HR-9142-119
Referred to the House Committee on the Judiciary.
Sponsored by Scott Fitzgerald (R-WI)
What it does
This bill would amend U.S. patent law (Title 35) to prevent entities on three specific national security watchlists — the Treasury Department's NS-CMIC List, the Defense Department's Chinese military company list, and the FCC's untrusted communications equipment list — from receiving or enforcing U.S. patents. Patents already issued to such entities would become unenforceable. These entities would also be barred from using expedited patent review programs. The President could grant waivers of up to 180 days at a time, with advance notice and a detailed report to Congress required before each waiver.
Who benefits
U.S. companies competing with Chinese military-linked firms, who would no longer face patent infringement claims from those entities. U.S. manufacturers and technology firms that currently pay licensing fees to such entities. National security agencies and policymakers seeking to limit adversarial nations' leverage over U.S. innovation. Domestic telecommunications and semiconductor industries that compete directly with listed companies such as Huawei and ZTE. American inventors whose technologies may have been misappropriated by listed entities.
Who is hurt
Chinese companies on the relevant watchlists, including subsidiaries and affiliates, who would lose the ability to enforce existing U.S. patents and receive new ones. U.S. businesses, universities, or joint ventures that have licensing agreements with listed entities, which could be disrupted. Foreign investors with stakes in listed companies. U.S. Patent and Trademark Office staff who would need to implement new screening procedures. Companies that may be added to these lists in the future without immediate notice, facing retroactive unenforceability of their existing patents. International trading partners who may view the measure as inconsistent with World Trade Organization (WTO) TRIPS Agreement obligations.
Supporters argue
Supporters argue that allowing adversarial military-linked companies to hold and enforce U.S. patents gives those entities legal leverage over American businesses and creates a national security vulnerability — for example, Huawei and other NS-CMIC-listed firms hold thousands of U.S. patents that can be used to extract royalties from American competitors. They contend that the U.S. patent system was designed to promote domestic innovation, not to provide enforcement tools to entities that the executive branch has already determined pose a threat to national security, and that tying patent rights to existing, congressionally authorized watchlists provides a clear, administrable standard rather than ad hoc determinations.
Opponents argue
Opponents argue that rendering existing patents unenforceable without compensation could constitute a taking under the Fifth Amendment, since patent rights are recognized as property interests, and that retroactive invalidation of vested property rights raises serious due process concerns. They also contend that the bill may violate U.S. obligations under the WTO's TRIPS Agreement, which generally prohibits discrimination in patent rights based on the nationality or identity of the patent holder, potentially inviting retaliatory trade measures that could harm American exporters. Additionally, critics argue that the watchlists used as triggers are executive-branch determinations subject to change, effectively delegating a core property-rights decision to the President with limited congressional oversight.
Constitutional context
Patent rights are recognized as property interests protected by the Takings Clause of the Fifth Amendment; rendering existing patents unenforceable without compensation could be challenged as an uncompensated taking of vested property. Post-Loper Bright (2024), courts would independently assess whether the bill's incorporation of executive-branch watchlists as triggers for patent denial constitutes an impermissible delegation of legislative power under the Nondelegation/Vesting Clause (Art. I, §1), since the lists are maintained and updated by executive agencies without direct congressional action.
Checks and balances
Congress gains authority to restrict patent rights based on national security status; the executive branch retains significant influence through its control of the three watchlists that trigger the restrictions, with a presidential waiver power checked by mandatory 30-day advance reporting to the House and Senate Judiciary Committees.
Historical precedent
The Trading with the Enemy Act and International Emergency Economic Powers Act (IEEPA) have been used to block adversarial entities from certain U.S. economic activities, but no prior statute has specifically stripped patent issuance and enforceability rights based on national security watchlist status.