USPTO Keeps Fees in President’s 2007 Budget

President Bush’s budget proposal for fiscal year 2007 recommends that the U.S. Patent and Trademark Office keep all of the roughly $1.8 billion it collects in patent and trademark fees and supports additional increases for reducing application processing times and improving quality.

Inventors and intellectual property owners have long complained of Congress’s habit of diverting USPTO fees to fund other federal programs. Funding for the USPTO, an agency of the Department of Commerce, is covered in the bill authorizing the budgets of the Departments of Commerce, State and Justice. President Bush has supported ending the practice of diversion in recent budget proposals.

The USTO will need access to all its funds in order to decrease its increasing backlog of patent applications and support e-government initiatives. Last year the USPTO hired some 970 patent examiners and received more than 400,000 new patent applications. The USPTO expects to hire approximately 1,000 more examiners per year throught fiscal year 2011, according to testimony before Congress by Jon Dudas, Undersecretary of Commerce for Intellectual Property and Director of the USPTO. The number of pending patent applications could increase from approximately 600,000 today to 1,000,000 by 2010, according to Dudas.

The USPTO has a mixed record on implementing technological solutions to its workload problem. The USPTO’s award-winning Trademark Electronic Application System (TEAS), lauched in October, 1998 and its Trademark Electronic Search Search (TESS) have been very successful. More than 88 percent of new trademark applications are filed electronically, according to the USPTO’s 2005 annual report. TESS includes all registered and pending trademark applications and expired trademarks since 1984. The USPTO’s patent electronic filing system, EFS, despite significant investment, has not been successful. Less than 2 percent of new patent applications are filed electronically. Inventors and patent attorneys have complained of the system’s difficult user interface, complexity and reliability. According to the annual report, a new, web-based version of EFS should be in full production mode by the end of 2006.

According to a report in Federal Computer Week, the USPTO plans to use much of the fiscal year budget authority to hire more patent and trademark examiners, and improve examiner traininng. The report also stated that the USPTO would budget $70.2 million to improve its patent automation system and an additional $18.2 million to enhance its trademark automation system. $10.1 million will be allocated for improvements to the USPTO’s web-based information dissemination management system.

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