Patrick Leahy

Mr. LEAHY

Mr. LEAHY. Mr. President, the Senator has been involved in this right from the beginning. We have worked at having a bill that would be in the best interests of the Senate under both Republicans and Democrats across the political spectrum. We have worked very closely together. We run the risk of countries in Asia and Europe out-innovating the United States, and the patent systems in other countries are well ahead of us. If we want to compete, as I know the Senator from Arizona does, and I know I do, we want to have the best tools to compete. I believe Americans can compete with any country in the world, but they should at least have the tools to do it and be able to play--it becomes almost a clich, but we have to play on a level playing field. This will allow us to do that. I compliment the Senator from Arizona for the way he has worked in his constant efforts in the committee, the public meetings, but that is the tip of the iceberg; it is the hundreds of hours of behind-the- scenes working to reach where we are. So I hope sometime in the next few minutes or so we can at least vote on the managers' package and then get going with the bill, because this is something that can be voted on, can be passed. We have been working, as the Senator from Arizona knows, very closely with our counterparts in the other body. I know Chairman Smith would like to move quickly. We could have a bill on the President's desk in a relatively short time. I thank the Senator for his kind words.

Mr. LEAHY. Madam President, I thought the amendment pending is the managers' amendment.

Mr. LEAHY. Madam President, the Senator raised some questions with me, both in committee and out of the committee, with respect to each other's positions. I appreciate his work in the committee to expedite getting the bill out of the committee. Like him, I believe it is extraordinarily important to level the playing to allow American innovators to compete in the world and within our country. I compliment the Senator and, as he knows, I have included his proposal in the managers' amendment because I thought it was a good proposal. Madam President, I ask unanimous consent that the time until 5 p.m. be for debate on the Leahy-Grassley amendment No. 121, as modified, which I believe is pending, and the Vitter for Toomey amendment No. 112, as modified, en bloc, and divided between the two leaders or their designees; that upon the use or yielding back of time, the Senate proceed to a vote in relation to the Leahy-Grassley amendment No. 121, as modified; that upon disposition of the Leahy-Grassley amendment, the Senate vote in relation to the Vitter for Toomey amendment No. 112, as modified; that the motions to reconsider be considered made and laid upon the table with no intervening action or debate; and that there be no amendments in order to any of the amendments listed in this agreement prior to the vote; further, that the Vitter amendment No. 113, as modified, be withdrawn.

Mr. LEAHY. Madam President, I suggest the absence of a quorum, and I ask unanimous consent that the time be charged equally.

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

Mr. LEAHY. Yes, the Senator is correct. I thank her for her hard work in putting together the gatekeeper damages language with Senator Specter and myself in committee last Congress. It was instrumental in helping to move this bill forward. However, as the Senator from California recognizes, the courts have advanced the law regarding damages since then. For example, in Uniloc USA, Inc. v. Microsoft Corp., decided just this year, the Federal Circuit held that expert testimony regarding a ``rule of thumb'' for allocating profits between a patent user and a patent owner did not meet the Daubert test for expert testimony, and was inadmissible. And in Lucent Technologies Corp. v. Gateway, Inc., the Federal Circuit found that no rational jury could have concluded a ``tiny feature of one part of a much larger software program with numerous features . . . appear[ing] to account for the overwhelming majority of consumer demand'' was worth an 8% royalty.'' This represented a new, greater level of review for jury damages assessment. In light of cases like these, it no longer appears necessary for this bill to contain language regarding the assessment of damages.

Mr. LEAHY. Mr. President, I move to reconsider the vote.

