At the quarterly meeting of the Patent Public Advisory Committee (PPAC) on Thursday, Acting U.S. Patent and Trademark Office (USPTO) Director Drew Hirshfeld told attendees that patent filings are presently down 3.9% compared to the same time last year; the Office had projected filings would be down 3.7% for the year in the wake of the pandemic, but since filings have been coming in at a greater rate than expected in the last two months, the models now predict an overall 2% decrease for the year instead.
The Office’s fiscal health is also good despite a year of economic turmoil, and PPAC Finance Subcommittee Chair Bernard Cassidy said that the “overall financial position of the PTO is positive and stable.” Congress recently approved a request to spend the Office’s overage from last year, and the situation could get even better if previously collected fees are made available to the agency in the future.
There is presently $1.17 billion in user fees that were collected prior to the America Invents Act that has yet to be allocated to the Office. The money is in an account at the Treasury Department and has not been diverted, but the agency has been unable to use it.
USPTO Chief Financial Officer Jay Hoffman told the PPAC and attendees that there are several ways the Office could spend that money if allocated: IT updates to make the agency more accessible to small businesses and independent inventors; improving efficiency by implementing artificial intelligence (AI) tools; and limiting fee increases for an extended period of time. “These balances would strengthen the financial position of the agency,” Hoffman said.
The unused fees would also help the agency to implement initiatives such as those required under the IDEA Act, which recently passed out of the Senate Judiciary Committee. Hoffman explained: “As we try to expand the breadth of services, the money’s got to come from somewhere – either from the aggregate fees we’re currently collecting, or these previously collected fees.”
Cassidy added: “This is a topic we’ll have to pursue; we need to get the cooperation of Congress to put the fees in the hands of the PTO.”
PPAC Chair, Julie Mar-Spinola, also asked Hoffman whether he had considered the potential financial impact of the Biden Administration’s decision to support waiver of IP rights related to COVID-19 technology on the Office. Hoffman said he hadn’t, but offhand, the technology centers it would affect – while not insignificant – are not the largest revenue generators for the USPTO.
Other topics addressed during the five-hour meeting included legislation relevant to the Office; Patent Trial and Appeal Board (PTAB) developments; AI initiatives; patent pendency and quality; and Office efforts to support President Biden’s Executive Order on advancing racial equality.
With respect to the latter, USPTO Director of the Office of Equal Employment Opportunity and Diversity Bismarck Myrick said that he has been heading up efforts to comply with the Executive Order, which requires each agency of the government to conduct an equity assessment. The Administration has provided “an extensive questionnaire to identify areas where equity could be improved,” Myrick said. A Steering Committee is currently assisting each unit in conducting an audit, and preliminary information is due to the Department of Commerce by June 15.
On the topic of legislation the Office is monitoring, Acting Director, Office of Governmental Affairs and Oversight Kimberley Alton said that, in addition to the IDEA Act, the USPTO is closely watching developments on the Endless Frontier Act, which was reintroduced last month by Senate Majority Leader Chuck Schumer (D-NY), Senator Todd Young (R-IN), Representative Ro Khanna (D-CA), and Representative Mike Gallagher (R-WI). The bill looks at how to invest and retool federal agencies that have science and technology as key parts of their missions. One aspect of the bill would provide $10 billion for the creation of regional technology hubs. “That function aligns closely with the PTO’s work, so we will work closely with Commerce as the bill moves through Congress,” Alton said.