Locke on the USPTO: "In some ways, it's like a Ponzi scheme"
Within an article by Chris O'Brien in the Mercury-News, one has the text:
Still on the agenda is rethinking the way the patent office is funded. Filers pay a fee upon submitting an application, and then another fee if the patent is approved.
"In some ways, it's like a Ponzi scheme," Locke said.
For now, they are requesting increases in filing fees, while also looking into ways to fund the office so it isn't relying on the ups and downs of the number of patent applications.
Generally, a Ponzi scheme is a fraudulent investment operation that pays returns to separate investors from their own money or money paid by subsequent investors, rather than from any actual profit earned [Wikipedia]. Last time we looked, the USPTO wasn't paying money to patent applicants and wasn't designed to make a profit.
People before Locke brought up the Ponzi scheme image. IPBiz had noted it was not apt but also observed:
However, a comment from the Social Security folks is relevant: "There is no unsustainable progression driving the mechanism of a pay-as-you-go pension system," and "as long as the amount of money coming in the front end of the pipe maintains a rough balance with the money being paid out, the system can continue forever." At the USPTO, the money taken in at the front end of the pipe (fees) is now less than the money paid out to administer the USPTO, and that system cannot continue.
O'Brien was worried about the "ups and downs" of patent applications, but somehow didn't mention fee diversion. If fee diversion doesn't stop, "increases in filing fees" is not going to help. O'Brien also didn't mention the variability in allowance rate, which was caused by the USPTO.
O'Brien wrote: Last fall, working with the patent examiner's association, they changed the decades-old incentive system to reward examiners for finding high-quality patents they can speed along.
Ron Riley wrote of one Kappos initiative: It is also notable that David Kappos is promoting small entity inventors giving up 50% of their inventions and the investment they have made in order to get timely consideration of the other half. What a deal, with friends like David Kappos who needs enemies? [See
Inventors Eye is for and about America ’s independent and small entity inventor community [?] ]
O'Brien concludes his clueless commentary with Silicon Valley should be right there making sure Congress knows this is a top priority if the U.S. is to maintain its innovation leadership. Hmmm, Coalition for Patent Fairness....
**Also, note the 1201Tuesday blog on some questionable (but revenue-generating) restriction practice by the USPTO. Further, the patent in question was of some interest, with a claim:
A method in a computer system for evaluating a creator of item reviews, comprising:
causing the display of one or more item reviews submitted by the creator to a plurality of viewers;
soliciting, from the viewers to whom an item review is displayed, an indication of whether the review is helpful;
receiving and storing any solicited indication provided by the viewers to whom item reviews are displayed, each indication being either positive or negative; and
applying, by said computer system, a formula to obtain a score for the creator based upon the stored indications that considers, for each review submitted by the creator, the number of viewers to whom the review was displayed that subsequently ordered the item identified by the review.
Crowdsourcing a review, based on subsequent orders of the reviewed product?
UPDATE. on social security
This year [2010], for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes — nearly $29 billion more.
Social Security is projected to drain its trust funds by 2037 unless Congress acts, and there's concern that the looming crisis will lead to reduced benefits.
"This is not just a wake-up call, this is it. We're here," said Mary Johnson, a policy analyst with The Senior Citizens League, an advocacy group. "We are not going to be able to put it off any more."
For more than two decades, regardless of which political party was in power, Congress has been accused of raiding the Social Security trust funds to pay for other programs, masking the size of the budget deficit.
(...)
the Treasury Department has been issuing special bonds that earn interest for the retirement program. The bonds are unique because they are actually printed on paper, while other government bonds exist only in electronic form.
They are stored in a three-ring binder, locked in the bottom drawer of a white metal filing cabinet in the Parkersburg offices of Bureau of Public Debt. The agency, which is part of the Treasury Department, opened offices in Parkersburg in the 1950s as part of a plan to locate important government functions away from Washington, D.C., in case of an attack during the Cold War.
One bond is worth a little more than $15.1 billion and another is valued at just under $10.7 billion. In all, the agency has about $2.5 trillion in bonds, all backed by the full faith and credit of the U.S. government. But don't bother trying to steal them; they're nonnegotiable, which means they are worthless on the open market.
Hmmm.... "Congress has been accused of raiding" as in fee diversion of USPTO funds?
