Patent office gets more money, but fees may be diverted

The long-running battle to reserve the money raised from patent fees exclusively for use by the Patent and Trademark Office is unlikely to be resolved in the 108th Congress. Lawmakers refused to block the diversion of such fees as part of the omnibus appropriations bill for fiscal 2005 cleared over the weekend.

They did provide PTO a funding boost and specifically allocated funding to hire more patent and trademark examiners. But the technology lobbying community, which worked hard to stop fee diversions this year, is split on whether the larger budget will benefit technology companies as long as PTO still could lose money from patent fees to unrelated programs.

Under the omnibus appropriations bill, PTO would receive up to $1.6 billion, or $342 million more than in fiscal 2004. The measure also would let PTO raise its fees between 15 percent and 25 percent over the next two years to fund its operations.

But the bill failed to incorporate language from a House bill that would have ended patent-fee diversion.

"We're disappointed obviously because we were strongly supporting language to end fee diversion in the long term, and our support for the fee increase was based on that position [but the bill] contains no such language," said Herb Wamsley, executive director of the Intellectual Property Owners Association.

Wamsley and a coalition of other business and intellectual property groups last week sent a letter to Senate appropriators asking them to drop the fee increase entirely instead of implementing a short-term solution. Representatives from the American Intellectual Property Law Association, Biotechnology Industry Organization, Computing Technology Industry Association, International Trademark Association, Medical Device Manufacturers Association, National Association of Manufacturers and U.S. Chamber of Commerce also signed the letter.

But Ralph Hellmann, senior vice president for government affairs at the Information Technology Industry Council, praised the funding increase for PTO. "We're actually very happy," he said. "It's a pretty significant amount of funding and will reduce the [patent application] backlog."

PTO currently has just less than 4,000 patent examiners. Its 21st-century strategic plan calls for the hiring of 900 additional patent examiners next year. The office also has more than 300 trademark examiners and plans to hire another 25 next year.

Asked about concerns that the business and intellectual property groups voiced over the bill, Hellman said: "I learned long ago that 'perfect' is the enemy of good. We need to move on and build from there."