PATNEWS: A letter to Congress to protest stealing patent fees
Gregory Aharonian
The AIPLA recently sent out the following letter to its patent lawyer
members, asking them to contact their Congressional representatives using
the form letter attached below. In general, it is a good letter that I
encourage inventors to use as well (though I changed the form letter to be
from the point of view of an inventor), except for the AIPLA's blind spot
to mismanagement at the PTO. While I want the PTO to get all of the monies
coming in from fees, at the same time I want them to spend the monies
efficiently and better manage operations at the PTO, especially the working
conditions of examiners and providing the public better access to patent data.
To that end, I added a paragraph to the following form letter asking Congress
to review the management practices at the PTO.
Greg Aharonian
Internet Patent News Service
====================
American Intellectual Property Law Association
2001 Jefferson Davis Highway, Suite 203, Arlington, Virginia 22202-3694
telephone (703) 415-0780 - facsimile (703) 415-0786
January 20, 1997
NEW CRISIS IN PTO FUNDING
The President's Budget contains an unprecedented proposal to take
$92,000,000 in patent fees from the PTO in FY 1998. It is imperative that
all AIPLA members communicate their opposition to this proposal to their
Congressional representatives.
IMMEDIATE ACTION NEEDED
An explanation of this proposal and its drastic impact on the PTO follows.
Please take the time to read this material. Please contact your
Representative and Senators. If you fail to act, our members and clients
will share the unfortunate consequences which will certainly follow.
Background
On February 6, 1997, President Clinton will forward his FY 1998 budget to
Congress in which the Administration proposes to take $92 million dollars
from the patent fees which will be paid by patent applicants in FY 1998.
This is unprecedented. While Congress has increasingly diverted patent fees
for other unrelated government programs over the past five years, never has
a President proposed to take patent user fees. If each recipient of this
message does not demand that this budget proposal be rejected, the $92
million will almost certainly be taken and Congress will take what funds
would be left in the patent fee surcharge. This will mean that the PTO will
lose nearly 20% of its patent examination funding for FY 1998--$$119,000,000.
Congress created the patent fee surcharge fund when it imposed a 69%
surcharge on patent fees in 1991 to replace the taxpayer revenue support
the PTO had been receiving. Almost immediately, however, Congress began
treating the revenue collected by the surcharge as if it was taxpayer
revenue. As you know, Congress has taken over $140,000,000 over the last
five years, including $54,000,000 in the current fiscal year. To cope with
this diversion in this fiscal year, the PTO has been forced to scale back
the hiring of patent examiners by 50% to process the workload and has
drastically curtailed its automation efforts. One can imagine the impact of
a cut more than twice the size of this year's diversion.
Action Request
Please use the following draft letter to communicate with your
Congressional representatives. Feel free to modify the letter to reflect
your personal views on this matter. Tailoring the letter to give the
message in your words is in fact desirable as it will indicate that this is
a matter on which each of our members has his or her own personal
views--and it will make it less like a form letter.
Some members of Congress will respond to your letters. The content will
vary considerably. Some may respond in a partisan fashion, taking the
opportunity to criticize the President. Others may respond with "budget
speak" to justify the diversion of funds in this and earlier years. Keep in
mind that while this is the first time a budget from the President has
proposed taking PTO fee revenue, both parties have diverted PTO fee income
when they were the majority party controlling Congress. Whether funds are
withheld at the request of the President or at the initiative of the
Congress, it is an outrage and must be stopped
Thank you,
Michael K. Kirk
Executive Director
The Honorable
U. S. House of Representatives/United States Senate
Washington, D.C. 20515/20510
Dear Representative/Senator:
As your constituent and an inventor, I am writing to express strong opposition
to the provisions in the budget sent to Congress by President Clinton on
February 6, 1997. This budget would take $92 million dollars of fees paid
by patent applicants for the processing of their applications by the Patent
and Trademark Office (PTO) in fiscal year 1998, presumably to permit funding
of some other government programs. The continued misappropriation of the PTO's
user fees in this and in earlier years by Congress, and now proposed by the
Administration, is a tax on innovation, imposed on America's inventors for
sharing the results of their creativity with the public, and must be stopped.
