[Pages S13552-S13565]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

By Mr. COVERDELL (for himself, Mr. Biden, Mr. Roth, Mr. Edwards,
Mr. Graham, Mr. Cleland, Mr. Sarbanes, Ms. Mikulski, and Mr.
Mack):
S. 1830. A bill to provide for the appointment of additional
temporary bankruptcy judges, and for other purposes; to the Committee
on the Judiciary.

bankruptcy judgeship act

Mr. COVERDELL. Mr. President, I rise today to introduce legislation
that would address the growing bankruptcy caseload in our federal
judiciary. Increased bankruptcy filings are placing a severe strain on
our federal courts and on the judges who preside over these cases. The
House and Senate bankruptcy reform bills seek to address this issue by
authorizing eighteen new bankruptcy judges. While Congress recognizes
the need for these judges, it has not yet taken the step it deems
necessary to approve another needed group of bankruptcy judges
identified by the U.S. Judicial Conference in March of this year. This
legislation would authorize these six judgeships and help our federal
judiciary address an overburdensome workload.
My home state of Georgia is one of the states that the Judicial
Conference has indicated needs another bankruptcy judge. The middle and
southern districts in Georgia have, respectively, the eighth and ninth
highest weighted caseloads in the country. The most recent data from
the Administrative Office of the U.S. Courts indicates that the
weighted bankruptcy filings per authorized judgeships is 1,907 for the
middle district and 1,880 for the Southern district. Even with approval
of a new judge for the southern district, the three full-time judges in
that district would still carry a caseload that exceeds the threshold
of 1,500 weighted hours that justifies the creation of another
judgeship.
The review undertaken by the Judicial Conference of the workload in
these Georgia districts also found that caseloads are being managed in
a highly efficient manner. The Judicial Conference had no suggestions
to assist the court in expending its caseload. A new judgeship is the
only solution to this caseload problem.
I understand that the Judicial Conference used the same criteria to
justify the 6 new judgeships in their March 1999 recommendation that
they used to justify the 18 judgeships in the bankruptcy reform bills.
Understanding the need for a new bankruptcy judge in my state, I
support the Judicial Conference's recommendation,

[[Page S13553]]

and other states' efforts to obtain an additional judge. I am pleased
that Senator Biden, Edwards, Graham, Cleland, Sarbanes, Mikulski, and
Mack, whose states were also included in the March 1999 Judicial
Conference recommendation, have joined me on this bill. I believe this
legislation will shed important light on caseloads and the need for new
judges. The last time Congress approved new bankruptcy judgeships was
seven years ago. These judges are needed now and I hope Congress will
move forward in approving them.
______

By Mr. DASCHLE (for himself and Mr. Johnson):
S. 1831. A bill to protect and provide resources for the Social
Security System, to reserve surpluses to protect, strengthen and
modernize the Medicare Program, and for other purposes; to the
Committee on the Budget and the Committee on Governmental Affairs,
jointly, pursuant to the order of August 4, 1977, with instructions
that if one committee reports, the other committee have 30 days to
report or be discharged.

medicaid eligibility restoration act of 1999

Mr. DASCHLE. Mr. President, today I introduce the Medicaid
Eligibility Restoration Act of 1999, which fixes a major problem
recently created in the health care safety net.
My bill addresses a Medicaid eligibility problem--lack of access to
health insurance during the first, and often costliest, month of
disability--that was inadvertently caused by a change to Supplemental
Security Income (SSI) policy in the 1996 welfare reform law.
Let me explain how this Medicaid ``gap month'' problem was created.
In 1996, the effective date of application for Supplemental Security
Income (SSI) was changed to the month following the date when an
individual applies for SSI.
Before the 1996 change, pro-rated payments began immediately. Since
1996, payments do not begin until the month following original
application.
This SSI payment change generated a small cost savings for the SSI
program and ended the administrative burden of calculating partial
month payments, but it also created a problem--a gap month--for
Medicaid eligibility that is linked to SSI.
For most SSI and Medicaid recipients, this change has resulted in one
lost month of Medicaid eligibility, which is a hardship in itself.
But those who suddenly become disabled or who are born with a
disability face more dire consequences.
Because of the 1996 change, they now lose health insurance coverage
for what is often their costliest month--their first month of
disability. This policy shift has left families with enormous medical
bills and hospitals with uncompensated care.
The Medicaid Eligibility Restoration Act would end this gap month in
Medicaid coverage and would restore the pre-1996 Medicaid eligibility
criteria.
This issue first came to my attention when I received a letter from
Randall Connelly of Sioux Falls, South Dakota.
His wife, Susan, had recently given birth to premature twins.
Tragically, the twins died a few days later.
Despite the fact that Randy had a good job, with good health
insurance, he still faced unaffordable out-of-pocket medical expenses.
Because of the twins' low birth weight, both children were
automatically eligible for SSI and Medicaid--or they would have been,
if the twins had been born before enactment of the welfare reform law
of 1996.
In fact, the Connellys were ineligible for any help with their
medical bills because of the small 1996 technical change in SSI payment
policy.
The unfortunate result was that the Connellys were left to cope not
only with the loss of their newborn twins, but also with unaffordable
hospital bills.
Since my communication with the Connellys, I have heard from hospital
administrators who have expressed concern on behalf of patients and
families who have suddenly found themselves with nowhere to turn during
their first weeks of extreme financial hardship and emotional trauma
due to disability.
Sioux Valley Hospital in Sioux Falls, SD, has reported that 28
newborns were affected during the past year in that one hospital alone.
Hospital administrators report that:

Delay in Medicaid coverage results in severe hardship for
many families. . . . The normal stresses of dealing with a
newborn with a serious disability are compounded by the
extensive financial demands attendant to medical services
provided for that child.

I ask that a copy of Sioux Valley's letter of support for the bill be
printed in the Record.
There being no objection, the letter was ordered to be printed in the
Record, as follows:

Sioux Valley

Hospitals & Health System,

Sioux Falls, October 27, 1999.
Hon. Thomas Daschle,
U.S. Senate, Hart Senate Office Building, Washington, DC.
Dear Senator Daschle: I am writing to express the support
of the Sioux Valley Hospitals & Health System for legislation
we understand you are planning to introduce which would
address an issue involving SSI eligibility, and therefore,
Medicaid eligibility. The issue, as we have experienced it,
involves the date on which Medicaid coverage would commence
for SSI eligible newborns. We understand that current law
results in a start date for Medicaid payment coverage on the
first of the month following SSI eligibility which for
disabled newborns is their date of birth.
That delay in Medicaid coverage results in severe hardship
for many families who have had babies with medical conditions
requiring extremely expensive services in the Sioux Valley
Hospital Neonatal Intensive Care Unit. Some 28 families have
been affected at Sioux Valley alone over the course of the
last year. The normal stresses of dealing with a newborn with
a serious disability are compounded by the extensive
financial demands attendant to medical services required for
the child.
While we understand that public programs cannot be expected
to address expenses associated with every catastrophic
medical situation, this delay in coverage for severely
disabled newborns seems particularly appropriate for a public
response. I wanted you to know, therefore, that we do support
your effects in this respect.
Please let me know if any of our staff could provide
further information with respect to the importance and impact
of the legislation which you propose.
Sincerely,
Frank M. Drew,
Senior Vice President of Public Policy.

Mr. DASCHLE. I have also heard from public health officials who are
concerned that public health funds may need to be diverted to address
the needs of those who should have been covered by Medicaid--as they
were in the past.
Some states are able to cover the gap month through other Medicaid
categories, such as the ``medically needy'' category and a category for
those who meet all the SSI criteria but are not receiving benefits.
There are several states, however, that still face the gap month
problem.
It is difficult for many of these states to address this problem,
because, while covering only the gap month may be affordable, adding a
whole new Medicaid category is seen as too expensive.
There is a simpler, and less expensive way to address the problem:
restore the pre-1996 Medicaid eligibility.
We must restore health care benefits to those with disabilities who
need them and should be eligible for them.
The gap month is not a difficult problem to fix.
A solution only requires our attention and our commitment to
protecting the health care safety net. My bill does that by ensuring
Medicaid helps cover those facing unexpected disability.
I urge my colleagues to join me in support of this legislation.
I ask unanimous consent that the text of the bill be printed in the
Record.
There being no objection, the bill was ordered to be printed in the
Record, as follows:

S. 1831

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Strengthen Social Security
and Medicare Act of 1999.''

SEC. 2. FINDINGS AND PURPOSE.

(a) Findings.--The Congress finds that:
(1) The Social Security system is one of the cornerstones
of American national policy and has allowed a generation of
Americans to retire with dignity. For 30 percent of all
senior citizens, Social Security benefits provide almost 90
percent of their retirement income. For 66 percent of all
senior citizens, Social Security benefits provide over half
of their retirement income. Poverty rates among the elderly
are at the lowest level since the United States began to keep
poverty statistics, due in large part to the Special Security
system. The Social Security system, together with the
additional protections afforded by the Medicare system, have
been an outstanding success for past and current retirees and
must be preserved for future retirees.

[[Page S13554]]

(2) The long-term solvency of the Social Security and
Medicare trust funds is not assured. There is an estimated
long-range actuarial deficit in the Social Security trust
funds. According to the 1999 report of the Board of Trustees
of the Social Security trust funds, the accumulated balances
in the Federal Old-Age and Survivors Insurance Trust Fund and
the Federal Disability Insurance Trust Fund are currently
projected to become unable to pay benefits in full on a
timely basis starting in 2034. The Medicare system faces more
immediate financial shortfalls, with the Hospital Insurance
Trust Fund projected to become exhausted in 2015.
(3) In addition to preserving Social Security and Medicare,
the Congress and the President have a responsibility to
future generations to reduce the Federal debt held by the
public. Significant debt reduction will contribute to the
economy and improve the Government's ability to fulfill its
responsibilities and to face future challenges, including
preserving and strengthening Social Security and Medicare.
(4) The Federal Government is now in sound financial
condition. The Federal budget is projected to generate
significant surpluses. In fiscal years 1998 and 1999, there
were unified budget surpluses--the first consecutive
surpluses in more than 40 years. Over the next 15 years, the
Government projects the on-budget surplus, which excludes
Social Security, to total $2.9 trillion. The unified budget
surplus (including Social Security) is projected by the
Government to total $5.9 trillion over the next 15 years.
(5) The surplus, excluding Social Security, offers an
unparalleled opportunity to: preserve Social Security;
protect, strengthen, and modernize Medicare; and
significantly reduce the Federal debt held by the public, for
the future benefit of all Americans.
(b) Purpose.--It is the purpose of this Act to protect the
Social Security surplus for debt reduction, to extend the
solvency of Social Security, and to set aside a reserve to be
used to protect, strengthen, and modernize Medicare.

SEC. 3. ADDITIONAL APPROPRIATIONS TO FEDERAL OLD-AGE AND
SURVIVORS INSURANCE TRUST FUND AND FEDERAL
DISABILITY INSURANCE TRUST FUND.

(a) Purpose.--The purpose of this section is to assure that
the interest savings on the debt held by the public achieved
as a result of Social Security surpluses from 2000 to 2015
are dedicated to Social Security solvency.
(b) Additional Appropriation to Trust Funds.--Section 201
of the Social Security Act is amended by adding at the end
the following new subsection:
``(n) Additional Appropriation to Trust Funds.
``(1) In addition to the amounts appropriated to the Trust
Funds under subsections (a) and (b), there is hereby
appropriated to the Trust Funds, out of any moneys in the
Treasury not otherwise appropriated--
``(A) for the fiscal year ending September 30, 2011, and
for each fiscal year thereafter through the fiscal year
ending September 30, 2016, an amount equal to the prescribed
amount for the fiscal year; and
``(B) for the fiscal year ending September 30, 2017, and
for each fiscal year thereafter through the fiscal year
ending September 30, 2044, an amount equal to the prescribed
amount for the fiscal year ending September 30, 2016.
``(2) The amount appropriated by paragraph (1) in each
fiscal year shall be transferred in equal monthly
installments.
``(3) The amount appropriated by paragraph (1) in each
fiscal year shall be allocated between the Trust Funds in the
same proportion as the taxes imposed by chapter 21 (other
than sections 3101(b) and 3111(b)) of Title 26 with respect
to wages (as defined in section 3121 of Title 26) reported to
the Secretary of the Treasury or his delegate pursuant to
subtitle F of Title 26, and the taxes imposed by chapter 2
(other than section 1401(b)) of Title 26 with respect to
self-employment income (as defined in section 1402 of Title
26) reported to the Secretary of the Treasury or his delegate
pursuant to subtitle F of Title 26, are allocated between the
Trust Funds in the calendar year that begins in the fiscal
year.
``(4) For purposes of this subsection, the ``prescribed
amount'' for any fiscal year shall be determined by
multiplying:
``(A) the excess of:
``(i) the sum of:
``(I) the face amount of all obligations of the United
States held by the Trust Funds on the last day of the fiscal
year immediately preceding the fiscal year of determination
purchased with amounts appropriated or credited to the Trust
Funds other than any amount appropriated under paragraph (1);
and
``(II) the sum of the amounts appropriated under paragraph
(1) and transferred under paragraph (2) through the last day
of the fiscal year immediately preceding the fiscal year of
determination, and an amount equal to the interest that would
have been earned thereon had those amounts been invested in
obligations of the United States issued directly to the Trust
Funds under subsections (d) and (f),

``over--
``(ii) the face amount of all obligations of the United
States held by the Trust Funds on September 30, 1999,

``times--
``(B) a rate of interest determined by the Secretary of the
Treasury, at the beginning of the fiscal year of
determination, as follows:
``(i) if there are any marketable interest-bearing
obligations of the United States then forming a part of the
public debt, a rate of interest determined by taking into
consideration the average market yield (computed on the basis
of daily closing market bid quotations or prices during the
calendar month immediately preceding the determination of the
rate of interest) on such obligations; and
``(ii) if there are no marketable interest-bearing
obligations of the United States then forming in part of the
public debt, a rate of interest determined to be the best
approximation of the rate of interest described in clause
(i), taking into consideration the average market yield
(computed on the basis of daily closing market bid quotations
or prices during the calendar month immediately preceding the
determination of the rate of interest) on investment grade
corporate obligations selected by the Secretary of the
Treasury, less an adjustment made by the Secretary of the
Treasury to take into account the difference between the
yields on corporate obligations comparable to the obligations
selected by the Secretary of the Treasury and yields on
obligations of comparable maturities issued by risk-free
government issuers selected by the Secretary of the
Treasury.''.

