Patent Office backers say agency must keep money it collects

Ratcheting up the fight against Bush administration budget officials and appropriators who have diverted funds from the Patent and Trademark Office, lawmakers Thursday turned a spotlight on conditions at the agency that they said could only be resolved with more money. At a House Judiciary subcommittee hearing on the operations and funding needs of the patent office, witnesses expressed deep dissatisfaction with the Bush administration's fiscal 2002 budget, which would divert $207 million of the fees paid by patent applicants. The president of the Intellectual Property Owners (IPO) said his group is contemplating a lawsuit against the government to stop fee diversions. "We have discussed the constitutionality of the continued diversion of funds, have consulted a constitutional lawyer and are preparing a paper," asserting that such a diversion violates the Constitution's prohibitions on "takings" without just compensation and direct federal taxation of property, said IPO President Ronald Myrick. He emphasized that his group had not yet taken a position. "The new administration and Secretary of Commerce are looking afresh [at the PTO], and we are hoping that it will make our concerns go away," Myrick said in response to a question from House Judiciary Courts, the Internet and Intellectual Property Subcommittee Chairman Howard Coble, R-N.C. Although subcommittee ranking Democrat Howard Berman, Calif., opposes the diversion of fees, he questioned the constitutionality claims. But he otherwise presented a united front with Coble and highlighted a bill, H.R. 2047, that would bar appropriators from taking any patent fees from the agency in fiscal 2002. Berman, a co-author of the bill, previously introduced similar legislation, H. Res. 110, and he pledged to pursue both. Acting PTO Director Nicholas Godici said the agency was doing its best to meet its goals to increase patent quality, reduce pendency--the time it takes for the office to issue a patent--and computerize its administrative procedures.

Myrick said that without more funding, the agency would continue to fall further behind. He said pendency is expected to rise from 26.2 months today to 38.6 months in 2006. "This is entirely unacceptable and will drive [businesses] away from using patents." Speaking on behalf of the International Trademark Association, Nils Victor Montan noted that in spite of a dearth of patent examiners, the agency had been required by officials at the Commerce Department to implement a hiring freeze earlier this year. "Commerce has authority over matters of policy but not over matters concerning personnel," Montan said, adding that he would like to "make sure that the PTO is no longer subject to Commerce Department hiring freezes."