Chuck Grassley

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, today I am introducing a bill that will keep the Federal Government accountable. Whistleblowers are the key to unlocking the secrets of wrongdoing because they have access to information about how the frauds were perpetrated and can help lead authorities in the right direction to uncover the frauds. However, for their brave efforts, they are often the victims of retaliation and are removed from their jobs by supervisors who don't want the wrongdoing uncovered. I have often said whistleblowers are as welcome as skunks at a Sunday picnic, despite the fact that all they do is bring forward the truth. This is wrong and that is why I have supported strong whistleblower protection laws during my time in Congress. The landmark whistleblower law, the Whistleblower Protection Act of 1989, WPA, provided rights and remedies to Executive Branch whistleblowers that are the victims of retaliation. I proudly cosponsored the WPA, but like many laws that are 20 years old, it needs to be updated. So, I cosponsored legislation introduced by Senator Akaka in the previous Congress to do just that. We are currently working to introduce similar legislation in this Congress. Despite this effort, there is still a critical gap in whistleblower protections for government employees, namely the lack of whistleblower protections for employees of the Legislative and Judicial branches of the Federal Government. I am here today to start that discussion and introduce legislation that will provide the same whistleblower protection rights currently extended to Executive Branch employees to the Legislative Branch. I am pleased to be joined by Senator McCaskill in introducing the Congressional Whistleblower Protection Act of 2011. This important legislation simply adds whistleblower protections to the Legislative Branch by incorporating the WPA into the Congressional Accountability Act of 1995, a law I authored to bring Congress in line with many labor laws and workplace protections. I have long believed Congress should practice what it preaches, and this legislation will do just that. A theme that has dominated this new Congress, as well as the elections this past November, is accountability and responsibility in Washington. In most instances, the only reason we discover waste or fraud is because employees are brave enough to stand up to the wrongdoers and expose their offenses. Without these whistleblowers, the American taxpayer would continue to foot the bill. This bill is long overdue. I have previously introduced similar legislation but, unfortunately, those bills were never brought up in Committee. I hope that the Homeland Security and Government Affairs Committee will examine this legislation closely and expeditiously report it to the full Senate so we can ensure employees of the Legislative Branch that they are protected from any reprisals related to protected whistleblowing. Now, it's been a number of years since the Congressional Accountability Act was signed into law by President Clinton, so I would like to remind my colleagues why we passed this law. It was a time very similar to today, the American people were demanding more from their elected officials in Washington and wanted accountability and transparency in all branches of Government. I believed then, as I do now, that Congress needs to put its money where its mouth is and apply the various labor and employment laws that we enforce on other branches of government and businesses all across the country to ourselves. The Congressional Accountability Act did just that. It applied a number of important laws to Congress, including, the Fair Labor Standards Act, Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Age Discrimination and Employment Act, the Family Medical Leave Act, the Occupational Safety and Health Act, the Employee Polygraph Protection Act, the Worker Adjustment and Retraining Notification Act, the Rehabilitation Act, as well as some provisions of title 5 related to Federal service labor- management relations. It also created the Office of Compliance in the Legislative Branch that oversees application of these important laws to the Legislative Branch and ensures that employee's rights under these laws are protected. While the Congressional Accountability Act was a good start, the Office of Compliance has recommended additional laws be applied to the Legislative Branch, including the Whistleblower Protection Act. We have already taken the steps to protect whistleblowers in the Executive Branch. It doesn't make sense not to extend these same protections to whistleblowers in our own backyard. This bill will, very simply, give congressional employees the same protections that workers in the other branches of government already possess. It does this by simply adding the Whistleblower Protection Act to the preexisting list of statutes that are applied to the Legislative Branch by the Congressional Accountability Act. This is a straightforward and simple solution to ensure that employees of the Legislative Branch are not without vital whistleblower protections. I hope my colleagues will join me and Senator McCaskill in supporting this bill to ensure that those who help us in the fight to hold government accountable are not punished for their efforts.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, today, we will confirm yet another of President Obama's judicial nominees. After today's vote, we will have confirmed five judicial nominees in the last 5 legislative days. We are moving swiftly in committee and on the Senate floor. Notwithstanding our quick pace, we hear from some that we are not moving fast enough. As I have said before, our side will continue to work in good faith to process consensus nominees. But we will not place quantity confirmed over quality confirmed. These lifetime appointments are too important to the Federal judiciary and the American people to simply rubberstamp them. Today we will vote on Judge James Boasberg to sit on the U.S. District Court for the District of Columbia. Judge Boasberg is not the first individual nominated to fill this vacancy. This seat became vacant in May 2008, when Judge Thomas F. Hogan took senior status. President Bush nominated Jeffrey Adam Rosen in June 2008. He was unanimously rated well qualified by the ABA Standing Committee on the Federal Judiciary. He had over 20 years of experience in private practice, principally involved in complex business litigation matters. He had more than 5 years of public service, having served as general counsel at the Office of Management and Budget and at the U.S. Department of Transportation. Despite his qualifications, Mr. Rosen's nomination languished in committee for over 6 months. While I am disappointed Mr. Rosen was not given any consideration, I am pleased to be able to support Judge Boasberg. He was nominated last June and had his hearing in September. He was reported out of committee last December, during the lameduck session, and the Senate was unable to complete action on the nomination. The committee moved quickly on his renomination this year, reporting him out of committee last month. Judge Boasberg presently serves as an associate judge of the Superior Court of the District of Columbia. Following the Senate's unanimous confirmation, President George W. Bush appointed him to this position in August, 2002. Judge Boasberg earned his B.A., magna cum laude, from Yale College, his master of studies from Oxford University, and his juris doctor from Yale Law School. After completing law school, he clerked for the Honorable Dorothy W. Nelson of the U.S. Court of Appeals for the Ninth Circuit. He then went into private practice, working as a litigator on complex business and white-collar defense matters. Judge Boasberg also served as an assistant U.S. attorney for the District of Columbia. There he prosecuted criminal matters and specialized in homicide cases. He has received a unanimous well qualified rating from the ABA Standing Committee on the Federal Judiciary. I am pleased this seat is being filled with someone who has concrete knowledge of what it takes to be a judge, and I hope Judge Boasberg continues to work hard to serve the American people. I congratulate the nominee and his family on this important lifetime appointment. I yield the floor and suggest the absence of a quorum.

Mr. GRASSLEY. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. GRASSLEY. Mr. President, I yield back the remainder of the time on our side.