The PTO is totally funded by user fees. The PTO has received no taxpayer
funds since 1991 when Congress raised patent fees 69%. However, beginning
in 1992, Congress has increasingly denied the PTO the right to use all of
the fee income collected. Congress raised patent fees to replace taxpayer
funds and now denies the PTO both taxpayer funds and the funds raised by
the increased fees. Through 1996, the PTO has been denied permission to
spend $90,000,000 of the patent fees it has collected, freeing up Congress
to spend an equivalent amount elsewhere. In the current fiscal year,
Congress is taking $54 million of patent applicant's fees (9% of the PTO's
operating budget). The President now proposes to take $92 million in next
year's fees, and Congress will undoubtedly increase this amount as it looks
for extra money to fund pet projects in the coming year.
There is no valid reason for the Administration or the Congress to take the
fees that patent applicants pay for PTO services and products. To give you
an example in real terms, for each of the 200,000 applications to be filed
in FY 1997, the 104th Congress decreed that $270 be taken from each patent
applicant's fees and used elsewhere. The President's proposed budget would
increase this to $435 and Congress, unless restrained, will increase this
amount even more.
As an inventor, I find it difficult to understand why the Federal Government
is using our fees to fund other programs rather than processing our patent
applications. Furthermore, to reduce the quality of United States patents by
shunting PTO users fees elsewhere is particularly ill-advised for maintaining
United States' technological strength abroad in light of recent action by the
European Patent Office. The European Patent Office recently reduced its patent
processing fees by $89 million annually in order to strengthen the incentives
of the European patent system for European inventors and industry. The decline
of the United States Patent Office against this backdrop will make it much more
difficult for United States' products to compete in the world market. The
chain of victims of this misappropriation of user fees begins with the
inventor, continues through the PTO and ends with the United States. Patent
applicants (your constituents) will experience increasing delays, the
quality of patents will decline, the incentives of the patent system to
invest in research will be diminished, and consequently, the United States'
technological leadership will be eroded.
The competitive strength of the United States in the 21st Century will be
built on high technology products and services. The loss of $54,000,000 in
user fees in FY 1997 and $92 million or more in FY 1998 would severely
impact the functioning of the PTO. Indeed, it risks destruction of the
patent system as we have known it and destruction of a pillar upon which
the United States' competitiveness in the global economy is based.
At the same time, I ask you to encourage Congress to examine the current
practices and management of the PTO. There are ongoing serious problems,
such as the intolerable conditions under which PTO examiners must examine
patent applications, that hurt the quality of issued patents and intregrity
of the patenting system. The PTO deserves all of the monies it receives
from patent fees, but the PTO must spend these monies responsibly and operate
the PTO more efficiently.
This practice--this theft--must be stopped. I am asking you to vote to keep
patent applicants' fees in the PTO's operating budget so that inventors
can obtain high quality patents and services timely.
Thank you.
Sincerely,
rjr...@tir.com
While I agree that PTO funds should stay in the PTO I would argue that
defeat of H.R. 400 is much more important to inventors than the funding
issue. The fact of the matter is that passage of H.R. 400 will make
patents held by independents inventors, small and medium sized business,
and universities virtually unenforceable.
AIPLA is run by many of the same large corporations that are noted for
stealing independent inventors work and it consistently advocates patent
changes that are damaging to our interests. In fact, it is one of the big
promoters of H.R. 400 and for that reason it's pleas tend to fall on deaf
ears.
Michael K. Kirk, Executive Director of AIPLA, has been known to make
numerous derogatory remarks about independent inventors including telling
one member of congress that the inventors who signed the "Open Letter to
President Clinton from 59 U.S. inventors".
http://www.alliance-dc.org/aainews/ipc1.html concerning the 20 year
language of the GATT enabling legislation did not understand the issues.
