House Republicans Propose USPTO as an Independent Agency

By Gene Quinn
September 29, 2017

This afternoon the House Budget Committee released a non-binding budget blueprint titled Building a Better America: A Plan for Fiscal Responsibility. As a part of this proposed fiscal year 2018 budget the House Budget Committee is proposing that the United States Patent and Trademark Office (USPTO) be made an independent agency.

On page 50 of the House budget proposal, under a heading discussing the elimination of overlapping Department of Commerce functions and consolidating necessary Department of Commerce functions into other Departments, the proposal includes the line item: “Establish the U.S. Patent and Trademark Office as an independent agency”. No further information is provided relating how that might be accomplished. The budget proposal does say, however, that the Commerce Department and its various agencies “are rife with waste, abuse, and duplication,” which is why House Republicans are recommending a different approach for the federal government supporting commerce moving forward.

“This is a very good idea, making it similar to NASA or the GSA,” said Q. Todd Dickinson, a partner at Polsinelli and former Under Secretary of Commerce and Director of the United States Patent and Trademark Office. “This was basically the intent of the American Inventor Protection Act back in 1999.”

According to Dickinson, who served as Director of the USPTO from 1999 to 2001, under the AIPA the USPTO was still to be an agency within the Department of Commerce under the policy authority of the Secretary, but by statute the USPTO was to retain responsibility for much decision-making. “Over time, however, Main Commerce basically abrogated the plain language of the AIPA and reasserted most managerial and budgetary authority,” Dickinson said.

Among the advantages Dickinson sees is that an independent USPTO would likely free itself from fee diversion problems that have continually plagued the Office, and it would also alleviate the USPTO from the burden of engaging in so-called “shared services” with the Department of Commerce, whereby the USPTO is being asked to pay for services the agency will not use. But some questions still remain. “One outstanding challenge is whether the head of the Office is still going to be responsible for IP policy issues in the Administration,” Dickinson explained.

The USPTO is the federal agency charged with granting U.S. patents and registering trademarks, and falls within the Department of Commerce. The USPTO advises the President of the United States, the Secretary of Commerce, and U.S. government agencies on intellectual property (IP) policy, protection, and enforcement. The USPTO also promotes stronger and more effective IP protection around the world.

“Making the USPTO an independent agency confirms that patents are private property,” said Peter Harter, a government affairs consultant. “This move echoes recommendations by the Heritage Foundations.”

Meanwhile, there has also been at least some discussion of an independent Copyright Office circulating the halls of Capitol Hill. Earlier this year, on February 2, 2017, Congressman Tom Marino, a member of the House Judiciary Committee, introduced H.R. 890, known as the Copyright Office for the Digital Economy Act. H.R. 890, which has only two co-sponsors, would establish the U.S. Copyright Office as a separate independent agency in the legislative branch, to be headed by a director appointed by the President with the advise and consent of the Senate.

On March 23, 2017, Congress Bob Goodlatte (R-VA), the Chair of the House Judiciary Committee, introduced H.R. 1695, known as the Register of Copyrights Selection and Accountability Act of 2017., which seeks to make the Registrar of Copyrights a Presidential Appointment.  The bill has 33 co-sponsors, with 29 of those co-sponsors sitting on the House Judiciary Committee. Thus, it is no great surprise that only days after it was introduced, on March 29, 2017, the House Judiciary Committee passed H.R. 1695 by a vote of 27-1. The House passed H.R. 1695 by a vote of 378-48 on April 26, 2017. A companion bill has been submitted in the Senate — S. 1010 — but no action other than introduction has taken place to date.

 

The Author

Gene Quinn

Gene Quinn is a Patent Attorney and Editor and founder of IPWatchdog.com. Gene is also a principal lecturer in the PLI Patent Bar Review Course and an attorney with Widerman Malek. Gene’s specialty is in the area of strategic patent consulting, patent application drafting and patent prosecution. He consults with attorneys facing peculiar procedural issues at the Patent Office, advises investors and executives on patent law changes and pending litigation matters, and works with start-up businesses throughout the United States and around the world, primarily dealing with software and computer related innovations. is admitted to practice law in New Hampshire, is a Registered Patent Attorney and is also admitted to practice before the United States Court of Appeals for the Federal Circuit. CLICK HERE to send Gene a message.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

Discuss this

There are currently 32 Comments comments. Join the discussion.

  1. Fred September 30, 2017 1:08 pm

    Does this mean fee diversion would stop? That would be good. However, I don’t understand the statement that making the PTO an independent agency would confirm that patents are private property–those two things seem unconnected.

  2. dh September 30, 2017 1:35 pm

    Because the NSA is more efficient and accountable?

    The USPTO is, essentially, a purely regulatory agency (it doesn’t make anything) the reliable functioning of which depends on transparency, such as it is.

