U.S. patent office gets boost in Obama budget

Mon Feb 1, 2010 11:38am EST

* US PTO would get budget increase, keep fees it collects

* Interim 15 pct surcharge proposed, pending new fees

WASHINGTON Feb 1 (Reuters) - The U.S. Patent and Trademark Office, which has a large backlog of patent applications and an antiquated computer system, got a big budget bump in the president's budget proposal released on Monday.

The PTO, which charges fees but does not always get to keep all of the money, was given a budget of $2.322 billion for the 2011 fiscal year beginning Oct. 1, up 23 percent from 2010's expected budget.

"The President's Budget gives the U.S. Patent and Trademark Office (USPTO) full access to its fee collections and will strengthen USPTO's efforts to improve the speed and quality of patent examinations through a fee surcharge," the White House said in budget documents.

"The budget includes a proposal to increase statutory patent fees by 15 percent, which is expected to yield over $200 million in additional collections in 2011. The increase is intended to be an interim measure," budget documents said.

President Barack Obama's proposed budget said the PTO would develop a new fee schedule that better aligns fees to the cost of providing services.

In the past two fiscal years, the patent office earned more in fees than it was allowed to keep despite a problems like taking an average of 34.6 months to approve or reject a patent application.

Meanwhile examiners have been leaving faster than they can be replaced and the examiner corps is hampered by a computer system that the new PTO head Director David Kappos has described as "antiquated." [ID:nN26116520]

Kappos has predicted it would take several years and "multiple hundreds of millions of dollars" to upgrade the PTO's computer system.

In 2009, the patent office used $1.9 billion in funding and gave back $2 million additional that it earned in fees. For the 2010 fiscal year, it is estimated that the PTO will have access to slightly less but earn an additional $116 million in fees.

In other years, Congress had set the patent office budget at the same amount as the agency's expected intake plus a cushion of $100 million. But Congress cut the cushion for fiscal 2010, that ends on Sept. 30. (Reporting by Diane Bartz; Editing by Tim Dobbyn)

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