The United States Patent and Trademark Office today announced two news items relative to its efforts to expand international work sharing arrangements. First, On May 19, 2010, USPTO Director David Kappos and China’s State Intellectual Property Office (SIPO) Commissioner Tian Lipu signed a Memorandum of Understanding (MOU) on comprehensive bilateral cooperation on patents. The signing took place during a signing ceremony held at the USPTO campus in Alexandria, Virginia. Second, in a separate and seemingly unrelated item, the USPTO also announced today that it would eliminate the fee for the petition to participate in Patent Prosecution Highway (PPH) programs. The elimination of the PPH petition fee is expected to encourage greater PPH participation by patent applicants. The good news is that yet more is being done to address the backlog and pendency. But I am still hoping for a plan aimed straight at independent inventors and start-up businesses here in the U.S.
It seems pretty clear that under the direction of David Kappos the United States Patent and Trademark Office is pursuing an “all of the above” strategy to cutting into the backlog and ultimately reducing the pendency of patent applications. It is easy to criticize any one of the initiatives that the USPTO is pursuing, but that would be to miss the forest for the trees. The reality is that unless and until Congress steps up to the plate and does something, which seems extraordinarily unlikely, the Patent Office will be left to attempt to piecemeal together solutions. So while no one solution can or will solve all of the problems plaguing the patent system, if cascading solutions are employed at least some applicants can be helped and at least some applications can be accelerated. Of course, the name of the game today is job creation, so I propose a creative way to accelerate patent applications out of order upon proper showing that jobs will be created, and focus my suggestions on those companies that are most likely to create jobs; namely those 5 years or younger and with 99 or fewer employees.
The United States Patent and Trademark Office today announced the expansion to all applicants a “Project Exchange” program. Under the expanded Project Exchange, which will take effect with the publication of the Federal Register notice in the coming weeks, an applicant with more than one application currently pending at the USPTO can receive expedited review of one application in exchange for withdrawing an unexamined application. This initiative was first announced by USPTO Director David Kappos at the 14th Annual Independent Inventors Conference held on the campus of the USPTO and officially announced via press release from the USPTO on November 6, 2009. At the time it was limited to small entities (i.e., independent inventors or small businesses), but now is being expanded to any applicant.
Last week David Kappos, Undersecretary of Commerce and Director of the USPTO, told a packed room of people at the BIO International Convention that innovation produces high paying jobs and patents are a critical component of the innovation to commercialization to job creation cycle. He didn’t receive any disagreement, but lets face it, he was preaching to the choir. As Jim Greenwood, President & CEO of BIO told me, “the only thing [most biotech companies] have is intellectual property… They start off with that and then they have to raise money to even begin to have microscopes and bricks and mortar and staff. It is on the strength of that intellectual property that they have to raise all of those dollars for a very long time.” So without patents the biotechnology sector simply wouldn’t exist, and that means many tens of thousands of jobs, if not hundreds of thousands of jobs, wouldn’t exist. So the BIO Convention was well in tune with the message Kappos delivered, but preaching to the choir is only so helpful. With that in mind allow me to take a stab at explaining how vital the US patent system is to the economy, why ignoring the USPTO has directly lead to this recession lasting far longer than it should have, and why properly funding the USPTO is critical to job creation and the US climbing out of this horrible economic crisis.
First, allow me to point out the reality that so many want to ignore. We can all pretend that innovation simply happens without funding, and the naysayers and anti-patent advocates will just assume that is true, but the unspeakable reality is that innovation requires funding. Without funding there can be no innovation, period! Anyone that believes otherwise is ignoring reality and akin to the quacks that run around claiming they have discovered the secrets of a perpetual motion machine. Perpetual motion machines don’t exist, and neither does unfunded innovation. Even if you are operating in an area where innovation doesn’t require enormous capital investment, it always requires the investment of time, which comes with opportunity costs. So please save me the ridiculous, head-in-sand ravings that innovation doesn’t cost. It does, and the overwhelming majority of investors want to see issued patents. It really is that simple.
Francis Gurry, WIPO Director General at BIO Convention
Yesterday I had the honor of spending 30 minutes interviewing Francis Gurry, the Director General of the World Intellectual Property Organization (WIPO). The interview was conducted on the record and at the BIO International Convention being held in Chicago, this week. My interview with the Director General took place at 11:00am, prior to his panel session with USPTO Director David Kappos at 2:00pm.
The Director General spoke substantively about issues facing the Patent Offices of the world, as well as some possible solutions. Gurry also discusses harmonization attempts, work-sharing agreements and the crushing worldwide backlog of patent applications that could lead to irrelevance of the system. As you read the interview you will also see that he thinks it is possible that the rest of the world will adopt a US-like grace period, which echos Kappos’ recent push to not only get US patent reform enacted but to harmonize laws, but to push the rest of the world toward a uniform grace period. Gurry also indulged me in a bit of speculation regarding software and the worldwide disagreement on whether software should be considered patentable subject matter.
Gurry was quite engaged and gracious. He is extraordinarily well informed and conversant with the issues and processes on both a macro and micro level, as well as the political realities associated with harmonization and other issues that have for decades dogged the international intellectual property community. We could have easily talked for hours on all sorts of issues, and I hope to have the opportunity to go back on the record with him in the future.
Louis Foreman is the creator, executive producer and lead judge of the Emmy® award-winning PBS reality show Everyday Edisons, which features ordinary people transforming their original ideas into retail products. Foreman is also Chief Executive of Enventys, an integrated product design and engineering firm with offices in Charlotte, NC and Taiwan, as well as the publisher of Inventors Digest, the largest and oldest publication for the inventor community. He is also co-author of The Independent Inventor’s Handbook. Foreman is an inventor himself, holding 10 US patents. So it is fair to say that few people know the trials and tribulations of independent inventors better than Louis does, and Louis Foreman supports patent reform.
Earlier today, Foreman sent the letter reproduced below to Senator Patrick Leahy (D-VT), who is Chair of the Senate Judiciary Committee. It is the Senate Judiciary Committee that has pending before it S. 515 relating to patent reform. As his letter explains, Foreman supports patent reform because “leaving the current system alone is not an option, nor does it benefit anyone.” Foreman believes the pending patent reform is a “significant improvement” because, among other things, it will lower fees for micro-entities and because it will “ultimately result in a stronger patent making it easier for independent inventors and small businesses to attract start-up capital.”
Earlier this week, on Tuesday, February 16, 2010, TiVo, Inc. (NASDAQ: TIVO) was granted US Patent No. 7,665,111, titled Data storage management and scheduling system. This patent is indicative of what I suspect will become a growing problem in the years to come, which is a resurgence in so-called submarine patents. This patent matured from a patent application filed on October 20, 1999, which means it was pending at the United States Patent and Trademark Office for over 10 years. Amazingly, according to the Patent Office no patent term extension is owed. Exactly how can a patent remain pending for over 10 years and not be entitled to an extension in the term? I really don’t know to be perfectly honest, but it seems that this patent will apply to pretty much any and all DVRs currently on the market, so even if there is no patent term extension granted it could produce a choke-hold on the industry through October 20, 2019, which should create a tidy sum of royalty payments for TiVo, at least over the near term. Of course, it will also spark a rush to innovate around the TiVo patent, thereby causing innovation to march forward, much to the chagrin of anti-patent advocates who are already proclaiming this patent to be evidence that patents harm innovation. In any event, a patent that issues after 10+ years suggests problems, even if the intended march of innovation is encouraged, which will of course be the case.
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