SEC. 4. PROTECTION OF SOCIAL SECURITY SURPLUSES.

(a) Points of Order To Protect Social Security Surpluses.--
Section 312 of the Congressional Budget Act of 1974 is
amended by adding at the end the following new subsection:
``(g) Points of Order To Protect Social Security
Surpluses.--
``(1) Concurrent resolutions on the budget.--It shall not
be in order in the House of Representatives or the Senate to
consider any concurrent resolution on the budget, or
conference report thereon or amendment thereto, that would
set forth an on-budget deficit for any fiscal year.
``(2) Subsequent legislation.--It shall not be in order in
the House of Representatives or the Senate to consider any
bill, joint resolution, amendment, motion, or conference
report if--
``(A) the enactment of the bill or resolution as reported;
``(B) the adoption and enactment of that amendment; or
``(C) the enactment of that bill or resolution in the form
recommended in that conference report,

would cause or increase an on-budget deficit for any fiscal
year.
``(3) Budget resolution baseline.--(A) For purposes of this
section, ``set forth an on-budget deficit'', with respect to
a budget resolution, means the resolution sets forth an on-
budget deficit for a fiscal year and the baseline budget
projection of the surplus or deficit for such fiscal year on
which such resolution is based projects an on-budget surplus,
on-budget balance, or an on-budget deficit that is less than
the deficit set forth in the resolution.
``(B) For purposes of this section, ``cause or increase an
on-budget deficit'' with respect to legislation means causes
or increases an on-budget deficit relative to the baseline
budget projection.
``(C) For purposes of this section, the term ``baseline
budget projection'' means the projection described in section
257 of the Balance Budget and Emergency Deficit Control Act
of 1985 of current year levels of outlays, receipts, and the
surplus or deficit into the budget year and future years,
except that--
``(i) if outlays for programs subject to discretionary
appropriations are subject to discretionary statutory
spending limits, such outlays shall be projected at the level
of any applicable current adjusted statutory discretionary
spending limits:
``(ii) if outlays for programs subject to discretionary
appropriations are not subject to discretionary spending
limits, such outlays shall be projected as required by
section 257 beginning in the first fiscal year following the
last fiscal year in which such limits applied; and
``(iii) with respect to direct spending or receipts
legislation previously enacted during the current calendar
year and after the most recent baseline estimate pursuant to
section 257 of the Balance Budget and Emergency Deficit
Control Act of 1995, the net extent (if any) by which all
such legislation is more than fully paid for in one of the
applicable time periods shall count as a credit for that time
period against increase in direct spending or reductions in
net revenue.''.
(b) Content of Concurrent Resolution on the Budget.--
Section 301(a) of the Congressional Budget Act of 1974 is
amended by redesignating paragraphs (6) and (7) as paragraphs
(7) and (8), respectively, and by inserting after paragraph
(5) the following new paragraph.
``(6) the receipts, outlays, and surplus or deficit in the
Federal Old-Age and Survivors Insurance Trust Fund and the
Federal Disability Insurance Trust Fund, combined,
established by title II of the Social Security Act;''.
(c) Super Majority Requirement.--
(1) Section 904(c)(1) of the Congressional Budget Act of
1974 is amended by inserting ``312(g),'' after
``310(d)(2),''.
(2) Section 904(d)(2) of the Congressional Budget Act of
1974 is amended by inserting ``312(g),'' after
``310(d)(2),''.

SEC. 5. PROTECTION OF MEDICARE.

(a) Points or Order To Protect Medicare.--

[[Page S13555]]

(1) Section 301 of the Congressional Budget Act of 1974 is
amended by adding at the end the following:
``(j) Points or Order To Protect Medicare.--
(1) In general.--It shall not be in order in the House of
Representatives or the Senate to consider any concurrent
resolution on the budget (or amendment, motion, or conference
report on the resolution) that would decrease the on-budget
surplus for the total of the period of fiscal years 2000
through 2009 below the level of the Medicare surplus reserve
for those fiscal years are calculated in accordance with
section 3(11).
``(2) Inapplicability.--This subsection shall not apply to
legislation that--
``(A) appropriates a portion of the Medicare reserve for
new amounts for prescription drug benefits under the Medicare
program as part of or subsequent to legislation extending the
solvency of the Medicare Hospital Insurance Trust Fund; or
``(B) appropriates new amounts from the general fund to the
Medicare Hospital Insurance Trust Fund.''.
(2) Section 311(a) of the Congressional Budget Act of 1974
is amended by adding at the end the following:
``(4) Enforcement of the medicare surplus reserve.--
``(A) In general.--It shall not be in order in the House of
Representatives or the Senate to consider any bill, joint
resolution, amendment, motion, or conference report that
together with associated interest costs would decrease the
on-budget surplus for the total of the period of fiscal years
2000 through 2009 below the level of the Medicare surplus
reserve for those fiscal years as calculated in accordance
with section 3(11).''.
``(B) Inapplicability.--This paragraph shall not apply to
legislation that--
``(i) appropriates a portion of the Medicare reserve for
new amounts for prescription drug benefits under the Medicare
program as part of or subsequent to legislation extending the
solvency of the Medicare Hospital Insurance Trust Fund; or
``(ii) appropriates new amounts from the general fund to
the Medicare Hospital Insurance Trust Fund.
(b) Definition.--Section 3 of the Congressional Budget Act
of 1974 is amended by adding at the end the following:
``(11) The term `Medicare surplus reserve' means one-third
of any on-budget surplus for the total of the period of the
fiscal years 2000 through 2009, an estimated by the
Congressional Budget Office in the most recent initial report
for a fiscal year pursuant to section 202(e).''.
(c) Super Majority Requirement--
(1) Section 904(c)(2) of the Congressional Budget Act of
1974 is amended by inserting ``301(j),'' after ``301(i),''.
(2) Section 904(d)(3) of the Congressional Budget Act of
1974 is amended by inserting ``301(j),'' after ``301(i),''.

SEC. 6. EXTENSION OF DISCRETIONARY SPENDING LIMITS.

(a) Extension of Limits.--Section 251(b)(2) of the Balanced
Budget and Emergency Deficit Control Act of 1985 is amended,
in the matter before paragraph (A), by deleting ``2002'', and
inserting ``2014''.
(b) Extension of Amounts.--Section 251(c) of the Balanced
Budget and Emergency Deficit Control Act of 1985 is amended
by striking paragraphs (4), (5), (6) and (7), and inserting
the following:
``(4) With respect to fiscal year 2000,
``(A) for the discretionary category: $535,368,000,000 in
new budget authority and $543,257,000,000 in outlays;
``(B) for the highway category: $24,574,000,000 in outlays;
``(C) for the mass transit category: $4,117,000,000 in
outlays; and
``(D) for the violent crime reduction category:
$4,500,000,000 in new budget authority and $5,564,000,000 in
outlays;
``(5) With respect to fiscal year 2001,
``(A) for the discretionary category: $573,004,000,000 in
new budget authority and $564,931,000,000 in outlays;
``(B) for the highway category: $26,234,000,000 in outlays;
and
``(C) for the mass transit category: $4,888,000,000 in
outlays;
``(6) With respect to fiscal year 2002,
``(A) for the discretionary category: $584,754,000,000 in
new budget authority and $582,516,000,000 in outlays;
``(B) for the highway category: $26,655,000,000 in outlays;
and
``(C) for the mass transit category: $5,384,000,000 in
outlays;
``(7) With respect to fiscal year 2003,
``(A) for the discretionary category: $590,800,000,000 in
new budget authority and $587,642,000,000 in outlays;
``(B) for the highway category: $27,041,000,000 in outlays;
and
``(C) for the mass transit category: $6,124,000,000 in
outlays;
``(8) With respect to fiscal year 2004, for the
discretionary category: $604,319,000,000 in new budget
authority and $634,039,000,000 in outlays;
``(9) With respect to fiscal year 2005, for the
discretionary category: $616,496,000,000 in new budget
authority and $653,530,000,000 in outlays;
``(10) With respect to fiscal year 2006, for the
discretionary category: $630,722,000,000 in new budget
authority and $671,530,000,000 in outlays;
``(11) With respect to fiscal year 2007, for the
discretionary category: $644,525,000,000 in new budget
authority and $687,532,000,000 in outlays;
``(12) With respect to fiscal year 2008, for the
discretionary category: $663,611,000,000 in new budget
authority and $704,534,000,000 in outlays; and
``(13) With respect to fiscal year 2009, for the
discretionary category: $678,019,000,000 in new budget
authority and $721,215,000,000 in outlays, ``as adjusted in
strict conformance with subsection (b).
``With respect to fiscal year 2010 and each fiscal year
thereafter, the term ``discretionary spending limit'' means,
for the discretionary category, the baseline amount
calculated pursuant to the requirements of Section 257(c), as
adjusted in strict conformance with subsection (b).''.

SEC. 7. EXTENSION AND CLARIFICATION OF PAY-AS-YOU-GO
REQUIREMENT.

Section 252 of the Balanced Budget And Emergency Deficit
Control Act of 1985 is amended--
(a) in subsection (a), by striking ``October 1, 2002'' and
inserting ``October 1, 2014'' and by adding ``or decreases
the surplus'' after ``increases the deficit''; (b)(1) in
paragraph (1) of subsection (b), by striking ``October 1,
2002'' and inserting ``October 1, 2014'' and by adding
``or any net surplus decrease'' after ``any net deficit
increase'';
(2) in paragraph (2) of subsection (b),
(i) in the header by adding ``or surplus decrease'' after
``deficit increase'';
(ii) in the matter before subparagraph (A), by adding ``or
surplus'' after ``deficit''; and
(iii) in subparagraph (C), by adding ``or surplus'' after
``net deficit''; and
(3) in the header of subsection (c), by adding ``or surplus
decrease'' after ``deficit increase''.

SEC. 8. EXTENSION OF BALANCED BUDGET AND EMERGENCY DEFICIT
CONTROL ACT.

Section 275(b) of the Balanced Budget and Emergency Deficit
Control Act of 1985 is amended by striking ``September 30,
2002'' and inserting ``September 30, 2104'' and by striking
``September 30, 2006'' and inserting ``September 30, 2018''.

SEC. 9. EXTENSION OF SOCIAL SECURITY FIREWALL IN
CONGRESSIONAL BUDGET ACT.

Section 904(e) of the Congressional Budget Act of 1974 is
amended by striking ``September 30, 2002'' and inserting
``September 30, 2014''.

SEC. 10. PROTECTION OF SOCIAL SECURITY INTEREST SAVINGS
TRANSFERS.