The group who is opposing him includes many Hall of Fame inventors and
several Nobel laureates, who I am sure were surprised that Michael K.
Kirk had such a low opinion of them.
Therefore, I suggest that loss of PTO funds is a direct result of
incompetent management of the PTO (and Kirk is one the former managers)
and that the inventors first priority should be removal of the bad
management and defeat of H.R. 400. The PTO would not be facing this
situation if they had been focused of their mission, but the fact is that
the PTO's upper management has been focused on promoting their own little
dictatorship in the form of a privatized PTO.
Mr. Lehman was no doubt instrumental in H.R. 400 provisions that would
not allow his removal at all for five years and then only with cause.
And he is quite willing to go along with the multinational corporate
agenda to gut America's patent system to achieve that end.
Last, I suggest that any letters inventors or other interested parties
send to congress should focus on defeating H.R. 400 with complaints about
the raid on PTO funding being a lower priority. It is a shame that Mr.
Lehman has created a situation where inventors can not afford to help
him.
I invite you to join us. There is no charge to join but we do gratefully
accept donations. Also, you will find an opportunity to network with
commercially successful inventors. Check out our web site or call (800)
308-6933.
-------------------------------------------------------------------------
Views expressed are my own. Detailed contact information available on web
pages shown below. NOTE: Remove the ".Remove" when replying.
Ronald J. Riley, E-mail rjr...@Alliance-DC.org
http://www.Alliance-DC.org/inventors/R.J._Riley/
Alliance for American Innovation, Web Pages: http://www.Alliance-DC.org
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Copy of AIPLA drivel follows:
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In article <E56r6...@world.std.com>,
-------------------==== Posted via Deja News ====-----------------------
http://www.dejanews.com/ Search, Read, Post to Usenet
Bruce Hayden
rjr...@tir.com wrote:
>
> While I agree that PTO funds should stay in the PTO I would argue that
> defeat of H.R. 400 is much more important to inventors than the funding
> issue. The fact of the matter is that passage of H.R. 400 will make
> patents held by independents inventors, small and medium sized business,
> and universities virtually unenforceable.
I have read the bill a couple of times and am having quite a hard time
finding anything in the bill that would lead to this result. Rather,
I would suggest that this is another instance of Ron's scaremongering.
> AIPLA is run by many of the same large corporations that are noted for
> stealing independent inventors work and it consistently advocates patent
> changes that are damaging to our interests. In fact, it is one of the big
> promoters of H.R. 400 and for that reason it's pleas tend to fall on deaf
> ears.
Let me suggest that the AIPLA probably has a larger percentage of
attorneys in private practice than who work for companies. I don't
know this for a fact, but most of the inhouse attys I know don't belong
since their companies will only pay for 1 or 2 professional
organizations,
while most of the outside counsel I know do belong. Small sample,
but probably more representative than Ron's.
> Michael K. Kirk, Executive Director of AIPLA, has been known to make
> numerous derogatory remarks about independent inventors including telling
> one member of congress that the inventors who signed the "Open Letter to
> President Clinton from 59 U.S. inventors".
> http://www.alliance-dc.org/aainews/ipc1.html concerning the 20 year
> language of the GATT enabling legislation did not understand the issues.
> The group who is opposing him includes many Hall of Fame inventors and
> several Nobel laureates, who I am sure were surprised that Michael K.
> Kirk had such a low opinion of them.
Well, I tend to agree with him. I see nothing in the proposed law
that would adversely impact the small inventor. On the other hand,
I see quite a bit that Ron has railed against over the last couple of
years.
> Therefore, I suggest that loss of PTO funds is a direct result of
> incompetent management of the PTO (and Kirk is one the former managers)
> and that the inventors first priority should be removal of the bad
> management and defeat of H.R. 400. The PTO would not be facing this
> situation if they had been focused of their mission, but the fact is that
> the PTO's upper management has been focused on promoting their own little
> dictatorship in the form of a privatized PTO.