Mr. GRASSLEY. I ask for the yeas and nays.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, soon we will be voting on another nominee for district court. We continue our rapid pace in which the Senate has been confirming President Obama's judicial nominees. This vote will mark the 11th judicial nominee to be confirmed this Congress. That is more than double the number confirmed in the 108th Congress, which only saw five confirmations at this point. Obviously, actions speak louder than words. So far, our actions have had concrete results. The Judiciary Committee met this morning and reported six more judicial nominees. That puts the total at 22 nominees reported favorably so far. We continue to hold hearings every 2 weeks and have heard from 31 nominees currently pending before the Senate. As I have said in the past, we will continue to move consensus nominees through the confirmation process. However, we will continue to do our due diligence in evaluating the nominees. What we will not do is put quantity confirmed over quality confirmed. These lifetime appointments are too important to the Federal Judiciary and the American people to allow rubberstamping. Just this past Monday, the Senate confirmed three district court judges. In his statement for the record, the chairman of the committee, Senator Leahy, stated: Nearly one out of every eight Federal judgeships is vacant. This puts at serious risk the ability of all Americans to have a fair hearing in court. However, what the chairman neglected to mention is the fact that President Obama has not put forth a nominee for every vacancy the court currently faces. In fact, of the 95 judicial vacancies, the Senate only has 45 nominees. That is 53 percent of vacancies without a nominee from the White House. Today, we vote on a nominee to sit on the Western District of North Carolina court. While this is an important vacancy, and a vacancy we need to fill, it is not a judicial emergency. However, there is a judicial emergency in the Eastern District of North Carolina. That seat, which has been vacant since 2005, does not have a nominee currently pending. President Bush nominated Thomas Alvin Farr to that seat twice, but he was never afforded a hearing, let alone an up-or- down vote. I am happy this side of the aisle is not repeating the same regrettable treatment Mr. Farr received. With regard to Mr. Cogburn, the nominee we will be voting on, the American Bar Association has rated him ``majority well qualified, minority qualified.'' He received his B.A. from the University of North Carolina at Chapel Hill and his juris doctorate from Cumberland School of Law. Mr. Cogburn has practiced law in many capacities. Through his work in private practice, he has worked on a wide range of issues, including criminal litigation, personal injury, civil litigation, and a significant amount of mediation. As an assistant U.S. attorney for over a decade, Mr. Cogburn gained substantial appellate experience. While there, he also served as drug task force attorney and chief assistant U.S. attorney. Mr. Cogburn also holds judicial experience. He was appointed to serve an 8-year term as a U.S. magistrate judge by the U.S. District Court for the Western District of North Carolina. After careful evaluation, the Judiciary Committee reported this fine nominee by voice vote on February 3, 2011. I congratulate Mr. Cogburn and his family on this important lifetime appointment and his willingness to continue in public service. I yield the floor, and I suggest the absence of a quorum.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I rise today to introduce important civil justice legislation. This legislation is desperately needed for several reasons--the most important of which is to cut down on the costs and expenses that are preventing private businesses from creating jobs for our fellow citizens during these difficult times. The billions of dollars wasted on frivolous lawsuits cost Americans jobs and severely damage our economy. The precise cost of America's lawsuit culture is staggering. The tort system's direct costs in 2002 were $233 billion, the equivalent of a 5 percent tax on wages. Today that number is even higher; the annual direct cost of American tort litigation exceeds $250 billion. Indeed, frivolous lawsuits are helping to prevent the ``innovation'' that the Obama administration is touting as the key to ``job creation'' and economic recovery. For example, firms with recent initial public offerings are most at risk to be sued. In fact, companies are most likely to be sued in their second year of public trading. In other words, the very corporations most likely to be the source of significant new job creation are at the highest risk of being sued just when they are seeking expansion capital through public offerings. In particular, frivolous lawsuits hurt small businesses. Small businesses rank the cost and availability of liability insurance as second only to the cost of health care as their top concerns, and both problems are fueled by frivolous lawsuits. Our front-line defense against frivolous lawsuits and the misuse of our legal system is Rule 11 of the Federal Rules of Civil Procedure. This rule is intended to deter frivolous lawsuits by sanctioning the offending party. The power of Rule 11 was diluted in 1993. This weakening is unacceptable to those of us who want to preserve courts as neutral forums for dispute resolution. That is why I am introducing the Lawsuit Abuse Reduction Act of 2011, ``LARA,'' which amends Rule 11 to restore its strength and ability to truly deter frivolous lawsuits. Senator Mike Lee of Utah is cosponsoring this bill. Representative Lamar Smith, the Chairman of the House Judiciary Committee, is introducing an identical bill today in the House of Representatives. Specifically, LARA takes three strong steps to help thwart frivolous lawsuits. First, LARA reverses the 1993 amendments to Rule 11 that made sanctions discretionary rather than mandatory. One of the most harmful changes that took effect in 1993 was to make sanctions for proven violations of Rule 11 discretionary. This means that if a party files a lawsuit simply to harass another party, and the court decides that this is in fact the case, the offending party still might not be sanctioned. This is unacceptable. The offending party might not be punished at all, which provides no deterrence for the offending party or anyone else who wants to misuse the courts. My bill reinstates the requirement that if there is a violation of Rule 11, there are sanctions. Second, LARA requires that judges impose monetary sanctions against lawyers who file frivolous lawsuits. Those monetary sanctions will include the attorney's fees and costs incurred by the victim of the frivolous lawsuit. Finally, LARA reverses the 1993 amendments to Rule 11 that allow parties and their attorneys to avoid sanctions for making frivolous claims by withdrawing them within 21 days after a motion for sanctions has been served. Because of Rule 11's ``safe harbor'' provision, many frivolous claims are never fully reviewed by federal judges. Under the ``safe harbor'' provision, a person who is victimized by a frivolous claim must hire an attorney to draft a motion for sanctions. That motion cannot, however, be filed immediately. Rather, under Rule 11(c)(2), the motion is served on the offending attorney 21-days before it is filed. During that period, the offending attorney can withdraw the frivolous claim and thereby avoid any sanction. LARA would prevent such injustices by eliminating the ``safe harbor'' provision. Although LARA would only amend Rule 11 of the Federal Rules of Civil Procedure, the procedural rules in State courts are often amended to track changes in the Federal rules. Consequently, it is our hope that many states would amend their rules governing frivolous lawsuits to reflect the changes implemented by LARA, just as they did when Rule 11 was last changed in 1993. Without the serious threat of punishment for filing frivolous lawsuits, innocent individuals and companies will continue to face the harsh economic reality that simply paying off frivolous claimants through monetary settlements is often cheaper than litigating the case. This perverse dynamic not only results in legalized extortion, but it leads to increases in the insurance premiums all individuals and businesses must pay. That is money that could be going to create new jobs. I want to work with those who are willing to be reasonable. I know that some have expressed concerns with similar bills in the past. We have considered those concerns and have drafted a bill that takes them into account. For example, this bill expressly provides that nothing in it ``shall be construed to bar or impede the assertion or development of new claims, defenses, or remedies under Federal, State, or local laws, including civil rights laws.'' Requiring mandatory sanctions is not an extreme position. It is a reasonable and effective solution to the problem of runaway frivolous lawsuits. Indeed, a mandatory sanctions requirement is currently the law in the area of securities litigation. In 1995, we enacted the Private Securities Litigation Reform Act, PSLRA, over President Clinton's veto. It essentially reinstates the 1983 version of Rule 11 for the purposes of securities litigation that falls within its coverage, and makes the imposition of sanctions mandatory. Upon a final adjudication of a case, the PSLRA requires courts to make written findings on whether the parties have complied with Rule 11. In other words, no motion for sanctions needs to be filed. At the conclusion of the case, a judge must review the case for compliance with Rule 11 and, if he finds that there has been a violation, he must impose sanctions. So addressing the damaging impact of frivolous lawsuits has had bipartisan support in the past. That bipartisan support should be even greater during these difficult economic times. Let's look at a few examples of the type of lawsuits that businesses must contend with: In July 2009, three New Jersey residents, backed by an advocacy group, filed a class action lawsuit against several hot dog manufacturers claiming they were exposed to carcinogens by eating hot dogs. None of the plaintiffs had actually developed cancer. The lawsuit sought damages in the amount of the total cost of the plaintiffs' hot dog purchases and a requirement that the companies place a new label on packages and advertising reading: ``Warning: Consuming hot dogs and other processed meats increases the risk of cancer.'' The case was dismissed on a Rule 12(b)(6) motion. Thus, a Federal court held that the plaintiffs had failed to even allege a claim, as a matter of law. In another case, a customer alleged that a wild bird ``attacked'' her while in a Lowe's outdoor garden center, causing her head injuries. She claimed negligence and a violation of the Illinois Animal Control Act. She maintained that the wild birds created a dangerous condition on the property and that Lowe's failed to exercise ordinary care to ensure that the premises were reasonably safe and failed to prevent the birds from entering the garden center. A Federal court entered summary judgment in favor of Lowe's holding that a ``reasonable plaintiff'' either would have noticed the birds or understood that contact with them was possible in any outdoor area with plants. The court also held that Lowe's was not the ``owner'' of the birds, a necessary element of the customer's statutory claim. These are just two examples of the scores of frivolous lawsuits that American businesses must contend with each year. Requiring sanctions when judges find lawsuits are frivolous will deter these types of cases from being brought. The savings will result in cost savings for businesses and new jobs for American workers. The time for words and rhetoric has long since passed. If the President means what he is saying about creating jobs, then we must take action. We need to help private business spur job creation. LARA is action. LARA is a step in the right direction. I urge all of my colleagues to work with me and to support this legislation.