(a) Definition of Deficit and Surplus Under Budget
Enforcement Act.--Section 250(c) of the Balanced Budget and
Emergency Deficit Control Act of 1985 is amended in paragraph
(1) by adding `` `surplus','' before ``and `deficit' ''.
(b) Reduction or Reversal of Social Security Transfers Not
To Be Counted as Pay-As-You-Go Offset.--Any legislation that
would reduce, reverse or repeal the transfers to the Federal
Old-Age and Survivors Insurance Trust Fund and the Federal
Disability Insurance Trust Fund made by Section 201(n) of the
Social Security Act, as added by Section 3 of this Act, shall
not be counted on the pay-as-you-go scorecard and shall not
be included in any pay-as-you-go estimates made by the
Congressional Budget Office or the Office of Management and
Budget under Section 252 of the Balanced Budget and Emergency
Deficit Control Act of 1985.
(c) Conforming Change.--Section 252 of the Balanced Budget
and Emergency Deficit Control Act of 1985 is amended, in
paragraph (4) of subsection (d), by--
(1) striking ``and'' after subparagraph (A),
(2) striking the period after the subparagraph (B) and
inserting ``; and'', and
(3) adding the following:
``(C) provisions that reduce, reverse or repeal transfers
under Section 201(n) of the Social Security Act.''.

SEC. 11. CONFORMING CHANGES.

(a) Reports.--Section 254 of the Balanced Budget and
Emergency Deficit Control Act of 1985 is amended--
(1) in paragraph (3) of subsection (c),
(A) in subparagraph (A), by adding ``or surplus'' after
``deficit'';
(B) in subparagraph (B), by adding ``or surplus'' after
``deficit''; and
(C) in subparagraph (C), by adding ``or surplus decrease''
after ``deficit increase'';
(2) in paragraph (4) of subsection (f), by adding ``or
surplus'' after ``deficit''; and
(3) in subparagraph A of paragraph (2) of subsection (f),
by striking ``2002'' and inserting ``2009''.
(b) Orders.--Section 258A(a) of the Balanced Budget and
Emergency Deficit Control Act of 1985 is amended in the first
sentence by adding ``or increase the surplus'' after
``deficit''.
(c) Process.--Section 258(C)(a) of the Balanced Budget and
Emergency Deficit Control Act of 1985 is amended--
(1) in paragraph (2), by adding ``or surplus increase''
after ``deficit reduction'';
(2) in paragraph (3), by adding ``or increase in the
surplus'' after ``reduction in the deficit''; and
(3) in paragraph (4), by adding ``or surplus increase''
after ``deficit reduction''.
______

By Mr. LEAHY:
S. 1835. A bill to restore Federal remedies for violations of
intellectual property rights by States, and for other purposes; to the
Committee on the Judiciary.

the intellectual property protection restoration of 1999

Mr. LEAHY. Mr. President, today I am introducing the Intellectual
Property Protection Restoration Act of

[[Page S13556]]

1999, a bill to restore federal remedies for violations of intellectual
property rights of States.
Innvoation and creativity have been the fuel of our national economic
boom over the past decade. The United States now leads the world in
computing, communications and biotechnologies, and American authors and
brand names are recognized across the globe.
Our national prosperity is, first and foremost, a tribute to American
ingenuity. But it is also a tribute to the wisdom of our Founding
Fathers, who made the promotion of what they called ``Science and the
Useful Arts'' a national project, which they constitutionally assigned
to Congress. And it is no less of a tribute to the successive
Congresses and Administrations of both parties who have striven to
provide real incentives and rewards for innovation and creativity by
providing strong and even-handed protection to intellectual property
rights. Congress passed the first federal patent law in 1790, and the
U.S. Government issued its first patent the same year--to Samuel
Hopkins of my home State of Vermont. The first federal copyright law
was also enacted in 1790, and the first federal trademark laws date
back to the 1870s.
The Supreme Court has long recognized that intellectual property
rights bear the hallmark of true constitutional property rights--the
right of exclusion against the world--and are therefore protection
against appropriation both by individuals and by government. Consistent
with this understanding of intellectual property, Congress has long
ensured that the rights secured by the federal intellectual property
laws were enforceable against the federal governments by waiving the
government's immunity in suits alleging infringements of those rights.
No doubt Congress would have legislated similarly with respect to
infringements by State entities and bureaucrats had there been any
doubt that they were already fully subject to federal intellectual
property laws. But there was no doubt. States had long enjoyed the
benefits of the intellectual property laws on an equal footing with
private parties. By the same token, and in accordance with the
fundamental principles of equity on which our intellectual property
laws are founded, the States bore the burdens of the intellectual
property laws, being liable for infringements just like private
parties. States were free to join intellectual property markets as
participants, or to hold back from commerce and limit themselves to a
narrower governmental role. The intellectual property right of
exclusion meant what it said and was enforced evenhandley for public
and private entities alike.
This harmonious state of affairs ended in 1985, with the Supreme
Court's announced of the so-called ``clear statement'' rule in
Atascadero State Hospital v. Scanlon. The Court in Atascadero held that
Congress must express its intention to abrogate the States' Eleventh
Amendment immunity ``in unmistakable language in the statute itself.''
A few years later, in Pennsylvania v. Union Gas Co., the Supreme Court
assured us that if the intent to abrogate were expressed clearly
enough, it would be honored.
Following Atascadero, some courts held that States and State entities
and officials could escape liability for patent, copyright and
trademark infringement because the patent, copyright and trademark laws
lacked the clear statement of congressional intent that was now
necessary to abrogate State sovereign immunity.
To close this new loophole in the law, Congress promptly did
precisely what the Supreme Court had told us was necessary. In 1990 and
1992, Congress passed three laws--the Patent and Plant Variety
Protection Remedy Clarification Act, the Copyright Remedy Clarification
Act, and the Trademark Remedy Clarification Acts. The sole purpose of
these Clarification Acts was to make it absolutely, unambiguously, 100
percent clear that Congress intended the patent, copyright and
trademark laws to apply to everyone, including the States, and that
Congress did not intend the States to be immune from liability for
money damages. Each of three Clarification Acts passed unanimously.
In 1996, however, by a five-to-four-vote, the Supreme Court in
Seminole Tribe of Florida v. Florida reversed its earlier decision in
Union Gas and held that Congress lacked authority under article I of
the Constitution to abrogate the States' Eleventh Amendment immunity
from suit in federal court.
Then, on June 23, by the same bare majority, the Supreme Court in
Florida Prepaid Postsecondary Education Expense Board v. College
Savings Bank told us that it did not really mean what it said in
Atascadero and invalidated the Patent and Plant Variety Protection
Remedy Clarification Act. In a companion case decided on the same day,
the same five Justices held that the Trademark Remedy Clarification Act
also failed to abrogate State sovereign immunity.
The Court's latest decisions have been the subject of bipartism
criticism. In a floor statement on July 1, I highlighted the anti-
democratic implications of the approach of the activist majority of the
Supreme Court, who have left constitutional text behind, ripped up
precedent, and treated Congress with less respect than that due to an
administrative agency in their haste to impose their natural laws
notions of sovereignty as a barrier to democratic regulations. I also
noted that ``the Court's decisions will have far-reaching consequences
about how . . . intellectual property rights may be protected against
even egregious infringements and violation by the State.''
One of my Republican colleagues on the Judicial Committee, Senator
Specter, expressed similar concerns in a floor statement on August 5.
He noted that the Court decisions ``leave us with an absurd and
untenable state of affairs,'' where ``States will enjoy an enormous
advantage over their private sector competitions.''
Not surprisingly, alarm has also been expressed in the business
community about the potential of the Court's recent decisions to harm
intellectual property owners in a wide variety of ways. A commentary in
Business Week on August 2, 1999, gave these examples:

Watch out if you publish software that someone at a State
university wants to copy for free . . . Watch out if you own
a patent on a medical procedure that some doctor in a State
medical school wants to use. Watch out if you've invested
heavily in a great trademark, like Nike's Swoosh, and a
bureaucrat decides his State program would be wildly promoted
if it used the same mark.

Charles Fried, a professor at Harvard Law School and former Solicitor
General during the Reagan Administration, has called the Court's
decisions in Florida Prepaid and College Savings Bank ``truly
bizarre.'' He observed, in a July 6 opinion editorial in the New York
Times:

[The Court's decisions] did not question that States are
subject to the patent and trademark laws of the United
States. It's just that when a State violates those laws--as
when it uses a patented invention without permission and
without paying for it--the patent holder cannot sue the State
for infringement. So a State hospital can manufacture
medicines patented by others and sell or use them, and State
schools universities can pirate textbooks and software, and
the victims cannot sue for infringement.

I believe that these concerns are very real. As Congress realized
when it waived federal sovereign immunity in the area, it would be
naive to imagine that reliance on the commercial decency of the
government and its myriad agencies and officials would provide the
security needed to promote investment in research and development and
to facilitate negotiation in the exclusive licensing arrangements that
are often necessary to bring valuable products and creations to market.
The issue is not whether State infringement has been frequent in the
past, but rather whether we can assure American inventors and investors
and our design trading partners that, as State involvement in
intellectual property becomes ever greater in the new information
economy, U.S. intellectual property rights are backed by guaranteed
legal remedies. It is a question of economics: our national economy
depends on real and effective intellectual property rights. It is also
a question of justice: in conceding that the States are
constitutionally bound to respect federal intellectual property rights
but invalidating the remedies Congress has created to enforce those
rights, the Court has jeopardized one of the key principles that
distinguishes our Constitution from the Constitution of the old Soviet
Union--the principle that where there is a right, there must also be a
remedy.

[[Page S13557]]

Some have suggested that a constitutional amendment may be the only
way to restore protection to patent, copyright and trademark owners as
against States. But even if Congress were to adopt such an amendment, I
do not expect that we will see a lot of States rushing to ratify an
amendment that forces them to pay for things that they can currently
get for free.
Fortunately, however, while the implications of the Court's decisions
for our constitutional scheme are serious, we can restore the
guarantees of our intellectual property laws without resorting to a
constitutional amendment. After close consideration of Florida Prepaid
and the other recent Supreme Court precedents, I have no doubt that
they leave several constitutional mechanisms open to us to restore
substantial protection for patents, copyrights and trademarks through
ordinary legislation. The Supreme Court's hyper-technical
constitutional interpretations require us to jump through some
technical constitutional hoops of our own, but that the exercise is now
not merely worthwhile, but essential to safeguard both U.S. prosperity
and the continued authority of Congress.
The Intellectual Property Protection Restoration Act is based on a
simple supposition--that there is no inherent entitlement to federal
intellectual property rights. In discussing the policies underlying the
patent laws, the Supreme Court has emphasized that ``[t]he grant of a
patent is the grant of a special privilege `to promote the Progress of
Science and useful Arts,' '' and that ``[i]t is the public interest
which is dominant in the patent system.'' Similarly, in discussing the
copyright laws, the Court has underscored that ``the monopoly
privileges that Congress has authorized, while `intended to motivate
the creative activity of authors and inventors by the provision of a
special reward,' are limited in nature and must ultimately serve the
public good.''
The Constitution empowers but does not require Congress to make
intellectual property rights available, and Congress should do so on in
a manner that encourages and protects innovation in the public and
private sector alike.
States and their institutions, especially State universities, benefit
hugely from the federal intellectual property laws. All 50 States own
or have obtained patents--some hold many hundreds of patents. States
also hold other intellectual property rights secured by federal law,
and the trend is toward increased participation by the States in
commerce involving intellectual property rights.
Principles of State sovereignty tell us that States are entitled to a
free and informed choice of whether or not to participate in the
federal intellectual property schemes, subject only to their
constitutional obligations. Equity and common sense tell us that one
who chooses to enjoy the benefits of a law--whether it be a federal
grant or the multimillion-dollar benefits of intellectual property
protections--should also bear its burdens. Sound economics and
traditional notions of federalism tell us that it is appropriate for
the federal government to assist and encourage the sovereign States in
their sponsorship of whatever innovation and creation they freely
choose to sponsor by giving them intellectual property protection and,
on occasion, funding, so long as the States reciprocate by assisting
the federal governments to keep its promise of guaranteed exclusive
rights to intellectual property owners.
The IPPRA builds on these principles. In order to promote cooperative
federalism in the intellectual property arena, it provides a mechanism
for States to affirm their willingness to participate in our national
intellectual property project and so ``opt in'' as full and
equal participants. A State would opt in to the federal intellectual
property system every time it applied for protection under a federal
intellectual property law, by promising to waive its sovereign immunity
from any subsequent suit against the State arising under such a law.