Still on the agenda is rethinking the way the patent office is funded. Filers pay a fee upon submitting an application, and then another fee if the patent is approved.
"In some ways, it's like a Ponzi scheme," Locke said.
For now, they are requesting increases in filing fees, while also looking into ways to fund the office so it isn't relying on the ups and downs of the number of patent applications.
Generally, a Ponzi scheme is a fraudulent investment operation that pays returns to separate investors from their own money or money paid by subsequent investors, rather than from any actual profit earned [Wikipedia]. Last time we looked, the USPTO wasn't paying money to patent applicants and wasn't designed to make a profit.
People before Locke brought up the Ponzi scheme image. IPBiz had noted it was not apt but also observed:
However, a comment from the Social Security folks is relevant: "There is no unsustainable progression driving the mechanism of a pay-as-you-go pension system," and "as long as the amount of money coming in the front end of the pipe maintains a rough balance with the money being paid out, the system can continue forever." At the USPTO, the money taken in at the front end of the pipe (fees) is now less than the money paid out to administer the USPTO, and that system cannot continue.
O'Brien was worried about the "ups and downs" of patent applications, but somehow didn't mention fee diversion. If fee diversion doesn't stop, "increases in filing fees" is not going to help. O'Brien also didn't mention the variability in allowance rate, which was caused by the USPTO.
O'Brien wrote: Last fall, working with the patent examiner's association, they changed the decades-old incentive system to reward examiners for finding high-quality patents they can speed along.
Ron Riley wrote of one Kappos initiative: It is also notable that David Kappos is promoting small entity inventors giving up 50% of their inventions and the investment they have made in order to get timely consideration of the other half. What a deal, with friends like David Kappos who needs enemies? [See
Inventors Eye is for and about America ’s independent and small entity inventor community [?] ]
O'Brien concludes his clueless commentary with Silicon Valley should be right there making sure Congress knows this is a top priority if the U.S. is to maintain its innovation leadership. Hmmm, Coalition for Patent Fairness....
**Also, note the 1201Tuesday blog on some questionable (but revenue-generating) restriction practice by the USPTO. Further, the patent in question was of some interest, with a claim:
A method in a computer system for evaluating a creator of item reviews, comprising:
causing the display of one or more item reviews submitted by the creator to a plurality of viewers;
soliciting, from the viewers to whom an item review is displayed, an indication of whether the review is helpful;
receiving and storing any solicited indication provided by the viewers to whom item reviews are displayed, each indication being either positive or negative; and
applying, by said computer system, a formula to obtain a score for the creator based upon the stored indications that considers, for each review submitted by the creator, the number of viewers to whom the review was displayed that subsequently ordered the item identified by the review.
Crowdsourcing a review, based on subsequent orders of the reviewed product?
UPDATE. on social security
This year [2010], for the first time since the 1980s, when Congress last overhauled Social Security, the retirement program is projected to pay out more in benefits than it collects in taxes — nearly $29 billion more.
Social Security is projected to drain its trust funds by 2037 unless Congress acts, and there's concern that the looming crisis will lead to reduced benefits.
"This is not just a wake-up call, this is it. We're here," said Mary Johnson, a policy analyst with The Senior Citizens League, an advocacy group. "We are not going to be able to put it off any more."
For more than two decades, regardless of which political party was in power, Congress has been accused of raiding the Social Security trust funds to pay for other programs, masking the size of the budget deficit.
(...)
the Treasury Department has been issuing special bonds that earn interest for the retirement program. The bonds are unique because they are actually printed on paper, while other government bonds exist only in electronic form.
They are stored in a three-ring binder, locked in the bottom drawer of a white metal filing cabinet in the Parkersburg offices of Bureau of Public Debt. The agency, which is part of the Treasury Department, opened offices in Parkersburg in the 1950s as part of a plan to locate important government functions away from Washington, D.C., in case of an attack during the Cold War.
One bond is worth a little more than $15.1 billion and another is valued at just under $10.7 billion. In all, the agency has about $2.5 trillion in bonds, all backed by the full faith and credit of the U.S. government. But don't bother trying to steal them; they're nonnegotiable, which means they are worthless on the open market.
Hmmm.... "Congress has been accused of raiding" as in fee diversion of USPTO funds?
posted by Lawrence B. Ebert at 4:28 AM
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