Today, the House Judiciary Committee is holding a Patent Office oversight hearing. It promises to include a headline-grabbing discussion of a recently released report showing abuses of the Patent Office’s telework program. It would be a serious missed opportunity if that conversation distracts the Committee from talking about what really matters: why the Patent Office issues low-quality patents and what can be done to fix it.
The Patent Office’s primary job is, not surprisingly to administer the patent system. This is not a small job—the Office has a staff of nearly 10,000 people and it grants approximately 350,000 patents a year. Each of these represents a 20-year monopoly, so it is crucial that the patents are of the highest quality. If they’re not, they can be quite dangerous, especially if they end up in the hands of a patent troll.
In fact, the U.S. Government Accountability Office (GAO) recently released a report finding some things we already knew, namely, that low-quality patents lead to more patent litigation and that the less time patent examiners are able to dedicate to a patent application, the more likely they are to turn that application into a patent. For starters, the increase in patent litigation has been well-reported and studied. As the GAO found:
District court filings of new patent infringement lawsuits increased from about 2,000 in 2007 to more than 5,000 in 2015, while the number of defendants named in these lawsuits increased from 5,000 to 8,000 over the same period.
Even worse, the vast, vast majority of those suits are brought by non-practicing entities, oftentimes called patent trolls. All that litigation, especially the suits brought by opportunistic actors taking advantage of a broken system, is a drag on our economy and a burden on our court system.
The high numbers of patent litigation are directly tied to the low-quality patents that come out of the Patent Office. Indeed, the GAO found that time limits imposed on patent examiners directly leads to the issuance of more patents.
Examiners are rated largely on their production, auditors said, and they are given different times to complete reviews based on the experience of the examiner and the technical level of the field. But they are not rated for quality work. Examiners work fast, creating “an environment where patents may be granted that do not fully meet patentability standards,” GAO found.
Our system currently incentivizes patent examiners to grant patents quickly, giving them even less time to review a given application as they get more senior (and the data correspondingly show that with less time, more applications are granted). Despite this, the current Patent Office has made important strides toward improving quality and has shown a real appetite to continue that trend.
If the problem is that simple, then why do so many subpar patent applications become patents, you may ask.
Structurally, our system is set up to grant as many patents as quickly as possible. It’s not just the time constraints the examiners face, it’s also the fact that there’s pretty much no such thing as a final rejection—a patent applicant can file time and again until she gets her patent granted. That’s not to mention the costs of obtaining a patent and defending oneself from claims of infringement that together tip the deck in favor of patent holders, who, it seems, always want more patents.
This uptick in granting patents really started to increase nearly five years ago, and it was a direct response to what an application backlog at the Patent Office. While the Patent Office under its former director attributed the resulting decrease in the backlog to hiring additional examiners, it might come as no surprise that, in fact, patents were granted more quickly and the Patent Office simply made it easier to grant patents. Years later, it’s become clear that the policies that led to this lowering of standards have had very real, negative consequences.
Which brings us back to today’s oversight hearing, focusing on reported abuses of the Patent Office’s telework program. One can see all too easily how this might play itself out: by focusing on (overblown) reports of Patent Office examiners abusing a work-from-home program, there will be efforts to turn patent-granting into even more of an assembly line than it already is. Instead of taking the time to really understand an application and whether or not it meets the legal standard of being novel and non-obvious, examiners may find themselves with even less flexibility than they have now. This would overturn recent progress made under Director Michelle Lee and turn back the clock to favoring granting over quality, promising that litigation rates will only continue to rise—threatening the bedrock of our patent system and harming our economy.
The views expressed by authors are their own and not the views of The Hill.