    An “independent agency” is not necessarily more efficient. But it is more of an unaccountable, rogue agency that can be controlled more completely in a top-down fashion, with even less pesky transparency requirements and regulated oversight.

    Which would you expect the motivation here to be – efficiency, or less-regulated control?

  3. dh September 30, 2017 1:43 pm

    The true motivation, not the one advertised.

  4. Paul Morinville September 30, 2017 2:00 pm

    Dh, on the other hand, it is pretty obvious that the PTO is a political organization. After all, the director reports through to the president. That strong linkage shows it’s corrupt head in the results of the PTAB. Perhaps Congress sees this and is attempting to insulate a primary participant in American job creation for that political influence.

  5. dh September 30, 2017 2:15 pm

    I can certainly appreciate your concern over politicised control over what should be technical decisions. However, the last twenty years of legislation and jurisprudence does not seem to support your rather warm, fuzzy hypothesis on the motivations.

    Instability and ground-breaking shake-ups have a tendency to consolidate control, not distribute it.

  6. Paul Morinville September 30, 2017 4:55 pm

    dh, The last twenty years of legislation and jurisprudence does not support my warm fuzzy view of the world? I guess you may have misinterpreted my comment. I’ll give it one more try:

    The PTO Director reports hardline to the Commerce Secretary, who reports hardline to the President. This necessarily makes the PTO a political entity. Over the last decade, Google et al bought the government by dumping hundreds of millions of dollars on Washington. That influence bought Michelle Lee as PTO Director under the direction of Obama. Naturally, Michelle Lee did Google’s bidding in the PTAB – it was her alma mater and future potential employer – thus destroying the patent system for all but the largest, richest multinational corporation like Google.

    Perhaps… just perhaps… Congress took note of just how easy it is to destroy the patent system under the current system of campaign bribery and they are trying to find a way to cut off the PTO from the direct influence political corruption.

    And what part of the last decade of legislation and jurisprudence does not support my warm and fuzzy view? eBay taking away injunctions despite the clear Constitutional language of “exclusive Right”? Perhaps Alice dumping a large dose of chaos by not defining the undefinable “abstract idea”? Maybe you are talking about the creation of the PTAB, which kills 92% of commercially viable patents? I don’t think any of my view is warm and fuzzy. I’m not certain what your comment means ambiguous as it is, but it appears to be the warm and fuzzy view of keep the PTO hidden under the umbrella of political corruption. I think my view is quite different. I would classify my view more accurately as hot and fiery – not warm and fuzzy.

  7. John Wu September 30, 2017 5:10 pm

    I hope the PTO will be run by commissioners appointed in rotation.

  8. Invention Rights September 30, 2017 5:32 pm

    John Wu – great point! The Commissioner should be the highest official responsible for America’s innovation system. Now he is a step-child where his boss repudiates his work 92% of the time through his favorite child the PTAB. Why do we need a Director?

  9. Edward Heller September 30, 2017 6:33 pm

    All post-grant proceedings need to be separated out from the examination functions and funded by the general revenues to eliminate bias to institute and political control over outcomes.

    The examination functions can remain and should remain in Commerce. The Director should have a strong role in US economic policy making.

  10. Randy Landreneau September 30, 2017 8:17 pm

    If all we get is the elimination of fee diversion, that is still a valuable net gain. Mr. Dickenson’s comparing it to the American Inventors Protection Act raises red flags since that act created the 18 month publication of patent applications, so formerly private information is public more than a year before the inventor has any protection. How will this change help eliminate the kinds of influence that have reduced the rights of independent inventors?

  11. dh September 30, 2017 8:21 pm

    Paul Morinville

    “Perhaps… just perhaps… Congress took note….” Well, that sounds more reserved.

    Here – let’s look at another hypothesis:

    Perhaps….just perhaps…this is more of the same collusionary BS we’ve been witnessing thus far, using the perfect (and most typical) premise to do so: upheaval and transplant of the organizational structure. So many unexpected consequences; no one is at fault …..

    I think a hell of a lot more detail is required to be forthcoming so as to arrive at your rosy hypothesis on the motives afoot (which would change for the worse in due time, anyway – that’s how Washington works), at which distant point, putting much stock in your rosy hypothesis would still be inexplicably foolhardy.

    Why not simply return the USPTO to accountability mechanisms. and the rule of law?

  12. Paul Morinville September 30, 2017 9:04 pm

    dh, There is no rule of law in the PTO. I am appealing virtually every patent application I have. Some have been pending for 14 years. I had hair when I filed them.

    Simply returning it to the rule of law may work in the current administration, but another comes and that so easily goes away.

    Rosy? Warm and fuzzy? No. Not at all. It is not working with political control. That is realism. The political control must be limited if there will ever be rule of law in the PTO.

