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December 31, 2009

Broken: The USPTO

This begins a series on what is wrong with patents in this country. The constitutional goal of patents is "to promote the progress of science and useful arts." But patents present irrepressible contradictions of purpose by the players of the patent game, and the pursuit of self interest by the players reveals their flaws and limits. Which is to say that the room for improvement would fit the several elephants of what is obviously wrong, but seldom acknowledged by those involved. Aside from incompetence, which weighs in heavily, two factors stress the patent system: politics and money. Let's begin with the place where patents are birthed: the patent office.

Problem number one with the PTO is the examiner corp. With rare exception, they do not approximate the sharpest tacks in the box, nor is the examination regime geared to sharpening them. Every prosecutor has his own nightmares to tell of examiner inanity. On more than one instance I've abandoned an application over prior art found by an examiner, but for which the examiner did not cite the right passages, and couldn't even write a decent rejection, thus failing to either fully appreciate or adequately articulate what he had found.

Career examiners and PTO management are government bureaucrats. In this country at least, that can't be mistaken for a complement. Unlike the French, the best and brightest Americans are not prone to public service. The smart ones go in for the resume boost and get out within a few years. Einstein's first career was in the Swiss patent office. He didn't linger.

KSR, a politically inspired Supreme Court decision, has made examiners practically insufferable with their unreasoned hand-waving rejections. The nature of the problem is that of lack of examiner competence and awareness: failure to conceptualize and failure to distinguish details. The irony is built in: examiners don't qualify as "one of skill in the art at the time of the invention," and don't examine objectively.

Examination has been heavily geared, post-KSR, to rejection. Examiners get scant training in the grounds to allow claims. The training regime is focused almost solely on the bases for rejection.

Besides examiners suffering logic as a second thought process, there is the less damning but often vexing problem of English as a second language.

KSR was a watershed in regime switching: from permissive too restrictive. KSR transpired as a culmination to the junk patent decade plus, which enveloped the Clinton years, where getting a patent granted was far too easy. It was the junk patent decade that lead to outcry by large computer corporations, assailed with lawsuits where only a fraction were worthy of patent protection.

Examiners work on a production quota point system. Like post office workers used to, to sort the mail. The fundamental flaw in using a production system where quality should take precedent over quantity should be obvious. It was to Patent Office Commissioner Casper W. Oom in 1945:

It has been brought to my attention that the practice prevails [in] the Patent Office of measuring the "amount of work accomplished" by Assistant Examiners during particular periods of time by assigning quotas of production.... This practice necessarily emphasizes quantity rather than quality of work.

Work of the kind in which Patent Office Examiners are engaged involves great public and private interests, and requires exceptional training and experience coupled with matured and considered judgment in its execution. For these reasons, it cannot be measured by methods applicable to routine office operations. High class professional work performance in a favorable environment and adequately compensated inevitably attracts and holds high class men [and women], and the pride of achievement entertained by such men [and women] ordinarily provides a sufficient incentive for work which is commendable both as to quality and quantity.

KSR at least paid lip service to articulating reasoning for combining references to an obviousness rejection. More often than not that articulation is only evident in the breach in an office action. Worse is mischaracterization of prior art, and reading in what was never disclosed. Those logical flaws are running wild in office actions. While the mentality varies from art unit to art unit, the heavy accent is on rejection, logic and regard for the law take the hindmost.

These generalizations are not intended as blanket damnations. Most examiners are at least civil, even the morons. As Pink Floyd observed on The Dark Side of the Moon, "good manners count for something." But, while the facade remains civil, the spirit has generally become meaner in not granting patents on merit since KSR, which was really a watershed in the larger political movement to crack down on patent protection.

Not all patents granted pre-KSR are junk, nor are all post-KSR patents worthy. But there's more than grains of truth in the generalization that, while examination quality may have remained something of a constant, the flip got switched to less garbage output, at the expense of some worthy inventions never reaching patent status.

