Analysis of H.R. 1249, the “America Invents Act,” Uncovers New Problems

Critics cite constitutionality, national defense implications, and hidden bank bailout

WASHINGTON--()--Today, the U.S. Business and Industry Council (USBIC), a national organization of business owners and executives dedicated to improving the U.S. domestic economy, again called upon Rep. Lamar Smith (R-TX) to withdraw House Resolution 1249 as soon as the House of Representatives reconvenes on June 13, 2011.

“The legislative process related to Representative Lamar Smith’s ‘America Invents Act’ has suffered from a complete lack of transparency,” said Kevin L. Kearns, president of the USBIC. “The public has no chance to provide input into the bill’s formation, and, as a result, problems facing the bill’s passage continue cropping up.”

On June 6, 2011, Reps. Harold Rogers (R-KY), chairman of the House Committee on Appropriations, and Paul Ryan (R-WI), chairman of the House Committee on the Budget, sent a letter to Rep. Smith calling H.R. 1249 into question. According to that letter, the bill will “hand the Congressional ‘power of the purse’ – bestowed in the Constitution – to the Obama White House, and essentially eliminate the ability of Congress to perform substantive oversight of the PTO.”

“Representatives Rogers and Ryan demonstrate that H.R. 1249 has not been fully vetted and is causing problems among House Republicans,” said Kearns.

H.R. 1249’s appropriations language is not the bill’s only unconstitutional provision, however. A growing number of constitutional scholars have also taken issue with H.R. 1249’s controversial “first-to-file” language. Constitutional scholar and advocate Jonathan Massey argues, for example, that the bill would “grant Congress the power to authorize the grant of patents to first-filers who are not inventors,” an authority not enumerated in the Constitution.

On June 6, 2011, the Supreme Court of the United States echoed this view. In delivering the Court’s majority (7-2) opinion in Stanford v. Roche, a patent infringement case on appeal from the U.S. Court of Appeals for the Federal Circuit, Chief Justice John Roberts held that “[s]ince 1790, the patent law has operated on the premise that rights in an invention belong to the inventor.” The “first-to-file” provision of H.R. 1249, which would allow Congress to award patents to non-inventors, is inconsistent with this decision.

If passed as written, H.R. 1249 would also have dangerous consequences for our national defense. In a letter sent to Speaker John Boehner (R-OH), the Inventors Network of the Capital Area (INCA) warned that U.S. defense technologies would not only be vulnerable to Chinese cyber-spies under H.R. 1249, but that the bill would also invite Chinese interests to pursue U.S. patents on technology uncovered as a result of espionage.

Finally, Section 18 of H.R. 1249 is another billion-dollar bailout for the biggest banks in the nation. Attacking the provision as “special interest legislation, pure and simple,” legal scholar Jonathan Massey argues that it would “shift the cost of patent infringement from financial services firms to the U.S. Treasury,” requiring the public to pick up the tab for the banks’ wrongdoing.

“H.R. 1249 is an example of what can happen when a bill is rushed through committee at the behest of special interests, without input from all stakeholders,” said Kearns. “Our members call on Representative Smith to pull this embarrassing bill from consideration as soon as Congress reconvenes.”

About the USBIC

Founded in 1933, the U.S. Business and Industry Council (USBIC) is a national organization of business owners and executives dedicated to making the U.S. domestic economy the world’s leading engine of economic growth. Member companies are typically family-owned or privately held, mostly in the manufacturing sector. They are often the major employers in their home communities and the mainstays of the local economy. This membership composition has given the USBIC an outlook on issues more rooted in mainstream America than other national business groups, which are dominated by giant multinational corporations with global agendas and dwindling national loyalties. For more information, see and


U.S. Business and Industry Council
Kevin L. Kearns, 202-266-3980

Release Summary

House Republicans are increasingly divided in their support for H.R. 1249, the "America Invents Act." Rep. Paul Ryan (R-WI) now argues it cedes Congress's "power of the purse" to the White House.


U.S. Business and Industry Council
Kevin L. Kearns, 202-266-3980