leadership to ensure that it aligned with House rules and did not include mandatory spending that would have resulted in a score. Just a few months ago, including a provision like this one would have been unheard of, and no such provision has been included in patent bills considered by previous Congresses. All excess fees that the PTO collects will be deposited into the PTO reserve fund and amounts in the fund ``shall be made available until expended only for obligation and expenditure by the Office.'' This compromise provision also ensures that the Appropriations and Judiciary Committees will continue to have oversight over the PTO. Though PTO remains within the appropriations process, the appropriators no longer have an incentive to divert fees. In other words, because excess fees are made available to the PTO, there will be no scoring advantage to the Appropriations Committee to decrease the appropriations, and this will not impact their 302(b) allocation for Commerce, Justice, State appropriations. I urge my colleagues to support the manager's amendment. By creating the Reserve Fund, we have walled-off PTO funds from diversion. All the excess fees are collected and deposited into the Fund and are made available in Appropriations Acts and cannot be ``diverted'' to other non-PTO purposes. PTO funding would still be provided in Appropriations Acts, but the language carried in those Acts will appropriate excess fee collections and provide a clear and easy mechanism for PTO to request access to those funds. By giving USPTO access to all its funds, the Manager's Amendment supports the USPTO's efforts to improve patent quality and reduce the backlog of patent applications. To carry out the new mandates of the legislation and reduce delays in the patent application process, the USPTO must be able to use all the fees it collects. The language in the Manager's Amendment reflects the intent of the Judiciary Committee, the Appropriations Committee and House leadership to end fee diversion. USPTO is 100% funded by fees paid by inventors and trademark filers who are entitled to receive the services they are paying for. The language makes clear the intention not only to appropriate to the USPTO at least the level requested for the fiscal year but also to appropriate to the USPTO any fees collected in excess of such appropriation. Providing USPTO access to all fees collected means providing access at all points during that year, including in case of a continuing resolution. Access also means that reprogramming requests will be acted on within a reasonable time period and on a reasonable basis. It means that future appropriations will continue to use language that guarantees USPTO access to all of its fee collections. Appropriations Chairman Rogers is committed to this agreement and to ending fee diversion at the PTO, and I appreciate his efforts. This provision represents a sea change of improvement over the current system and I urge all Members to strongly support this end to fee diversion at the PTO. This amendment, including the commitment from Chairman Rogers to Leadership ensures that all the user fees that the PTO collects will be available to the PTO so that they can get to work to reduce patent pendency and the backlog, and issue strong patents.