States take their commitments seriously. We can therefore expect that
a State, having promised to waive its immunity if called upon to do so,
would take whatever steps were necessary to fulfill that promise. At
least in theory, however, a State could assert its immunity regardless
of any assurance to the contrary.
The IPPRA addresses this problem by conditioning a State's
intellectual property rights on its adherence to its promise to waive
immunity. Thus, a State's refusal to waive immunity in an intellectual
property suit after it has accepted benefits under an intellectual
property law would have a number of consequences. Most significantly,
it would give private parties the right to assert an immunity-like
defense to damages claims in any action to enforce an intellectual
property right that is or has been owned by the State during the five
years preceding the State's assertion of immunity. This quid pro quo
provision restores the level playing field by putting States that
assert immunity in essentially the same position as private parties who
seek to endorse federal intellectual property rights against them.
The IPPRA does this without coercing the State to waive by
threatening pre-existing benefits. The quid pro quo provision only
affects those intellectual property rights that the State acquired by
virtue of its promise to waive immunity. To ensure that State waivers
are voluntary, State intellectual property rights that pre-date the
passage of the IPPRA are preserved regardless of waiver.
This scheme is consistent with the spirit of federalism, as
interpreted by the Supreme Court, because it gives the States a free,
informed and meaningful choice to waive or not to waive immunity at any
time. It is also plainly authorized by the letter of the Constitution.
Article I empowers Congress to ``promote the Progress of Science and
useful Arts, by securing for limited Times to Authors and Inventors the
exclusive Right to their respective Writings and Discoveries.''
Incident to this power, Congress may attach conditions on the receipt
of exclusive intellectual property rights. Indeed, we have always
attached certain conditions, such as the requirements of public
disclosure of an invention at the Patent and Trademark Office in order
to obtain a patent.
Congress may attach conditions on States' receipt of federal
intellectual property protection under its Article I intellectual
property power just as Congress may attach conditions on States'
receipt of federal funds under its Article I spending power. Either
way, the power to attach conditions to the federal benefit is an
integral part of the greater power to deny the benefit altogether.
Either way, States have a choice--to forgo the federal benefit and
exercise their sovereign power however they wish subject to the
Constitution, or to take the benefit and exercise their sovereign power
in the manner requested by Congress. In South Dakota v. Dole, for
example, the Supreme Court held that Congress may condition federal
highway funds on a State's agreement to raise its minimum drinking age
to 21. The condition imposed on receipt of federal benefits by the
IPPRA--submitting to suit under laws that are already binding on the
States--is not onerous, nor does it co-opt any State resources to the
service of federal policy.
Given the choice between opting in to the intellectual property laws
and forgoing intellectual property protection under the federal laws,
most States are likely to choose to former. The benefits secured by
those laws far outweigh the burdens. Most States already respect
intellectual property rights and will seldom find themselves in
infringement suits. To deny the States the choice that the IPPRA offers
them would amount to penalizing States that play by the federal
intellectual property rules for the free-riding violations of the
minority of States that refuse to commit to do so. As is normally the
case in a federal system, cooperation between the States and the
federal government is likely to be beneficial to all concerned.
However, some States and some State entities and officials have
infringed patents and violated other intellectual property rights in
the past, and the massive growth of both intellectual property and
State participation in intellectual property that we are seeing as we
move into the next century give ample cause for concern that such
violations will continue. Now that the Supreme Court has seemingly
given States and State entities carte

[[Page S13558]]

blanche to violate intellectual property rights free from any adverse
financial consequences so long as they stand on their newly augmented
sovereign immunity, the prospect of States violating federal law and
then asserting immunity is too serious to ignore.
The IPPRA therefore also provides for the limited set of remedies
that the Supreme Court's new jurisprudence leaves available to Congress
to enforce a non-waiving State's obligations under federal law and the
United States Constitution. The key point here is that, while the Court
struck down our prior effort to enforce the intellectual property laws
themselves by authorizing actions for damages against the States, it
nonetheless acknowledged Congress' power to enforce constitutional
rights related to intellectual property.
First, for the avoidance of doubt, the IPPRA ensures the full
availability of prospective equitable relief to prevent States from
violating or exceeding their rights under federal intellectual property
laws. As the Supreme Court expressly acknowledged in its Seminole Tribe
decision in 1996, such relief is available, notwithstanding any
assertion of State sovereign immunity, under what is generally known as
the doctrine of Ex parte Young.
Second, to address the harm done to the rights of intellectual
property owners before they can secure an injunction, the IPPA also
provides a damages remedy against non-consenting States, to the full
extent of Congress' power to enforce the constitutional rights of
intellectual property owners. Under the Supreme Court's recent
decisions, this remedy is necessarily limited to the redress of
constitutional violations, not violations of the federal intellectual
property laws themselves. However, as I have already noted, the Supreme
Court has reaffirmed on many occasions that the intellectual property
owner's right of exclusion is a property right fully protected from
governmental violation under the Fifth Amendment's Takings Clause and
under the Fourteenth Amendment's Due Process Clause.

Under the Fifth Amendment, a State can be sued for damages for taking
an intellectual property right. Although States can normally take a
property right constitutionally, so long as they do so for a ``public
purpose'' and provide ``just compensation,'' the Supreme Court held in
1984 that the ``public purpose'' requirement for a lawful taking means
that the taking must be a valid exercise of the State's eminent domain
powers. Because of the uniquely federal nature of federal intellectual
property rights of exclusion, States have no eminent domain or other
sovereign power over them. ``When Congress grants an exclusive right or
monopoly, its effects are pervasive; no citizen or State may escape its
reach.'' Therefore, every State taking of an intellectual property
right, with or without some promise of subsequent compensation, is a
constitutional violation ripe for congressional enforcement under
section five of the Fourteenth Amendment.
Stangely, and I think improperly, the Supreme Court declined to
decide in Florida Prepaid whether our earlier Clarification Acts could
be sustained as an enforcement of the Takings Clause. The Court also
did not resolve when a violation of intellectual property rights
amounts to an unconstitutional taking. Because the Court emphasized
that the resolution of such constitutional questions is its job, and
not ours, the IPPRA simply provides a federal cause of action for an
unconstitutional taking of intellectual property rights, leaving the
courts to make the final determination of what is a constitutional
violation and what remedy is constitutionally authorized. The IPPRA
does, however, instruct the courts to interpret both the right and the
remedy as broadly as constitutionally permissible. At the same time, by
excluding treble damages from the remedies provided and by adopting the
same standard of compensation--``reasonable and entire compensation''--
that is currently available against the federal government for patient
infringements, the bill respects the States' dignity and responds to
the Court's objection that the Clarification Acts provided identical
remedies against States and private parties.
Finally, in order to ensure the full availability of constitutionally
permissible remedies if the courts adopt a narrow view of the Takings
Clause in this context, the IPPRA adopts a similar approach in
providing the fullest remedies constitutionally available, up to and
including ``reasonable and entire compensation'' but excluding treble
damages, for State violations of a federal intellectual property
owner's Fourteenth Amendment right not to be deprived of her property
without due process of law.
In sum, the constitutional remedy provided by the IPPRA closely
resembles the remedy that Congress provided decades ago for
deprivations of federal rights by persons acting under color of State
law. The bill does not expand the property rights secured by the
federal intellectual property laws--these laws are already binding on
the States--nor does the bill interfere with any governmental authority
to regulate businesses that own such rights. It simply restores the
ability of private persons to sue in federal court to enforce such
rights against the States.
I view this bill as an exercise in cooperative federalism. Clear,
certain and uniform national rules protecting federal intellectual
property rights benefit everyone: consumers, businesses, the federal
government and the States. The IPPRA preserves States' rights, and
gives the States a free choice. At the same time, it ensures effective
protection for individual constitutional rights, and fills the gap left
by recent Supreme Court decisions in which there are federal rights
unsupported by effective remedies.
There are, to be sure, other approaches that Congress could take to
address the problems created by the Court's decisions. For example,
Congress could condition a State's receipt of federal funds--including
federal research funds used to generate intellectual property--on the
State's wavier of immunity from any suit arising under the federal
intellectual property laws. As I previously discussed, this approach is
squarely supported by the Court's decisions in the spending cases. In
my view, however, such an approach would be less respectful of State
sovereignty than the opt-in-scheme proposed by the IPPRA. It would also
impede the States' ability to conduct research in a manner that the
IPPRA would not.
There is another approach that remains open to Congress that would
provide a remedy for intellectual property owners against States,
respect State sovereignty, and restore some degree of uniformity and
consistency in the construction of the federal intellectual property
laws. That is, Congress could give State courts jurisdiction over
intellectual property suits or just compensation claims against the
States, and then require the United States Supreme Court to exercise
appellate review of the resulting State court judgment. There is no
possible constitutional objection to this approach; the Eleventh
Amendment does not defeat the Supreme Court's appellate jurisdiction
over suits brought against the States. We should not, however, burden
the Supreme Court in this manner when, as the IPPRA demonstrates, there
are efficient and proper ways to bring these claims into the lower
federal courts in which intellectual property expertise resides.
Intellectual property is the currency of the new global economy. As
we move into the 21st century, we should not allow that currency to be
devalued by abstruse 18th century legal formalities. For that reason, I
believe that legislation is imperative to minimize the ill effects of
the Supreme Court's latest attack on our ability to protect our
national economic assets. The IPPRA restores protection for violations
of intellectual property rights that may, under current law, go
unremedied, and so provides the certainty and security necessary to
foster innovation and creativity. We unanimously passed more sweeping
legislation earlier this decade, but were thwarted by Supreme Court
technicalities. The IPPRA is designed to restore the benefits we sought
to provide intellectual property owners while meeting the Supreme
Court's technical requirements. We should move to consider this
legislation as soon as we return next year.
I ask unanimous consent that the bill and a section-by-section
summary of the bill be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:

[[Page S13559]]

S. 1835

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; REFERENCES; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the
``Intellectual Property Protection Restoration Act of 1999''.
(b) References.--Any reference in this Act to the Trademark
Act of 1946 shall be a reference to the Act entitled ``An Act
to provide for the registration and protection of trade-marks
used in commerce, to carry out the provisions of certain
international conventions, and for other purposes'', approved
July 5, 1946 (15 U.S.C. 1051 et seq.).
(c) Table of Contents.--The table of contents for this Act
is as follows:

Sec. 1. Short title; references; table of contents.
Sec. 2. Findings and purposes.

TITLE I--STATE PARTICIPATION IN THE FEDERAL INTELLECTUAL PROPERTY
SYSTEM

Subtitle A--Definitions

Sec. 101. Definitions.

Subtitle B--Procedures for State Participation in the Federal
Intellectual Property System

Sec. 111. Opt-in procedure.
Sec. 112. Breach of assurance by a State.
Sec. 113. Consequences of breach of assurance by a State.

Subtitle C--Administration of Procedures for State Participation in the
Federal Intellectual Property System

Sec. 121. Notification by court of State assertion of sovereign
immunity.
Sec. 122. Confirmation by Commissioner of Patents and Trademarks of
State assertion of sovereign immunity.
Sec. 123. Publication by Commissioner of Patents and Trademarks of
State assertion of sovereign immunity.
Sec. 124. Rulemaking authority.

Subtitle D--Amendments to the Federal Intellectual Property Laws

Sec. 131. Conditions for State participation in the Federal patent
system.
Sec. 132. Conditions for State participation in the Federal plant
variety protection system.
Sec. 133. Conditions for State participation in the Federal copyright
system.
Sec. 134. Conditions for State participation in the Federal mask work
system.
Sec. 135. Conditions for State participation in the Federal original
design system.
Sec. 136. Conditions for State participation in the Federal trademark
system.
Sec. 137. No retroactive effect.

TITLE II--RESTORATION OF PROTECTION FOR FEDERAL INTELLECTUAL PROPERTY
RIGHTS

Sec. 201. Liability of States for patent violations.
Sec. 202. Liability of States for violation of plant variety
protection.
Sec. 203. Liability of States for copyright violations.
Sec. 204. Liability of States for mask work violations.
Sec. 205. Liability of States for original design violations.
Sec. 206. Liability of States for trademark violations.
Sec. 207. Rules of construction.

TITLE III--EFFECTIVE DATES

Sec. 301. Effective dates.
Sec. 302. Severability.

SEC. 2. FINDINGS AND PURPOSES.

