BILL NUMBER: SB 681 AMENDED
BILL TEXT
AMENDED IN SENATE JUNE 29, 2015
AMENDED IN SENATE JUNE 3, 2015
AMENDED IN SENATE MAY 5, 2015
INTRODUCED BY Senator Hill
( Principal coauthor: Assembly Member
Mullin )
FEBRUARY 27, 2015
An act to add Title 19 (commencing with Section 3273.5)
to Part 4 of Division 3 of the Civil Code, relating to civil law.
An act to add Section 24446 to the Revenue and
Taxation Code, relating to income taxation, and declaring the urgency
thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
SB 681, as amended, Hill. Civil law: patents.
Corporation taxes: deduction: public utilities.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including gas corporations.
The Corporation Tax Law allows various deductions in computing the
income that is subject to the taxes imposed by those laws, and in
modified conformity with federal law, allows a deduction for ordinary
and necessary expenses carrying on a trade or business. Existing law
provides that no deduction is allowed for any fine or similar
penalty paid to a government for the violation of any law.
This bill would not allow a deduction under the Corporation Tax
Law for expenses or expenditures for plant and equipment by Pacific
Gas and Electric Company that the Public Utilities Commission
determined in a specific decision should be borne by the shareholders
of the utility, and not the utility's ratepayers, because of the
utility's numerous violations of law relating to the public safety.
The bill would additionally not allow a deduction for amounts that
the Public Utilities Commission ordered Pacific Gas and Electric
Company to pay to reimburse the commission for its costs incurred in
investigating and enforcing violations of law by the utility relating
to public safety.
This bill would declare that it is to take effect immediately as
an urgency statute.
Existing federal law provides for the issuance and enforcement of
patents, makes a person who actively induces infringement of a patent
liable as an infringer, and establishes rights and remedies for
infringement of patents.
This bill would make it unlawful to engage in a pattern or
practice of sending written communications, stating that the
recipient, as defined, is or may be infringing, or has or may have
infringed, on a United States patent if the sender of the
communication makes a specified false statement or representation in
bad faith, fraudulently seeks compensation for specified conduct, or
fraudulently conceals or omits specified information in the
communication.
The bill would provide that a person who sends a communication in
violation of these provisions may be enjoined and is liable for a
civil penalty of up to $2,500 for each violation. The bill would also
specify that its provisions are only enforceable by the Attorney
General, an attorney acting on behalf of the state, or a district
attorney, county counsel, city attorney, or city prosecutor in this
state. The bill would specify that its provisions do not impair or
impede any other rights, causes of action, claims, or defenses
available under other law and that the remedies provided for under
its provisions are cumulative with any other remedies available under
other law.
Vote: majority 2/3 . Appropriation:
no. Fiscal committee: yes. State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 24446 is added to the
Revenue and Taxation Code , to read:
24446. Section 162(a) of the Internal Revenue Code, relating to
trade or business expenses, in general, shall not apply to the
following:
(a) Expenses or expenditures for plant and equipment by Pacific
Gas and Electric Company that the Public Utilities Commission
determined in Decision 15-04-024 (April 9, 2015), "Decision on Fines
and Remedies to be Imposed on Pacific Gas and Electric Company for
Specific Violations in Connection with the Operation and Practices of
its Natural Gas Transmission System Pipelines," should be borne by
the shareholders of the utility, and not the utility's ratepayers,
because of the utility's numerous violations of law relating to
public safety.
(b) Amounts that the Public Utilities Commission, in Decision
15-04-024, ordered Pacific Gas and Electric Company to pay to
reimburse the commission for its costs incurred in investigating and
enforcing a violation of law relating to public safety by the
utility.
SEC. 2. This act is an urgency statute necessary
for the immediate preservation of the public peace, health, or safety
within the meaning of Article IV of the Constitution and shall go
into immediate effect. The facts constituting the necessity are:
In order for the provisions of this act to be applicable to the
current tax year and to better ensure the effectiveness of decisions
of the Public Utilities Commission protecting the public safety, it
is necessary that this act take effect immediately.