Mr. GOODLATTE. Madam Chairman, it was mentioned earlier by one of those speaking in opposition to the bill that the National Association of Realtors was opposed to this legislation. And we will make available for the Record a letter that we received, dated 2 days ago, from the National Association of Realtors: ``On behalf of the 1.1 million members of the National Association of Realtors, we are pleased to support H.R. 1249, the America Invents Act.'' It goes on to explain in great detail why they, along with literally hundreds of other organizations, support this legislation. That includes the United States Chamber of Commerce, the National Association of Manufacturers, and the Retail Federation of America. There is a whole host of organizations and individual companies, both large and small, who support the legislation because they know that this is what is vital for job creation in this country. We need to have reform of our patent laws because, unfortunately in recent years, countries like China have overtaken us in the productivity of their patent office. And the fact of the matter is, unless we change our patent laws, we are going to continue to be at a disadvantage. And the advantages that we've had in the past are no longer available to us because, quite frankly, the complexity of inventions has increased; and more and more, we find ourselves in a situation where the laws that we operate under today, which were last updated in 1952, need to be updated to address a lot of the abuses that you've heard described here this evening. We also need to pass this legislation to make sure that the fee diversion, that, as has been noted, has kept nearly $1 billion from going to the operation of the Patent Office to work down the 3-year 1 million patent backlog, also can be addressed. And we also need to recognize that this legislation, in addition to being a jobs bill, as recognized by all of these many, many, many companies and associations of various trade groups, it is also major litigation reform. It cuts out the abuses with tax strategy patents and other business method types of patents, where individuals do not produce anything other than lie in wait for somebody else to come up with a similar idea and then come forward and say, Hey, that was really my idea, and now you pay me a lot of money. They aren't creating jobs. They, in fact, are causing jobs to leave this country. So there are many reasons to support this legislation, and I would urge my colleagues to do so. We have not yet come to the manager's amendment, but it provides a critical component to making sure that fee diversion does not occur. National Association of Realtors, Washington, DC, June 20, 2011. House of Representatives, Washington, DC. Dear Representative: On behalf of the 1.1 million members of the National Association of REALTORS (NAR), we are pleased to support H.R. 1249, the America Invents Act. NAR's support, however, is predicated upon the retention of important anti-fee diversion provisions contained in section 22 of the bill. NAR believes it is critically important that the U.S. Patent Trademark Office have access to all user fees paid to the agency by patent and trademark applicants. Without this reform, delays in processing patent applications will continue to undermine American innovation and stymie the nation's economy. NAR, whose members identify themselves as REALTORS, represents a wide variety of real estate industry professionals. REALTORS have been early adopters of technology and are industry innovators who understand that consumers today are seeking real estate information and services that are fast, convenient and comprehensive. Increasingly, technology innovations are driving the delivery of real estate services and the future of REALTORS' businesses. The nation's patent law system faces many of the same issues but has not kept pace. It has been more than 50 years since the patent system's last major overhaul. Modernization is critically needed to improve the quality of issued patents, reduce the burden of unnecessary litigation on businesses and refocus the nation's efforts on innovation and job creation. As technology users, NAR and several of its members currently find themselves facing onerous patent infringement litigation over questionable patents launched by patent holding companies and other non-practicing entities. Without needed reforms that assure that asserted patent rights are legitimate, the ability of businesses owned by REALTORS, many of which are small businesses, to grow, innovate and better serve modern consumers will be put at risk. For this reason, NAR supports reforms such as expanded post-grant review and prior user rights. The America Invents Act contains needed reforms geared towards improving patent quality. NAR supports greater transparency in the patent application process including creating a mechanism to allow practitioners with the expertise and knowledge to review and comment on the appropriateness of a patent application prior to the issuance of the patent and the creation of a streamlined and more effective process for challenging a patent outside of the judicial system. Finally, it is critically important that the U.S. Patent Trademark Office have access to all user fees paid to the agency by patent and trademark applicants. Without this reform, delays in processing patent applications will continue to undermine American innovation. The National Association of REALTORS supports H.R. 1249 with the section 22 anti-fee diversion provisions. We urge the House to pass this much needed legislation with these critical provisions. Sincerely, Ron Phipps, 2011 President.

Mr. GOODLATTE. Over 140 tax strategy patents have already been issued, and more applications are pending. Tax strategy patents have the potential to affect tens of millions of everyday taxpayers, many who do not even realize that these patents exist. The Tax Code is already complicated enough without also expecting taxpayers and their advisers to become ongoing experts in patent law. Scores, hundreds of organizations in fact, support these reforms. It is important that this House supports the manager's amendment; and by the way, the United States Chamber of Commerce supports the manager's amendment and the bill. That is why I worked to include in H.R. 1249 a provision to ban tax strategy patents. H.R. 1249 contains such a provision which deems tax strategies insufficient to differentiate a claimed invention from the prior art. This will help ensure that no more tax strategy patents are granted by the PTO. Importantly, the House worked hard to find a compromise that will ensure Americans have equal access to the best methods of complying with the Tax Code while also preserving the ability of U.S. technology companies to develop innovative tax preparation and financial management software solutions. I believe the language in H.R. 1249 strikes the right balance. By giving the necessary tools to the Patent Office to issue strong patents and by enacting litigation reforms, we will help to inject certainty about the patents that emerge from this process--patents rights that are more certain to attract more investment capital. This will allow independent inventors, as well as small, medium and large- sized enterprises to grow our economy and create jobs.

