Wednesday, September 14, 2005

IPO poll suggests belief in low quality patents

During its annual meeting in Seattle today, Intellectual Property Owners Association (IPO) released results of a survey showing that its corporate members perceive the quality of patents granted by the U.S. Patent and Trademark Office to be less than satisfactory.

Over half of respondents, 51.3 percent, rated the quality of patents issued in the U.S. today as less than satisfactory or poor (47.5 percent less than satisfactory and 3.8 percent poor). Those rating quality more than satisfactory or outstanding were 8.8 percent of all respondents (8.8 percent more than satisfactory and 0 percent outstanding). The portion saying it is satisfactory was 40.0 percent.

Respondents' prognosis for the future was not encouraging. Over two- thirds of respondents said they thought the patent process would get longer, not shorter, over the next three years. And nearly three-quarters said they would be spending more, not less, on patent litigation over the coming years.

IPO President J. Jeffrey Hawley said, "IPO believes that higher patent quality is critically important for boosting American technology and reducing business litigation. The survey results confirm the concerns of IPO members and others since the 1990's. The significance of the survey is two-fold: It verifies that quality is perceived to be less than satisfactory and it provides a baseline for future IPO surveys of patent quality. We intend to repeat the survey at least once a year."

High quality patents are usually thought of as those that will hold up if challenged in court. In order to issue high quality patents the U.S. Patent and Trademark Office (PTO) must (1) conduct thorough searches of earlier technology (2) correctly apply statutory requirements for obtaining a patent, and (3) communicate clearly with the patent applicant and create an adequate record of the examination of the application.

Between 1992 and 2004 Congress diverted to unrelated government programs more than three-quarters of a billion dollars that patent applicants paid to the PTO to have their patent applications processed. IPO believes the loss of funding and delays in modernizing the agency's operations have been primary causes of the current weaknesses in patent quality and the growing delays in processing.

IPO supported an increase in fees that Congress enacted last year to give the PTO an additional $200 million a year. IPO supports a robust hiring program now under way at the PTO to add more patent examiners and supports implementation of the PTO's "21st Century Strategic Plan," which is designed to improve operations. IPO also supports certain legislation now pending in Congress to reform the patent system.

For a report containing more detailed results of the IPO survey please visit:

[Note: as pointed out by Lumney, most patents, when challenged in court, do hold up in court (i.e., invalidity determinations are lower now than 20 years ago). Thus, by the criterion of the IPO, patent quality has been increasing in the most recent 20 year stretch. Yet, the poll suggests otherwise. Are the poll takers familiar with court invalidity statistics? A resolution of this point is relevant to H.R. 2795.]


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