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Public Statements

Leahy-Smith America Invents Act

Floor Speech

Location: Washington, DC


Ms. CANTWELL. Madam President, simply my amendment restores section 18 of the language that was passed out of the Senate. Basically it implements the Senate language.

I come to the floor today with much respect for my colleague Chairman Leahy, who has worked on this legislation for many years, and my colleagues on the other side of the aisle who have tried to work on this important legislation and move it forward. I am sure it has been challenging. I mean no offense to my colleagues about this legislation. It simply is my perspective about where we need to go as a country and how we get there.

I am excited that we live in an information age. In fact, one of the things that I count very fortunate in my life is that this is the age we live in. I often think if I lived in the agrarian age, maybe I would be farming. That is also of great interest, given the State of Washington's interests in agriculture. Maybe I would live in the industrial age when new factories were being built. That would be interesting. But I love the fact that whether you are talking about agriculture, whether you are talking about automotive, whether you are talking about health care, whether you are talking about software, whether you are talking about communications, whether you are talking about space travel, whether you are talking about aviation, we live in an information age where innovation is created every single day. In fact, we are transforming our lives at a much more rapid pace than any other generation because of all that transformation.

I love the fact that the United States has been an innovative leader. I love the fact that the State of Washington has been an innovative leader. If there is one thing I pride myself on, it is representing a State that has continued to pioneer new technology and innovations. So when I look at this patent bill, I look at whether we are going to help the process of making innovation happen at a faster rate or more products and services to help us in all of those industries I just mentioned or whether we are going to gum up the wheels of the patent process. So, yes, I joined my colleagues who have been out here on the Senate floor, such as Senator Feinstein and others who debated this issue of changing our patent system to the ``first to file,'' which will disadvantage inventors because ``first to file'' will lead to big companies and organizations getting the ability to have patents and to slow down innovation.

If you look at what Canada and Europe have done, I don't think anybody in the world market today says: Oh, my gosh, let's change to the Canadian system because they have created incredible innovation or let's look to Europe because their ``first to file'' has created such innovation.

In fact, when Canada switched to this ``first to file'' system, that actually slowed down the number of patents filed. So I have that concern about this legislation.

But we have had that discussion here on the Senate floor. I know my colleague is going to come to the floor and talk about fee diversion, which reflects the fact that the Patent Office actually collects money on patents. That is a very viable way to make the Patent Office effective and efficient because it can take the money it collects from these patents and use it to help speed up the process of verifying these patents and awarding them. But the Senate chose good action on this issue, and good measure, and simply said that the money collected by the Patent Office should stay in the Patent Office budget.

But that is not what the House has done. The House has allowed that money to be diverted into other areas of appropriations, and the consequence will be that this patent reform bill will basically be taking the economic engine away from the Patent Office and spreading it out across government. So the reform that we would seek in patents, to make it a more expeditious process, is also going to get down.

I could spend my time here today talking about those two things and my concerns about them, but that is not even why I am here this morning. I am here to talk about how this legislation has a rifleshot earmark in it for a specific industry, to try to curtail the validation of a patent by a particular company. That is right, it is an earmark rifleshot to try to say that banks no longer have to pay a royalty to a particular company that has been awarded a patent and that has been upheld in court decisions to continue to be paid that royalty.

That is why I am here this morning. You would say she is objecting to that earmark, she is objecting to that personal approach to that particular industry giveaway in this bill. Actually, I am concerned about that, but what I am concerned about is, given the way they have drafted this language to benefit the big banks of America and screw a little innovator, this is basically drafted so broadly that I am worried that other technology companies are going to get swept up in the definition and their patents are also going to be thrown out as invalid.

That is right. Every State in the United States could have a company that, under this language, could now have someone determine that their patent is no longer viable even though the Patent Office has awarded them a patent. Companies that have revenue streams from royalties that are operating their companies could now have their bank financing, everything pulled out from under them because they no longer have royalty streams. Businesses could lay off people, businesses could shut down, all because we put in broad language in the House version that exacerbates a problem that was in the Senate version to begin with.

Now I could say this is all a process and legislation follows a process, but I object to this process. I object to this language that benefits the big banks but was never debated in the committee of jurisdiction, the Judiciary Committee. It was not debated. It was not voted on. It was not discussed there. It was put into the managers' amendment which was brought to the Senate floor with little or no debate because people wanted to hurry and get the managers' amendment adopted.