Mr. LEAHY. I want to thank all Senators for supporting adoption of the Leahy-Grassley-Kyl managers' amendment. This consensus amendment is a compromise that resolves a number of the key outstanding issues in the bill, including fee diversion, business method patents, damages and venue. I want to take a moment to discuss the importance of these provisions. First, the provisions in this managers' amendment that end fee diversion from the PTO are supported by all corners of the patent community. Today, users fund 100 percent of the PTO's operations. The PTO does not take a dime of taxpayer money. For all of the improvements that this legislation makes to our patent system, the Patent Office will always be hindered if it cannot retain the funds it generates to more adequately plan for its future. Today, as we ask our Patent Office to unleash the best in innovation from our businesses, our Patent Office does not have the funding to do the same for itself. Ending fee diversion will better equip the patent office with the resources to tackle the complexities of the 21st century. Second, the managers' amendment creates a temporary proceeding at the Patent Office to reexamine certain business method patents. I appreciate the work that Senator Schumer has done on this issue, and the provisions included in the managers' amendment represents a middle- ground that bridges a divide on this issue between the financial and tech communities that reside in all of our States. Third, the managers' amendment strikes provisions on damages and venue. Removing these provisions addresses recent concerns voiced by certain Members of the House, and raised by the high-tech community. Finally, this managers' amendment wraps in Senator Bennet's previously offered amendment to provide a 50-percent reduction in fees for small business accelerated patent applications at the PTO, as well as some technical amendments. This break for small businesses, which drive innovation and create jobs, will better enable them to compete with the demands of the 21st century. As we return to the America Invents Act, I encourage any Senator who has a germane amendment to come and debate it now. This is bipartisan legislation that our economy desperately needs. It will allow the PTO to function, and our inventors and innovators to flourish. If any other Senators have amendments, this is the time. We need to move on to other pressing matters as soon as we complete work on this bill.

Mr. LEAHY

Mr. LEAHY. Mr. President, I ask unanimous consent that the Committee on Rules and Administration be authorized to meet during the session of the Senate on March 1, 2011, at 10 a.m.

Mr. LEAHY. Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on March 1, 2011, at 10 a.m., to hold a hearing entitled ``Breaking the Cycle of North Korean Provocations.''

Mr. LEAHY. Mr. President, I ask unanimous consent that the Committee on Armed Services be authorized to meet during the session of the Senate on March 1, 2011, at 9:30 a.m.

Mr. LEAHY. Mr. President, I ask unanimous consent that the Committee on Armed Services be authorized to meet during the session of the Senate on March 1, 2011, at 4:30 p.m.

Mr. LEAHY. Mr. President, I ask unanimous consent that the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the session of the Senate on March 1, 2011, at 10 a.m., to conduct a committee hearing entitled ``Semiannual Monetary Policy Report to Congress.''

Mr. LEAHY. Mr. President, I ask unanimous consent that the Committee on Finance be authorized to meet during the session of the Senate on March 1, 2011, at 10 a.m., in 215 Dirksen Senate Office Building, to conduct a hearing entitled ``How Did We Get Here? Changes in the Law and Tax Environment Since the Tax Reform Act of 1986.''

Mr. LEAHY

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

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

Mr. LEAHY

Mr. LEAHY. Mr. President, I thank the distinguished Senator from Iowa. As I noted before he got on the floor, he has been extremely important in working on this issue. Mr. President, just so I can have a moment to speak with the Senator from Louisiana, I suggest the absence of a quorum.

Mr. LEAHY. Mr. President, I see the distinguished senior Senator from Utah on the Senate floor, a man who has worked for years on this issue and has made every effort to keep it bipartisan. I yield to the Senator from Utah.

Mr. LEAHY. Mr. President, I ask unanimous consent that the committee- reported amendments be agreed to, the motions to reconsider be considered made and laid upon the table, with no intervening action or debate; further, that the amended version be considered original text for the purposes of further amendment.