(a) Findings.--Congress makes the following findings:
(1) The protection of Federal intellectual property rights
is of critical importance to the Nation's ability to compete
in the global market.
(2) There is a strong Federal interest in the development
of uniform and consistent law regarding Federal intellectual
property rights, and in the fulfillment of international
treaty obligations that the Federal Government has
undertaken.
(3) Prior to 1985 and the Supreme Court ruling in
Atascadero State Hospital v. Scanlon, 473 U.S. 234 (1985) (in
this section referred to as ``Atascadero''), owners of
Federal intellectual property rights could fully protect
their rights against infringement by States.
(4) Following Atascadero, a number of courts held that
Federal patent, copyright and trademark laws failed to
contain the clear statement of intent to abrogate State
sovereign immunity necessary to permit owners of Federal
intellectual property rights to protect their rights against
infringement by States.
(5) In 1990, Congress passed the Copyright Remedy
Clarification Act (Public Law 101-553), to clarify its intent
to abrogate State sovereign immunity from suits for
infringement of copyrights and exclusive rights in mask
works.
(6) In 1992, Congress passed the Patent and Plant Variety
Protection Remedy Clarification Act (Public Law 102-206) and
the Trademark Remedy Clarification Act (Public Law 102-542)
to clarify its intent to abrogate State sovereign immunity
from suits for infringement of patents, protected plant
varieties and trademarks.
(7) In 1996, the Supreme Court held in Seminole Tribe of
Florida v. Florida, 517 U.S. 44 (1996) (in this section
referred to as ``Seminole Tribe'') that Congress may not
abrogate State sovereign immunity under article I of the
United States Constitution. Under the Supreme Court decision
in Seminole Tribe, the Copyright Remedy Clarification Act,
the Patent and Plant Variety Protection Remedy Clarification
Act, and the Trademark Remedy Clarification Act could not be
sustained under clause 3 or 8 of section 8 of article I of
the United States Constitution.
(8) In 1999, the Supreme Court held in Florida Prepaid
Postsecondary Education Expense Board v. College Savings
Bank, 119 S. Ct. 2199 (1999) (in this section referred to as
``Florida Prepaid'') that the Patent and Plant Variety
Protection Remedy Clarification Act could not be sustained as
legislation enacted to enforce the guarantees of the due
process clause of the fourteenth amendment of the United
States Constitution.
(9) As a result of the Supreme Court's decision in Florida
Prepaid, and absent remedial legislation, a patent owner's
only remedy under the Federal patent laws against a State
infringer of a patent is prospective relief under the
doctrine of Ex parte Young, 209 U.S. 123 (1908).
(10) On the same day that it decided Florida Prepaid, the
Supreme Court in College Savings Bank v. Florida Prepaid
Postsecondary Education Expense Board, 119 S. Ct. 2219 (1999)
(in this section referred to as ``College Savings Bank'')
extended State sovereign immunity to purely commercial
activities of certain State entities.
(11) The Seminole Tribe, Florida Prepaid and College
Savings Bank decisions have the potential to--
(A) deprive private intellectual property owners of
effective protection for both their Federal intellectual
property rights and their constitutional rights under the
fifth and fourteenth amendments of the United States
Constitution; and
(B) compromise the ability of the United States to fulfill
its obligations under a variety of international treaties.
(12) Article I of the United States Constitution empowers,
but does not require, Congress to offer Federal intellectual
property protection to any person on such terms as appear
reasonable and appropriate to serve the public interest by
encouraging scientific and artistic innovation and promoting
commerce and fair competition.
(13) Congress can best accomplish the public interests
described under paragraph (12) by providing clear and certain
national rules protecting Federal intellectual property
rights that establish a level playing field for everyone,
including States.
(14) In recent years, States have increasingly elected to
avail themselves of the benefits of the Federal intellectual
property system by obtaining and enforcing Federal
intellectual property rights.
(15) Any State should continue to enjoy the benefits of the
Federal intellectual property system, if that State accepts
the burdens with the benefits.
(16) A State should not enjoy the benefits of the Federal
intellectual property laws unless it is prepared to have
those same laws enforced against that State.
(17) Limiting the ability of a State to enjoy the benefits
of the Federal intellectual property system will neither
prevent the State from providing any services to citizens of
that State, nor stop the State from engaging in any
commercial activity.
(18) If a State waives its sovereign immunity from suit
under the Federal intellectual property laws, any
constitutional violation resulting from its infringement of a
Federal intellectual property right may be remedied in an
infringement suit in Federal court.
(19) If a State does not waive sovereign immunity with
respect to Federal intellectual property laws, it is
necessary and appropriate for Congress to exercise its power
under section 5 of the fourteenth amendment to the United
States Constitution to protect the constitutional rights of
owners of Federal intellectual property rights, which are
property interests protected by the fifth and fourteenth
amendments of the United States Constitution.
(20) According to the Supreme Court in College Savings
Bank, ``The hallmark of a protected property interest is the
right to exclude others.''. Patents, copyrights, and
trademarks are constitutionally cognizable species of
property because they secure for their owners rights of
exclusion against others.
(21) A State may not exercise any of the rights conferred
by a Federal intellectual property law without the
authorization of the right holder, except in the manner and
to the extent authorized by such law. In Goldstein v.
California, 412 U.S. 546 (1973), the Supreme Court stated
``When Congress grants an exclusive right or monopoly, its
effects are pervasive; no citizen or State may escape its
reach.''.
(22) Because a State engaged in an infringing use of a
Federal intellectual property right is acting outside the
scope of its sovereign power, such State fails to meet the
public use requirement for a taking of property imposed by
the fifth amendment of the United States Constitution (made
applicable to the States through the fourteenth amendment).
(23) According to the Supreme Court in Hawaii Housing
Authority v. Midkiff, 467 U.S. 229 (1984), a claim for the
taking of property

[[Page S13560]]

in violation of the public use requirement is ripe at the
time of the taking.
(24) A violation of the Federal intellectual property laws
by a State may also constitute an unconstitutional
deprivation of property under the due process clause of the
fourteenth amendment of the United States Constitution.
(25) In order to enforce Federal intellectual property
rights against States under the fifth and fourteenth
amendments of the United States Constitution, it is
appropriate to provide a right to enjoin any continuing or
future constitutional violation and a right to recover
sufficient damages to make the injured party whole.
(26) Violations of the Federal intellectual property laws
by States not only impair the constitutional rights of the
individual intellectual property owner, but also discourage
technological innovation and artistic creation. Moreover, the
potential for future violations to go unremedied as a result
of State sovereign immunity prevents intellectual property
owners from securing fair and efficient fees in licensing
negotiations.
(27) States and instrumentalities of States have been
involved in many intellectual property cases. Some States
have violated Federal intellectual property rights and the
constitutional provisions which protect such rights and have
refused to waive their constitutional immunities, thereby
securing unfair economic advantages over other States and
private entities with whom such States may be in competition.
(28) States and instrumentalities of States have become
increasingly involved in commerce involving intellectual
property rights in recent years, and this trend is likely to
continue. As a result, violations of Federal intellectual
property rights by States have become increasingly more
widespread.
(29) It is not practical for Congress to engage in an
ongoing particularized inquiry as to which States are
violating the United States Constitution at any given time.
Accordingly, a national, uniform remedy for constitutional
violations is appropriate.
(b) Purposes.--The purposes of this Act are to--
(1) provide States an opportunity to participate in the
Federal intellectual property system on equal terms with
private entities;
(2) reaffirm the availability of prospective relief to
prevent State officials from violating Federal intellectual
property laws, and to allow challenges to assertions by State
officials of rights secured under such laws, on the same
terms and in the same manner as if such State officials were
private parties;
(3) provide other Federal remedies to owners of Federal
intellectual property rights as against the States, State
instrumentalities and State officials, to the maximum extent
permitted by the United States Constitution; and
(4) abrogate State sovereign immunity in suits alleging
violations of Federal intellectual property laws or
challenging assertions of Federal intellectual property
rights by States to the maximum extent permitted by the
United States Constitution, pursuant to Congress's powers
under the fifth and fourteenth amendments of the United
States Constitution and any other applicable provisions.

TITLE I--STATE PARTICIPATION IN THE FEDERAL INTELLECTUAL PROPERTY
SYSTEM

Subtitle A--Definitions

SEC. 101. DEFINITIONS.

In this title:
(1) Federal intellectual property law.--The term ``Federal
intellectual property law'' means a statute or regulation of
the United States that governs the creation or protection of
any form of intellectual property, including a patent,
protected plant variety, copyright, mask work, original
design, trademark, or service mark.
(2) Federal intellectual property right.--The term
``Federal intellectual property right'' means any of the
rights secured under a Federal intellectual property law.
(3) Federal intellectual property system.--The term
``Federal intellectual property system'' means the system
established under the Federal intellectual property laws for
protecting and enforcing Federal intellectual property
rights, including through the award of damages, injunctions,
and declaratory relief.

Subtitle B--Procedures for State Participation in the Federal
Intellectual Property System

SEC. 111. OPT-IN PROCEDURE.

(a) In General.--No State or any instrumentality of that
State may acquire a Federal intellectual property right
unless the State opts into the Federal intellectual property
system.
(b) Agreement To Waive Sovereign Immunity.--A State opts
into the Federal intellectual property system by providing an
assurance under the procedures established in subtitle D of
this title with respect to the State's agreement to waive
sovereign immunity from suit in Federal court in any action
against the State or any instrumentality or official of that
State--
(1) arising under a Federal intellectual property law; or
(2) seeking a declaration with respect to a Federal
intellectual property right.

SEC. 112. BREACH OF ASSURANCE BY A STATE.

(a) In General.--If a State asserts sovereign immunity
contrary to an assurance provided under the procedures
established in subtitle D of this title, such State shall be
deemed to have breached such assurance.
(b) Assertion of Immunity.--A State asserts sovereign
immunity for purposes of subsection (a) if--
(1) the State or any instrumentality or official of that
State is found to have asserted the State's sovereign
immunity in an action against the State or any
instrumentality or official of that State--
(A) arising under a Federal intellectual property law; or
(B) seeking a declaration with respect to a Federal
intellectual property right; and
(2) such State, instrumentality, or official does not,
within a period of 60 days after such finding, withdraw such
assertion of immunity and consent to the continuation or
refiling of the action in which the finding was made.
(c) Effective Date of Breach of Assurance.--A State shall
be deemed to have breached an assurance on the day after the
end of the 60-day period provided in subsection (b)(2).

SEC. 113. CONSEQUENCES OF BREACH OF ASSURANCE BY A STATE.

(a) Abandonment of Pending Applications.--Any application
by or on behalf of a State or any instrumentality or official
of that State for protection arising under a Federal
intellectual property law shall be regarded as abandoned and
shall not be subject to revival after the date referred to
under paragraph (2), if that application--
(1) contains an assurance provided under the procedures
established in subtitle D; and
(2) is pending on the date upon which such State is deemed
to have breached an assurance under section 112.
(b) Establishment of Defense to Liability.--
(1) In general.--No damages or other monetary relief shall
be awarded in any action to enforce a Federal intellectual
property right that is or has been owned by or on behalf of a
State or any instrumentality of that State at any time during
the 5-year period preceding the date upon which such State is
deemed to have breached an assurance under section 122.
(2) No retroactive effect.--The defense under paragraph (1)
shall not be available in any action to enforce a Federal
intellectual property right that was owned by or on behalf of
a State or an instrumentality of a State before the effective
date of this title.
(c) One-Year Bar on Acquisition of New Rights.--
(1) In general.--A State may not opt back into the Federal
intellectual property system under section 111 during the 1-
year period following the date upon which that State was
deemed to have breached an assurance under section 112.
(2) New rights unencumbered.--Federal intellectual property
rights acquired by or on behalf of a State or any
instrumentality or official of that State after the State has
opted back into the Federal intellectual property system
shall be unencumbered by any prior breach of an assurance.

Subtitle C--Administration of Procedures for State Participation in the
Federal Intellectual Property System

SEC. 121. NOTIFICATION BY COURT OF STATE ASSERTION OF
SOVEREIGN IMMUNITY.

Not later than 20 days after any finding by a Federal court
that a State or any instrumentality or official of that State
has asserted the State's sovereign immunity from suit in that
court in an action against the State or any instrumentality
or official of that State arising under a Federal
intellectual property law, or seeking a declaration with
respect to a Federal intellectual property right, the clerk
of the court shall notify the Commissioner of Patents and
Trademarks. The clerk shall send with the notification a copy
of any order, judgment, or written opinion of the court.

SEC. 122. CONFIRMATION BY COMMISSIONER OF PATENTS AND
TRADEMARKS OF STATE ASSERTION OF SOVEREIGN
IMMUNITY.

Not later than 20 days after receiving a notification under
section 121, the Commissioner of Patents and Trademarks
shall--
(1) forward such notification to the attorney general of
the State whose sovereign immunity has been found to have
been asserted, together with a copy of this title; and
(2) inquire of the attorney general whether the State
intends to withdraw such assertion of immunity and consent to
the continuation or refiling of the action in which the
finding was made within the 60-day period provided in section
112(b)(2).

SEC. 123. PUBLICATION BY COMMISSIONER OF PATENTS AND
TRADEMARKS OF STATE ASSERTION OF SOVEREIGN
IMMUNITY.

(a) In General.--The Commissioner of Patents and
Trademarks, in consultation with the Secretary of Agriculture
and the Register of Copyrights, shall publish in the Federal
Register and maintain on the Internet information concerning
the participation of each State in the Federal intellectual
property system.
(b) Content of Information.--The information under
subsection (a) shall include, for each State--
(1) whether the State's sovereign immunity from suit in
Federal court has been asserted under section 112(b); and
(2) the name of the case and court in which such assertion
of immunity was made.

SEC. 124. RULEMAKING AUTHORITY.

The Commissioner of Patents and Trademarks may, pursuant to
section 6 of title 35,

[[Page S13561]]

United States Code, promulgate such rules as necessary to
implement the provisions of this subtitle.