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I rise today to introduce important civil justice legislation. This legislation is desperately needed for several reasons--the most important of which is to cut down on the costs and expenses that are preventing private businesses from creating jobs for our fellow citizens during these difficult times. The billions of dollars wasted on frivolous lawsuits cost Americans jobs and severely damage our economy. The precise cost of America's lawsuit culture is staggering. The tort system's direct costs in 2002 were $233 billion, the equivalent of a 5 percent tax on wages. Today that number is even higher; the annual direct cost of American tort litigation exceeds $250 billion. Indeed, frivolous lawsuits are helping to prevent the ``innovation'' that the Obama administration is touting as the key to ``job creation'' and economic recovery. For example, firms with recent initial public offerings are most at risk to be sued. In fact, companies are most likely to be sued in their second year of public trading. In other words, the very corporations most likely to be the source of significant new job creation are at the highest risk of being sued just when they are seeking expansion capital through public offerings. In particular, frivolous lawsuits hurt small businesses. Small businesses rank the cost and availability of liability insurance as second only to the cost of health care as their top concerns, and both problems are fueled by frivolous lawsuits. Our front-line defense against frivolous lawsuits and the misuse of our legal system is Rule 11 of the Federal Rules of Civil Procedure. This rule is intended to deter frivolous lawsuits by sanctioning the offending party. The power of Rule 11 was diluted in 1993. This weakening is unacceptable to those of us who want to preserve courts as neutral forums for dispute resolution. That is why I am introducing the Lawsuit Abuse Reduction Act of 2011, ``LARA,'' which amends Rule 11 to restore its strength and ability to truly deter frivolous lawsuits. Senator Mike Lee of Utah is cosponsoring this bill. Representative Lamar Smith, the Chairman of the House Judiciary Committee, is introducing an identical bill today in the House of Representatives. Specifically, LARA takes three strong steps to help thwart frivolous lawsuits. First, LARA reverses the 1993 amendments to Rule 11 that made sanctions discretionary rather than mandatory. One of the most harmful changes that took effect in 1993 was to make sanctions for proven violations of Rule 11 discretionary. This means that if a party files a lawsuit simply to harass another party, and the court decides that this is in fact the case, the offending party still might not be sanctioned. This is unacceptable. The offending party might not be punished at all, which provides no deterrence for the offending party or anyone else who wants to misuse the courts. My bill reinstates the requirement that if there is a violation of Rule 11, there are sanctions. Second, LARA requires that judges impose monetary sanctions against lawyers who file frivolous lawsuits. Those monetary sanctions will include the attorney's fees and costs incurred by the victim of the frivolous lawsuit. Finally, LARA reverses the 1993 amendments to Rule 11 that allow parties and their attorneys to avoid sanctions for making frivolous claims by withdrawing them within 21 days after a motion for sanctions has been served. Because of Rule 11's ``safe harbor'' provision, many frivolous claims are never fully reviewed by federal judges. Under the ``safe harbor'' provision, a person who is victimized by a frivolous claim must hire an attorney to draft a motion for sanctions. That motion cannot, however, be filed immediately. Rather, under Rule 11(c)(2), the motion is served on the offending attorney 21-days before it is filed. During that period, the offending attorney can withdraw the frivolous claim and thereby avoid any sanction. LARA would prevent such injustices by eliminating the ``safe harbor'' provision. Although LARA would only amend Rule 11 of the Federal Rules of Civil Procedure, the procedural rules in State courts are often amended to track changes in the Federal rules. Consequently, it is our hope that many states would amend their rules governing frivolous lawsuits to reflect the changes implemented by LARA, just as they did when Rule 11 was last changed in 1993. Without the serious threat of punishment for filing frivolous lawsuits, innocent individuals and companies will continue to face the harsh economic reality that simply paying off frivolous claimants through monetary settlements is often cheaper than litigating the case. This perverse dynamic not only results in legalized extortion, but it leads to increases in the insurance premiums all individuals and businesses must pay. That is money that could be going to create new jobs. I want to work with those who are willing to be reasonable. I know that some have expressed concerns with similar bills in the past. We have considered those concerns and have drafted a bill that takes them into account. For example, this bill expressly provides that nothing in it ``shall be construed to bar or impede the assertion or development of new claims, defenses, or remedies under Federal, State, or local laws, including civil rights laws.'' Requiring mandatory sanctions is not an extreme position. It is a reasonable and effective solution to the problem of runaway frivolous lawsuits. Indeed, a mandatory sanctions requirement is currently the law in the area of securities litigation. In 1995, we enacted the Private Securities Litigation Reform Act, PSLRA, over President Clinton's veto. It essentially reinstates the 1983 version of Rule 11 for the purposes of securities litigation that falls within its coverage, and makes the imposition of sanctions mandatory. Upon a final adjudication of a case, the PSLRA requires courts to make written findings on whether the parties have complied with Rule 11. In other words, no motion for sanctions needs to be filed. At the conclusion of the case, a judge must review the case for compliance with Rule 11 and, if he finds that there has been a violation, he must impose sanctions. So addressing the damaging impact of frivolous lawsuits has had bipartisan support in the past. That bipartisan support should be even greater during these difficult economic times. Let's look at a few examples of the type of lawsuits that businesses must contend with: In July 2009, three New Jersey residents, backed by an advocacy group, filed a class action lawsuit against several hot dog manufacturers claiming they were exposed to carcinogens by eating hot dogs. None of the plaintiffs had actually developed cancer. The lawsuit sought damages in the amount of the total cost of the plaintiffs' hot dog purchases and a requirement that the companies place a new label on packages and advertising reading: ``Warning: Consuming hot dogs and other processed meats increases the risk of cancer.'' The case was dismissed on a Rule 12(b)(6) motion. Thus, a Federal court held that the plaintiffs had failed to even allege a claim, as a matter of law. In another case, a customer alleged that a wild bird ``attacked'' her while in a Lowe's outdoor garden center, causing her head injuries. She claimed negligence and a violation of the Illinois Animal Control Act. She maintained that the wild birds created a dangerous condition on the property and that Lowe's failed to exercise ordinary care to ensure that the premises were reasonably safe and failed to prevent the birds from entering the garden center. A Federal court entered summary judgment in favor of Lowe's holding that a ``reasonable plaintiff'' either would have noticed the birds or understood that contact with them was possible in any outdoor area with plants. The court also held that Lowe's was not the ``owner'' of the birds, a necessary element of the customer's statutory claim. These are just two examples of the scores of frivolous lawsuits that American businesses must contend with each year. Requiring sanctions when judges find lawsuits are frivolous will deter these types of cases from being brought. The savings will result in cost savings for businesses and new jobs for American workers. The time for words and rhetoric has long since passed. If the President means what he is saying about creating jobs, then we must take action. We need to help private business spur job creation. LARA is action. LARA is a step in the right direction. I urge all of my colleagues to work with me and to support this legislation.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I want to discuss an important component of the patent reform legislation that protects against frivolous and vexatious litigation arising from qui tam suits for false patent markings. The bill before the Senate abolishes this qui tam procedure and I would like to discuss why I support doing so, even though I am generally a strong proponent of using the qui tam mechanism to protect American taxpayers. The qui tam provisions of the False Claims Act specifically allow the government to intervene and control litigation when the government has been harmed through false or fraudulent billing. The qui tam provisions of the patent law do not. In fact, a recent Federal court decision struck down the qui tam provisions of the patent law as unconstitutional because the false patent marking statute does not give the executive branch sufficient control over the litigation to ensure that the President can ``take Care that the Laws be faithfully executed.'' As I mentioned, the False Claims Act is completely different. The Justice Department has the right to intervene, to prosecute, or to dismiss a False Claims Act qui tam. I was instrumental in ensuring such controls on frivolous lawsuits were inserted into the False Claims Act and the absence of similar controls in the false patent marking law is problematic. I would not want anyone watching the patent reform bill to conclude that Congress will weaken or undermine the False Claims Act qui tam statute because we have stricken a flawed qui tam provision in the patent bill. I will vigorously defend the False Claims Act and urge my colleagues to do the same. The False Claims Act is the Federal Government's strongest weapon to protecting the taxpayer dollars from fraud and abuse. It would be a serious miscalculation for anyone to imply or attempt to characterize my support for the removal of the patent qui tam as a starting point for striking or reforming the False Claims Act qui tam provisions. The False Claims Act qui tam provisions have helped the Federal Government recover over $28 billion since I amended it to add the qui tam provisions in 1986. With the recent amendments to the False Claims Act that I, along with Senator Leahy, included in the Fraud Enforcement and Recovery Act of 2009, the False Claims Act will continue to serve as the Federal Government's most valuable tool to combat fraud in government programs for decades to come.