Mr. LEAHY. Mr. President, the Senate today is turning its attention to a measure that will help create jobs, energize the economy, and promote innovation. The Patent Reform Act, which has also come to be called the America Invents Act, is a key part of any jobs agenda. We can help unleash innovation and promote American invention, all without adding a penny to the deficit. This is commonsense and bipartisan legislation. During the next few days, the Senate can come together to pass this needed legislation, and do so in a bipartisan manner. It represents the finest traditions of the Senate. I thank the majority leader for proceeding to this measure, and the Republican leader for his cooperation. This is a bill that was reported unanimously by the members of the Judiciary Committee. Republicans and Democrats alike recognize that it is important to our country's continued economic recovery, and to our ability to successfully compete in the global economy. America needs a 21st century patent system in order to lead. The last reform of our patent system was nearly 60 years ago, and I think it is about time the patent system caught up with the needs of this country and what the rest of the world has already done. In his State of the Union Address, President Obama challenged the Nation to out-innovate, out-build, and out-educate. Enacting the America Invents Act is a key to meeting this challenge. Reforming the Nation's antiquated patent system will promote American innovation, it will create American jobs, and it will grow America's economy. I thank the President and his administration for their help and support for the Leahy-Hatch-Grassley America Invents Act. Commerce Secretary Locke has been a strong partner in our efforts, and Director Kappos of the Patent and Trademark Office has been an indispensable source of wise counsel. Innovation drives the Nation's economy, and that entrepreneurial spirit can only be protected by a patent system that promotes invention and spurs new ideas. We need to reform our patent system so that these innovations can more quickly get to market. A modernized patent system--one that puts American entrepreneurs on the same playing field as those throughout the world--is a key to that success. This is an idea that cuts across the political spectrum. Our bipartisan Senate cosponsors include Senator Kohl of Wisconsin, Senator Klobuchar of Minnesota, Senator Gillibrand of New York, the distinguished Acting President pro tempore, Senator Coons of Delaware, as well as Senator Kyl, the assistant Republican leader, Senator Sessions of Alabama, Senator Lieberman of Connecticut, Senator Franken of Minnesota, Senator Blumenthal of Connecticut, and Senator Harkin of Iowa. Republicans and Democrats from big States and small, and from all ends of the political spectrum, are coming together to support American innovation. The Senate Judiciary Committee unanimously approved this legislation on February 3, 2011. But this effort extends back several years. Our current congressional efforts to reform the Nation's patent system began in 2005. Indeed, our bill is the product of years of work and compromise. The Senate Judiciary Committee has reported patent reform legislation to the Senate in each of the last three Congresses. And the House has seen efforts over the same period led by Congressmen Lamar Smith of Texas and Howard Berman of California. The legislation we are considering today, in fact, is structured on the original House bill and contains many of the original provisions. From the beginning, we each recognized the need for a more effective and efficient patent system, one that improves patent quality and provides incentives for entrepreneurs to create jobs. A balanced and efficient intellectual property system that rewards invention and promotes innovation through high-quality patents is crucial to our Nation's economic prosperity and job growth. It is how we win the future--by unleashing the American inventive spirit. This bill, the America Invents Act, will allow our inventors and innovators to flourish, and it will do so without adding a penny to the deficit. Not a dime in taxpayer money is spent on the Patent and Trademark Office reforms. They are all funded by patent fees, not taxes. The America Invents Act will accomplish three important goals, which have been at the center of the patent reform debate from the beginning: It will improve and harmonize operations at the Patent and Trademark Office; it will improve the quality of patents that are issued; and it will provide more certainty in litigation. Particularly, this legislation will transition our Nation's patent system to a first-inventor-to-file system. It will also make changes to improve the quality of patents that are issued, and it will provide the PTO with the resources it needs to work through its backlog. The America Invents Act provides the tools the PTO needs to separate the inventive wheat from the chaff, to help businesses bring new products to market and create jobs. This is interesting because this is a piece of legislation that is supported by both business and labor--something we all want to see in this Chamber--including the National Association of Manufacturers, the United Steelworkers, the National Venture Capital Association, the AFL- CIO, the Association of American Universities, and companies representing all sectors of the patent community that have been urging action on patent reform proposals for years. Innovation has always been at the heart of America and American success. From the founding of our Nation, we recognized the importance of promoting and protecting innovation. The Constitution explicitly grants Congress the power to ``promote the progress and science and useful arts, by securing for limited times to . . . inventors the exclusive right to their respective . . . discoveries.'' It is not a creature of the legislature but an integral part of our Constitution. The patent system plays a key role in encouraging innovation and bringing new products to market. The discoveries made by American inventors and research institutions, commercialized by our companies, and protected and promoted by our patent laws, have made our system the envy of the world. In spite of this, a Newsweek study last year found that only 41 percent of Americans believe the United States is staying ahead of China in innovation. A Thompson Reuters analysis has already predicted that China will outpace the United States in patent filings this