America Invents Act

Floor Speech

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Mr. SCHOCK. I thought when we started this Congress that we had agreed to no more earmarks, no more handouts, no more special privileges for any specific industry. But based on reading H.R. 1249, it's obvious to see that it includes controversial language which does just that--section 18, which sets forth a new and different process for certain business method patents for any other patents seeking approval.

Section 18 carves out a niche of business method patents covering technology used specifically in the financial industry and would create a special class of patents in the financial services field subject to their own distinctive post-grant administrative review. This new process allows for retroactive reviews of already-proven patents that have undergone initial scrutiny, review, and have even been upheld in court. Now these patents will be subjected to an unprecedented new level of interrogation.

The other side will argue that somehow magically a number of these financially related patents breezed through the patent office and thus must be reviewed. Well, nothing could be further from the truth. In fact, the allowance rate for these business method patents is the smallest of any of the art forms. In fact, roughly 10 percent of those business method patents applied for are actually approved.

At a time when these small entrepreneurs and innovators need to be dedicating their resources and new advancements to innovation, they will instead, because of section 18, be required to divert research funds to lawyers to fight the deep pockets of Wall Street, who will now attempt to attack their right to hold these financially related patents.

With that, Madam Chair, I reserve the balance of my time.

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Mr. SCHOCK. Madam Chair, I yield 1 minute to my friend, the cosponsor of this amendment, the gentlewoman from California (Ms. Waters).

Ms. WATERS. As a member of the Judiciary Committee, I rise in strong support of the Schock-Boren-Waters-Sensenbrenner-Franks-Kaptur amendment to strike section 18. For years, the too-big-to-fail banks have attempted to eliminate their patent infringement liabilities to smaller companies and inventors that have patented financial services-related business method patents. They are now coming to Congress in hopes that you will help them steal a specific type of innovation and legislatively take other financial services-related business method patents referenced in H.R. 1249, section 18. This is simply wrong.

Elected Members of Congress should not allow the banks to use us to steal legally issued and valid patents. Financial services-related business method patents have saved financial services companies billions of dollars. But that's not enough for the banks. Because the banks have failed at every attempt to void these patents, they're attempting to use their power to write into law what they could not achieve at PTO or in the courts.

Don't be tricked, don't be fooled, and don't be used. I urge my colleagues to listen to the floor debates.

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Mr. SCHOCK. Mr. Chairman, for so many reasons, this provision of the bill is flawed. I ask my colleagues to join me in supporting the repeal of section 18, and simply ask this:

Regardless of where your support lies as to the underlying bill, why are we doing something separate for financial services patents? Why are we doing something separate for the business method patents? Shouldn't all reforms affect all patents and all industries?

I would argue this is an earmark and a special provision for one industry, and for so many reasons would ask for a ``yes'' vote on my amendment.

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