February 01, 2011

ABA Urges Congress to Ensure Availability of USPTO Fees

ABA President Stephen N. Zack expressed the association’s concerns to House appropriators Feb. 4 about funding for the U.S. Patent and Trademark Office (USPTO), which operates entirely on user fee collections but is currently in a crisis.

In a letter to Reps. Frank Wolf, chairman of the House Appropriations Subcommittee on Commerce, Justice, Science and Related Agencies, and Chaka Fattah, the panel’s ranking member, Zack emphasized that a combination of events has produced the present dire circumstances in which the USPTO must operate on funding that is more than $1 million less per day than the full funding that Congress determined was needed.

For the past six years, congressional appropriations have provided full funding of the USPTO in the amounts equal to the agency’s projected fee collections. Zack said that “a perfect storm began gathering” when the agency underestimated its fee collections in fiscal year 2010, and as a result the appropriations level for fiscal year 2010 did not include approximately $50 million in additional collections. Since Congress did not agree on fiscal year 2011 funding measures before the Oct. 1, 2010, beginning of the fiscal year, most of the federal government, including the USPTO, has been functioning at fiscal year 2010 levels through several continuing resolutions.

This situation has produced an unrealistically lower level of spending authority for the USPTO based on the underestimated fee collections for 2010. Meanwhile, fee collections and the corresponding workload of the USPTO continue to rise, but the office has no access to those additional funds under the continuing resolution funding mechanism.

Zack strongly urged that Congress include an appropriate “buffer” provision in the appropriation for the USPTO for the rest of the year that would make available to the office actual fee collections that exceed the amount provided in the appropriation. Without the buffer, Zack said, the resulting underfunding of approximately $400 million would “trigger a downward spiral in productivity and quality of the patent and trademarks systems, with crippling effects on the engines of innovation, investment and job creation that drive our nation’s economy and improve the lives of our citizens.”

 

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