Mr. GOODLATTE. I thank the chairman for yielding and for his leadership on this issue, and I rise in strong support of H.R. 1249. For the better part of the past decade, Congress has been working to update our patent laws to ensure that the incentives our Framers envisioned when they wrote article I, section 8, of our Constitution remain meaningful and effective. The U.S. patent system must work efficiently if America is to remain the world leader in innovation. It is only right that as more and more inventions with increasing complexity emerge, we examine our Nation's patent laws to ensure that they still work efficiently and that they still encourage and not discourage innovation. The core principles that have guided our efforts have been to ensure that quality patents are issued by the PTO in the first place and to ensure that our patent enforcement laws and procedures do not create incentives for opportunists with invalid claims to exploit while maintaining strong laws that allow legitimate patent owners to enforce their patents effectively. H.R. 1249 addresses these principles. With regard to ensuring the issuance of quality patents, this legislation allows third parties to submit evidence of prior art during the examination process, which will help ensure examiners have the full record before them when making decisions. In addition, after the PTO issues a patent, this legislation creates a new post-grant opposition system in which third parties can raise objections to a patent immediately after its issuance, which will both help screen out bad patents while bolstering valid ones. Furthermore, the bill contains a provision on fee diversion where any fees that are collected but not appropriated to the PTO will be placed in a special fund to be used only by the PTO for operations. This solves the fee diversion issue, and it assures that the problem that we have had in the past will not take place in the future; but at the same time it also assures that the Congress will continue its oversight authority because the Patent Office will have to come to the Congress, to the Appropriations Committee, to justify those expenditures. They can't be spent on anything else, but they have to be justified to the Congress before the funds are appropriated. These funds will still be subject to appropriation but will be set aside to only fund the PTO. With a backlog of almost a million patent applications and many waiting 3 years to get an initial action on their patent applications, this agreement could not come at a more crucial time. We have been trying for 10 years, by the way, and this is the closest we have ever come. In addition to these patent quality improvements, H.R. 1249 also includes provisions to ensure that patent litigation benefits those with valid claims but not those opportunists who seek to abuse the litigation process. Many innovative companies, including those in the technology and other sectors, have been forced to defend against patent infringement lawsuits of questionable legitimacy. When such a defendant company truly believes that the patent being asserted is invalid, it is important for it to have an avenue to request the PTO to take another look at the patent in order to better inform the district court of the patent's validity. This legislation retains an inter partes re-exam process, which allows innovators to challenge the validity of a patent when they are sued for patent infringement. In addition, the bill allows the Patent and Trademark Office to reexamine some of the most questionable business method patents, which opportunists have used for years to extort money from legitimate businesses. By allowing the PTO to take another look at these patents, we help ensure that invalid patents will not be used by aggressive trial lawyers to game the system. The bill also ensures that abusive false markings litigation is put to an end. Current law allows private individuals to sue companies on behalf of the government to recover statutory damages in false markings cases. After a court decision 2 years ago that liberalized the false markings damages awards, a cottage industry has sprung up, and false markings claims have risen exponentially. H.R. 1249 maintains the government's ability to bring these actions but limits private lawsuits to those who have actually suffered competitive harm. This will discourage opportunistic lawyers from pursuing these cases. The bill also restricts joinder rules for patent litigation. Specifically, it restricts joinder of defendants to cases arising out of the same facts and transactions, which ends the abusive practice of treating as codefendants parties who make completely different products and have no relation to each other. Furthermore, the bill addresses the problem of tax strategy patents. Unbelievably, tax strategy patents grant monopolies on particular ways that individual taxpayers can comply with the Tax Code.

