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Tag Archives: Fee Diversion

Patent Office Funded Through Fiscal Year 2012

Posted by Courtenay Brinckerhoff on Posted in Patent Office Practice; Patent Reform

With last week’s passage of the Consolidated and Further Continuing Appropriations Act (H.R. 2112), the USPTO finally has its spending authority set through the end of the current fiscal year, September 30, 2012. The bottom line is that the USPTO can spend up to $2.7 billion, assuming it collects that much in “fees and surcharges.”

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File Electronically To Avoid “Tax” On U.S. Patent Applications

Posted by Courtenay Brinckerhoff on Posted in Patent Reform

The America Invents Act included two separate fee provisions with early effective dates. A 15% surcharge on many USPTO fees took effect on September 26, 2011. Next, a surcharge on patent applications that are not filed electronically will take effect on November 15, 2011.

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USPTO Fee Diversion Escalates With Higher User Fees

Posted by Courtenay Brinckerhoff on Posted in Patent Office Practice; Patent Reform

One of the first provisions of the Leahy-Smith America Invents Act to take effect was the 15% surcharge on most USPTO user fees that the USPTO started collecting on September 26, 2011. As I wrote previously, the USPTO has not been able to spend any of the extra fees collected in the last few days of the fiscal year that ended September 30, 2011, and will not be able to spend any of the additional fees it is collecting now unless and until Congress increases its appropriations.

Last week, the Intellectual Property Owners Association (IPO) published numbers that drive home the extent of the fee diversion problem, and illustrate how patent reform is exacerbating the situation. Before patent reform was enacted, the USPTO had been on track to lose $70 to $100 million. However, because so many patent applicants paid fees “early” to avoid the new surcharge, the USPTO ended up collecting over $200 million more than it was authorized to spend. That means patent and trademark applicants paid over $200 million in fees that, instead of going to fund USPTO functions, went into the United States treasury’s general fund.

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Patent Reform–A Tax On Innovation?

Posted by Courtenay Brinckerhoff on Posted in Patent Reform

The enactment of the Leahy-Smith America Invents Act on September 16, 2011 means that a 15% surcharge on most patent office fees will take effect on September 26, 2011. (The USPTO has published the new fee schedule on its Leahy-Smith America Invents Act Implementation website). But, with no new appropriations, the USPTO will not be permitted to spend this money. Rather, it will go into the U.S. treasury’s general fund, further compounding the problem of fee diversion.

Although patent reform places significant new demands on the USPTO, there is talk of funding the USPTO under another “continuing resolution” for the new fiscal year that begins October 1, 2011. If the USPTO is not permitted to spend all of the (higher) fees it collects, it may be forced to pull resources from examination in order to meet the new statutory mandates.

The net effect of higher USPTO fees, increased demands on the USPTO, and a static or reduced USPTO budget will be a new tax on patent applicants–hardly the job-creating, innovation-promoting patent reform that we were promised.

How Will Patent Reform Solve The USPTO Backlog?

Posted by Courtenay Brinckerhoff on Posted in Patent Reform

Last week, The Kojo Nnamdi Show on Washington, D.C. public radio station WAMU had two programs about patent reform. On Tuesday, there was a panel discussion on “Innovation and Patent Reform.” On Wednesday, Kojo talked with USPTO Director David Kappos about “Updating the U.S. Patent Office.” While I usually cringe when mainstream media discusses patent issues, I found these shows to be very good, even if I didn’t agree with everything that was said. One issue I would like to press Director Kappos about is his assertion that the pending patent reform legislation will help the USPTO solve the problem of the examination backlog.

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Patent Reform Clears Another Hurdle

Posted by Courtenay Brinckerhoff on Posted in Patent Reform

It is getting harder and harder for me to not pay attention to patent reform: Yesterday, tthe House approved its version of Patent Reform (H.R. 1249, the America Invents Act).  

The next step is to reconcile the differences with the Senate version approved in March (S. 23). Perhaps the most significant difference relates to USPTO funding. The House version passed with a “compromise” on the anti-fee diversion provision which many USPTO supporters will find unacceptable. Although the House bill provides for USPTO user fees to be deposited into a separate fund, the USPTO’s spending authority still would be limited by Congressional appropriations. The House version also includes various provisions with no corresponding terms in the Senate version, which may or may not fall out of any final legislation.

While Patent Reform has at least one more hurdle to clear, it is getting closer and closer to the finish line.

USPTO Budget Cuts Halt Track I & Other USPTO Initiatives

Posted by Courtenay Brinckerhoff on Posted in Patent Office Practice

On April 22, 2011, USPTO Director Kappos announced the impact of the budget reductions embodied in the fiscal year 2011 budget that finally was enacted on April 15, 2011. (Fiscal year 2011 runs through September 30, 2011). The budget gives the USPTO the authority to spend only $2.09 billion, which is about $100 million less than its projected fee collections.

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The Washington Post Muddies The Waters On Patent Reform

Posted by Courtenay Brinckerhoff on Posted in Patent Reform

Now that the Senate is set to vote on the Patent Reform Act of 2011 this week, the mainstream media is weighing in on the issues. This Saturday, The Washington Post published an editorial in support of patent reform, (“Why The patent process should be overhauled,” Feb. 26, 2011) but it butchered the background facts so thoroughly that it did more to confuse the issues than enlighten the public. I sincerely hope that Senators are better informed when they place their votes this week.

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Stop Robbing Peter Patent to Pay Paul Public

Posted by Courtenay Brinckerhoff on Posted in Patent Office Practice; Patent Reform

As Congress continues to debate the federal budget, patent stakeholders are justifiably concerned that Direct Kappos’ efforts to improve the U.S. patent examination process, enhance patent quality, and reduce the backlog of unexamined applications will be thwarted by inadequate funding. Indeed, if Congress continues to divert hundreds of millions of the USPTO’s user fees to the general fund, any vision of an innovation-driven, patent-backed growth in the U.S. economy will quickly fade away.

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Fee-Based Fast-Track Examination On The Horizon?

Posted by Courtenay Brinckerhoff on Posted in USPTO Proposed Rule Changes

The USPTO has issued a proposed rulemaking supporting its plans to implement “Track I” of the three track examination program announced last year. According to the announcement, the USPTO is still considering public comments on other aspects of the program, but wants to move forward with Track I because “the vast majority of public input was supportive.”Continue reading this entry

USPTO Gets $129M For Back-To-School Shopping

Posted by Courtenay Brinckerhoff on Posted in Patent Office Practice

In a blog post published August 2, 2010, Director Kappos announced the passage of legislation that will give the USPTO the authority to spend an additional $129 million in the current fiscal year, which ends September 30, 2010.

The USPTO plans to spend this money on the following priorities, which correspond to key items from its draft Strategic Plan for 2010-2015:

  • hiring additional patent examiners
  • funding overtime for patent examiners and support staff
  • accelerating patent examination process reengineering
  • funding PCT contract work
  • accelerating IT projects

Once the legislation is signed by President, it will reduce the Fiscal Year 2010 fee diversion from the USPTO to under $100 million. (The USPTO’s total budget for FY 2010 was about $1.9 billion.)

This is a trend that everyone in the U.S. patent community would like to see continue, especially as the budget for next fiscal year is set. (The USPTO has requested a budget of $2.3 billion for FY 2011.) No matter what our own spending priorities might be, there is nearly unanimous agreement that the USPTO should be able to keep the fees that it collects, and reinvest those funds to improve its operations.