Now, I objected to that process in driving this language because I was concerned about it. I sought colloquy at that point in time and was not able to get one from any of my colleagues, and I so opposed this legislation. Well, now this legislation has been made even worse in the House of Representatives by saying that this language, which would nullify patents--that is right. The Senate would be participating in nullifying patents that the Patent Office has already given to companies, and it can now go on for 8 years--8 years is what the language says when it comes back from the House of Representatives.

All I am asking my colleagues to do today is go back to the Senate language they passed. Go back to the Senate language that at least says this earmark they are giving to the big banks so they can invalidate a patent by a company because they don't like the fact they have to pay a royalty on check imaging processing to them--I am sorry you don't like to pay the royalty. But when somebody innovates and makes the technology, they have the right to charge a royalty. You have been paying that royalty. I am sorry, big banks, if you don't like paying that royalty anymore. You are making a lot of money. Trying to come to the Senate with an earmark rifle shot to X out that competition because you don't want to pay for that technology--that is not the way the Senate should be operating.

The fact that the language is so broad that it will encompass other technologies is what has me concerned. If all my colleagues want to vote for this special favor for the big banks, go ahead. The fact that my colleagues are going to basically pull us in to having other companies covered under this is a big concern.

The section I am concerned about is business method patents, and the term ``covered business method patent'' means patents or claims or method or corresponding apparatus for performing data processing or other operations. What does ``or other operations'' mean? How many companies in America will have their patents challenged because we don't know what ``or other operations'' means? How many? How many inventors will have their technology basically found null and void by the court process or the Patent Office process because of this confusing language?

I am here to ask my colleagues to do a simple thing: revert to the Senate language. It is not a perfect solution. If I had my way, I would strip the language altogether. If I had my way, I would have much more clarity and predictability to patent lawyers and the Patent Office so the next 3 or 4 years will not be spent in chaos between this change in the patent business method language and the whole process that is going to go on. Instead, we would be moving forward with predictability and certainty.

I ask my colleagues to just help this process. Help this process move forward by going back to the Senate language. I know my colleagues probably want to hurry and get this process done, but I guarantee this language with the Senate version could easily go back to the House of Representatives and be passed. What I ask my colleagues to think about is how many companies are also going to get caught in this process by the desire of some to help the big banks get out from under something the courts have already said they don't deserve to get out of.

I hope we can bring closure to this issue, and I hope we can move forward on something that gives Americans the idea that people in Washington, DC, are standing up for the little guy. We are standing up for inventors. We are standing up for those kinds of entrepreneurs, and we are not spending our time putting earmark rifle shot language into legislation to try to assuage large entities that are well on their way to taking care of themselves.

I hope if my colleagues have any questions on this language as it relates to their individual States, they would contact our office and we would be happy to share information with them.

I yield the floor and suggest the absence of a quorum.


Ms. CANTWELL. Madam President, I encourage my colleagues to support the Cantwell amendment. The Cantwell amendment is the reinstatement of section 18 language as it passed the Senate. So casting a vote for the Cantwell amendment will be consistent with language previously supported by each Member.

The reason we are trying to reinstate the Senate language is because the House language broadens a loophole that will allow for more confusion over patents that have already been issued. It will allow for the cancellation of patents already issued by the Patent Office, throwing into disarray and legal battling many companies that already believe they have a legitimate patent.

The House language, by adding the word ``other,'' broadens the definition of section 18 and extends it for 8 years, so this chaos and disarray that is supposedly targeted at a single earmark for the banking industry to try to get out of paying royalties is now so broadened that many other technology companies will be affected.

I urge my colleagues to support the Cantwell amendment and reinstate the language that was previously agreed to.


Ms. CANTWELL. Mr. President, rising in opposition, this is not a patent reform bill, this is a big corporation patent giveaway that tramples on the rights of small inventors. It changes ``first to invent'' to ``first to file,'' which means if you are a big corporation and have lots of resources, you will get there and get the patent.

Secondly, it doesn't keep the money where it belongs. It belongs in the Patent Office. Yet, instead of having reforms that will help us expedite patents, it is giving away the money that is needed to make this kind of innovation work.

Third, the bill is full of special giveaways to particular industry corporations, as we have just witnessed with votes on the floor.

Fourth, by taking away the business patent method language, you will make it more complicated and have years and years of lawsuits on patents that have already been issued. If this is job creation, I have news for my colleagues; in an innovation economy, it is siding with corporate interests against the little guy. I urge a ``no'' vote.


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