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Judge Michel on the Patent System

By Peter Zura

On the nomination of Kappos as USPTO Director:

I think the selection of David Kappos as the director of the USPTO is the clearest indication of the new administration's appreciation of IP issues . . . This appointment is salutary - Kappos is a highly experienced lawyer with a worldwide perspective and strong management, as well as legal and technical, skills.

On USPTO funding:

The US Congress decided some years ago that the USPTO must be self-supporting. However, this works only if the fees are adequate to generate the revenue needed for a high-quality, speedy process for both trademarks and patents. I think the reality is that the fees, although they have been raised over the years, are still woefully inadequate to support the examination and IT resources required on the patent side and they barely cover the internal costs incurred on the trademark side. In my opinion, Congress has relied excessively on fee revenue to support the office. During the current economic crisis it would make sense to alter the financing arrangements in place for the USPTO so that it can draw on both taxpayer and fee-generated funds. I am not suggesting that this dual-funding option should be ongoing, but I do think it would be justified as an emergency stop-gap measure. A transfusion of public money to the USPTO would help rescue it from its current mission impossible. It simply cannot do the job needed by industry, the corporate world and ultimately the national economy with the totally inadequate resources it currently commands.

Michel's remarks can be viewed in full at World Trademark Review (registration required). You can also read comments from Joff Wild at the IAM Blog here (link).

Also, Judge Michel does not appear to be enamored with the tenor of arguments in favor of patent reform, or the diversity of voices - recently, he implored a group of lawyers to "voice their views" in the congressional debate over patent reform, and "lamenting that California technology companies are currently driving the discussion." Michel remarked:

Patent legislation is an opportunity for things to get much better, but it's also a risk for things to get much worse, and it's not entirely clear which direction it's going to head in . . . It will depend a lot on what people in the profession do. If we each do our part, then I think the odds go up greatly that the outcome will be favorable to the broad mass of companies.

From today's article from Law.com:

Michel estimates that 14 Silicon Valley companies, which mainly produce computer and telecommunications equipment, are influencing the debate the most. The interests of many other industries and geographic regions and the bulk of some 30,000 U.S. companies with more than 100 employees, he suggested, are not being heard.

In reviewing most of the congressional testimony from the past five years, Michel said he found it lacking. Specifically, he said statements that the patent system has been ruined by an explosion of litigation and that there have been rampant and excessive damage awards are wrong. Both the number of patent infringement cases filed and the median award in those cases have been stable for the past 15 years, he said.

Read Law.com "Judge Michel Calls for More Voices in Patent Reform Debate" (link)

Full post as published by Two-Seventy-One Patent Blog on October 01, 2009 (boomark / email).