Mr. GRASSLEY. Mr. President, I urge my colleagues to support final passage on the America Invents Act. The Judiciary Committee has held numerous hearings on the need for patent reform, and has done a lot of work over the past several Congresses. We have had a good process on the floor. We adopted several amendments to improve the bill. We had votes on amendments and a pretty good open process, which we have not seen much of in the last few years. We have a good bipartisan bill--the chairman of the Judiciary Committee has successfully brought Senators and industry together to craft this compromise legislation. Now I urge my colleagues to support final passage on this important bill so we can conclude our work in the Senate. The America Invents Act will protect inventors' rights and encourage innovation and investment in our economy. It will improve transparency and third party participation in the patent review process, which will strengthen patent quality and reduce costs. The bill will institute beneficial changes to the patent approval and review process, and will curb litigation abuses and improve certainty for investors and innovators. It will help companies do business more efficiently on an international basis. The America Invents Act will also help small entities in their patent applications and provide for reduced fees for microentities and small businesses. The bill will prevent patents from being issued on claims for tax strategies, which can add unwarranted fees on taxpayers simply for attempting to comply with the Tax Code. Finally, the America Invents Act will enhance operations of the Patent and Trademark Office with administrative reforms and will give the Office fee setting authority to reduce backlogs. It will end fee diversion, which will improve the ability of the Patent and Trademark Office to manage its affairs and allocate resources where they are most needed. I thank Chairman Leahy and Senator Hatch for their hard work on this bill. Without their leadership, we would not be where we are today. I thank Senators Kyl, Sessions, and Coburn. They were instrumental in making improvements to the bill. I also wish to acknowledge the Senate Judiciary Committee staff for their efforts on this bill: in particular, Bruce Cohen, Aaron Cooper, and Curtis LeGeyt of Chairman Leahy's staff, Matt Sandgren of Senator Hatch's staff, Joe Matal of Senator Kyl's staff, and Sarah Beth Groshart of Senator Coburn's staff. I especially thank Kolan Davis and Rita Lari Jochum of my staff for their good work on this bill. In conclusion, I urge my colleagues to vote for the America Invents Act. This is a bill that will spur inventions, create innovative new products and services, and stimulate job creation. This bill will help upgrade and strengthen our patent system so America can stay competitive in an increasingly global environment. I urge my colleagues to support this carefully crafted bill.