Mr. GOODLATTE. I also very much appreciate this debate on the constitutionality of this issue. I had the honor of leading the reading of the Constitution on the second day of this new Congress. I want to make it very clear because there's a lot of confusion on the part of a lot of people who think this is a first-to-file--even if you're not the inventor--gets the patent. That is most assuredly not the case. This is first-inventor-to-file. You must be a bona fide inventor to qualify for this. Our Constitution grants exclusive rights to inventors. Now, in point of fact, when our Constitution was first adopted and our Patent Office was established, there was no interference provision, and it was 80 years later before that took place. In fact, in at least one case patents were granted to more than one inventor. So the issue here I think is not at all well-founded. This is clearly constitutional. We have submitted and we will make part of the Record writings by 20 constitutional law professors-- Attorney General Mukasey who has noted this as well. The Constitution grants Congress the authority to award inventors the exclusive rights to their inventions; however, the Constitution leaves to Congress how to settle disputes between two individuals who claim to have invented a certain idea. Article I, section 8, of the Constitution declares that patent rights are to be granted in order to ``promote the progress of science and useful arts.'' A first-inventor-to-file system ensures this by awarding patent protections to the first actual inventor to disclose and make productive use of its patent. Our Nation has adopted different standards for settling these issues in the past. Currently, we have a first-to-invent standard. The reality is that a first-to-invent standard subjects small businesses and individual inventors who have filed for patent protection to surprise and costly litigation in what are called interference actions to determine who invented the idea first. This is a better idea, and this is a constitutional idea. We can make this process much easier by awarding a patent to the first inventor to make use of his invention by seeking patent protection. This will reward the inventor who is making productive use of his patent and will discourage individuals from sitting idly on their ideas. Let us make clear--switching to First-Inventor-to-File does not allow a subsequent party to steal an invention. It requires that a subsequent inventor had to have come up with the idea independently and separately. Switching to a First-Inventor-to-File system fits squarely within the plain meaning of the Constitution and will reward inventors who are working to launch our nation into the next level of innovation and job creation.

Mr. GOODLATTE

Mr. GOODLATTE. Mr. Chair, I rise today in support of the gentleman's amendment to this legislation. First, I want to be clear that I do believe that discrimination against many black farmers occurred. In 1997 a group of black farmers who had been discriminated against filed a case against USDA. By 1999 the courts agreed and approved a settlement for the farmers who had been discriminated against and provided a framework and time frames to settle the claims. Included in this settlement, the court provided a time frame for new claimants to have their cases heard. Anyone who had a claim was given the opportunity to come forward during this court approved window. Despite this framework, we are still allowing additional payments to others, who had an earlier opportunity to file claims but did not. What is most disturbing is that approximately 94,000 total claims have been filed, yet census data shows that there were only 33,000 black farmers in the U.S. during the relevant time period. Furthermore, whistleblowers have come forward, including a black farmer, alleging widespread fraud in this process. These serious allegations of fraud should be investigated before we spend potentially $1.2 billion on these claims, especially when the standard of proof for these claims is reduced under this settlement compared to what it would have been in a court. I believe that we must investigate any allegations of fraud that are occurring before this Congress allows any more funds to be used for the settlement. Just as it would be an injustice to not grant relief to black farmers who had been discriminated against, it would also be an injustice to grant an award to an individual who had not been discriminated against.

Mr. GOODLATTE

Mr. GOODLATTE. Madam Speaker, like many members of this body, I have been outraged by the President's failure to comply with the War Powers Act and to define the U.S. mission in Libya. This Congress must not neglect its responsibility and authority regarding the use of force in Libya, and the debate we are having today is long overdue. I think most Americans, including myself, agree that seeing Moammar Gadhafi and his regime of thugs removed from power would be a good thing. However, I think most Americans, including myself, also feel strongly that American forces should not be committed to this kind of mission without the consent of the U.S. Congress. Our Founding Fathers envisioned a country where the executive branch and the legislative branch share the responsibility regarding the use of force. President Obama has not sought the consent of the Congress in terms of involving American forces in Libya and that is why we are having this debate today. I rise in support of H. Res. 292. This resolution demands that the President provide answers about our involvement in the conflict in Libya, including the President's justification for not seeking Congressional authorization for this action. The resolution gives the President 14 days to respond to this request. The President should take very seriously this resolution. And our leadership in Congress should be vigilant to demand a full and clear response from the President. This resolution also gives adequate notice to NATO and our other allies of the concerns of the House before the House takes further action. The further action must take note of the President's failure to comply with the War Powers Act and notwithstanding that fact must also take note of our Nation's foreign policy interests and efforts to combat terrorism. H. Res. 292 is an important first step in restoring the balance that our Founding Fathers envisioned, that our legislative and executive branches share the responsibility regarding the use of U.S. force. However, the action taken today should not be the last step. In 14 days, the House of Representatives should reconvene to evaluate our continued involvement in Libya. We must then make hard decisions about the operation in Libya and the role of the United States in this conflict. I hope my colleagues will join me in remaining vigilant and demanding accountability from the White House.