year. China has a specific plan not just to overtake the United States in patent applications, but to more than quadruple its patent filings over the next 5 years--all the more reason why we must act now. This is not something that should be delayed. We should act on it. Delaying it is saying we want China to overtake the United States. Moving forward says we want to be competitive. It is astonishing to consider that China has been modernizing its patent laws and promoting innovation, but the United States has failed to keep pace. I said before, it has been 60 years since we last enacted reform of American patent law. We can no longer wait. We can no longer remain complacent and expect to stay on top. In many areas that were highly contentious when the patent reform debate began, the courts have acted. Their decisions reflect the concerns heard in Congress that questionable patents were too easily obtained, too difficult to challenge. The courts have moved the law in a generally positive direction, more closely aligned with the text of the statutes. More recently, the Federal circuit aggressively moved to constrain runaway damage awards, which plagued the patent system by basing awards on unreliable numbers, untethered to the reality of licensing decisions. The courts have addressed issues where they can, but in some areas only Congress can take the necessary steps. Our act will both speed the application process and, at the same time, improve patent quality. It will provide the USPTO with the resources it needs to work through its application backlog, while also providing for greater input from third parties to improve the quality of patents issued and that remain in effect. High quality patents are the key to our economic growth. They benefit both patent owners and users, who can be more confident in the validity of issued patents. Patents of low quality and dubious validity, by contrast, enable patent trolls who extort unreasonable licensing fees from legitimate businesses, and constitute a drag on innovation. Too many dubious patents also unjustly cast doubt on truly high quality patents. The Department of Commerce issued a report indicating that these reforms will create jobs without adding to the deficit. The Obama administration supports these efforts, as do industries and stakeholders from all sectors of the patent community. Congressional action can no longer be delayed. Innovation and economic development are not uniquely Democratic or Republican objectives, so we worked together to find the proper balance for America, for our economy, for our inventors, for our consumers. Thomas Friedman wrote not too long ago in the New York Times that the country which ``endows its people with more tools and basic research to invent new goods and services . . . is the one that will not just survive but thrive down the road. . . . We might be able to stimulate our way back to stability, but we can only invent our way back to prosperity.'' I think of the country's first patent, which was issued to a Vermonter. Thomas Jefferson, the Secretary of State, examined the application, and President George Washington signed it. A recent Judiciary Committee meeting on this measure was on the anniversary of the day Thomas Edison received the historic patent for the principles of his incandescent lamp that paved the way for the bulb that has illuminated our homes, offices, and venues in our country and around the world. This week is when the patent was issued for lifesaving improvements to the diver's suit. It was magician Harry Houdini who devised a mechanism that allowed divers in distress to safely escape a diving suit. So we can smooth the path for more interesting and great American inventions. That is what the bipartisan comprehensive patent reform bill would do. I wish to recognize in particular the work of Senator Hatch, who is here on the Senate floor--and he has been a longtime partner of mine on intellectual property issues--and Senator Grassley, the ranking Republican on our committee. The bill has also received tremendous input from Senator Kyl, Senator Klobuchar, Senator Sessions and many others. We are working together, along with those on both sides of the aisle in the House, to reach the goal of improving patent quality and the operations at the PTO, and to address the related unpredictability of litigation that has been harming innovation. No one claims that ours is a perfect bill. It is a compromise that will make key improvements in the patent system. Over the course of the next couple of days, the Senate will have the opportunity to consider amendments. Senator Coburn intends to bring an amendment on the use of patent fees. Other Senators who disagree with the move to a first-to-file system may seek to reverse that progress. I urge those Senators that have amendments to come forward, agree to time agreements and proceed without delay. We should be able to complete action on this bill this week and I would hope by Wednesday night. Then the Senate will need to move on to other important matters. So after a brief period for opening statements to outline the bill and frame the debate, I will call for Senators to come forward with any amendments they may have to the bill. This bill is important and its scheduling comes as no surprise. It was more than 10 days ago that the Senate unanimously agreed to its consideration. So, let us do our job, and get to the task of considering and completing action on this important bill in order to help create jobs, encourage innovation and promote American invention. Mr. President, some of the Nation's leading innovators and inventors have expressed strong support for S. 23, the America Invents Act. The Coalition for Patent and Trademark Information Dissemination, whose members are patent and trademark holders, recently wrote to the Senate Judiciary Committee in support of the bill, stating that its members have ``an interest in a more efficient system that produces higher- quality patents and trademarks.'' The Intellectual Property Owners Association, one of the largest trade associations devoted to intellectual property rights also recently wrote to Senators endorsing important provisions in the bill, including the first-to-file system. I ask that these letters, as well as a statement of support from the Coalition for 21st Century Patent Reform be printed in the Record at this time. I also ask that a list of cross-sector manufacturers and innovators that support S. 23 be printed in the Record.