Mr. GRASSLEY. I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I am pleased to join my colleague, Senator Feinstein, in cosponsoring the Saving Kids from Dangerous Drugs Act of 2011. I believe we have an ongoing moral obligation to ensure our young people have every opportunity to grow up without being accosted by drug pushers at every turn, whether on TV, in the movies, or on the way to school. This bipartisan legislation--which has previously passed the Senate with unanimous consent--comes in response to ongoing warnings issued by the Drug Enforcement Administration, DEA, and the White House's Office of National Drug Control Policy, ONDCP, about highly addictive and dangerous drugs being colored, packaged, and flavored in ways that appear to be designed to attract use by children. As ranking member of the Committee on the Judiciary and cochairman of the Senate Drug Caucus, I can tell you that the most at-risk population for drug abuse is our young people. Sadly, recent youth surveys are indicating youth drug use is increasing. Research has shown time and again that if you can keep a child drug free until they turn 20, chances are very slim that they will ever try or become addicted to drugs. Unfortunately, unscrupulous drug dealers are all too aware of statistics like these and have developed new techniques and marketing gimmicks to lure in younger users. As a parent and grandparent, this is extremely troubling. Drug dealers are now flavoring and disguising drugs to make them appear and taste like candy. For instance, some drugs that have been recovered by the DEA and local law enforcement have been flavored to taste like strawberry and are known on the street as ``Strawberry Quick.'' Other flavors, such as lemon, coconut, cinnamon and chocolate are clearly being used to make highly addictive drugs like meth and cocaine seem less harmful and more appealing. Soft drinks are also being laced with THC, the active ingredient in marijuana, and marketed with names like ``Canna Cola'' and ``Doc Weed.'' Law enforcement has also recovered drugs that have unique designs which could be appealing to children. For example, Ecstasy pills imprinted with President Obama's likeness or with images of popular cartoon characters have been seized in raids. These flavored and disguised drugs are also being marketed in smaller amounts, making it cheaper and more accessible to children. According to an article in USA Today, at least 8 States have reported instances involving candy flavored drugs, and many law enforcement officials are expecting these deadly substances to infiltrate their States in the near future. The DEA has made an effort to stop these practices. For example, the DEA arrested three men in an undercover operation in California where candy flavored cocaine was being distributed. The DEA seized at least four different flavors of cocaine along with other dangerous substances. The estimated street value of the flavored cocaine seized in this operation was $272,400. The DEA also arrested 12 people in connection to a marijuana-laced candy and soft drink operation in 2006. The marijuana-laced candy that was seized in this operation was packaged to look like well known brand name candy bars. These drug busts further illustrate the fact that drug dealers will stop at nothing to hook a new generation on these deadly substances. Currently, Federal law enhances the criminal penalties that apply when a person sells drugs to anyone under the age of 21. When this occurs, the Federal penalties are doubled--or tripled for a repeat offense--and a mandatory minimum of at least 1 year must also apply. However, this penalty applies only to someone who actually sells drugs to someone under 21. The Saving Kids from Dangerous Drugs Act would increase the prison sentence to anyone who knowingly or intentionally manufactures or creates with the intent to distribute a controlled substance that has been flavored, colored, packaged or otherwise altered in a way that is designed to make it more appealing to a person under 18 years of age. The DEA busts are prime examples of why we need this bipartisan bill to keep drug dealers from peddling their poison to our children. The fight against deadly drugs is an ongoing struggle. In light of the fact that youth drug use is increasing we must do all we can to protect the most vulnerable among us. We must send a clear message to those wishing to prey on our youth that you risk serious prison time when you target our future. Although this bill was passed out of the Senate unanimously in 2010, the House never passed the bill in the 111th Congress. I ask that my colleagues join us again in support of this important legislation and pass the Saving Kids from Dangerous Drugs Act, and I encourage the House of Representatives to take up this important bill and help remove these dangerous candy flavored drugs from our communities.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I am pleased to join my colleague, Senator Feinstein, in cosponsoring the Saving Kids from Dangerous Drugs Act of 2011. I believe we have an ongoing moral obligation to ensure our young people have every opportunity to grow up without being accosted by drug pushers at every turn, whether on TV, in the movies, or on the way to school. This bipartisan legislation--which has previously passed the Senate with unanimous consent--comes in response to ongoing warnings issued by the Drug Enforcement Administration, DEA, and the White House's Office of National Drug Control Policy, ONDCP, about highly addictive and dangerous drugs being colored, packaged, and flavored in ways that appear to be designed to attract use by children. As ranking member of the Committee on the Judiciary and cochairman of the Senate Drug Caucus, I can tell you that the most at-risk population for drug abuse is our young people. Sadly, recent youth surveys are indicating youth drug use is increasing. Research has shown time and again that if you can keep a child drug free until they turn 20, chances are very slim that they will ever try or become addicted to drugs. Unfortunately, unscrupulous drug dealers are all too aware of statistics like these and have developed new techniques and marketing gimmicks to lure in younger users. As a parent and grandparent, this is extremely troubling. Drug dealers are now flavoring and disguising drugs to make them appear and taste like candy. For instance, some drugs that have been recovered by the DEA and local law enforcement have been flavored to taste like strawberry and are known on the street as ``Strawberry Quick.'' Other flavors, such as lemon, coconut, cinnamon and chocolate are clearly being used to make highly addictive drugs like meth and cocaine seem less harmful and more appealing. Soft drinks are also being laced with THC, the active ingredient in marijuana, and marketed with names like ``Canna Cola'' and ``Doc Weed.'' Law enforcement has also recovered drugs that have unique designs which could be appealing to children. For example, Ecstasy pills imprinted with President Obama's likeness or with images of popular cartoon characters have been seized in raids. These flavored and disguised drugs are also being marketed in smaller amounts, making it cheaper and more accessible to children. According to an article in USA Today, at least 8 States have reported instances involving candy flavored drugs, and many law enforcement officials are expecting these deadly substances to infiltrate their States in the near future. The DEA has made an effort to stop these practices. For example, the DEA arrested three men in an undercover operation in California where candy flavored cocaine was being distributed. The DEA seized at least four different flavors of cocaine along with other dangerous substances. The estimated street value of the flavored cocaine seized in this operation was $272,400. The DEA also arrested 12 people in connection to a marijuana-laced candy and soft drink operation in 2006. The marijuana-laced candy that was seized in this operation was packaged to look like well known brand name candy bars. These drug busts further illustrate the fact that drug dealers will stop at nothing to hook a new generation on these deadly substances. Currently, Federal law enhances the criminal penalties that apply when a person sells drugs to anyone under the age of 21. When this occurs, the Federal penalties are doubled--or tripled for a repeat offense--and a mandatory minimum of at least 1 year must also apply. However, this penalty applies only to someone who actually sells drugs to someone under 21. The Saving Kids from Dangerous Drugs Act would increase the prison sentence to anyone who knowingly or intentionally manufactures or creates with the intent to distribute a controlled substance that has been flavored, colored, packaged or otherwise altered in a way that is designed to make it more appealing to a person under 18 years of age. The DEA busts are prime examples of why we need this bipartisan bill to keep drug dealers from peddling their poison to our children. The fight against deadly drugs is an ongoing struggle. In light of the fact that youth drug use is increasing we must do all we can to protect the most vulnerable among us. We must send a clear message to those wishing to prey on our youth that you risk serious prison time when you target our future. Although this bill was passed out of the Senate unanimously in 2010, the House never passed the bill in the 111th Congress. I ask that my colleagues join us again in support of this important legislation and pass the Saving Kids from Dangerous Drugs Act, and I encourage the House of Representatives to take up this important bill and help remove these dangerous candy flavored drugs from our communities.