    We can agree on one thing… A hell of a lot more detail is required. The difference you and I have is how much we trust the political environment to keep things steady and how much we don’t.

  13. Night Writer October 1, 2017 10:11 am

    Maybe this will give the PTO more political will and it will become another entity in DC that wants to survive.

  14. dh October 1, 2017 3:26 pm

    Paul Morinville,

    Laws are what matter, and they were changed in broad dayllght.

    After political “think tanks” (funded by Big Pharma, and IT firms like Google) have successfully undermined the USPTO efficacy through grafting compromising DNA into the organism’s legal structure (e.g., see AIA procedures, see SCOTUS; In Re KSR), such political think tanks are now proposing to “fix” the crippling after-effects of these lobbying efforts, by now uprooting and transplanting the entire, now-compromised, USPTO organism into a completely different pasture (the over-sight regulatory environment).

    Do you find this metaphor unfair?

  15. Paul Morinville October 1, 2017 4:04 pm

    dh, Laws do matter. And yes, the law has changed in broad daylight. If the PTO followed the law, I would agree with you. But the PTO follows no law – in fact, they flagrantly disobey the law. I don’t get from your comments that you disagree with that. If the new administration asserts itself and forces the PTO to comply with the law, then I believe the PTO will comply. However, it turns out for all to see that administrations are pretty easy to buy and if the next one is bought, the PTO would again be allowed to make up their own laws and we are back to the future.

    Your argument is that this seems to be a good way to organize the PTO – under the direct control of a political office that can be bought. Mine is that this does not work. It cannot ever work. This is proven true since the creation of the corrupt PTAB where all of the power to create and destroy a property right is in the hands of one person. The PTAB alone is a recipe for corruption but that corruption bleeds through into examination. Not one of my appeals from examination are based on misinterpreted facts. They are all based the examiner flagrantly disobeying the law, just as they do in the PTAB. The whole damn thing is a sham.

    You seem to be arguing that it is working now, so why change it. I think it is not working and insulating it from political pressure (better said political corruption) is a far better solution than leaving it as it is.

  16. dh October 1, 2017 6:31 pm

    Paul Morinville,

    You are making many creative inferences here. I’m not sure how you could rationally construe my remarks to be, somehow, “arguing that it is working now.”

    The USPTO has been methodically TRANSFORMED into a kangaroo court by precisely “the last twenty years of legislation and jurisprudence” I have been outlining from the beginning of this thread.

    Apparently, although you bemoan them (the PTAB, courtesy of AIA), you do not find any fundamental problem with these recent legal innovations, in their transformative effect.

    Are you aware that the USPTO used to operate differently?

  17. Night Writer October 2, 2017 2:11 pm

    @14 Maybe it is that moving the PTO out of Commerce is a way to try to weaken it further so it has no parent to stick up for it.

  18. Anon October 2, 2017 3:05 pm

    Night Writer,

    The reasons given include making it stronger by moving it out of Commerce (vis a vis, the ability to not be hamstrung by other Commerce-wide IT initiatives).

    I do not see how a “no parent” view is something necessarily weaker. What is it that is to be “stuck up” for? to whom?

  19. Night Writer October 2, 2017 3:14 pm

    Anon,

    Standard bureaucratic SOP. Commerce won’t want one of the entities it controls to be decimated and is a bigger stronger entity. The PTO by itself would have no parent to stick up for it.

  20. Anon October 2, 2017 6:33 pm

    decimated by whom?

    “stick up for” – for what?

    I am not seeing an answer – I am seeing your repeat the thing that I am questioning.

  21. dh October 3, 2017 2:31 am

    Anon, Paul

    Rather than actually walk the USPTO system back to an acceptable baseline, by simply removing the well-recognized problem (recent SCOTUS rulings and back-door AIA legislation that brought us to this pathetic juncture), you are arguing to, instead, ignore these fundamental changes that have produced this regrettable transformation; and, instead, introduce an entirely new, un-tested, global change to the systems underlying control apparatus (regulatory environment) of the now already defunct system. Sure!… that’s the ticket!

    Assuming you have ever had to fix anything, is this how you generally interface with complex physical systems? Is this how you fix your computer?

    I really do not see how this argument could be forwarded in good faith.

    …What I do see, in plain sight, is that “think tanks” are at the cutting edge of (if not partially defined by) understanding how to rhetorically leverage public anger and disgust (which is now plainly present), so as to accomplish what is actually their purpose, which is serving their actual clients/benefactors (clients) – a very old and well-rehearsed tactic pre-dating so-called think tanks.

    I think it is also clear that this “leveraging” of public anger and distrust will be absolutely required in this particular environment, in order for the think tanks to “deliver” results to their deep-pocketed clients – said clients which are, by the way, required in order to activate said think tanks.