Mr. LEAHY

Mr. LEAHY. There is both good news and bad news represented by today's debate. The good news is that we begin another week by considering two of President Obama's judicial nominations. With judicial vacancies remaining over 100, nearly half of them judicial emergencies, the Senate's action today on 2 outstanding nominees to fill judicial emergency vacancies in Georgia is much needed. The bad news is that we did not consider these nominations earlier, and that we are not considering any of the other 8 judicial nominees awaiting final Senate consideration and confirmation. Two of those nominees, Sue Myerscough and James Shadid, were each nominated to fill emergency vacancies on the Central District of Illinois. Their confirmations would help relieve the chief judge of that district, who is the only active judge in the entire district. Chief Judge McCuskey wrote to Senator Durbin in November urging the Senate to take action to fill those vacancies, but we did not. Despite the desperate need in that district, neither of these nominations received final Senate votes when they were reported unanimously by the Judiciary Committee last year. Both have now been reported unanimously again, and we should not further delay taking care of this overburdened court and the hard- working Americans who depend on it. I do thank, in particular, the majority leader for scheduling this time, and also thank the Republican leader for his cooperation. I also commend our ranking Republican on the Judiciary Committee. Senator Grassley has worked with me on each of the judicial nominations that President Obama renominated this January. All 13 of the judicial nominations that were unanimously reported last year have now been unanimously reported, again, this year. To date, five of those nominations have been confirmed and with the confirmation of Amy Totenberg and Steve Jones, we will have reconsidered and confirmed 7 of those 13 unanimously reported judicial nominees. The Judiciary Committee has also now considered the renomination of Susan Carney of Connecticut to the Second Circuit and Michael Simon to be a district court judge in Oregon. More than half of the Republicans on the Judiciary Committee voted in favor of those nominations. They should be debated and confirmed without delay, as well. Working with Senator Grassley, I also expect to be able to move forward with Judiciary Committee consideration of the renominations of two district court nominees, Edward Chen of California and Jack McConnell of Rhode Island, in the next few weeks. The renomination of Goodwin Liu of California to the Ninth Circuit will be reexamined at a Judiciary Committee hearing this week, at the request of our Republican members, and then reconsidered by the committee, as well. We will be holding our third confirmation hearing of the year this week. It will include Professor Liu and four other judicial nominees from Tennessee, Florida, and New Jersey. At the earlier two hearings we considered eight additional judicial nominees who now await committee approval and Senate consideration. We are holding hearings every 2 weeks and hope finally to begin to bend the curve and start to lower judicial vacancies across the country. I also commend the Senator from Iowa for his statement on February 14 during which he urged the Senate to turn the page and not revisit the recriminations from administrations past. I agree. The nominees we consider today are both from Georgia. They were both reported unanimously by the Judiciary Committee this year. Actually, they were also reported unanimously by the Judiciary Committee last year. They were among the 19 judicial nominees who were ready to be confirmed by the Senate last year but were not. When there was objection to proceeding last year, the vacancies persisted, the President had to renominate them and the Judiciary Committee had to reconsider their nominations. I expect the Senate will confirm them both tonight. I hope we do so unanimously. Both have the support of their home State Senators. Senators Isakson and Senator Chambliss worked with me and with President Obama in connection with these nominations. While I am encouraged that the Senate is proceeding today, I am disappointed that we did not consider these nominees and other nominees from California, North Carolina, and the District of Columbia before the Presidents Day recess. We used to be able to clear the calendar of nominations before a recess. All six of these judicial nominees were approved unanimously by every Republican and every Democrat on the Judiciary Committee weeks before the recess. When they are considered, I fully expect they will be confirmed unanimously by the Senate. With persistently high judicial vacancies around the country, the