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, I ask unanimous consent that I may speak for some little time after 10 minutes.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, the American economy remains on an unsettled footing, as we all know. There are some real signs of economic recovery, but it shows a very fragile recovery. The consumer confidence level seems to be increasing, and that is good news. U.S. factory activity is up. That is good news. But also we are very nervous about the housing market remaining weak. The Nation's unemployment rate stands at 9 percent--maybe officially now 8.9 percent--and now our economy is facing a significant head wind due to rising energy prices. Since the unrest began in Tunisia, our energy markets have rocked upward by the uprisings in Egypt and now in Libya. Libya produces only roughly 2 percent of the world's crude oil, with much of that going to Europe. But even with Libya producing such a small amount, it still makes a tremendous impact on the world market of oil. The uncertainty and fear about supplies, according to oil speculators, has driven crude prices to more than $100 a barrel. Prices at the pump were already high before the unrest in the Middle East. The events going on in North Africa and the Persian Gulf area just worsened the problem. According to the Energy Information Administration, gas prices jumped 19 cents during a 1-week period at the end of February. This is the second largest 1-week jump in more than 20 years. I think over the weekend we learned that gasoline, in a 2-week period of time, is up 33 cents. So Americans are now paying, on average, $3.51 a gallon for gas. That, obviously, is about 80 cents higher than this time last year. The average cost to fill a tank of gas is likely around $50. We all know that for a family struggling to make ends meet, these are valuable dollars spent at the pump, with most of those dollars going overseas. I am sure the Presiding Officer probably knows that before this rapid rise in the price of oil, we were spending $730 million a day to import oil. Obviously, that is now a much higher figure, probably close to $1 billion a day right now. Our country is at risk, our economy is at risk, our Nation's security is at risk; that is, economic security, but also it is related to our national security. Our ever-increasing reliance on foreign sources for energy is undermining our Nation's economic and national security. The activities in the Middle East over the last 6 weeks should be an alarm bell going off. It should, in fact, be a wake-up call. Let me be clear. I know that for our economy to grow and for business and individuals to thrive, we need access to reliable, affordable energy. I support an energy policy that I like to say is akin to a four-legged stool or another way of saying it is all of the above--obviously, all the sources of petroleum we can get our hands on, and more domestically, obviously, than import, all sorts of alternative energy. Conservation has to be a leg of that stool and, obviously, nuclear energy. So to be repetitive: First, we have to have access to oil and gas resources here at home. Two years ago, when gas prices were so high, the rallying cry was ``drill here, drill now.'' It seems to me that still is a legitimate rallying cry for us with gas at $3.51 a gallon. The idea that we limit our access to our own resources, which in turn leads us to go hat in hand to foreign dictators such as Hugo Chavez and oil sheiks is ludicrous. It is silly to be sending more money overseas to give people resources to train terrorists to kill Americans. We currently import more than 60 percent of our crude oil, and it doesn't have to be that way. I know we can't get to energy independence by drilling here and drilling now all by itself, but isn't it a little foolish to have our economy held hostage by events in Libya--North Africa generally--or the Persian Gulf area and particularly with Libya only supplying 2 percent of the world's oil? The Obama administration needs to put an end to the existing policy of a de facto moratorium through permitting; that is, for drilling onshore and offshore of our own domestic supply. We need to make sure we are doing everything we can to protect workers and the environment. But permitting delays and obstacles should not prevent our Nation from moving forward to developing resources here at home. I also support efforts to expand the use of clean coal and nuclear energy. I also support conservation efforts. I agree that the cheapest form of energy is the energy that doesn't have to be used. That is conservation. Here in the Senate, I have supported policies aimed at reducing energy use in homes and buildings through conservation and energy-efficient technologies. I see the value in reducing overall energy consumption. I have also been a leader in the Senate in promoting alternative and renewable energy. Why? Because the supply of fossil fuels is a finite quantity. We must look to alternative and renewable resources so we can improve our energy and our national security. This includes supporting energy from wind, biomass, hydroelectric, solar, geothermal, and biofuels. I would like to focus now on the effort to develop homegrown biofuels. For many years, Congress has realized the need to develop an alternative to fossil fuels, particularly as a means of reducing our dependence on that fossil fuel. One of the first priorities was a tax incentive to encourage the use of homegrown ethanol. For over 100 years, the fossil fuel industry has had a monopoly on our transportation fuel. They built the market. They own the infrastructure. They weren't about to use a product they didn't manufacture, own or profit from. So Congress created a tax incentive to encourage big oil to use the product and make it available to their consumers. It was paired with an import tariff to make sure that only domestic ethanol receives the benefit of the tax incentive. So the tax incentive and the tariff worked together to do two things: The incentive exists to encourage the use of domestic ethanol. The tariff exists to ensure that we aren't giving a tax incentive to already subsidized foreign ethanol. In other words, wouldn't it be silly to have a tax incentive for the production of a domestic alternative energy and then allow the import of it, which would have taxpayers subsidizing an alternative form of energy coming in from another country? Well, that wouldn't make sense. Together, these two approaches ensure that we don't replace our dependence on foreign oil with a dependence upon foreign ethanol. The incentive was created to encourage big oil to use a domestically produced product and a renewable product. In 2005, Congress created the Renewable Fuels Standard. The standard was created to ensure a minimum amount of renewable fuels was used in the fuel supply. It was strongly opposed by big oil, but it was enacted over their opposition. In 2007, it was greatly expanded. It mandates the use of 36 billion gallons of renewable fuel annually by 2022. But that decision, made in 2007, also limited the amount of ethanol that can be made from grain to 15 billion gallons. One of the criticisms I hear occasionally is that the ethanol receives both an incentive and a mandate. So I think we should address that point. First, while the mandate requires that the fuel be used, it does not mandate that the ethanol be produced domestically. The incentive acts as an encouragement to use homegrown products. It increases economic activity at home and works to reduce our dependence upon foreign oil. It doesn't do any good if you are importing a domestic renewable fuel if it can be done here locally, creating the jobs here. Secondly, the mandate acts as a floor to ethanol use. Without the incentive, we would consume a bare minimum. The incentive encourages ethanol use beyond the mandate. Some in the environmental community are quick to raise objections to the biofuels mandate as well as the incentive. I would like to suggest to them that this is a clear example of limitless hypocrisy and intellectual dishonesty in this town. Many of the loudest voices against these policies are the same voices who lobby me for tax incentives and also mandates for wind, solar, geothermal, and other renewable energy. I happen to be a strong supporter of electricity generated from wind and other renewable sources. I first authored the production tax credit for wind in 1992. Over the years, it has been expanded to include other types of resources. Since as far back as 2003, environmental advocacy groups have been pushing for a renewable portfolio standard, which is a mandate that utilities around the country use