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July 9, 2009

Bailout

Mismanagement at the USPTO gets a thumbs up from Congress. The House went along with the Senate in passing a bill Tuesday that would let the PTO rob its trademark kitty to tide over its dwindling patent piggy bank. In a politically inspired balk (from mega-computer/software companies whining about being incessantly hammered for infringement), the patent office has been rejecting patent applications with religious fervor in recent years, grievously wounding the goose formerly known for laying golden eggs. In an ironic twist of a concept called accountability, the Congressional measure includes a surcharge to punish patent-pleading goslings. If people everywhere would all simply agree that the old ways are the best, none of this would be necessary.

Posted by Patent Hawk at July 9, 2009 1:11 PM | The Patent Office

Comments

You ain't seen nothing yet...

As I posted at the trainwreck,

Playing around with the numbers provided for the USPTO daily intake versus what was expected provides some rather shocking projections. Let's just say that the Congressional action so far is a small drop in a staggering bucket of red.

If the Office revenues continue to drop at a similar rate of decline during the second half of the year as has happened in the first half, the emergency action by Congress will seem quite meaningless to the necessity of furloughs or even down right layoffs.

Consider: even with all of the cutbacks in programs, overtime and the ilk, the Office needed emergency funding in the first half of the year that saw a 14.7% miss on revenue (137.8 million calculated from an estimated 802.3 million versus a projected 940.1 million). The bailout loan to be repaid being roughly half of the miss seems a bit inconsequential if the boat isn’t turned around IMMEDIATELY.

If the rate of revenue drop continues at the SAME PACE, the miss will widen in the second half to a 27.5% miss, or a 21.2% miss for the full year (402.9 million calculated from an estimated 1,500 million versus a projected 1,903 million). The required end of year bailout, assuming no more cuts would need to be 6 times as much already given, or five times more if the current bailout is for upcoming needs rather than current needs.

IF the rate of revenue drop doesn’t accelerate.

IF Congress is willing to provide all of these funds.

How deep would the cuts go if Congress says “no more”? How deep if Congress ponies up half?


- surprisingly, this drew no comments. Perhaps with the open-ended-make-up-the-difference-by-adding-surcharges staring the users of the Office in the face (can you say innovation-tax?), a few may stand up and take notice.

Posted by: Noise above Law at July 9, 2009 5:17 PM

"surprisingly, this drew no comments."

Because I already told everyone what the situation is. We have other plans to try to get money from congress, and if they fall through then there will be furloughs and an end to new hiring (right now it is iffy), and then if the problem persists then there would be layoffs. But, as I understand it, revenue would have to go pretty far down for them to start layoffs so the chances are very low.

Posted by: 6 at July 9, 2009 7:52 PM

Noise above the Law,

Staggering! Unfortunately, the PTO being the dysfunctional agency it has become, would lay off junior examiners instead of more senior non-examining waste of spacers who deserve a major part of the blame for this fiasco.

Posted by: an RC Cola and a Moonpie at July 10, 2009 3:09 AM

How long ago was it I told you layoffs were coming, 6? Six months or more?

Posted by: Anon at July 10, 2009 5:17 AM

sorry, just three 1/2 months.

Posted by: Anon at July 10, 2009 5:19 AM

"We have other plans to try to get money from congress..."

Okay, this is your funniest post ever.

You keep topping yourself.

Bravo!!!!!

Posted by: JohnDarling at July 10, 2009 6:56 AM

Kicking the can down the road?

Don't attack 6, he's just following the party line and believing what he's told.

Layoffs? Oh we might definitely see them, but they'll be concentrated among junior examiners who are suddenly unable to make their production quotas thereby justifying "performanced based" layoffs.

I'd rather see layoffs than furloughs. What possible good can furloughing employees do in a government service industry which has been already paid through filing fees to provide a service? You furlough employees to reduce product output thereby letting the market deplete excess inventory, not when you've already been paid to provide a service.

My guess is Kappos and clan will push for deferred examination (and no you don't get your filing fees back) hoping Applicants will bite. Or maybe enhanced 'work sharing' with other offices. Anyone else care to speculate?

Posted by: newbie examiner at July 10, 2009 7:23 AM

You may describe yourself as a newbie, but you're pretty wise.

No need to speculate. You've hit the nail on the head. RIF's couched as "performance based," a pitiful request that applicants kiss their filing fees, paid 3, 4 5 years ago, good-bye by accepting a "deferred examination" scheme (like the 5+ years applicants wait for a FAOM isn't already a deferred examination system), or else face more of the "quality = reject, reject, reject" treatment, which is just about the only thing anybody at the PTO still knows how to do anyway, and more pie-in-the-sky "work sharing" and "harmonization" blather from the incompetent lifers running the PTO.

Nothing to see here, folks. Move along.

Posted by: JohnDarling at July 10, 2009 7:36 AM

JohnDarling,

Without change, we may have a case of "Nothing here, folks. Move along."

The cloudy issue is the en banc rules determination. Had the Office consolidated its power grab, the bulk of the examination effort could have been pushed onto the applicants with super-IDS requirements to the MPEP level standard of the Office's choice. Mere consideration of the applicant's extensive prior art search could have greatly cut through the backlog. With that option on hold (expect ANY en banc decision to be appealed to the Supremes), the red ink will force the Office to some drastic action before the end of the year.

As I said, you ain't seen nothing yet.

Posted by: Noise above Law at July 10, 2009 8:27 AM

NAL,

You may be right. The PTO's budget crisis is far worse than anybody over there is willing to admit. The $60M they borrowed from the trademarks side of the house is a drop in the bucket.

I can hear the weeping and gnashing of teeth from all of the incredibly underworked and overpaid (mis)management stooges over there when they find out they're not getting a bonus (which they all view as an entitlement). They're all lucky to have uselessknownothingdonothingdeadweightGS-15 paying jobs. You'd think getting paid GS-15 money to LITERALLY do nothing would be enough. You'd be wrong. Prepare yourself for the sobbing, weeping, and wailing that is sure to come.

Posted by: JohnDarling at July 10, 2009 8:36 AM

I guess that the PTO for past six or so years has been like a Ponzi scheme -- taking in new applications, cashing the filing fee checks, but not timely bringing the applications to issuance (or abandonment). Thus they do not collect the issue fees or the maintenance fees.

Now that the recession has hit and filings are down, they don't have the money.

Additionally, and a bit ironically ( though I am not sure that irony is the best word), one of the problems with the long pendency times has been the failure to bring in and train new examiners and to solve that problem there is now (or the possibility of) a hiring freeze.

Posted by: John Prosecutor at July 10, 2009 8:46 AM

JD rofl's his mao at reality. See JD, you're supposed to rofl your mao at things which don't make sense. Ur doin it wrong.

Posted by: 6 at July 10, 2009 8:56 AM

6,

Keep 'em coming. You are one funny dude.

Posted by: JohnDarling at July 10, 2009 9:46 AM

Though I've been sworn to secrecy, the truth is too important to withhold from the industry...

Congress and the PTO are in fact in high-level negotiations this weekend with flip-flop Arnold to allow them to tack these deficits on to the backs of us Californians (what's a few hundred mill more when you're already 25+ billion over budget) ... in exchange for the requirement of the US Pres having to be born in the the country ... so Mr. flip-flop can run against Obama in '12.

Watch for the announcement first thing Mon morn.

Posted by: Steve M at July 11, 2009 3:42 PM