Remarks at American Intellectual Property Law Association (AIPLA) Mid-Winter Institute

Acting Under Secretary of Commerce for IP and Acting USPTO Director Teresa Stanek Rea

AIPLA Mid-Winter Institute

February 2, 2013

Remarks as Prepared for Delivery

Good morning, everyone! Thank you, Q. Todd, for graciously inviting me to be here. Coming to an AIPLA event always feels a little bit like coming home. I loved my time with the organization, and I really treasure these opportunities to see old friends and meet new ones. Of course, coming to Tampa is an added bonus. It has been a cold, strange winter in the D.C. area. Snow one day, 60 degrees and sunny the next, and then thunderstorms and severe wind warnings. Of course, we have embraced teleworking like no other federal agency, so we keep on going, processing patent and trademark applications, rain, snow, or shine!

Before I delve into the subjects we are here to discuss today, I would like to say a few words about my colleague and inspiration for the last two years, David Kappos. For those of you who may not know, yesterday was his last day in office as Under Secretary of Commerce for Intellectual Property and Director of the Patent and Trademark Office. Dave's leadership has transformed the USPTO, turning it into the model of a 21st century efficient and customer-friendly federal agency. He also transformed our nation's IP laws with his key role in the passage and implementation of the America Invents Act.

As Dave himself has said in other forums and conversations, this is no ordinary time for the USPTO and its stakeholders. The one thing you will never hear around our agency is the phrase, "business as usual." We owe that to Dave. Now, it is my task and my goal, as Acting Director, to carry on that innovative spirit, and to build on that momentum, with the exceptional leadership team and legacy of excellence Dave established at the agency.

It is worth noting that one of Dave's last acts as director before departing was to sign off on every final rule of the America Invents Act, including First-Inventor-to-File, which goes into effect March 16. Look for that rule to publish soon in the Federal Register. I do not need to tell you how important this new rule will be in allowing us to further harmonize our patent procedures with other countries. But of course, the USPTO placed harmonization efforts on the front burner from the moment Director Kappos took over the agency.

In that effort, we were not alone. In 2011, at the close of an Asia-Pacific Patent Cooperation Forum, a number of the participating offices present, including our own, agreed upon a statement that concluded: "The time for substantive harmonization is now. We are operating in a global economy, business innovation is happening across borders. The IP system needs to be supportive of this new reality." Everyone in this room knows the truth of that statement-that in our 21st century global economy, it is IP that drives manufacturing, exports, and job creation, in the U.S. and around the world-wherever, in fact, innovation is rewarded and protected.

At a meeting last October, experts from the Tegernsee Group-which includes representatives from the patent offices of Denmark, France, Germany, Japan, the U.K., U.S., and the E.U.-launched a productive dialogue on the international harmonization of substantive patent law. Participating offices were tasked to collaboratively develop a joint questionnaire to aid in the acquisition and analysis of stakeholder views on four issues of particular interest to harmonization of substantive patent law: grace period, publication of applications, treatment of conflicting applications, and prior user rights.

We are moving forward on our part of the questionnaire, and we are looking to you for input. To help us gather this information, we are hosting a public event at our headquarters in Alexandria, Virginia on March 21st, and like many of our public forums it will be webcast. If you would like to provide oral testimony at the hearing, please send in your request by February 28 to That is also the deadline for written comments. You can learn all of the details in the Federal Register notice that was just published yesterday.

Another important front in our harmonization efforts is the increasing number of Patent Prosecution Highway, or PPH agreements, we have signed with other nations' IP offices. We recently signed agreements with Hungary, the Czech Republic, and Taiwan, and we are currently in the process of finalizing two more, with the Philippines and Portugal-which will bring our total number of PPH agreements to 26. Under each agreement, if you receive a ruling from one nation's patent office that at least one of your claims is patentable, you can then request that the other nation's office fast-track the examination of corresponding claims. This allows applicants to obtain patents faster and more efficiently.

And one month ago, on January 1-while the world celebrated the end of one year and the start of another-the USPTO and the European Patent Office, or EPO, celebrated another new milestone in international IP collaboration. That was the day the long-awaited Cooperative Patent Classification system went into effect, allowing patent applicants before both offices to receive patent examination and protection that is consistent and enforceable.

