Stewart Defends Hands-On Approach as Squires Confirmation Looms

Coke Morgan Stewart (center) with IPWatchdog Chief Operating Officer Renee Quinn (right) and IPWatchog Editor-in-Chief Eileen McDermott (left)

In the first session of IPWatchdog’s three-day 2025 Women’s IP Forum, which kicked off today, Acting Director of the United States Patent and Trademark Office (USPTO) Coke Morgan Stewart addressed recent criticism of her approach to running the agency thus far, as well as the future direction of the Office. At the same time, the Senate Executive Calendar today indicated that Trump nominee for USPTO Director, John Squires, may be confirmed as early as this week, as part of a block of nominees to be considered following a Senate rule approved last week invoking the so-called “nuclear option.”

Embracing Change

Stewart’s tenure at the USPTO so far marks a period of tremendous change. Having returned to the Office in January after a decade of prior service, she told IPWatchdog’s Chief Operating Officer, Renee Quinn, that her familiarity with the agency enabled her to hit the ground running. “We reached terminal velocity early,” Stewart said. Facing an unprecedented backlog and operational challenges heightened by the aftermath of the pandemic, she explained that her mandate has been to take proactive—some have dubbed them aggressive—steps to align with the expectations of the Trump administration.

Stewart specifically responded to a question about a letter sent last week by a former USPTO Solicitor Thomas Krause that referred to some of the actions she has taken as being part of “an aggressive and probably unlawful patent-maximalist agenda,” by calling Krause’s comments “a misunderstanding about the way government operates.”

“As a matter of law, the Acting Director has all of the authority of the Director in the absence of one,” Stewart noted. She also said she had little choice.

“We came into a crisis situation,” she explained, referring to the largest backlog on record, which she inherited from former USPTO Director Kathi Vidal. And, despite challenges imposed by a hiring freeze, return to work orders, and high attrition rates, the Office ”has completely turned the tide on the backlog,” and is currently in the process of hiring 1,100 employees, Stewart noted.

She also acknowledged that the decision to bring newer examiners and others working within 50 miles into the Office has been “a pretty radical change for people and we recognize that” but that the Office is in a “hard reset” right now and will get back to some kind of baseline when it is in a better position.

Stewart said she agrees with former USPTO Commissioner for Patents Bob Stoll’s comments during IPWatchdog LIVE earlier this year that it’s imperative to keep examiners happy, but there are necessary sacrifices that must be made right now to tackle the backlog. “It’s really, really tough on people and I feel terrible about it,” Stewart said, but the results they’ve achieved justify the disruption, for now. “There is light at the end of the tunnel We are going to be able to offer more flexibilities, but there’s not much we can do about it right now.”

Policy Shifts and Driving Progress

With respect to the Director Discretionary Denial decisions that Stewart has been issuing as part of the interim process for Patent Trial and Appeal Board (PTAB) Workload Management, and specifically, the “settled expectations” doctrine that has come out of those, Stewart noted that “the pendulum needs to be brought back to the middle” when it comes to America Invents Act (AIA) cases. “The AIA is still new,” Stewart said. “Settled expectations is just a level-setting.”

While she believes it’s working well and will ultimately balance out, Stewart said one thing the Office is “keeping an eye on” is why about 95% of Director Discretionary Denial cases referred to the Board from the Director are being instituted, which she said “seems unusually high.” Between 40% and 60% of the petitions are being referred to a panel each month to decide on the merits, and previously, institution rates were about 70%. While that could just be because the Director review process is weeding out cases that would be less likely to be instituted, Stewart said she wants to “make sure we’re not unintentionally communicating to the Board that ‘well, we’ve referred it, that means you have to do something with it.’”

Stewart also addressed Secretary of Commerce Howard Lutnick’s patent valuation proposal, which perhaps has been the most widely reported and controversial potential policy shift at the Office. While Stewart said it’s too early to really say how the idea would work in practice or what Lutnick’s true vision is, she is excited about the “opportunity to modernize our fee structure.”

“I think there are a lot of opportunities to talk about our fee structure and what’s working and what’s not working and how we can make it more fair and more modern,” Stewart said. “I’m very happy that the Secretary wants to dig into it. The Secretary is very creative…and he is laser-focused on the IP system. Maybe some of those ideas are going to work, maybe they aren’t, but I think we can all sympathize with where he’s sitting and what he’s looking at across the government and some of the challenges we’re facing as a country.”

Challenges Ahead

Going forward, Stewart said the Office will be focused on improving the examination processes on both the patent and trademark sides and bringing in artificial intelligence tools and other resources to ensure that the resulting rights are “something you can feel comfortable relying on and that can withstand challenge.” These are priorities that have been articulated by incoming Director Squires, who is expected to be confirmed without issue.

With respect to the biggest challenges the agency is facing ahead, Stewart said it’s running such a complex organization without letting anything fall by the wayside. She explained:  

“There’s a misunderstanding about how complicated it is to run the USPTO. It’s a huge $5 billion agency with over 14,000, soon to be 15,000, employees, and we have two judicial systems and a huge examining corp. We’ve got issues, as you’ve seen, with the unions. I think people focus a lot on the discretionary considerations or 101, or whatever’s happening, but they kind of forget that there’s this massive business that has to be operated.”

IPWatchdog’s 2025 Women’s IP Forum is taking place this week, Monday through Wednesday, at IPWatchdog headquarters in Ashburn, Virginia.