Kappos on the US Economy, Music to My Ears

David Kappos at IPO

David Kappos at IPO

Last week USPTO Director David Kappos explained during his speech at IPO that intellectual property law “is widely recognized as the engine that drives our information age economy, maintains our competitiveness and is responsible for creating and sustaining tens of millions of U.S. jobs.” I have been beating this drum now for several years, and despite the obvious and indisputable correlation between innovation and economic expansion that leads to new jobs, the old guard at the USPTO simply couldn’t or wouldn’t understand. It would seem that the days of shuffling chairs on the Titanic are over, and if nothing else at least the USPTO has a leader that seems to understand the link between recessions, start-up companies forming and increased innovation leading to new industries that create jobs. Of course, it certainly helps that Kappos is a patent attorney and was responsible for being Captain of the IBM intellectual property ship, which after all is really all IBM has because without intellectual property protection, particularly without patent protection, IBM would be just three random letters rather than one of America’s mega-corporations that provides jobs.

It was also heartening to hear Kappos express the need to cut pendency and get to issuing patents in growth segments that are likely to lead to the creation of new industries and new jobs that will continue to help American workers dig themselves, and the country, out of recession and into a period of prolonged growth. In this regard Kappos explained that the Patent Office is “looking at ways to cut pendency in specific growth segments such as green technologies, with programs that would shorten the time an application waits for review.” On March 30, 2009, I wrote A Patent Proposal for Green Technology, suggesting:

On July 28, 1987, President Ronald Reagan set forth what became known as the “11-point superconductivity initiative” in a speech to the Federal Conference on Commercial Applications of Superconductivity. As a part of President Reagan’s superconductivity initiative he proposed amendments to the antitrust laws to make it easier for companies to collaborate with respect to basic research, he requested changes to the Freedom of Information Act to allow national laboratories to keep basic scientific research secret and he required the United States Patent Office to proceed with all due speed on applications relating to superconductivity technologies. In this speech President Reagan explained: “We need to strengthen patent laws to increase protection for manufacturing processes and speed up the patent process so that it can keep pace with the fast-paced world of high technology.” This caused the US Patent Office to allow Petitions to Make Special to be filed along with applications relating to superconductivity inventions so as to accelerate the examination process. See MPEP 708.02. This is exactly what we need to do today for green technologies. While I am not foolish enough to suspect much of Reagan’s agenda will be adopted by President Obama, this is one lesson President Obama should learn from. Expediting patent applications on green innovations will help the economy, make the world more environmentally friendly and improve US national security.

Not surprisingly, I think it is a splendid idea for the Patent Office to look for creative ways to accelerate patent applications in areas where there is the largest opportunity to impact the US economy in a positive way. While superconductivity did not pan out the way we hoped, that doesn’t mean it was wrong to accelerate such applications. The truth is that an invention is an asset, and unfortunately an asset that isn’t worth very much without at least one patent being issued. Investors want to see that innovations lead to patents and if they do not then investors either never appear or disappear after having provided seed money. We all know that investors are disappearing in all sectors of the US economy, and that is a pity. The Patent Office should do whatever is necessary to issue quality patents in a technically reasonable time frame. Accelerating patent application in a growth area like green technology just makes sense, and I hope Kappos continues to pursue this path.

Of course, you can already accelerate patent applications that relate to green technology, but current law is a non-starter. Unfortunately, when what we know as accelerated examination was ushered in during August of 2006 the ability to file a Petition to Make Special changed. Now you can only file a Petition to Make Special if the applicant is 65 or older, or is in poor health. You can, however, have an accelerated examination and there would be no fee if the invention relates to environmental quality, the development of energy resources or conservation of energy resources. Of course, you still have to meet the other requirements for accelerated examination, which are rather draconian and ultimately calculated to lead to patent rights that are extremely narrow, extremely costly to obtain due to the voluminous amount of information that needs to be presented to the Patent Office and all of the admissions that need to be made would cause inequitable conduct to hang over the granted patent like a cloud over Seattle. What Kappos and the USPTO needs to do is move green innovations back into the column that does not require the onerous and rather ridiculous accelerated examination standards to be met.

The time to move on green technologies is now. During the PLI briefing on Green Technology Patent Litigation held last week, it was made abundantly clear by the presenter, Steven J. Glassman of Kaye Scholer LLP, that green patent applications (i.e., patents covering green technologies) are increasing in number at the USPTO and green patents are being litigated with increasing frequency. As Glassman pointed out, patents and patent applications relating to green innovations range from alternative energy production sources, efficient energy storage and distribution, efficient energy use/conservation and management and finance. Of course, this last category of innovation relates to the infamous class 705, which relates to business methods. Yes, there are green tech business method patents and computer related innovations, so before we drain the tub we ought to make sure we are not getting rid of the baby with the bath water, but that is another topic for another day. What Glassman’s presentation made abundantly clear is that there is more and more interest in the green technology space, and rather than look at patent activity as a bad thing we need to realize that such activity is exactly what the founding fathers wanted to encourage.

Given that traditional energy resources are scarce and we cannot rely on them forever without end, we need to do whatever we can to become energy independent. While I do not buy into all the global warming myth which distorts truth and ignores historical facts, the truth is it would be better to pollute less. Who could argue that polluting less and respecting and preserving resources is a bad thing? Regardless of whether the ice core data suggests that temperatures on earth have been higher in the past then they are now, and at times when no humans existed to cause global warming, we as a nation should do the responsible thing and that is to use our ingenuity and resulting innovations to make a more environmentally friendly society. Being responsible in this manner has the outstanding by product of providing greater national security as a result of becoming energy independent.

While all of us may not always agree with the politics of Bruce Springsteen, his words in the song My Hometown are dead on accurate. The manufacturing jobs are gone and they are not coming back. Therefore, Kappos is 100% correct to say that we need intellectual property, and particularly patents, to be the engine that drives the US economy, creates new industries and leads to robust jobs growth. As President Obama is fond of saying, green jobs cannot be outsourced and make the perfect foundation upon which to build America’s economic future. So now it is time to put words into action.

The only way we can hope to achieve true energy independence and significant environmental benefit is to do what American’s do best, which is to identify a problem and solve it with ingenuity and innovation. Now we just need a patent system that allows for that to happen, rather than standing in the way of it happening. So far Kappos’ words suggest he understands the problems of the past and intends to turn the USPTO back into a part of the solution to our economic troubles, which is indeed welcome news.


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Join the Discussion

One comment so far.

  • [Avatar for Kamal Preet]
    Kamal Preet
    September 28, 2009 10:30 pm

    Oh Gene, oh Gene, where have you been my friend? You and everyone else that is so pro-Kappos are the first to believe things have changed at the USPTO and that he and his management are the first to believe that innovation and IP are driving factors of the US economy. I heard Dudas say this same thing for the past 5 years. I don’t doubt that he believed it (I talked to him about it once and he seemed sincere). I don’t see any major changes with the new leadership and it will be business as usual. Yet I find it funny that all the IP blogs keep talking about this new day and new way of thinking and I can’t help but shake my head and realize all the past critics have already had the kool-aid.

    There was such a hatred to Rogan, Dudas, et al that I don’t think they could have done anything to appease the bloggers. I somewhat now believe it was due to personal politics and not a pure pro-IP position. Now that a new political party is in office that you and others are more inclined admire based on their politics – your IP brain has been soaked by the sugary water drink.

    Little to nothing has changed and I don’t think mere words should be given as much weight as they have until we see actions. The federal register notice surely does not have me believing that things are getting better. But, I’ll give them more time and won’t be in a rush to praise or overtly criticize. I ask the same from everyone else in the patent community.

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