We have also engaged with other member offices of the IP5-not just the EPO, but China, Japan, and Korea as well-on a number of fronts, including a recent IP5 Statistics Report. It is designed to facilitate an understanding of operations and patent procedures among the offices, while providing a means for gauging inventive activity, technology flow, and comparing procedures.

I should also mention that our IP attachés around the world continue to do amazing work at facilitating cooperation among the nation's leading IP offices and at promoting American economic interests abroad. This is especially true in China, where we have not just one but three attachés, as well as a "China Team" of five lawyers supporting them from the USPTO. These attachés in China, as elsewhere, serve to promote and deepen vitally important bilateral relationships, while our IP attaché in Guangzhou, for example, has made great inroads in developing relationships with the IP enforcement offices in the southern region of China.

For the past few years we have worked closely with the Chinese Trademark Office, or CTMO, and their Trademark Review and Adjudication Board, exchanging best practices and candidly discussing challenges. This engagement, in turn, has led to several positive developments. For example, we collaborated with and supported CTMO's effort to increase transparency through projects such as an online English-language trademark registration to assist companies conducting preliminary searches, and on English translations of its research reports on the protection of foreign, well-known marks. Thanks to these two efforts, U.S. companies can now conduct easy, no-cost preliminary trademark searches in English, and they can gain a better understanding of the way China protects well-known marks.

But of course a robust global IP system of the kind we are striving to create with our international partners is about more than harmonization-it is also about fundamental, human progress. About improving lives. We often talk about a global economy, but we also live in a global community-with all that the word community implies.

That was very much the spirit behind the 12-month Patents for Humanity program we launched last February, to reward companies that bring life-saving technologies to under-served regions of the world, and to highlight positive examples of humanitarian actions that are compatible with business interests and strong patent rights. Just two weeks ago at their annual Global Technology Impact Forum in Geneva, Switzerland, Licensing Executives Society International honored Patents for Humanity with their National IP and Technology Transfer Policy Award-of which we are very proud. We will be announcing the winners of the competition this spring, so stay tuned.

Altogether, these international efforts, from the Patent Prosecution Highway to Patents for Humanity and everything in between, mark the dawning of a new era in international cooperation, one that is bringing our IP laws and practices closer together in a way that protects and advances American interests, while seeking to spread the benefits of a global IP system to less developed parts of the world.

Now while this forum is focused a great deal on international issues, there are some things closer to home that we have to do right if we are going to engage successfully on the world stage. One in particular that will be front and center for me in the months ahead as acting director is our focus on reducing the backlog of unexamined patent applications. You may recall that in 2009 that backlog stood at more than 750,000. Well, we are now in the range of 600,000-a 20 percent reduction despite an increase of five percent in filings on average per year. That is a huge testament to the hard work and dedication of our patent examiner corps-and one of our true success stories.

We have also made great strides in reducing the amount of time it takes to process patent applications. Applicants filing an application today will on average receive an initial patentability determination, or "first office action", within 15.8 months, compared to the approximately 27.2 months from filing to first office action at the beginning of 2009. Moreover, the total amount of time it takes for the USPTO to finally dispose of an application from start to finish, also known as Average Total Pendency, is at 33.7 months, down from 34.3 months in August 2009.

There is much I could say about the reasons for these successes and how we plan to accelerate that progress even further, but since we do not have the time, allow me to note that there are two other current items in the Federal Register for which we are soliciting comment and participation from the IP community, in addition to the request for comments on harmonization.

On January 3, we announced an opportunity to bring software stakeholders together through a series of informal, interactive roundtable discussions to share ideas, feedback, experiences, and insights on software-related patents. To commence this "Software Partnership" and to provide increased opportunities for participation, the USPTO is sponsoring two roundtable events with identical agendas, one in Silicon Valley on February 12, and the other in New York City on February 27.

We are also soliciting public feedback to help us better understand the full spectrum of factors that impact the decision to file a Request for Continued Examination, or RCE. Our goal is to reduce RCE filings and the RCE backlog-which currently stands at more than 90,000 patent applications that have not been examined since the filing of a RCE. This backlog diverts resources away from the examination of new applications.

In short, we continue to explore new ways to help make our nation's IP laws and infrastructure as effective and efficient as they can be, in order to help American businesses compete and thrive in the 21st century global economy. Your input toward that goal is absolutely vital. Thank you all for your attention. I look forward to hearing now from my distinguished counterparts from Mexico and Brazil, and to having a great discussion afterward.

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