The patent office is a political creature. This was glaringly apparent with the last director, Jon Dudas, who was nothing shy of a ill-favored political hack, and whose subsequent descent was to a very politically oriented law firm: Foley & Lardner. As to his stated qualifications: "Mr. Dudas is admitted in Illinois only. His practice is limited to matters before federal courts and agencies." Not a patent agent, hence not a prosecutor. Not a patent litigator. And, as his tenure at the PTO showed, not a manager.

The USPTO is practically the only federal agency capable of actually making money. Application and allowance fees almost pay the rent. It's the maintenance fees on granted patents that are the gilt trim of profit.

From 1992 through 2004, Congress pilfered the patent office's piggy bank. That budgetary shortfall created a backlog of 1.2 million applications, estimated to be six years in catch-up work, if adequately funded. 2005-2008, when the agency was fully funded, were largely squandered by Dudas, whose lack of managerial acumen led to both examiner discontent and acrimony from the patent community. The built-in irony is that Dudas has been credited with getting the money to spruce up the agency, but lacked the wherewithal to make productive use of it.

How to fix the PTO? Better management, better training. Easy to say, nearly impossible to do. Especially at a time of fiscal constraint. Which is why the Dudas reign represented such a lost opportunity. A very few years ago the Office was flush, and could afford corrective action. No more, nor likely for years to come. Current Director David Kappos, former patent handler at IBM, has his work cut out for him.

The recession hammered the PTO like it hammered everyone but corporate chieftains. Kappos came on board inheriting a $200 million deficit. So he can neither hire & train new examiners, nor upgrade the agency's reputedly antiquated computer systems. Attrition continues to sap quality, as about 50 examiners a month quit without replacements. The agency has recently launched a campaign to hire back into the fold examiners who quit, thus regaining experience and some talent while saving training costs. The response of silence has been deafening. One erstwhile examiner told me, "I'd rather wait tables than go back to the PTO."

Congress just passed a budget this month larded with pet projects, as usual, but with a restrictive spending ceiling on the PTO. An additional $100 million was stripped at the last-minute.

Lack of quality examination equates to patent abortion. Alas, the damage of not granting patents to merited inventions is inestimable, like proving a negative, that something that should exist doesn't. One cannot easily state one way or another whether commerce, or society, is better off granting fewer or more patents. The hurt is individual: of companies or inventors not getting patents they deserved. The failure of patent protection by merit could doom startup companies that depend on such to raise capital and have a shot at marketing their innovative products without having their lunch eaten by a mega-corporation. The recent i4i v. Microsoft is a case in point.

Kappos is aware of the dilemma, waxing prophetic to make a point: "Every patent application that we sit on is an American job not being created."

That's one of the truisms about patents: it's nearly impossible to make generalizations about their value, other than to say that patents do serve a valuable role in rewarding innovation by providing a return on investment. Not protecting invention means the economy's engine lacks lubrication.

The factory where patents come from is fouled, and there's no fix in sight.

Posted by Patent Hawk at December 31, 2009 9:53 AM | The Patent Office


"This begins a series on what is wrong with patents in this country."

This, on the other hand, is the story all about how
My life got flipped, turned upside down
And Id like to take a minute just sit right there
Ill tell you how I became the prince of a town called bel-air

In west philadelphia born and raised
On the playground where I spent most of my days
Chilling out, maxing, relaxing all cool
And all shooting some b-ball outside of the school
When a couple of guys said were up in no good
Started making trouble in my neighbourhood
I got in one little fight and my mom got scared
And said you're moving with your auntie and uncle in bel-air

I whistled for a cab and when it came near the
Licensplate said fresh and had dice in the mirror
If anything I could say that this cab was rare
But I thought now forget it, yo homes to bel-air
I pulled up to a house about seven or eight
And I yelled to the cabby yo, homes smell ya later.
Looked at my kingdom I was finally there
To settle my throne as the prince of bel-air

Posted by: 6000 at December 31, 2009 3:06 PM

Kappos (ex IBM) that came into office just when many hundreds of billions of stimulus dollars were flowing out of DC was not able to secure the measly $200M emergency budget to save what is said to be the "engine of innovation", "a corner stone of our economy...". Is kappos incompetent? or does he want a despratly weak and dysfunctional PTO while the Senate ponders the infamous patent "reform" in 2010?