a certain amount of wind or other types of alternative energy instead of coal in the production of electricity. So now what do we hear? They want the production tax credit for wind and other renewable electricity and a mandate that it be produced. Yet they oppose these same policies for biofuels. That is an inconsistency. That seems to be an intellectually dishonest approach; that they would like to have this Senator support mandates for wind as well as a tax incentive for wind but lobbying against this Senator's approach to having a tax incentive for other alternative energies as well as a mandate. I have been a champion of ethanol and biofuels for a long time. I am well aware of the positive role ethanol is playing to create a cleaner environment. It is improving our economic and national security and it is creating jobs and economic activity in rural America. In 2010, nearly 90 percent of all gasoline sold in the United States contained some ethanol. The 13 billion gallons of ethanol produced in the United States reduced our oil imports by 445 million barrels of oil. After domestic oil production and imports from Canada, U.S. ethanol production is the third largest source of transportation fuel--what we use in internal combustion engines. U.S. ethanol production is larger than what we import from Saudi Arabia or even from Hugo Chavez's Venezuela. Without domestic biofuels, we would be on bended knees even more than we are today, begging others for oil. Just think what has developed in the 2 weeks of Libya. We have OPEC having to go to Saudi Arabia to make up the difference, just because of 2 percent of the oil production being affected. Why would we want to be more dependent upon foreign sources of energy, particularly for our national security? Without domestic biofuels it seems to me that we would be on bended knees even more than we are today, begging others for oil. Ethanol is the only reliable, legitimate alternative to crude oil. Domestic ethanol currently accounts for nearly 10 percent of our transportation fuel. There is no other renewable fuel that comes close to achieving the economic, environmental, and national security benefits currently delivered by this biofuel that we call ethanol. There are other well-funded misinformation campaigns underway to undermine the only alternative to crude oil. Big oil has been joined in recent years by opportunistic grocery manufacturers who hope to find a scapegoat in their desire to increase profits and raise food prices. They did this just 2 years ago, when corn was $7. They scapegoated ethanol. They needed a cover to raise the price of food and then, within 7 months, when the price of corn was down to half that price, $3.50 per bushel, did you see the price of food come down? No. You are going to find the same thing now. These people continue to perpetuate the same tired, baseless arguments to try to undermine our efforts toward energy independence. They are more interested in protecting market share and profits than national economic security. Over the next few weeks I am going to do everything I can to talk about this issue, to educate the public on the benefits of domestic biofuels. I am not going to sit quietly while the energy, environmental, and national security benefits of ethanol are scoffed at. I intend to beat back every false attack. The American public deserves an honest, fact-based discussion about the benefits of reducing our dependence on people such as Hugo Chavez and Muammar Qadhafi. They deserve to hear the benefits of reducing our dependence on dirty fossil fuel. I look forward to continuing this effort and invite dialog from any of my colleagues.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, today we continue in our efforts to lessen the burden our overworked courts currently face. We are about to confirm three more judicial nominees. Two of the three nominees we will vote on tonight are for seats designated as judicial emergencies. With our action today, in only 22 days the Senate has been in session, the Senate has confirmed 10 nominees. With these votes tonight, we will have confirmed 19 percent of President Obama's judicial nominees submitted in this Congress. This pace far exceeds the progress made at this point in the 108th Congress, which was the beginning of the third year of President Bush's Presidency. At this point, the 108th Congress had confirmed only 4 of the 48 nominations sent to the Senate, about an 8 percent confirmation rate. Our fast pace on the floor is matched by our rapid pace in committee. We held our third nominations hearing this past Wednesday. We have now heard from 13 judicial nominees and have reported 16 favorably. Our work in committee and on the floor indicates a cooperative effort between me, the chairman of the Judiciary Committee and our leadership. It is an indication of the progress that can be made when the President nominates consensus nominees. We will continue in our efforts, but again, I would remind everyone that while we in the Senate are doing our part, the administration must also be engaged in this process. I would note that 24 of the 41 vacant seats deemed to be judicial emergencies have no nominee. Of the additional 54 vacancies, 28 have no nominee. I am perplexed as to why the President would ignore these pending vacancies and instead spend time and resources to send up a nomination for a seat that will not be vacant for some time. I refer to the President's nomination, on February 16, 2011, of Scott Skavdahl, to be United States District Judge for the District of Wyoming. This seat will not be vacant until July 24, 2011, when the current judge will retire. I do not understand the administration's priorities when it comes to judicial nominations. Instead of focusing on nominations for future vacancies, I would hope the administration would use some common sense and direct its efforts towards nominating individuals for seats which are at least currently vacant. With regard to the nominees on whom we will vote this evening, let me say a few words about each. Judge Joseph Battaglia is nominated to be a U.S. district judge for the Southern District of California. He presently serves in that district as a U.S. magistrate judge. He was first appointed to that position in 1993. In addition to serving as a magistrate judge, Judge Battaglia has served on the Judicial Conference of the United States Advisory Committee on Rules of Criminal Procedure, on the Ninth Circuit Executive Board of Magistrate Judges, and as a Magistrate Judge Observer on the Judicial Council of the Ninth Circuit. In 2009, Judge Battaglia was appointed by Chief Justice Roberts as Magistrate Judge Observer to the Judicial Conference of the United States. Judge Battaglia received his B.A. from the U.S. International University and his J.D. from California Western School of Law. He spent almost two decades working in private practice, and also acted as an arbitrator for the San Diego Superior Court, serving on many panels. The American Bar Association Standing Committee on the Federal Judiciary unanimously rated him ``Well-Qualified.'' This evening, we will also vote on two nominees to the Central District of Illinois. Both of these vacancies are considered to be judicial emergencies. Judge James E. Shadid received his B.S. from Bradley University and his J.D. from the John Marshall Law School. Upon admission to the Illinois bar, Judge Shadid opened his own law practice. He maintained his law practice until 2001, when he was appointed by the Illinois Supreme Court to fill a vacancy on the Tenth Judicial Circuit. He was elected to a full term in 2002 and re-elected in 2008. While in private practice, he served as a part-time public defender at the Peoria County Public Defender's Office. He also served an assistant attorney general for the State of Illinois. He was appointed by Governor Jim Edgar to serve as a commissioner of the Court of Claims in Illinois. The American Bar Association Standing Committee on the Federal Judiciary rated Judge Shadid as ``Qualified'' by a substantial majority, while a minority rated him ``Well Qualified.'' Also nominated to a judicial emergency vacancy for the Central District of Illinois is Judge Sue E. Myerscough. Judge Myerscough received her B.A. with honors, from Southern Illinois University, and her J.D. from Southern Illinois School of Law. Upon graduation from law school, she served as a law clerk to the Honorable Harold A. Baker of the U.S. District Court for the Central District of Illinois. Judge Myerscough was in private practice for approximately 6 years before being elected as an associate circuit court judge for the Seventh Judicial Circuit of Illinois. Judge Myerscough later became a circuit judge for the Seventh Circuit. In 1998 she was elected as an appellate court justice of the Illinois Appellate Court, Fourth District. The American Bar Association Standing Committee on the Federal Judiciary unanimously rated Judge Myerscough as ``Qualified.'' I congratulate these three nominees and wish them well in their public service as a U.S. district judge. I yield the floor.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, we are prepared to yield back the balance of time on this side.

