Patent Law

Judge Michel: USPTO Should Receive $1 Billion Infusion of Cash

By Dennis Crouch

Chief Judge Paul Michel recently spoke to USPTO patent examiners on the topic of 'American economic security' and the threat posed by 'the outflow of jobs, talent, technology and production.'  Judge Michel argued that private investment in US R&D is the only politically feasible solution and that goal will be supported by a well operating patent system: 'The answer is faster, sounder and clearer patents, plus faster, stronger enforcement.'

If more R&D is done here, [technologically talented individuals] will come here and stay. If not, foreign talent studying at our universities will all return home. Our own leading technologists will also go elsewhere, just as is now happening in firms such as Intel and Applied Materials, both of whom will soon open large new labs in China headed by their top American researchers.

What is wrong with the current patent system:

First, and foremost: delay. In some technologies it now takes 4-6 years even to get a patent. . . . That is because for two decades the patent office has been underfunded and losing ground. It operates entirely on user fees set by Congress long ago at levels that can no longer finance necessary operations. It lacks both enough examiners, especially experienced examiners, and modern computer systems. Imagine, the government's own technology agency is using 30 year old computer technology! These are the reasons delays are so long. Even worse, because most applications must by law be published at 18 months, others, including foreign competitors, can pirate inventions for years before the patents issue, for until then patent owners have no rights.

The patent system is failing primarily because the patent office is failing. In a word, it is dysfunctional. Over 700,000 applications sit unread in a warehouse in Alexandria, Virginia, often for years. Although 400,000 are under examination, their progress is far too slow. And every year almost 400,000 more are filed. 

Using money to fix the problem:

. . . Although the PTO should remain financed by user fees, it I needs a transfusion of public money to overcome its dysfunction. It needs thousand of additional examiners, salary increases to retain experienced examiners, new computer systems and space to house an expanded work force. (At present, many employees, although lacking extensive experience, work at home where adequate supervision is more difficult and applicant interviews are problematic.) Thus, even if Congress raised fees, which it should, resolving the current crisis requires a large infusion of public money. And it is needed soon. Deferral will have corrosive consequences that cannot be undone. Therefore, I suggest an immediate capital investment of one billion dollars. It could be spent over the next several fiscal years, but it must be appropriated immediately. . . . Is my suggestion unrealistic? Maybe, but not if our nation followed proper priorities.

Would such a transfusion as a capital investment fix the patent office? Mostly. . . .

Read the text of Judge Michel's Speech at the JPTOS Website.

Full post as published by Patently Obvious on May 12, 2010 (boomark / email).