Reading H.R. 400, it sure seems to indicate that it would stop the
loss of PTO funds.
I would also suggest that what is really happening is that the Congress
has discovered a revenue source, and is exploiting it. Sure, Lehman
could
defend it a little better, but I doubt that it would help that much.
In any case, that provision alone should endear the bill to Ron.
> Mr. Lehman was no doubt instrumental in H.R. 400 provisions that would
> not allow his removal at all for five years and then only with cause.
> And he is quite willing to go along with the multinational corporate
> agenda to gut America's patent system to achieve that end.
>
> Last, I suggest that any letters inventors or other interested parties
> send to congress should focus on defeating H.R. 400 with complaints about
> the raid on PTO funding being a lower priority. It is a shame that Mr.
> Lehman has created a situation where inventors can not afford to help
> him.
In otherwords, ignore the provisions in the bill that would stop the
raiding,
and instead, jump on Ron's bandwagon of "independent inventors". Sorry.
As noted above, there is little if anything that would hurt the
independent
inventor. Indeed, the provisional rights appear to go somewhat to
overcoming
Ron's fictious patent shortening problems with the 20 year term by
starting
the infringement clock at the time of publication. Indeed, it appears
that
you can move this up even further by opting for early publication.
--
--------------------------------------------------------------------
The preceding was not a legal opinion, and is not my employer's.
Original portions Copyright 1997 Bruce E. Hayden,all rights reserved
My work may be copied in whole or part, with proper attribution,
as long as the copying is not for commercial gain.
--------------------------------------------------------------------
Bruce E. Hayden bha...@acm.org
Austin, Texas bha...@copatlaw.com
Robert P. Bell
Bruce Hayden wrote:
>
> Reading H.R. 400, it sure seems to indicate that it would stop the
> loss of PTO funds.
Really? Well I posted a note earlier on that same vein, and was told that there is NO
provision in HR 400 which would prevent the PTO coffers from being raided. In fact,
the poster told me that such a provision was explicity excised at the request of
Congress. So which is correct?
IMHO, the PTO budget scare is an attempt to get us all to stampede for passage of HR
400 without thinking too hard about its provisions.
The timing is altogether too convenient.
Regards,
--Bob.
--
Robert Platt Bell & Associates, P.C.
Patent, Trademark, & Copyright Matters
917 Duke Street
Alexandria, VA 22314
Ph. (703) 683-8822
FAX (703) 683-8823
Rober...@BELLPAT.COM
Bruce Hayden
Robert P. Bell wrote:
>
> Bruce Hayden wrote:
> >
> > Reading H.R. 400, it sure seems to indicate that it would stop the
> > loss of PTO funds.
>
> provision in HR 400 which would prevent the PTO coffers from being raided. In fact,
> the poster told me that such a provision was explicity excised at the request of
> Congress. So which is correct?
Lee Hollar has found the appropriate portion of the bill backing your
position.
I thus do appologize. The section seemed to read that you couldn't raid.
But then there was the single exception, through which of course you can
drive the truck.
> IMHO, the PTO budget scare is an attempt to get us all to stampede for passage of HR
> 400 without thinking too hard about its provisions.
Especially as the money grab seems that much bigger this year.
However, I would suggest that Ron Riley and the anti crowd are just
as frantic in trying to stampede people the other way, without real
debate.
Bruce Hayden
Robert P. Bell wrote:
>
> Bruce Hayden wrote:
>
> > However, I would suggest that Ron Riley and the anti crowd are just
> > as frantic in trying to stampede people the other way, without real
> > debate.
> Mr. Riley, as an inventor, may be a bit 'wacky' - that is typical of the
> species. But don't let his hyperbole undermine his underlying message.
> H.R. 400 should be discussed on it merits - and it has many provisions
> which will profoundly change our patent practice.
