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AIPLA Testifies Before PPAC

Proposed USPTO Fee Schedule

Arlington, VA—AIPLA Executive Director Q. Todd Dickinson testified at the February 15 hearing of the USPTO Patent Public Advisory Committee (PPAC) regarding the Office’s proposed fees under its new fee-setting authority created by the America Invents Act.

Dickinson observed at the outset that a fundamental impetus of patent reform under the AIA was a widely-held concern about the overall quality of patents, real and perceived. Moreover, he added, many stakeholders either opposed granting the PTO fee setting authority or, as with AIPLA, supported it only to the extent that the Office retained control over and access to all fees.

Dickinson noted that a rationale for many of the higher fees is the daunting challenge of reducing patent pendency as quickly as possible. "While pendency reduction is certainly an important and laudatory goal, also long-sought by the user community, it must be balanced with the costs of entering into and participating in the system; it should not interfere with the primary goal of reform: pursuit of quality improvement, both in perception and in fact. In other words, if pendency reduction results in either keeping inventors from using the system, or decreasing the quality of the rights they receive, the value of pendency reduction is undermined."

Dickinson testified that AIPLA agrees that fees, in the aggregate, should recover 100% of the PTO costs, and that the relationship between "front-end" fees (for filing, search, examination, etc.) and "back-end" (for maintenance, renewal, etc.) should be maintained. Thus, he explained, search and examination fees for patents should not necessarily be set to recover the entire costs of front-end processing for patents, and that a portion of such costs should continue to be borne by maintenance and renewal fees. "This approach ensures that front-end fees remain low enough to allow a wide range of inventors and businesses to seek protection, making up the shortfall with back-end maintenance fees. The current fee schedule was built on this core philosophy." However, it is difficult to judge the reasonableness of the fees as a cost-recovery step without more information about the basis for the asserted costs, he added.

At the same time, when overall fee setting occurs or when fees are targeted or adjusted to incent or retard certain behaviors, AIPLA believes the nature and magnitude of those fees should lean towards quality enhancement as a first principal, according to Dickinson. We believe that is why Congress for the first time also directed that the Office to change from an individual action cost recovery model to one in which fees must only in the aggregate add up to the cost of managing the various functions of the Office, he concluded.