More money, end of fee diversion sought for patent agency

The Patent and Trademark Office would receive $1.9 billion in fiscal 2008 under the budget plan President Bush released Monday.

This also is the fourth year in a row the White House has recommended the Congress allow the agency keep fees collected from patent and trademark applications instead of diverting funding to other government programs.

The proposed increase for PTO is about 8 percent higher than the amount Congress is expected to appropriate for fiscal 2007, PTO Deputy Director Stephen Pinkos said in a telephone briefing with reporters.

If approved, the fiscal 2008 budget request would allow the PTO to "build on its recent successes in improving quality and increasing the number of patent and trademark examinations," Pinkos said. The agency also could continue hiring patent examiners and expand its worldwide intellectual property protection efforts, he added.

In fiscal 2008, the PTO anticipates hiring an additional 1,200 patent examiners and plans to continue expanding the agency's telework efforts. The net gain in examiners would be about 800 employees because the agency's attrition rate is about 10 percent annually, Pinkos said.

The funding request also would let the agency move toward its goal of processing all patent and trademark applications electronically. Almost 50 percent of patent applications already are filed electronically, he said.

Under Bush's proposal, PTO could expand its global intellectual property academy, which has provided training programs for foreign government officials since its launch in September 2005. The funding request also would allow the agency post additional IP experts abroad, Pinkos said.

According to PTO, examiners completed 332,000 patent applications in 2006 -- the largest number ever -- while achieving the lowest patent allowance error rate (3.5 percent) in more than two decades. At 54 percent, the amount of applications reviewed and approved also was the lowest on record, the agency reported.

PTO also processed a record number of trademark applications in 2006, Pinkos said. His agency's trademark attorneys took final action on 378,111 applications, a 36 percent surge over the previous year.

California Democrat Howard Berman, chairman of the House Judiciary's Court, the Internet and Intellectual Property Subcommittee, praised the budget request's stipulation barring fee diversion. The agency should keep the fees they collect "so they can implement quality initiatives for higher quality patents and hire additional necessary staff to reduce pendency," he said.

A spokesman for patent crusader Sen. Orrin Hatch, R-Utah, echoed Berman's remarks. He said PTO's full access to its fees, plus a $72 million increase over the fiscal 2007 budget, is the key to a healthy future for the agency.

Herb Wamsley, executive director of the Intellectual Property Owners Association, noted that if the PTO income generated from fees is greater than what is projected, the agency does not get to pocket the excess money. "The system is not perfect yet, but it's getting better," he said.

PTO did not have to relinquish any surplus fees to the government in fiscal 2005 or fiscal 2006 because the agency actually collected "slightly below our authorization figure for those two years," Pinkos said.