Personally, sometimes I think he does his cause more harm than good.
He argues so poorly (IMHO) that many of us jump on the other side on
general principles, regardless of the merits of his case (which he
invariably never really sucessfully advocates).
> If anything, I think it is the incorporation crowd who has yet to state
> exactly why this provision is necessary. AGAIN, I've heard a lot of
> what-ifs and what-could-bes, but no concrete examples of why is it
> necessary or even desirable. The onus is not the status quo to defend it
> self, it is on those proponents for change.
The two reasons why I don't think that incorporation is all bad is:
1) it would presumably provide a mechanism to better reward PTO
employees,
especially examiners, and 2) make it somewhat harder for Congress to
raid the coffers. Of course, as you noted earlier, they apparently have
retained a back door allowing them to keep on raiding.
> And please, no more analagies about the Post Office. It is irrelevent as
> to how _specifically_ incorporation will change the PTO. And the PTO is
> no losing money like the Post Office was.
Actually, in my mind, the Post Office would be a good counter-example to
incorporation. It is still bloated and inefficient, Congress just has
less control.
> As we move toward hamonization, ask yourself this question - do we need
> or want a Japanese or EP style patent system with little novelty and
> little enforcability? What made our patent system so great and powerful
> in the first place? Why do we want to take these very provisions away so
> quickly?
>
> When first-to-file is in place, along with 18 month publication, Markman
> hearings, and a stripped-down doctrine of equivalents, why bother filing
> for a patent?
I guess I am unconvinced that first-to-file would really be that
different.
Sure, interferences exist, but almost always result in a win for the
senior
applicant.
I also am not convinced that the proposed publication is all that bad.
The more important patent applications of larger companies are already
being published when foreign filed. Add to this the likelihood that
anyone
really is going to read the applications. And finally, the proposed law
appears to provide provisional rights, giving you potential recovery for
the time between publication and issue, once it issues.
Lee Hollaar
The surcharge on patent fees, which can then be appropriated by Congress,
remains a part of HR 400. See Sec. 112 of the bill:
(12) may retain and use all of its revenues and receipts,
... subject to the provisions of section 10101 of the
Omnibus Budget Reconciliation Act of 1990 (35 U.S.C. 41 note)
But the surcharges end after fiscal year 1998, unless extended by Congress.
Robert P. Bell
Gosh, you don't think Congress would extend such a provision, would you? <Grin>.
I think your post illustrates why the argument that incorporation will end the theft
of patent office monies is illusory.
Instead of tearing apart and reworking our government, why don't we just make it work?
It would take the same amount of political capital and effort to end this theft of
PTO funds as it would to push for incorporation. In either case, we will continually
have to lobby congress to keep their hands off the PTO coffers.
IMHO, actions such as incorporation (or firing PTO employees and replacing them with
contractors to reduce head count) is merely rearranging deck chairs on the Titanic.
Robert P. Bell
Bruce Hayden wrote:
>
> Personally, sometimes I think he does his cause more harm than good.
> He argues so poorly (IMHO) that many of us jump on the other side on
> general principles, regardless of the merits of his case (which he
> invariably never really sucessfully advocates).
Well, that, and the Lemelson connection (follow the money trail!).
I chatted with Mr. Hollar who is helping draft legislation on the Senate side for
the companion bill to H.R. 400. Thanks for the info, Lee.
After an hour's discussion, we reached the conclusion that:
1. Incorporation could facilitate a lot of neat things, but would not guarantee
them.
2. Title 5 provisions in H.R. 400 may end up getting dropped on conference (Mr.
Stern, are you listening?).
3. Congress will still raid the PTO coffers, at least until 1998 _by statute_
(See, e.g., _Note_ 35 USCA 41, on this history of the funding provision - hey,
could anyone post this?). I didn't realize that by law, congress HAS to raid the
PTO coffers for at least another couple of years....