Kappos is doing the bidding for the mega technology corporations that are on the brink of perpetrating the biggest legislative swindle in the history of America (on top of the numerous pro big-business SCOTUS rulings of the last several years)

God save us all if the 21st century Robber Barons are successful in passing (by proxy) the devastating patent "reform" and Godspeed to the pharmaceutical/bio-tech/industrial corporations that are fighting against this evil legislation.

Posted by: Regatta De Blanc at December 31, 2009 4:58 PM

The Age of Reason died many years ago, in an unnoticed crevice that was trampled over by the maddened crowds (9/11, GWB, Bernie Madoff, Wall Street bailout, ...)

We are all now part of the Idiocracy and the USPTO is no exception.

Drink Brawno. It's got electrolytes.

Drink KSR. It's got electoral lites (weights).
Drink Bilski. It's got particular machine trites.

Posted by: step back at January 1, 2010 6:55 AM

"Problem number one with the PTO is the examiner corp."

I disagree Hawk. They have to go where they're led, like sheep, or they're forced out - I saw it happen.

Problem number one has been the PTO "shepherds" who got fat off of politics (Lehman, Rogan, Dudas, Peterlin) while caring nothing for innovation and muddying the waters for their sheep.

Posted by: nirpa at January 1, 2010 9:36 AM

Is the saying "Where there's a will, there's a way" known in the USA? It ought to be, for it expresses a thought which I see as quintessentially American.

If so, and if Director Kappos has the will and can infect everybody else with it, there are some grounds for optimism, aren't there?

That said, I'm disappointed at the morbidity of the Kappos blog. Why isn't it more lively?

Posted by: MaxDrei at January 1, 2010 2:29 PM

"That said, I'm disappointed at the morbidity of the Kappos blog. Why isn't it more lively?"

They want to keep it professional and not cause a ruckus.

Posted by: 6 at January 1, 2010 6:55 PM

Any Examiner that would rather wait tables than have every other Friday off, gov't holidays, a six figure (or likely close enough) salary and gov't benefits...well....deserves to wait tables, for that person is a moron.

I supsect the unamed source is currently unemployed and trying to justify his/her ongoing failure as purposeful.

I agree the Office has it's fair share of idiots, but I think this article is a bit overboard on the doom and gloom.

Posted by: Voice of Reason at January 1, 2010 8:24 PM

I think that we need to amend the original document of self-defense. You see the United States Constitution is nothing more than a delcaration of self-defense against governmental power. The First Amendment is by far one of the most interesting portions of the Constitution. The driving force behind the First Amendment is to prevent theological government. Theological government is a very destructive form of government. In fact we are fighting that form of government throughout the Middle East. However, they pose no real threat to the U.S. Beyond the Middle East issue, the theological government rears its ugly head now and then only to be swatted. Bush 43 was the closest we ever came to the Feds instituting a theologicla government in the U.S. at the Federal level.

However, Corporatocracy has been on the rise ever since the creation of the corporate entity in the mid 19th Century. It poses the greatest risk to democracy: great than the British Crown, Napoleon, Southern Insurrection, Nazi Germany and Soviet Russia. What we need to stem this tide of destructive power is a proclaimation in our U.S. Consitution mandating the Separation of Business and State.

Posted by: Ken Brooks at January 2, 2010 8:32 AM

"What we need to stem this tide of destructive power is a proclaimation in our U.S. Consitution mandating the Separation of Business and State."

Well said, but not gonna happen

In fact, current and past administrations are heavily seeded with ex-big-business VIPs, be it ex-IBM's Kappos for PTO or ex-GoldmanSacks Paulson for treasury etc. etc.