Mr. GOODLATTE

Mr. GOODLATTE. Mr. Speaker, I am pleased to introduce and welcome the Reverend Dr. John Sloop, Senior Pastor of First Presbyterian Church in Harrisonburg, Virginia, a church that has grown to over 1,100 members and over 500 attendees for Sunday services. Dr. Sloop has served the First Presbyterian Church and the Harrisonburg community since he received his calling in 1986. Dr. Sloop is passionate about seeing the Presbyterian Church renewed and growing again, and he has been actively involved in Presbyterian for Renewal, the Presbyterian Coalition, the Confessing Church movement, and has served on the board of the Presbyterian Outreach Foundation. Dr. Sloop and his wife of 41 years, Gwen, are the proud parents of three children and two sons-in-law and have been blessed by five grandchildren. We welcome Dr. Sloop's family and other guests who join us today. And I am honored to call Dr. Sloop a constituent and a friend, and I offer the thanks of this entire body today for his delivering the opening prayer.

Mr. GOODLATTE

Mr. GOODLATTE. Madam Speaker, on rollcall No. 309 I was unavoidably detained and missed the vote. Had I been present, I would have voted ``aye.''

Mr. GOODLATTE

Mr. GOODLATTE. I thank the chairman for his comments. I commend him for this legislation, and I support it.

Mr. GOODLATTE. I yield to the gentleman.

Mr. GOODLATTE. Mr. Chairman, I rise to engage the chairman in a colloquy. Chairman Hastings, as you know, I am committed to ensuring that revenue-sharing of the benefits of OCS development are returned to those coastal States where drilling is occurring or may occur, like Virginia. Can you share with me and other Members of this body whether this will be addressed by the committee?

Mr. GOODLATTE

Mr. GOODLATTE. I thank the chairman for yielding. Madam Speaker, as a cosponsor, I rise today in support of H.R. 3, the No Taxpayer Funding for Abortion Act. I have long believed that the right to life is one that we must vigorously protect, and I have cosponsored many bills to do that, including the Right to Life Act last Congress. While there are many divergent views on this topic, one thing that most agree on is that it is wholly improper for the Federal Government to use taxpayers' hard-earned dollars to fund abortions. This is a moral issue of the highest importance to many taxpayers and to force them to fund these activities is completely unacceptable. For many Americans, taxpayer-funded abortions would constitute an extreme violation of conscience that should not be sanctioned by this Congress. I urge my colleagues to support H.R. 3, and I want to thank the gentleman from New Jersey, Mr. Smith, and the gentleman from Texas, Mr. Smith, for first introducing and then advancing this legislation.

Mr. GOODLATTE

Mr. GOODLATTE. I thank the gentleman for yielding. I rise in strong support of the Republican Study Committee budget alternative. The fact of the matter is we're broke. The Federal budget deficit is projected to exceed $1 trillion for the next 2 fiscal years and exceed $800 billion annually for at least the next decade. We cannot sustain this path without bankrupting our country. Congressman Ryan's budget proposal is a great start and sets us on a path to bringing the budget into balance. However, that proposal takes 28 years to do so. I support and will vote for his budget, but I am concerned about what will happen to it if future Congresses are not as willing to make the tough choices that are necessary to see this budget path to completion. That's why I strongly support the RSC budget, which balances the Federal budget within 9 years. Ultimately, we need a constitutional amendment to require a balanced budget to force all future Congresses to make these tough decisions, but the RSC budget does the best job of getting our fiscal house in order as quickly as possible. And now I urge all Members to support it. The RSC Budget Proposal: Puts forward commonsense reforms to improve Medicare and Medicaid by offering increased choices and improved services, and takes steps to save Social Security. Repeals ObamaCare to eliminate $677 billion in additional spending over 10 years. Freezes total discretionary spending at 2008 levels ($933 billion) beginning in 2013. Prevents any new tax increases, repeals the unaffordable $813 billion tax increase included in ObamaCare, and proposes a smarter tax code that would lower rates while broadening the tax base. Reduces unnecessary mandatory spending--other than Medicare, Medicaid, and Social Security--by $1.9 trillion between 2012 and 2021.