Mr. GRASSLEY

Mr. GRASSLEY. Madam President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. GRASSLEY. Madam President, I understand there are questions about what the tax strategies portion of the bill does and who it impacts. So I want to take a few minutes to address those questions. In simple terms, a tax strategy is any method for reducing, avoiding, or deferring tax liability based upon the tax law--including interpretations and applications of the Internal Revenue Code, regulations, and related guidance. A tax strategy can be as simple as a plan to buy tax-exempt bonds or invest in an IRA to reduce your tax liability or as complex as some sort of sale-leaseback tax shelter involving multiple domestic and foreign corporations and partnerships. A tax strategy patent, which is what we are talking about in this bill, is just that--a patent on a particular tax strategy. Madam President, I ask unanimous consent to have printed in the Record an article from a publication called the Tax Adviser. This article provides some examples of tax strategies that should not be patented.

Mr. GRASSLEY. Tax strategies are bad because they allow the tax law to be patented. A patent gives the holder the exclusive right to exclude others from using the patented invention. A tax strategy patent makes taxpayers choose between paying more than legally required in taxes or providing a windfall to a tax strategy patentholder by paying a royalty to comply with the tax law. Tax strategy patents add another layer of complexity to the tax laws by requiring taxpayers or their advisers to conduct patent searches and exposing them to potential patent infringement lawsuits. If a tax strategy patent is granted for a tax shelter designed to illegally evade taxes, the fact that a patent was granted may mislead unknowing taxpayers into believing the obvious: That the strategy is valid under the tax law when, in fact, it might not be. Tax strategies are not like other inventions because everyone wants to pay less tax. Tax strategy patents are on the rise, which then means more and more legal tax strategies are unavailable or, obviously, more expensive for more and more taxpayers. Madam President, I ask unanimous consent to have printed in the Record a letter. This letter, which is from a coalition of 15 consumer groups, including the umbrella group for public accountants, the Tax Justice Center, and the U.S. Public Interest Research Group, provides more information on why tax strategy patents are bad for taxpayers.

Mr. GRASSLEY. Section 14 of the bill, which has been before the Senate for the last week or more, prevents patenting of tax law. It provides that a strategy that relies on the tax law to reduce, to avoid, or to defer tax liability cannot be novel or nonobvious. So a strategy for reducing, avoiding, or deferring tax liability will be deemed insufficient to differentiate a claimed invention from the prior art for purposes of evaluating an invention under section 102 or section 103 of the bill that is before us. This ensures that taxpayers and their advisers will then be guaranteed equal access to the tax laws, and that is obviously the fair way to do it. It is the commonsense way to do it. So I wish to be clear that tax preparation software is not a tax strategy. Senior policy and examination staff from the Patent and Trademark Office agree that such software is not a tax strategy. I also have letters from H&R Block, KPMG LLP, and Grant Thornton that state that the underlying language does not impact their software patents. Again, I ask unanimous consent to have these letters printed in the Record.

Mr. GRASSLEY. However, now, in order to allay the concerns of Intuit, makers of Turbo Tax, I have worked with Senator Baucus to make clear that tax preparation software such as Turbo Tax is not a tax strategy. Financial management software, however, is a little murkier. While products such as Quicken and QuickBooks are not tax strategies, tax strategies can be embedded in financial management products and software. The investment banks and the law firms that have patented tax strategies often use software that could be deemed financial management software. The Tax Adviser article I mentioned earlier and got unanimous consent to have printed in the Record describes some of these. With financial management software, patent claims that include inventions that are severable from tax strategies may be entitled to patent protection, but the tax strategy itself will remain available to all taxpayers. So it is important to protect intellectual property rights for true tax preparation and financial management software. However, we must be sure to protect the rights of taxpayers to have equal access to legal tax strategies. I yield the floor, and I suggest the absence of a quorum.

Mr. GRASSLEY

Mr. GRASSLEY. Mr. President, do we report it first and then object or do we object even to the reporting of it? I heard the Presiding Officer say report the amendment.

Mr. GRASSLEY. OK. I object on behalf of Senator Coburn of Oklahoma.

Mr. GRASSLEY

Mr. GRASSLEY. Madam President, I associate myself with the remarks of the chairman of the committee. I ask that people on my side of the aisle not support the Feinstein amendment. At this point, I move to table the Feinstein amendment and ask for the yeas and nays.