Senate should be considering judicial nominations without unnecessary delays. Litigants all over the country are having a hard time getting their cases heard in court because of the high number of vacancies. There are nominees pending on the calendar with unanimous support by both Republicans and Democrats on the Senate Judiciary Committee. We ought to at least vote on these nominations to fill the vacancies. In fact, when these 2 nominations are confirmed, there will still be nearly 100 Federal judicial vacancies around the country. That is too many and they have persisted for too long. That is why Chief Justice Roberts, Attorney General Holder, White House Counsel Bob Bauer, and many others, including the President of the United States, have spoken out and urged the Senate to act. Nearly one out of every eight Federal judgeships is vacant. That puts at serious risk the ability of Americans all over the country to have a fair hearing in court. The real price being paid for these unnecessary delays is that the judges who remain are overburdened and the American people who depend on them are being denied hearings and justice in a timely fashion. These delays affect everyone; whether you are a plaintiff, a prosecutor, or a defendant. Regrettably, the progress we made during the first 2 years of the Bush administration has not been duplicated, and the progress we made over the 8 years from 2001 to 2009 to reduce judicial vacancies from 110 to a low of 34 was reversed. The vacancy rate we reduced from 10 percent at the end of President Clinton's term to less than 4 percent in 2008 has now risen back to over 10 percent. In contrast to the sharp reduction in vacancies we made during President Bush's first 2 years when the Democratically controlled Senate confirmed 100 of his judicial nominations, only 60 of President Obama's judicial nominations were allowed to be considered and confirmed during his first 2 years. We have not kept up with the rate of attrition, let alone brought the vacancies down. By now they should have been cut in half. Instead, they continue to hover around 100. The Senate must do better. The Nation cannot afford further delays by the Senate in taking action on the nominations pending before it. Judicial vacancies on courts throughout the country hinder the Federal judiciary's ability to fulfill its constitutional role. They create a backlog of cases that prevents people from having their day in court. This is unacceptable. We can consider and confirm this President's nominations to the Federal bench in a timely manner. President Obama has worked with both Democratic and Republican home State Senators to identify superbly qualified consensus nominations. None of the nominations on the Executive Calendar are controversial. They all have the support of their home State Senators, Republicans and Democrats. All have a strong commitment to the rule of law. All have demonstrated faithfulness to the Constitution. During President Bush's first term, his first 4 tumultuous years in office, we proceeded to confirm 205 of his judicial nominations. This was after 60 of President Clinton's nominations had been pocket- filibustered by those on the other side of the aisle. I decided not to continue that trend and we showed good faith in moving 100 of President Bush's nominees in the 17 months that I was chairman. During the remaining 31 months under Republican control, the Senate confirmed another 105 judicial nominations. So far in President Obama's third year in office, the Senate has only been allowed to consider 67 of his Federal circuit and district court nominees. We remain well short of the benchmark we set during the Bush administration. When we approach it, we can reduce vacancies from the historically high levels at which they have remained throughout the first 3 years of the Obama administration to the historically low level we reached toward the end of the Bush administration. I have often said that the 100 of us in the Senate stand in the shoes of over 300 million Americans. We owe it to them to do our constitutional duty of voting on the President's nominations to be Federal judges. We owe it to them to make sure that hard-working Americans are able to have their cases heard in our Federal courts. I know the distinguished Senator from Iowa is going to want to speak and time has been reserved for him. I first yield to the Senator from Pennsylvania on my time.

Mr. LEAHY

Mr. LEAHY. Mr. President, once the Senator has introduced his amendment and has spoken, will he be willing to set that aside so that other amendments on the patent bill can come up?

Mr. LEAHY. That is what is pending now?

Mr. LEAHY. I thank the Chair.

Mr. LEAHY. Was that set aside so he could introduce his second amendment?