4. Mr. Hollar has an unique proposition with regard to 18-month publication:
Publication at 18 months OR 3 months after a First Action on the Merits (FAOM).
That (#4) strikes me as an interesting idea.
So... the incorporation thing is still sort of a "trust me, we'll do great things
with this" kind of idea. I guess it gets down to whether you trust the folks
involved. Ironically, I trust the "career bueracrats" more than I do the
political appointees, as I know (or know of) most of the career folks. If Steve
Kunin or Stew Levy told me this was a swell idea, I'd believe it.
Stephen Meier
Bruce Hayden wrote:
> The two reasons why I don't think that incorporation is all bad is:
> 1) it would presumably provide a mechanism to better reward PTO
> employees,
> especially examiners,
If they wanted to better reward PTO employees, they wouldn't have
reneged on the Examiner's bonuses. All of this came well before budget
constraints.
Stephen Meier
Howard Davis
Robert P. Bell wrote:
>
> Did you see the documentary about Philo T. Farnsworth on PBS last night?
> Invented the television at age 22 (in S.F. - one of the early 'silicon
> valley pre-pioneers!).
>
> Farnsworth drank himself to death after a lengthy patent battle with
> David Sarnoff of RCA.
>
> Armstrong (who invented the regenerative feedback amplifier) leap to his
> death after a lengthy patent battle with De Forest.
>
Bob, I think you are wrong about Armstrong! Though
you are right that Col. Armstrong apparently (or was
he pushed?) committed suicide by jumping from his NY
city apartment after a lengthy patent battle with De
Forest, that battle had been lost several years
previous. He was at the time in the middle of a
patent battle with Sarnoff over the FM. His widow
eventually won. Man, can you imagine the Karma of
destroying the lives of the inventors of both radio
and TV?!!!
Howard Davis
ps. I agree with you about Riley.
John Pederson
On Wed, 12 Feb 1997 23:22:52 -0400, Howard Davis <hrd...@Randomc.com>
wrote:
>Robert P. Bell wrote:
>> Armstrong (who invented the regenerative feedback amplifier) leap to his
>> death after a lengthy patent battle with De Forest.
>>
>
>
>Bob, I think you are wrong about Armstrong! Though
>you are right that Col. Armstrong apparently (or was
>he pushed?) committed suicide by jumping from his NY
>city apartment after a lengthy patent battle with De
>Forest, that battle had been lost several years
>previous. He was at the time in the middle of a
>patent battle with Sarnoff over the FM. His widow
>eventually won. Man, can you imagine the Karma of
>destroying the lives of the inventors of both radio
>and TV?!!!
Right. It was the FM battle with Sarnoff that drove him to jump,
and his widow did ultimately prevail. There is a book on the
story, entitled Man of High Fidelity.
John Pederson, Retired
Former Director of Patents
Major Manufacturing Company
Lee Hollaar
In article <33022B...@BELLPAT.COM> "Robert P. Bell" <Rober...@BELLPAT.COM> writes:
>2. Title 5 provisions in H.R. 400 may end up getting dropped on conference.
Actually, what I pointed out was that that last year's Senate bill had very
different labor provisions, so it isn't clear what would finally come out
of conference.
>4. Mr. Hollar has an unique proposition with regard to 18-month publication:
>Publication at 18 months OR 3 months after a First Action on the Merits.
>That (#4) strikes me as an interesting idea.
The provision is in HR 400, and came from one of the versions of last year's
activities. For those with a copy of HR 400 (and you can get one from
thomas.loc.gov), you need to look at Sec. 202 of the bill, and especially
new section 122(b)(2)(C)(i).
There is a lot to HR 400, and simply saying things like "18 month publication"
does not cover all the nuances of the bill, like the delay until 3 months
after first office action for many applications.
I encourage anybody interested in this to get a copy of HR 400 and read it
carefully to understand exactly what is being proposed, rather than just
accept characterizations from newsgroups like this.