New Chief of Patent Office Takes Aim at a Massive Backlog
By AMY SCHATZ
WASHINGTON -- The U.S. Patent and Trademark Office's new chief has kicked off an effort to overhaul the patent-application process, seeking to fix the backlogged and financially strapped agency and help the Obama administration earn some good will with the business community.
On Thursday, Director David Kappos scrapped controversial rules that would have limited the number of patent claims companies could file and the information they could submit to back up claims. The rules were proposed during the Bush administration in a bid to accelerate the patent process, but many in the business community believed the opposite would result.
The Obama administration this week also pledged to help push through legislation to overhaul the patent process this year.
"It's a high priority for the administration," said Mr. Kappos, who previously served as IBM Corp.'s top intellectual-property lawyer. "The administration is very committed to getting it done as quickly as possible."
The patent office has a backlog of more than 700,000 patent applications, and a $200 million funding shortfall for the fiscal year that began Oct. 1.
Although the office has traditionally operated with a backlog, the pile has increased in recent years. Even though there has been a drop-off in applications during the recession, it hasn't helped examiners catch up. One reason is that overtime has been cut, so examiners spend fewer hours processing applications. What's more, because the office is entirely funded by user fees, the dropoff has left it with a budget gap.
Patent rules haven't changed significantly in five decades, despite many attempts by Congress.
This year, a fragile compromise between pharmaceutical and technology companies on a Senate bill could make a difference. The bill would institute a "first-to-file" system that would award patents based on the date an application is filed, rather than on the date of invention was made.
"The Senate did a good job of getting a compromise," said Intel Corp. Chief Executive Paul Otellini, who joined other CEOs in Washington this week to lobby administration officials and lawmakers on issues including patents. "I worry that the agreement [between drug and tech companies] is transient."
Mr. Kappos's moves are part of an effort by the Obama administration to help the business community with faster, higher-quality patent approvals -- a priority for companies, especially those in the high-tech and pharmaceutical sectors.
U.K. drug maker GlaxoSmithKline PLC challenged the Bush administration's rules in federal court in 2007. It was joined by pharmaceutical and tech companies and universities, which worried the rules would limit their ability to get quality patents.
The rules, which were stayed by the court because of the lawsuit, would require shorter applications to help speed processing. They also would limit how much information could be submitted after an application was filed, a special concern for drug companies that routinely submit data later.
"We're not here to penalize the U.S. innovation community," Mr. Kappos said.
Sherry Knowles, GlaxoSmithKline's chief intellectual-property counsel, welcomed the decision to scrap the rules, but some public-interest groups and companies disagreed.
"The rules were a good idea because they sought to implement reasonable limits on the amount of times you could apply for a patent," said Daniel Ravicher, a law professor and executive director of the nonprofit Public Patent Foundation.
Mr. Kappos has taken other steps to improve the agency's efficiency. He recently proposed adjusting the compensation system for patent examiners, in an effort to give staff an incentive to process applications differently, including handling routine ones more quickly.
The patent examiners' union helped draft the new rules, which would give examiners more time to study applications, with the aim of decreasing their need to seek extensions to resolve questions about the applications.