Subtitle D--Amendments to the Federal Intellectual Property Laws

SEC. 131. CONDITIONS FOR STATE PARTICIPATION IN THE FEDERAL
PATENT SYSTEM.

(a) Application for Patent.--Section 111 of title 35,
United States Code, is amended by adding at the end the
following:
``(c) Application by or on Behalf of a State.--When an
application for patent or a provisional application for
patent is made by or on behalf of a State, an instrumentality
of a State, or a State official acting in an official
capacity, the Commissioner shall require--
``(1) an assurance that, during the pendency of the
application and the term of any patent resulting from that
application, the State's sovereign immunity from suit in
Federal court will be waived in any action against the State
or any instrumentality or official of that State--
``(A) arising under a Federal intellectual property law; or
``(B) seeking a declaration with respect to a Federal
intellectual property right; and
``(2) a certification that, during the 1-year period
preceding the date of the application, the State's sovereign
immunity from suit in Federal court has not been asserted in
any action described in paragraph (1).''.
(b) Assignment and Recordation.--Section 261 of title 35,
United States Code, is amended--
(1) by striking ``Subject to the provisions of this title''
in the first sentence and inserting ``(a) In General.--
Subject to the provisions of this title''; and
(2) by adding at the end the following:
``(b) Recordation by or on Behalf of a State.--When an
assignment, grant, or conveyance of an application for
patent, patent, or any interest in that patent, is recorded
in the Patent and Trademark Office by or on behalf of a
State, an instrumentality of a State, or a State official
acting in an official capacity, the Commissioner shall
require--
``(1) an assurance that, during the pendency of the
application and the term of any patent resulting from that
application, or during the remaining term of the patent or
any interest in that patent, the State's sovereign immunity
from suit in Federal court will be waived in any action
against the State or any instrumentality or official of that
State--
``(A) arising under a Federal intellectual property law; or
``(B) seeking a declaration with respect to a Federal
intellectual property right; and
``(2) a certification that, during the 1-year period
preceding the date of the recordation, the State's sovereign
immunity from suit in Federal court has not been asserted in
any action described in paragraph (1).''.

SEC. 132. CONDITIONS FOR STATE PARTICIPATION IN THE FEDERAL
PLANT VARIETY PROTECTION SYSTEM.

(a) Application for Certificate of Protection.--Section 52
of the Plant Variety Protection Act (7 U.S.C. 2422) is
amended--
(1) by striking ``An application for a certificate'' in the
first sentence and inserting ``(a) An application for a
certificate''; and
(2) by adding at the end the following:
``(b) When an application for plant variety protection is
made by or on behalf of a State, an instrumentality of a
State, or a State official acting in an official capacity,
the Secretary shall require--
``(1) an assurance that, during the pendency of the
application and the term of any plant variety protection
resulting from that application, the State's sovereign
immunity from suit in Federal court will be waived in any
action against the State or any instrumentality or official
of that State--
``(A) arising under a Federal intellectual property law; or
``(B) seeking a declaration with respect to a Federal
intellectual property right; and
``(2) a certification that, during the 1-year period
preceding the date of the application, the State's sovereign
immunity from suit in Federal court has not been asserted in
any action described in paragraph (1).''.
(b) Assignment and Recordation.--Section 101 of the Plant
Variety Protection Act (7 U.S.C. 2531) is amended by adding
at the end the following:
``(e) When an assignment, grant, conveyance, or license of
plant variety protection or application for plant variety
protection is filed for recording in the Plant Variety
Protection Office by or on behalf of a State, an
instrumentality of a State, or a State official acting in an
official capacity, the Secretary shall require--
``(1) an assurance that, during the remaining term of the
plant variety protection, or during the pendency of the
application and the term of any plant variety protection
resulting from that application, the State's sovereign
immunity from suit in Federal court will be waived in any
action against the State or any instrumentality or official
of that State--
``(A) arising under a Federal intellectual property law; or
``(B) seeking a declaration with respect to a Federal
intellectual property right; and
``(2) a certification that, during the 1-year period
preceding the date of the recordation, the State's sovereign
immunity from suit in Federal court has not been asserted in
any action described in paragraph (1).''.

SEC. 133. CONDITIONS FOR STATE PARTICIPATION IN THE FEDERAL
COPYRIGHT SYSTEM.

Section 409 of title 17, United States Code, is amended--
(1) in paragraph (10), by striking ``and'' at the end;
(2) by redesignating paragraph (11) as paragraph (12); and
(3) by inserting after paragraph (10) the following:
``(11) if the application is by or on behalf of a State or
an instrumentality of a State--
``(A) an assurance that, during the pendency of the
application and the subsistence of any copyright identified
in that application, the State's sovereign immunity from suit
in Federal court will be waived in any action against the
State or any instrumentality or official of that State--
``(i) arising under a Federal intellectual property law; or
``(ii) seeking a declaration with respect to a Federal
intellectual property right; and
``(B) a certification that, during the 1-year period
preceding the date of the application, the State's sovereign
immunity from suit in Federal court has not been asserted in
any action described in subparagraph (A); and''.

SEC. 134. CONDITIONS FOR STATE PARTICIPATION IN THE FEDERAL
MASK WORK SYSTEM.

Section 908 of title 17, United States Code, is amended by
adding at the end the following:
``(h) When an application for registration of a mask work
is made by or on behalf of a State or an instrumentality of a
State, the Register of Copyrights shall require--
``(1) an assurance that, during the pendency of the
application and any term of protection resulting from that
application, the State's sovereign immunity from suit in
Federal court will be waived in any action against the State
or any instrumentality or official of that State--
``(A) arising under a Federal intellectual property law; or
``(B) seeking a declaration with respect to a Federal
intellectual property right; and
``(2) a certification that, during the 1-year period
preceding the date of the application, the State's sovereign
immunity from suit in Federal court has not been asserted in
any action described in paragraph (1).''.

SEC. 135. CONDITIONS FOR STATE PARTICIPATION IN THE FEDERAL
ORIGINAL DESIGN SYSTEM.

Section 1310 of title 17, United States Code, is amended by
adding at the end the following:
``(k) Application by or on Behalf of a State or an
Instrumentality of a State.--When an application for
registration of a design is made by or on behalf of a State
or an instrumentality of a State, the Administrator shall
require--
``(1) an assurance that, during the pendency of the
application and any term of protection resulting from that
application, the State's sovereign immunity from suit in
Federal court will be waived in any action against the State
or any instrumentality or official of that State--
``(A) arising under a Federal intellectual property law; or
``(B) seeking a declaration with respect to a Federal
intellectual property right; and
``(2) a certification that, during the 1-year period
preceding the date of the application, the State's sovereign
immunity from suit in Federal court has not been asserted in
any action described in paragraph (1).''.

SEC. 136. CONDITIONS FOR STATE PARTICIPATION IN THE FEDERAL
TRADEMARK SYSTEM.

(a) Application for Use of Trademark or Service Mark.--
Section 1 of the Trademark Act of 1946 (15 U.S.C. 1051) is
amended by adding at the end the following:
``(f) When an application under subsection (a) or (b) of
this section is made by or on behalf of a State or an
instrumentality of a State, the Commissioner shall require--
``(1) an assurance that, during the pendency of the
application and for as long as the mark is registered, the
State's sovereign immunity from suit in Federal court will be
waived in any action against the State or any instrumentality
or official of that State--
``(A) arising under a Federal intellectual property law; or
``(B) seeking a declaration with respect to a Federal
intellectual property right; and
``(2) a certification that, during the 1-year period
preceding the date of the application, the State's sovereign
immunity from suit in Federal court has not been asserted in
any action described in paragraph (1).''.
(b) Assignment and Recordation.--Section 10 of the
Trademark Act of 1946 (15 U.S.C. 1060) is amended--
(1) by inserting ``(a)'' before ``A registered mark'';
(2) by inserting ``(b)'' before ``An assignee not
domiciled''; and
(3) by adding at the end the following:
``(c) When an assignment of a registered mark or a mark for
which an application to register has been filed is recorded
in the Patent and Trademark Office by or on behalf of a State
or an instrumentality of a State, the Commissioner shall
require--
``(1) an assurance that, during the pendency of any
application and for as long as any mark is registered, the
State's sovereign immunity from suit in Federal court will be
waived in any action against the State or any instrumentality
or official of that State--
``(A) arising under a Federal intellectual property law; or
``(B) seeking a declaration with respect to a Federal
intellectual property right; and

[[Page S13562]]

``(2) a certification that, during the 1-year period
preceding the date of the recordation, the State's sovereign
immunity from suit in Federal court has not been asserted in
any action described in paragraph (1).''.

SEC. 137. NO RETROACTIVE EFFECT.

The amendments made by this subtitle shall not apply to--
(1) any application pending before the effective date of
this title; or
(2) any assertion of sovereign immunity made before the
effective date of this title.

TITLE II--RESTORATION OF PROTECTION FOR FEDERAL INTELLECTUAL PROPERTY
RIGHTS

SEC. 201. LIABILITY OF STATES FOR PATENT VIOLATIONS.

Section 296 of title 35, United States Code, is amended to
read as follows:

``Sec. 296. Liability of States, instrumentalities of States,
and State officials for infringement of patents

``(a) Remedy for Statutory Violation.--In any action
against an officer or employee of a State for infringement of
a patent under section 271, or for any other violation under
this title, prospective relief is available against the
officer or employee in the same manner and to the same extent
as such relief is available in an action against a private
individual under like circumstances. Prospective relief may
include injunctions under section 283, attorney fees under
section 285, and declaratory relief under section 2201 of
title 28.
``(b) Remedy for Constitutional Violation.--
``(1) Definition.--In this subsection, the term `State'
includes a State, an instrumentality of a State, and an
officer or employee of a State acting in an official
capacity.
``(2) In general.--
``(A) Remedies.--Any State that takes any of the rights of
exclusion secured under this chapter in violation of the
fifth amendment of the United States Constitution, or
deprives any person of any of the rights of exclusion secured
under this chapter without due process of law in violation of
the fourteenth amendment--
``(i) shall be liable to the party injured in a civil
action against the State for the recovery of that party's
reasonable and entire compensation; and
``(ii) may be enjoined from continuing or future
constitutional violations, in accordance with the principles
of equity and upon such terms as the court may determine
reasonable.
``(B) Compensation.--Reasonable and entire compensation may
include damages, interest, and costs under section 284,
attorney fees under section 285, and the additional remedy
for infringement of design patents under section 289.
``(3) Limitations.--
``(A) In general.--The remedy provided under paragraph (2)
is not available in an action against--
``(i) a State that has waived its sovereign immunity from
suit in Federal court for damages resulting from a violation
of this title; or
``(ii) a State official in an individual capacity.
``(B) Remedies.--Remedies (including remedies both at law
and in equity) are available against such State or State
official in the same manner and to the same extent as such
remedies are available in an action against a private entity
or individual under like circumstances.
``(4) Burden of proof.--If a claimant produces prima facie
evidence to support a claim under paragraph (2), the burden
of proof shall be on the State, except as to any elements of
the claim that would have to be proved if the action were
brought under another provision of this title. The burden of
proof shall be unaffected with respect to any such element.
``(c) Preemption.--No State may use or manufacture the
invention described in or covered by a patent without the
authorization or consent of the patent owner, except in the
manner and to the extent authorized by Federal law.''.

SEC. 202. LIABILITY OF STATES FOR VIOLATION OF PLANT VARIETY
PROTECTION.

Section 130 of the Plant Variety Protection Act (7 U.S.C.
2570) is amended to read as follows:

``SEC. 130. LIABILITY OF STATES, INSTRUMENTALITIES OF STATES,
AND STATE OFFICIALS FOR INFRINGEMENT OF PLANT
VARIETY PROTECTION.

``(a) In any action against an officer or employee of a
State for infringement of plant variety protection under
section 111, or for any other violation under this chapter,
prospective relief is available against the officer or
employee in the same manner and to the same extent as such
relief is available in an action against a private individual
under like circumstances. Prospective relief may include
injunctions under section 123, attorney fees under section
125, and declaratory relief under section 2201 of title 28,
United States Code.
``(b)(1) In this subsection, the term `State' includes a
State, an instrumentality of a State, and an officer or
employee of a State acting in an official capacity.
``(2)(A) Any State that takes any of the rights of
exclusion secured under this chapter in violation of the
fifth amendment of the United States Constitution, or
deprives any person of any of the rights of exclusion secured
under this chapter without due process of law in violation of
the fourteenth amendment--
``(i) shall be liable to the party injured in a civil
action against the State for the recovery of that party's
reasonable and entire compensation; and
``(ii) may be enjoined from continuing or future
constitutional violations, in accordance with the principles
of equity and upon such terms as the court may determine
reasonable.
``(B) Reasonable and entire compensation may include
damages, interest, and costs under section 124, and attorney
fees under section 125.
``(3)(A) The remedy provided under paragraph (2) is not
available in an action against--
``(i) a State that has waived its sovereign immunity from
suit in Federal court for damages resulting from a violation
of this chapter; or
``(ii) a State official in an individual capacity.
``(B) Remedies (including remedies both at law and in
equity) are available against such State or State official in
the same manner and to the same extent as such remedies are
available in an action against a private entity or individual
under like circumstances.
``(4) If a claimant produces prima facie evidence to
support a claim under paragraph (2), the burden of proof
shall be on the State, except as to any elements of the claim
that would have to be proved if the action were brought under
another provision of this chapter. The burden of proof shall
be unaffected with respect to any such element.
``(c) No State may exercise any rights of the owner of a
plant variety protected by a certificate of plant variety
protection under this chapter without the authorization or
consent of such owner, except in the manner and to the extent
authorized by Federal law.''.