SECTION 1. Title 19 (commencing with Section
3273.5) is added to Part 4 of Division 3 of the Civil Code, to read:
TITLE 19. Patent Demands
3273.5. For the purposes of this title, the following definitions
shall apply:
(a) "Final determination" means, with respect to the invalidity or
unenforceability of a patent, that the invalidity or
unenforceability has been determined by a court of the United States
or the United States Patent and Trademark Office in a final decision
that is unappealable or for which any opportunity for appeal is no
longer available.
(b) "Recipient" means a person who purchases, rents, leases, or
otherwise obtains a product or service in the commercial market that
is not for resale in the commercial market and that is, or later
becomes, the subject of a patent infringement allegation.
3273.6. It is unlawful for a person, in connection with the
assertion of a United States patent, to engage in a pattern or
practice of sending written communications that state or represent
that the recipient is or may be infringing, or has or may have
infringed, the patent and is liable or owes compensation to another,
if any of the following conditions are met:
(a) The sender of the communication makes, in bad faith, any of
the following statements or representations, knowing those statements
or representations are false:
(1) That the sender has the right to license or enforce the patent
at the time the communications are sent, if the sender is not a
person with that right.
(2) That a civil action asserting a claim of infringement of the
patent has been filed against either the recipient or against other
persons.
(3) That legal action for infringement of the patent will be taken
against the recipient.
(4) That the sender is the exclusive licensee of the patent
asserted in the communications.
(5) That persons other than the recipient purchased a license for
the patent asserted in the communications.
(6) That persons other than the recipient purchased a license, and
the sender does not disclose that the license is unrelated to the
alleged infringement or the patent asserted in the communications.
(7) That an investigation of the recipient's alleged infringement
has occurred.
(8) That the sender, or an affiliate of the sender, previously
filed a civil action asserting a claim of infringement of the patent
based on the activity that is the subject of the written
communication when the sender knew that the activity was held, in a
final determination, not to infringe the patent.
(b) The sender of the communication fraudulently seeks
compensation for any of the following:
(1) A patent claim that has been determined to be unenforceable or
invalid against the recipient in a final determination.
(2) Activity undertaken by the recipient after expiration of the
patent asserted in the communication.
(3) Activity of the recipient that the sender knew was authorized,
with respect to the patent claim that is the subject of the
communication, by a person with the right to license the patent.
(c) The sender of the communication fraudulently conceals or omits
any of the following information from the communication, when that
information is readily available to the sender at the time the
communication is sent:
(1) The identity of the person asserting a right to license the
patent to, or enforce the patent against, the recipient, including
the identity of any parent entity and the ultimate parent entity of
the person, unless that person is a public company and the name of
the public company is identified.
(2) Identification of at least one patent issued by the United
States Patent and Trademark Office alleged to have been infringed.
(3) Identification, to the extent reasonable under the
circumstances, of at least one product, service, or other activity of
the recipient that is alleged to infringe the identified patent.
(4) A description, to the extent reasonable under the
circumstances, of how the product, service, or other activity of the
recipient infringes an identified patent and patent claim.
(5) A name and contact information for a person the recipient may
contact about the assertions or claims relating to the patent
contained in the communications.
3273.7. (a) A person who sends a communication in violation of
Section 3273.6 may be enjoined in a court of competent jurisdiction
and is liable for a civil penalty not to exceed two thousand five
hundred dollars ($2,500) for each violation. The penalty collected in
an action by the Attorney General or an attorney acting on behalf of
the state shall be paid to the General Fund.
(b) Subject to subdivision (c), the Attorney General, an attorney
acting on behalf of the state, or a district attorney, county
counsel, city attorney, or city prosecutor in this state shall have
the sole authority to enforce this title with respect to the unlawful
acts expressly enumerated in Section 3273.6. Nothing in this title
shall be construed to create a private right of action with respect
to the unlawful acts expressly enumerated in Section 3273.6.
(c) Except as provided in subdivision (b) with respect to the
unlawful acts expressly enumerated in Section 3273.6, nothing in this
title shall be construed to impair or impede any other rights,
causes of action, claims, or defenses available under other law. The
remedies provided in this title are cumulative with any other
remedies available under other law.