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Increased Fees v. Operational Efficiencies
Blog by Under Secretary of Commerce for Intellectual Property and Director of the USPTO David Kappos
Returning to our series on America Invents Act (AIA) implementation, I’d like to focus today on an aspect of USPTO fee-setting. During a number of our recent outreach events on the USPTO’s fee-setting proposal, some stakeholders have taken the view—to caricature it slightly—that the USPTO does not need to increase fees; it needs to get more efficient.
We could not agree more on the importance of improving efficiency at the USPTO. During the last three years, we have made many improvements aimed squarely at improving efficiency. To name a few, we’ve implemented a new count system, revised examiner performance plans, established a first action interview pilot, provided training and incentives to substantially increase interviews overall, instituted the Patents Ombudsman Program, reengineered our Patent Cooperation Treaty processing, reengineered our reexamination processing, introduced important IT improvements including e-petitions, a reengineered MPEP/TMEP, and modern computing platforms, as well as expanded our Patent Prosecution Highway and other work-sharing programs to avoid duplication of efforts with international IP offices.
And we have much more coming. Many additional process improvements have been identified through our patents reengineering effort, with work already underway to improve legacy IT systems and develop new 21st century systems and processes. These improvements, coupled with the efficiency elements of the AIA such as Track One accelerated examination, will assure continued efficiency gains into the future. In fact, we will never be done looking for ways to improve efficiency, and we will never be complacent about our efficiency.
But attempting to draw a corollary between fee-setting and speculation about the possible impact of potential future efficiency gains is difficult without the benefit of hindsight. As we have outlined in our fee proposal, our fees must be set in a manner that enables us to continue investing in reducing the backlog and improving all other areas of our agency. Our experience also reminds us that implementing improvements frequently causes short term disruptions, and likely won't immediately translate into efficiencies. Anyone who runs a business will tell you that productivity investments often take years to pay off.
Moreover, my judgment as the steward of this agency is that I cannot proceed with a funding model that assumes further efficiency gains, especially if we have not yet achieved them. It places our agency at risk, and is just not right for our employees or for our stakeholders.
The responsible approach is to rely on our experience and current cost model, factoring in the efficiency gains we have achieved to date, but not speculating about possible future gains. This approach of using current costs as a basis for setting prices is the common practice among businesses, and follows the sound advice of the accounting, finance, and economics professions.
Then the question becomes the one asked in our fee proposal: does the U.S. innovation community want us to continue investing to quickly reduce the backlog and fully capture the promise of the AIA, or does it want us to back off a bit and accept a longer trajectory to reducing the backlog, and a higher level of risk relative to future funding downturns? The answer will ultimately have consequences for the kinds of efficiencies the agency is able to realize in the future, and what level of services the USPTO can deliver in years to come.