    Now.. what do these deep pockets actually want? – to effectively reverse recent rulings and legislation of past 10-20 years that have utterly diluted the rule of law at this so-called “new and improved” USPTO? Obviously not – or such effective reversal would, instead, be on the table.

    This current poker-faced proposal will (from a complex systems-analysis approach) effectively “bake into” the system these relatively new laws (that should instead be reversed) that are currently causing widespread public outrage and dismay. That’s fairly elementary, and probably not by accident.

  22. Anon October 3, 2017 8:13 am

    dh,

    You mis-attribute my comments, as I am not arguing to DO anything as you seem to think.

    I am looking for the reasoning behind certain comments that appear to have been made that “sound good” but when looked at more closely, need some substantiation.

    If you think that I am not very much aware of what the problems patent law has faced (and from whom) then you have not bee paying attention to my posts on those topics.

  23. dh October 3, 2017 11:21 pm

    Anon,

    Ah, I can see your point, as you appear to be a practiced contrarian, such that one might easily mis-direct ones responses by including your name.

  24. Anon October 4, 2017 7:47 am

    dh,

    You make the mistake. I called your attention to the mistake. How is this then a case of me being a contrarian or me misdirecting based on your mistake?

    There is nothing contrarian or misdirecting going on here from me.

    I do not think that you see my point at all. Rather, I think that you are vainly trying to not admit an error on your part, even as you may appear to be admitting an error.

  25. Night Writer October 4, 2017 10:19 am

    Anon: I gave you the answer. If the USPTO is under Commerce, then Commerce will not want the USPTO to shrink. This is standard stuff. Bureaucrats always want their departments to grow. The PTO by itself will have no friend to stick up for it in Congress, i.e., Commerce. Not sure what else you want. This is very standard reasoning when dealing with DC.

  26. dh October 4, 2017 12:50 pm

    Anon,

    How a self-directed algorithm might interpret irony.

    And yet, were there not more substantive issues to discuss?

  27. Anon October 4, 2017 1:36 pm

    dh,

    Whether or not there are more substantive issues to discuss has nothing at all to do with your error, compounded with you trying to shift things onto me.

    Night Writer,

    So your position is that an independent department (or whatever the Office would become) will not want to grow, but that departments would want to grow…

    Or is it that the SIZE of the entity (all of whom want to grow per the standard bureaucratic model), that is the real driver?

    The PTO – by itself – (and with the ability of Congress to ‘plunder’ or divert) may not NEED any friends “to stick up for it.”

    And by the way, you still have not answered the point of “stick up for what:… Your offered reasoning on that point is still circular.

  28. dh October 4, 2017 1:59 pm

    Anon,

    “The reasons given include making it stronger by moving it out of Commerce (vis a vis, the ability to not be hamstrung by other Commerce-wide IT initiatives).”

    Your paraphrasing rhetoric is your own, and nobody else’s. Please do not pretend to be a logical purist.

  29. Night Writer October 4, 2017 2:57 pm

    @27 Anon:

    What? My position is pretty straightforward. That the department of Commerce may stick up or the PTO as part of wanting to keep the department of Commerce large–typical games in DC. The “stick up for” is anything. Like maybe even legislation that may weaken the PTO.

    The PTO own its own is less powerful than Commerce in fighting Congress and the President. Really Anon this is standard thinking inside the Beltway.

  30. Anon October 4, 2017 4:18 pm

    dh @ 28,

    What does my comment have to do with you being wrong and my pointing out that you were wrong?

    What is it in my comment that you wish to label as “paraphrasing rhetoric,” and what does that term actually mean?

    Night Writer,

    Did you read my comment? I offered two distinct versions of how I may take your “standard” view – maybe you would like to read the comment and choose one.

  31. dh October 5, 2017 1:14 am

    Anon,

    Your smugly circular arguments aside, if you genuinely have to be shown what rhetorical devices exist in the above example, than attempting to point it out to you would be like showing card tricks to a dog.

    However, since you insist that this discussion to be all about you, I do observe that your manner smacks of the all-new breed of examiner now being actively cultivated at the USPTO, since it appears you would rather only pretend to argue points of substance, as you (quite intentionally it would seem) waste our limited interview in a silly rhetorical dance, along with the limited opportunity we had to discuss the nominal, and entirely, entirely, more important, subject matter of this discussion thread.

    Is this mere coincidence?

  32. Night Writer October 8, 2017 10:27 am

    @30 Anon

    I did answer your question. Commerce is bigger and would protect the PTO (in general to help grow itself). That is the way it works. Bureaucrats in DC try to build anything under them to increase their size. Probably if Congress wanted to cut the PTO, then Commerce would demand some compensation in the growth of something else it controls.

    You need to learn more about how DC works.

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