SEC. 203. LIABILITY OF STATES FOR COPYRIGHT VIOLATIONS.

Section 511 of title 17, United States Code, is amended to
read as follows:

``Sec. 511. Liability of States, instrumentalities of States,
and State officials for infringement of copyright

``(a) Remedy for Statutory Violation.--In any action
against an officer or employee of a State for violation of
any rights of a copyright owner as provided in sections 106
through 121 or of an author as provided in section 106A, or
for any other violation under this title, prospective relief
is available against the officer or employee in the same
manner and to the same extent as such relief is available in
an action against a private individual under like
circumstances. Prospective relief may include injunctions
under section 502, impounding and disposition of infringing
articles under section 503, costs and attorney fees under
section 505, and declaratory relief under section 2201 of
title 28.
``(b) Remedy for Constitutional Violation.--
``(1) Definition.--In this subsection, the term `State'
includes a State, an instrumentality of a State, and an
officer or employee of a State acting in an official
capacity.
``(2) In general.--
``(A) Remedies.--Any State that takes any of the rights of
exclusion secured under this title in violation of the fifth
amendment of the United States Constitution, or deprives any
person of any of the rights of exclusion secured under this
title without due process of law in violation of the
fourteenth amendment--
``(i) shall be liable to the party injured in a civil
action against the State for the recovery of that party's
reasonable and entire compensation; and
``(ii) may be enjoined from continuing or future
constitutional violations, in accordance with the principles
of equity and upon such terms as the court may determine
reasonable.
``(B) Compensation.--Reasonable and entire compensation may
include actual damages and profits or statutory damages under
section 504, and costs and attorney fees under section 505.
``(3) Limitations.--
``(A) In general.--The remedy provided under paragraph (2)
is not available in an action against--
``(i) a State that has waived its sovereign immunity from
suit in Federal court for damages resulting from a violation
of this title; or
``(ii) a State official in an individual capacity.
``(B) Remedies.--Remedies (including remedies both at law
and in equity) are available against such State or State
official in the same manner and to the same extent as such
remedies are available in an action against a private entity
or individual under like circumstances.
``(4) Burden of proof.--If a claimant produces prima facie
evidence to support a claim under paragraph (2), the burden
of proof shall be on the State, except as to any elements of
the claim that would have to be proved if the action were
brought under another provision of this title. The burden of
proof shall be unaffected with respect to any such element.
``(c) Preemption.--No State may exercise any rights of a
copyright owner protected under this title without the
authorization or consent of such owner, except in the manner
and to the extent authorized by Federal law.''.

[[Page S13563]]

SEC. 204. LIABILITY OF STATES FOR MASK WORK VIOLATIONS.

(a) In General.--Chapter 9 of title 17, United States Code,
is amended--
(1) in section 911, by striking subsection (g); and
(2) by adding at the end the following:

``Sec. 915. Liability of States, instrumentalities of States,
and State officials for violation of mask works

``(a) Remedy for Statutory Violation.--In any action
against an officer or employee of a State for infringement of
any rights in a mask work protected under this chapter, or
for any other violation under this chapter, prospective
relief is available against the officer or employee in the
same manner and to the same extent as such relief is
available in an action against a private individual under
like circumstances. Prospective relief may include injunctive
relief under section 911(a), impounding and destruction of
infringing products under section 911(e), costs and attorney
fees under section 911(f), and declaratory relief under
section 2201 of title 28.
``(b) Remedy for Constitutional Violation.--
``(1) Definition.--In this subsection, the term `State'
includes a State, an instrumentality of a State, and an
officer or employee of a State acting in an official
capacity.
``(2) In general.--
``(A) Remedies.--Any State that takes any of the rights of
exclusion secured under this chapter in violation of the
fifth amendment of the United States Constitution, or
deprives any person of any of the rights of exclusion secured
under this chapter without due process of law in violation of
the fourteenth amendment--
``(i) shall be liable to the party injured in a civil
action against the State for the recovery of that party's
reasonable and entire compensation; and
``(ii) may be enjoined from continuing or future
constitutional violations, in accordance with the principles
of equity and upon such terms as the court may determine
reasonable.
``(B) Compensation.--Reasonable and entire compensation may
include actual damages and profits under section 911(b) or
statutory damages under section 911(c), and costs and
attorney fees under section 911(f).
``(3) Limitations.--
``(A) In general.--The remedy provided under paragraph (2)
is not available in an action against--
``(i) a State that has waived its sovereign immunity from
suit in Federal court for damages resulting from a violation
of this title; or
``(ii) a State official in an individual capacity.
``(B) Remedies.--Remedies (including remedies both at law
and in equity) are available against such State or State
official in the same manner and to the same extent as such
remedies are available in an action against a private entity
or individual under like circumstances.
``(4) Burden of proof.--If a claimant produces prima facie
evidence to support a claim under paragraph (2), the burden
of proof shall be on the State, except as to any elements of
the claim that would have to be proved if the action were
brought under another provision of this chapter. The burden
of proof shall be unaffected with respect to any such
element.
``(c) Preemption.--No State may exercise any rights of the
owner of a mask work protected under this chapter without the
authorization or consent of such owner, except in the manner
and to the extent authorized by Federal law.''.
(b) Conforming Amendment.--The table of sections for
chapter 9 of title 17, United States Code, is amended by
adding at the end the following:

``915. Liability of States, instrumentalities of States, and State
officials for violation of mask works.''.

SEC. 205. LIABILITY OF STATES FOR ORIGINAL DESIGN
VIOLATIONS.

(a) In General.--Chapter 13 of title 17, United States
Code, is amended--
(1) in section 1309(a), by adding at the end the following:
``In this subsection, the term `any person' includes any
State, any instrumentality of a State, and any officer or
employee of a State or instrumentality of a State acting in
an official capacity. Any State, and any such
instrumentality, officer, or employee, shall be subject to
the provisions of this chapter in the same manner and to the
same extent as any nongovernmental entity.''; and
(2) by adding at the end the following:

``Sec. 1333. Liability of States, instrumentalities of
States, and State officials for violation of original
designs

``(a) Remedy for Statutory Violation.--In any action
against an officer or employee of a State for infringement of
any rights in a design protected under this chapter, or for
any other violation under this chapter, prospective relief is
available against the officer or employee in the same manner
and to the same extent as such relief is available in an
action against a private individual under like circumstances.
Prospective relief may include injunctions under section
1322, attorney fees under section 1323(d), disposition of
infringing and other articles under section 1323(e), and
declaratory relief under section 2201 of title 28.
``(b) Remedy for Constitutional Violation.--
``(1) Definition.--In this subsection, the term `State'
includes a State, an instrumentality of a State, and an
officer or employee of a State acting in an official
capacity.
``(2) In general.--
``(A) Remedies.--Any State that takes any of the rights of
exclusion secured under this chapter in violation of the
fifth amendment of the United States Constitution, or
deprives any person of any of the rights of exclusion secured
under this chapter without due process of law in violation of
the fourteenth amendment--
``(i) shall be liable to the party injured in a civil
action against the State for the recovery of that party's
reasonable and entire compensation; and
``(ii) may be enjoined from continuing or future
constitutional violations, in accordance with the principles
of equity and upon such terms as the court may determine
reasonable.
``(B) Compensation.--Reasonable and entire compensation may
include damages, profits, and attorney fees under section
1323.
``(3) Limitations.--
``(A) In general.--The remedy provided under paragraph (2)
is not available in an action against--
``(i) a State that has waived its sovereign immunity from
suit in Federal court for damages resulting from a violation
of this title; or
``(ii) a State official in an individual capacity.
``(B) Remedies.--Remedies (including remedies both at law
and in equity) are available against such State or State
official in the same manner and to the same extent as such
remedies are available in an action against a private entity
or individual under like circumstances.
``(4) Burden of proof.--If a claimant produces prima facie
evidence to support a claim under paragraph (2), the burden
of proof shall be on the State, except as to any elements of
the claim that would have to be proved if the action were
brought under another provision of this chapter. The burden
of proof shall be unaffected with respect to any such
element.
``(c) Preemption.--No State may exercise any rights of the
owner of a design protected under this chapter without the
authorization or consent of such owner, except in the manner
and to the extent authorized by Federal law.''.
(b) Conforming Amendment.--The table of sections for
chapter 13 of title 17, United States Code, is amended by
adding at the end the following:

``1333. Liability of States, instrumentalities of States, and State
officials for violation of original designs.''.

SEC. 206. LIABILITY OF STATES FOR TRADEMARK VIOLATIONS.

Section 40 of the Trademark Act of 1946 (15 U.S.C. 1122) is
amended to read as follows:

``SEC. 40. LIABILITY OF STATES, INSTRUMENTALITIES OF STATES,
AND STATE OFFICIALS FOR INFRINGEMENT OF
TRADEMARKS.

``(a) Remedy for Statutory Violation.--In any action
against an officer or employee of a State for infringement of
a trademark under section 32, or for any other violation
under this Act, prospective relief is available against the
officer or employee in the same manner and to the same extent
as such relief is available in an action against a private
individual under like circumstances. Prospective relief may
include injunctive relief under section 34, costs and
attorney fees under section 35, destruction of infringing
articles under section 36, and declaratory relief under
section 2201 of title 28, United States Code.
``(b) Remedy for Constitutional Violation.--
``(1) Definition.--In this subsection, the term `State'
includes a State, an instrumentality of a State, and an
officer or employee of a State acting in an official
capacity.
``(2) In general.--
``(A) Remedies.--Any State that takes any of the rights of
exclusion secured under this Act in violation of the fifth
amendment of the United States Constitution, or deprives any
person of any of the rights of exclusion secured under this
Act without due process of law in violation of the fourteenth
amendment--
``(i) shall be liable to the party injured in a civil
action against the State for the recovery of that party's
reasonable and entire compensation; and
``(ii) may be enjoined from continuing or future
constitutional violations, in accordance with the principles
of equity and upon such terms as the court may determine
reasonable.
``(B) Compensation.--Reasonable and entire compensation may
include actual damages and profits or statutory damages, and
costs and attorney fees under section 35.
``(3) Limitations.--
``(A) In general.--The remedy provided under paragraph (2)
is not available in an action against--
``(i) a State that has waived its sovereign immunity from
suit in Federal court for damages resulting from a violation
of this title; or
``(ii) a State official in an individual capacity.
``(B) Remedies.--Remedies (including remedies both at law
and in equity) are available against such State or State
official in the same manner and to the same extent as such
remedies are available in an action against a private entity
or individual under like circumstances.
``(4) Burden of proof.--If a claimant produces prima facie
evidence to support a

[[Page S13564]]

claim under paragraph (2), the burden of proof shall be on
the State, except as to any elements of the claim that would
have to be proved if the action were brought under another
provision of this Act. The burden of proof shall be
unaffected with respect to any such element.
``(c) Preemption.--No State may use a federally registered
mark for the same or similar goods or service without the
authorization or consent of the owner of the mark, except in
the manner and to the extent authorized by Federal law.''.

SEC. 207. RULES OF CONSTRUCTION.

(a) Jurisdiction.--The district courts shall have original
jurisdiction of any action arising under this title and the
amendments made by this title under section 1338 of title 28,
United States Code.
(b) Broad Construction.--This title and the amendments made
by this title shall be construed in favor of a broad
protection of Federal intellectual property rights, to the
maximum extent permitted by this title and the United States
Constitution.

TITLE III--EFFECTIVE DATES

SEC. 301. EFFECTIVE DATES.

(a) Title I.--Title I of this Act and the amendments made
by that title shall take effect 90 days after the date of
enactment of this Act.
(b) Title II.--The amendments made by title II of this Act
shall take effect with respect to violations that occur on or
after the date of enactment of this Act.

SEC. 302. SEVERABILITY.