Sort of like the old anecdote:

A career thief is getting hired as a nigh-watch for a merchandise warehouse. He is shown his responsibilities and where all kinds of goodies are located and then presented with his salary figures.
His reply: "Huh, I'm even getting paid here ?!!!"

Posted by: angry dude at January 4, 2010 12:30 PM

"That said, I'm disappointed at the morbidity of the Kappos blog. Why isn't it more lively?"

I wonder that myself. Maybe it's the layout? Maybe it's the use of pseudonyms. Maybe people should stand behind their ideas and recognize the blog for what it is, an excellent way to express your opinions.

I wonder have any examiners posted on the external blog? Or do they stick to the internal blog. My guess is internal. Maybe it's the lack of having two sides debating.

Posted by: Jules at January 5, 2010 1:18 PM

Jules, thanks. Did I get the word right? Moribund might now fit better.

Posted by: MaxDrei at January 5, 2010 2:27 PM

MD, I hadn't thought of that because the former sounds correct, but after looking up the definitions I suppose the latter does seem more correct. Regardless, this has got me thinking.

This doesn't pertain to any topic in particular, also not that it matters all that much, but my curiosity has gotten the best of me. MD, what flag do you stand behind? The dry humor and careful use of the English language leads me to guess the United Kingdom, sometimes referred to as the Motherland by us Americans. Correct? Now that I have gone through this exercise, I am realizing my lacking knowledge of European history, so I could very well be wrong with my guess. That said, I appreciate the additional viewpoint regardless. Feel free to send me an email or leave it a mystery.

BTW, I saw this: http://ipbiz.blogspot.com/2009/10/maxdrei-comments-at-ipbiz-on-post-grant.html Pretty funny that you have a blog story based on your comments. That's a good sign that you're getting through to people and/or ruffling some feathers.

Finally, to get back on topic... even if the Kappos blog is currently looking a bit sparse with comments, I do believe that just having it available will prove beneficial. When someone has a great idea, it just may be the best place to express it.

Posted by: Jules at January 6, 2010 7:11 AM

Jules, thanks. Yeah, British, but in an international firm.

Posted by: MaxDrei at January 6, 2010 7:25 AM

Ahh, well, if you're a soccer fan, then you must be looking forward to the match on June 12. Or am I relying too heavily on cliches?

Posted by: Jules at January 6, 2010 7:57 AM

Let me guess: England v. USA in South Africa. Yes indeed. There is form, between those two sides.

Didn't say I was English though, did I.

Anybody who doubts that soccer gets passionate should watch France play in South Africa, close in front of a big screen, but it must be in an Irish pub.

Posted by: MaxDrei at January 6, 2010 9:40 AM

No, you didn't say you are English. It's easy to get confused in that respect on my end. But anyway, I will have to watch those matches. Check out the movie Green Street Hooligans too, if you get a chance. I can't confirm whether it represents reality because it is just a movie, but it was an interesting portrayal of the "firms" of local soccer teams and their passion. It was a bit brutal actually.

Posted by: Jules at January 6, 2010 10:25 AM

Don't know the movie Jules but from your description I'm not sure I want to. The Irish will get passionate about the French because France beat Ireland to get to South Africa, with one of the French players handling the ball (caught by the TV cameras) just before scoring the winning goal (which of course should therefore not have been allowed). People get quite worked up about such things.

Actually, the cricket in South Africa at the moment is much more exciting than any game of football, with the tension lasting over the full five days that the game takes to play out. Here, the tension is raised by the fact that so many key members of the England team were born and raised in South Africa (just like Lord Hoffmann, the UK Supreme Court's leading patents judge, till he retired last year).

Who's representing England is more fluid than ever, these days.

Posted by: MaxDrei at January 7, 2010 12:39 AM

That's really interesting, MD, thanks.

Posted by: Jules at January 7, 2010 7:55 AM