On June 8, 2005, the House Subcommittee on Courts, the Internet, and Intellectual Property introduced HR 2795, a bill with sweeping changes to the patent law. The bill includes the following main provisions:

Post Grant Opposition. The bill would establish two types of post-grant opposition to challenge a patent in the Patent Office: (1) a post-grant opposition similar to that in Europe which has to be filed within nine months of the patent's issuance, and (2) a litigation alternative opposition allowing an opposition in the patent office within 6 months after receipt of a notice of infringement. The opposition would be stayed if the patent owner files suit before the end of the 9 or 6 month periods.

The oppositions would be heard by 3 patent administrative judges. The oppositions may be based on patents, printed publications or declarations for "other factual evidence" or expert opinions. The patent owner can amend the claims. There is a right to depose each person giving a declaration. The depositions are limited to cross- examination on matters relevant to the declaration. No other discovery is permitted unless the panel determines it is necessary in "the interests of justice." If requested, there will be an oral hearing with briefs. The standard is preponderance of the evidence (not clear and convincing), based on the broadest reasonable construction of the claims. The bill requires that oppositions be concluded within one year of initiation. Oppositions are appealable by both sides to the Court of Appeals for the Federal Circuit. The opposer is estopped with respect to any issue of validity actually decided, except for material new facts.

Oppositions would not be available until one year after enactment, or such later date as the Patent Office sets. They will only be available for patents issuing on applications with an effective filing date a year after enactment. Thus, oppositions would likely not be available for 2-3 years after enactment.

First to File. The bill would adopt the first to file system of other countries. This would eliminate interferences, except to determine if the first to file is an inventor, and didn't derive it from someone else. This would apply to applications with an effective filing date a year or more after enactment.

Prior art. The novelty and obviousness standards would be modified to drop provisions dependent upon invention dates and make other changes. A joint research exception is added.

One year grace period pressure on Europe, Japan. Other countries are denied using the filing dates in their countries for the new first to file provision until both Europe and Japan adopt a one year grace period for the inventor.

Best Mode. The best mode requirement is eliminated, to conform to other countries.

Inequitable Conduct. Inequitable conduct cannot be pled until there is a finding of invalidity, and only serious inequitable conduct can be pursued in litigation, with lesser inequitable conduct being referred to the Patent Office. A new administrative procedure in the patent office is provided to deal with inequitable conduct, with civil penalties up to $1 million, or $5 million or more for egregious conduct.

Willful Infringement. Willful infringement would be limited to only where there is (1) written notice (specific enough for a declaratory judgment action and identifying which claims are allegedly infringed by which products), (2) intentional copying or (3) prior adjudication. The willfulness needs to be proved by evidence that is "clear and convincing." It can't be plead and determined until after a determination that the patent is not invalid and has been infringed (bifurcation required). It codifies the Knorr Bremse ruling of no adverse inference from not introducing an opinion of counsel.

Possible limits on continuation applications. The patent office is given the discretion to limit the use of continuation applications.

No presumed irreparable harm for injunctions. To issue an injunction, the court is required to consider the fairness in light of all facts and the interests of the parties. An injunction shall be stayed on appeal upon an affirmative showing of no irreparable harm.

Inter Partes Reexam expansion, estoppel. The estoppel for inter partes reexamination is limited to grounds actually raised, not those that could have been raised. Also, inter partes reexamination will apply to any patent, eliminating the current limitation to only patents based on original applications filed on or after the original enactment date of Nov. 29, 1999.

All applications published. The exception to publication where there will be no foreign filing is eliminated.

Reasonable royalty for combinations. Where the infringing item is a combination, and the reasonable royalty (not lost profits) standard is applied for damages, they are limited to the portion of the realizable profit that should be credited to the inventive contribution (a limit on the entire market value rule).

Filing application by assignee. A patent application can be filed in the name of an assignee, rather than the inventors, as is the practice in other countries.

Preissuance submissions by 3rd parties. Prior art may be submitted to the examiner by a 3rd party prior to the earlier of (1) notice of allowance or (2) the later of 6 months after publication or the first office action rejection. This is an increase from the current limit of 2 months after publication.

Click here to read HR 2795 as introduced.