Mr. GOODLATTE

Mr. GOODLATTE. Mr. Speaker, I rise today to introduce, along with Representative Bobby Scott of Virginia, the Business Activity Tax Simplification Act. This bipartisan legislation will provide a ``bright line'' test to clarify state and local authority to collect business activity taxes from out-of-state entities. Many states and some local governments levy corporate income, franchise and other taxes on out-of-state companies that conduct business activities within their jurisdictions. While providing revenue for states, these taxes also serve to pay for the privilege of doing business in a state. However, with the growth of the Internet, companies are increasingly able to conduct transactions without the constraint of geopolitical boundaries. The growth of the technology industry and interstate business-to-business and business-to-consumer transactions raises questions over where multi-state companies should be required to pay corporate income and other business activity taxes. Over the past several years, a growing number of jurisdictions have sought to collect business activity taxes from businesses located in other states, even though those businesses receive no appreciable benefits from the taxing jurisdiction and even though the Supreme Court has ruled that the Constitution prohibits a state from imposing taxes on businesses that lack substantial connections to the state. This has led to unfairness and uncertainty, generated contentious, widespread litigation, and hindered business expansion, as businesses shy away from expanding their presence in other states for fear of exposure to unfair tax burdens. In order for businesses to continue to become more efficient and expand the scope of their goods and services, it is imperative that clear and easily navigable rules be set forth regarding when an out-of- state business is obliged to pay business activity taxes to a state. Otherwise, the confusion surrounding these taxes will have a chilling effect on e-commerce, interstate commerce generally, and the entire economy as tax burdens, compliance costs, litigation, and uncertainty escalate. Previous actions by the Supreme Court and Congress have laid the groundwork for a clear, concise and modern ``bright line'' rule in this area. In the landmark case of Quill Corp. v. North Dakota, the Supreme Court declared that a state cannot impose a tax on an out-of-state business unless that business has a ``substantial nexus'' with the taxing state. However, the Court did not define what constituted a ``substantial nexus'' for purposes of imposing business activity taxes. In addition, over 50 years ago, Congress passed legislation to prohibit jurisdictions from taxing the income of out-of-state corporations whose in-state presence was nominal. Public Law 86-272 set clear, uniform standards for when states could and could not impose such taxes on out-of-state businesses when the businesses' activities involved the solicitation of orders for sales. However, the scope of Public Law 86-272 only extended to tangible personal property. Our nation's economy has changed dramatically over the past 50 years, and this outdated statute needs to be modernized. The Business Activity Tax Simplification Act both modernizes and provides clarity to an outdated and ambiguous tax environment. First, the legislation updates the protections in P.L. 86-272. This legislation reflects the changing nature of our economy by expanding the scope of the protections in P.L. 86-272 from just tangible personal property to include intangible property and services. In addition, our legislation sets forth clear, specific standards to govern when businesses should be obliged to pay business activity taxes to a state. Specifically, the legislation establishes a ``physical presence'' test such that an out-of-state company must have a physical presence in a state before the state can impose corporate net income taxes and other types of business activity taxes. In our current, challenging economic times, it is especially important to eliminate artificial, government-imposed barriers to small businesses. Small businesses are crucial to our economy and account for a significant majority of new product ideas and innovation. Small businesses are also central to the American dream of self-improvement and individual achievement, which is why it is so vital that Congress enact legislation that reduces the tax burdens that hinder small businesses and ultimately overall economic growth and job creation. Unfortunately, small businesses are often the hardest hit when aggressive states and localities impose excessive tax burdens on out- of-state companies. These businesses do not have the resources to hire the teams of lawyers that many large corporations devote to tax compliance, and they are more likely to halt expansion to avoid uncertain tax obligations and litigation expenses. The clarity that the Business Activity Tax Simplification Act will bring will ensure fairness, minimize litigation, and create the kind of legally certain and stable business climate that frees up funds for businesses of all sizes to make investments, expand interstate commerce, grow the economy and create new jobs. At the same time, this legislation will protect the ability of states to ensure that they are fairly compensated when they provide services to businesses that do have physical presences in the state. I urge my colleagues to support this important legislation.