If any provision of this Act or of an amendment made by
this Act, or any application of such provision to any person
or circumstance, is held to be unconstitutional, the
remainder of this Act, the amendments made by this Act, and
the application of the provision to any other person or
circumstance shall not be affected.
____

Intellectual Property Protection Restoration Act--Section-by-Section
Summary

overview

The purpose of the Intellectual Property Protection
Restoration Act of 1999 (``IPPRA'') is to restore protection
for owners of federal intellectual property rights against
infringement by States. Recent Supreme Court decisions
invalidated prior efforts by Congress to abrogate State
sovereign immunity in actions arising under the federal
intellectual property laws. The IPPRA encourages States to
participate in the federal intellectual property system on
equal terms with private entities, by conditioning a State's
receipt of future benefits under the federal intellectual
property laws on an unambiguous waiver of sovereign immunity.
As against States that choose not to participate, the bill
also provides new remedies for federal intellectual property
rights, to the maximum extent permitted by the Constitution.

detailed summary

TITLE I--STATE PARTICIPATION IN THE FEDERAL INTELLECTUAL PROPERTY
SYSTEM

Subtitle A--Definitions

Sec. 101. Definitions

Section 101 defines terms used in this title.

Subtitle B--Procedures for State Participation in the Federal
Intellectual Property System

Sec. 111. Opt-in procedure

Section 111 provides that no State or State instrumentality
may acquire a federal intellectual property right unless the
State opts in to the federal intellectual property system by
agreeing to waive sovereign immunity in any subsequent action
that either arises under a federal intellectual property law
or seeks a declaration with respect to a federal intellectual
property right. Thus, if a State elects to receive the
benefits of a nationally recognized right governed by uniform
federal laws, then it must accept the obligation to defend
any suits arising under those laws in the federal courts.
An assurance provided under section 111 is binding on the
State and fully enforceable. ``A State may effectuate a
waiver of its constitutional immunity . . . in the context of
a particular federal program,'' so long as the State's
intention to waive its immunity is unequivocal. Atascadero
State Hosp. v. Scanlon, 473 U.S. 234, 238 n.1 & 241 (1985).
See also Litman v. George Mason Univ., 186 F.3d 544 (4th Cir.
1999) (holding that a State's acceptance of federal education
funding resulted in a binding waiver of immunity in a
subsequent action against a State university under Title IX);
Innes v. Kansas State Univ., 184 F.3d 1275 (10th Cir. 1999)
(holding that a State university's agreement to participate
in a federal loan program acted as a binding waiver of
immunity).

Sec. 112. Breach of assurance by a State

Section 112 establishes procedures for determining whether
a State that has opted in to the federal intellectual
property system is in breach of its agreement to waive
sovereign immunity.

Sec. 113. Consequences of breach of assurance by a State

Section 113 sets forth three consequences of a breach of an
agreement to waive sovereign immunity.
First, under subsection (a), any pending applications by or
on behalf of the State for federal intellectual property
rights shall be regarded as abandoned and shall not be
subject to revival thereafter.
Second, under subsection (b), no damages or other monetary
relief shall be awarded in any action to enforce a federal
intellectual property right that is or has been owned by or
on behalf of the State during the preceding five years.
Third, under subsection (c), the State is barred from
acquiring any new rights under the federal intellectual
property laws for a period of one year. If, however, the
State opts back in to the system after a year has passed, by
providing a new assurance that it will henceforth waive its
sovereign immunity in federal intellectual property
litigation, it can then acquire new rights that will be
enforceable by the full panoply of federal intellectual
property remedies.

Subtitle C--Administration of Procedures for State Participation in the
Federal Intellectual Property System

Sec. 121. Notification by court of State assertion of sovereign
immunity

Section 121 directs federal courts to notify the
Commissioner of Patents and Trademarks within 20 days of
finding that a State has asserted sovereign immunity in any
action to enforce or challenge a federal intellectual
property right.

Sec. 122. Confirmation by Commissioner of Patents and Trademarks of
State assertion of sovereign immunity

Section 122 directs the Commissioner of Patents and
Trademarks, within 20 days of receiving a notification under
section 121, to forward such notification to the Attorney
General of the State, together with a copy of title I of the
IPPRA, and inquire whether the State intends to withdraw its
assertion of immunity and consent tot he continuation or
refiling of the action in which it was made within the 60-
day grace period provided in section 112(b)(2).

Sec. 123. Publication by Commissioner of Patents and Trademarks of
State assertion of sovereign immunity

Section 123 directs the Commissioner of Patents and
Trademarks, in consultation with the Secretary of Agriculture
and the Register of Copyrights, to publish in the Federal
Register and maintain on the Internet information concerning
the participation of each State in the federal intellectual
property system. The information must include, for each
State, whether the State's sovereign immunity has been
asserted, and the name of the case and court in which any
such assertion of immunity was made.

Sec. 124. Rulemaking authority

Section 124 authorizes the Commissioner of Patents and
Trademarks to promulgate such rules as necessary to implement
the provisions of this subtitle.

Subtitle D--Amendments to the Federal Intellectual Property Laws

Sec. 131. Conditions for State participation in the federal patent
system

Section 131 amends the federal patent statute to require
any State that seeks to register for patent protection to
provide an unequivocal assurance of the State's intention to
waive sovereign immunity in any action to enforce or
challenge a federal intellectual property right. A State must
also certify that the State's sovereign immunity has not been
asserted in any such action during the past year.

Sec. 132. Conditions for State participation in the federal plant
variety protection system

Section 132 amends the federal plant variety statute to
require any State that seeks to register for plant variety
protection to provide an unequivocal assurance of the State's
intention to waive sovereign immunity in any action to
enforce or challenge a federal intellectual property right. A
State must also certify that the State's sovereign immunity
has not been asserted in any such action during the past
year.

Sec. 133. Conditions for State participation in the federal copyright
system

Section 133 amends the federal copyright statute to require
any State that seeks to register for copyright protection to
provide an unequivocal assurance of the State's intention to
waive sovereign immunity in any action to enforce or
challenge a federal intellectual property right. A State must
also certify that the State's sovereign immunity has not been
asserted in any such action during the past year.

Sec. 134. Conditions for State participation in the federal mask work
system

Section 134 amends the federal mask work statute to require
any State that seeks to register for mask work protection to
provide an unequivocal assurance of the State's intention to
waive sovereign immunity in any action to enforce or
challenge a federal intellectual property right. A State must
also certify that the State's sovereign immunity has not been
asserted in any such action during the past year.

Sec. 135. Conditions for State participation in the federal original
design system

Section 135 amends the federal original design statute to
require any State that seeks to register for design
protection to provide an unequivocal assurance of the State's
intention to waive sovereign immunity in any action to
enforce or challenge a federal intellectual property right. A
State must also certify that the State's sovereign immunity
has not been asserted in any such action during the past
year.

Sec. 136. Conditions for State participation in the federal trademark
system

Section 136 amends the federal trademark statute to require
any State that seeks to

[[Page S13565]]

register for trademark protection to provide an unequivocal
assurance of the State's intention to waive sovereign
immunity in any action to enforce or challenge a federal
intellectual property right. A State must also certify that
the State's sovereign immunity has not been asserted in any
such action during the past year.

Sec. 137. No retroactive effect

Section 137 ensures that the amendments made by this
subtitle are not given retroactive effect. Specifically, the
amendments do not apply to any application by a State that
was pending before the effective date of this subtitle, or to
any assertion of sovereign immunity by a State made before
the enactment of the IPPRA.

TITLE II--RESTORATION OF PROTECTION FOR FEDERAL INTELLECTUAL PROPERTY
RIGHTS

Sec. 201. Liability of States for patent violations

Section 201 replaces section 296 of title 35, which was
enacted pursuant to the Patent and Plant Variety Remedy
Clarification Act of 1992 and invalidated by the Supreme
Court in Florida Prepaid Postsecondary Educ. Expense Bd. v.
College Savings Bank, 119 S. Ct. 2199 (1999).
Subsection (a) ensures the full availability of prospective
relief to prevent State officials from violating the federal
patent laws, and to allow challenges to assertions by State
officials of rights secured under such laws, on the same
terms and in the same manner as if such State officials were
private individuals. Such relief is authorized under the
doctrine of Ex parte Young, 209 U.S. 123 (1908), which held
that an individual may sue a State official in an official
capacity for prospective relief requiring the State official
to cease violating federal law, even if the State itself is
immune from suit under the Eleventh Amendment.
Subsection (b) provides a cause of action against States,
State instrumentalities, and State officials acting in an
official capacity for (1) taking a patent right in violation
of the Fifth Amendment or (2) depriving a person of a patent
right without due process of law in violation of the
Fourteenth Amendment. Damages are fixed at ``reasonable and
entire compensation,'' which is the measure of damages
available against the United States for infringement of a
patent (see 28 U.S.C. 1498); treble damages are not
available under this subsection. Injunctive relief is
available to prevent or deter constitutional violations.
The remedy provided under subsection (b) is not available
against States that have waived their sovereign immunity from
suit in federal court, nor is it available against State
officials in their individual capacity, who do not partake of
the State's sovereign immunity. Such States and State
officials remain subject to the remedies provided by other
provisions of the federal patent laws, to the same extent as
such remedies are available in an action against any private
entity or individual. Thus, for example, a State official
sued in an individual capacity may not assert any defense or
claim of absolute or qualified immunity that would not be
available to a private individual under similar
circumstances.
Subsection (b) abrogates State sovereign immunity to the
maximum extent permitted by the Constitution, pursuant to
Congress's powers under the Fifth and Fourteenth Amendments
and any other applicable provisions.
A claim under subsection (b) for taking a patent right is
ripe at the time of the taking. In Hawaii Housing Authority
v. Midkiff, 467 U.S. 229 (1984), the Supreme Court held that
the Public Use Clause of the Fifth Amendment, made applicable
to the States through the Fourteenth Amendment, prohibits a
State from taking private property for a non-public use, even
with just compensation. The Court further stated that ``[t]he
`public use' requirement is . . . coterminous with the scope
of a sovereign's police powers.'' 457 U.S. at 240. Because
States making unauthorized uses of federal intellectual
property rights are acting outside the scope of their
sovereign powers, a State's infringement of a patent, even if
compensated, is an unconstitutional taking of property for a
non-public use; accordingly, the patent holder need not seek
a remedy in State proceedings before filing a claim under
subsection (b) in federal court.
Subsection (b)(4) addresses the burden of proof when a
claimant produces prima facie evidence to support a claim
under this subsection. Under subsection (b)(4), the burden of
proof is on the State, except as to any elements of the claim
that would have to be proved if the action were brought under
another provision of this title. As to such elements, the
burden of proof is unaffected. Thus, for example, if the
adequacy of any State remedies became an issue, the State
would bear the burden of proof thereon.
Subsection (c) clarifies that the federal patent laws and
treaties supersede and preempt any power of a State to
acquire or otherwise affect patent rights through the
exercise of eminent domain.

Sec. 202. Liability of States for violation of plant variety protection

Section 202 establishes the same sorts of remedies for
violations of protected plant varieties as section 201
establishes with respect to patents.

Sec. 203. Liability of States for copyright violations

Section 203 establishes the same sorts of remedies for
violations of copyrights as section 201 establishes with
respect to patents.

Sec. 204. Liability of States for mask work violations

Section 204 establishes the same sorts of remedies for
violations of federally-protected rights in mask works as
section 201 establishes with respect to patents.

Sec. 205. Liability of States for original design violations

Section 205 establishes the same sorts of remedies for
violations of federally-protected rights in original designs
as section 201 establishes with respect to patents.

Sec. 206. Liability of States trademark violations

Section 206 establishes the same sorts of remedies for
violations of federally-registered trademarks and service
marks as section 201 establishes with respect to patents.

Sec. 207. Rules of construction

Subsection (a) makes clear that the district courts shall
have original jurisdiction under 28 U.S.C. Sec. 1338 of any
action arising under this title. It follows that, pursuant to
28 U.S.C. Sec. 1295, the United States Court of Appeals for
the Federal Circuit shall have exclusive jurisdiction of any
appeal from a final decision of a district court in an action
arising under this title relating to patents, plant variety
protection, and exclusive rights in designs under chapter 13
of title 17.
Subsection (b) provides that this title shall be construed
in favor of a broad protection of intellectual property
rights, to the maximum extent permitted by its terms and the
Constitution.

TITLE III--EFFECTIVE DATES

Sec. 301. Effective dates

Subsection (a) provides that the opt-in procedures
established by title I of the IPPRA shall take effect 90 days
after the date of enactment of the IPPRA.
Subsection (b) provides that the remedial provisions
established by title II of the IPPRA shall take effect with
respect to violations by States that occur on or after the
date of enactment of the IPPRA.

Sec. 302. Severability

Section 302 contains a strong severability clause. If any
provision of the IPPRA or of any amendment made by the IPPRA,
or any application of such provision to any person or
circumstance, is held to be unconstitutional, the remainder
of the IPPRA, the amendments made by the IPPRA, and the
application of the provision to any other person or
circumstance shall not be affected.

____________________