Mr. GOODLATTE

Mr. GOODLATTE. I thank the chairman for yielding and for his leadership on this issue. To the gentleman from Washington, I would tell him yesterday this House voted to cut government spending and keep the government open. Today this House will vote to cut government regulations and keep the Internet open. That's what this is all about. Let me add that, to the gentleman from Pennsylvania who said all the FCC is doing is making two simple promises, here they are: 200 pages, single spaced, small print, to make two simple promises to keep the Internet open. Well, guess what. The Internet is open now and we have laws to protect keeping the Internet open now, and they are called antitrust laws. If they need to be modified, they should come forward with those proposals. But the Internet is open today. And to my friends in the technology community, and they are my friends, some of whom think this is a great thing the FCC is doing, I would say to them, be careful what you ask for because these 200 pages are just the beginning. There will be thousands of pages more as they illegally try to blast their way into regulating the most valuable invention in the history of the world. That is what is going on here. And to the gentlewoman from California who says there is a market power analysis, I refer to page 12 of the very FCC regulations, which says: ``We are not performing a market power analysis in this proceeding.'' This issue is very, very important. The Internet is based upon free enterprise. It is based upon individual initiative and creativity. It is not based upon government regulation, and government regulation will stifle it and ultimately snuff it out. If you want proof of that, go look at government- regulated Internets in other countries around the world like China and Iran. That is not what this country is about. We are about protecting the greatest job creator we have ever made in this country. Support this resolution. Oppose the naysayers. I rise in support of House Joint Resolution 37. Many Internet content providers are concerned, as am I, about proposals to create different classes of content on the Internet or to discriminate against legitimate content or services online. Unfortunately, I believe that the FCC has gone too far in its recent action and urge a yes vote on H.J. Res. 37, which would eliminate uncertainty created in the marketplace by the FCC's power-grab. I believe in free market principles and the fact that Government involvement often stifles innovation. I also believe that our Nation's antitrust laws have served as important guidelines to ensure that markets remain competitive and that these antitrust laws must remain applicable to ensure that Internet access providers do not discriminate against or block access to certain Web sites, services, or content. In fact, the Judiciary Subcommittee on Intellectual Property, Competition, and the Internet, which I chair, recently held a hearing to discuss the impact of antitrust laws on net neutrality. I urge passage of this resolution.

Mr. GOODLATTE

Mr. GOODLATTE. I thank the chairman for yielding me the time and for his leadership on this issue. I rise in strong support of this legislation. Despite President Obama stating that he would prefer Congress to take the lead in determining how to handle greenhouse gases, what do you know? The Environmental Protection Agency has begun their own plan to regulate greenhouse gases. American voters spoke in November, and they clearly rejected the cap- and-trade agenda that was offered in this Congress last year and that was not taken up in the United States Senate. Now we, ourselves, are faced with the need to act. So unless Congress acts to stop the EPA, this administration and the Environmental Protection Agency will enact their own cap-and-trade-like agenda. Without action, the EPA will add more regulatory red tape onto American businesses and manufacturers, hampering the ability of companies to operate competitively in the United States. These businesses could be forced to move those jobs overseas, to locations with fewer regulatory burdens, or they could simply pass these increased costs on to American consumers. Either choice is not good for jobs in America. Without action, these regulations will be paid by anyone who turns on a light switch or who plugs in an appliance. We must stop the EPA from continuing their spree of overregulating our economy. During this economic slow-down, we should be adopting policies that seek to rebuild our economy and create more jobs. We should be producing more energy, an all-of-the-above energy plan that I know the Energy and Commerce Committee is working on, to increase the domestic production of oil and natural gas and coal and safe nuclear power and to encourage new productions from new sources of energy. Let's make America energy independent. Let's not raise the cost of energy and ship jobs overseas, which will cost millions of American jobs. We should be doing just the opposite. This legislation starts us on that path, and I urge my colleagues to support it.