Patent Chief Kappos `On the Hunt' to Reduce U.S. Backlog, Spur Innovation

David Kappos, the head of the U.S. patent office, said his agency is “on the hunt” to cut its applications backlog to the lowest since 2007 to further President Barack Obama’s goal of job growth through innovation.

U.S. Patent and Trademark Office application reviews, which often take more than two years, have been sped up and hiring practices improved, Kappos, 49, said in an interview yesterday at Bloomberg’s Washington office. Kappos says the changes are part of efforts to help the U.S. maintain its economic power.

“I’m quite convinced there’s really only one way that will happen and it will be based on innovation,” said Kappos, who spent more than two decades as an engineer and intellectual property lawyer for International Business Machines Corp. “Innovation-driven companies, small and large, especially small, are huge creators of jobs and creators of wealth.”

Obama, who yesterday said he recognizes that the U.S. economic recovery has been “painfully slow,” has called for incentives to promote American ingenuity as part of his measures to create jobs and expand productivity. Patent applications are up about 4 percent for the year that ends this month, following a 2.3 percent drop in fiscal 2009, led by medical, computer, biotechnology and nanotechnology inventions, Kappos said.

“The U.S. business sector seems to be reviving,” Kappos said. “The recovery isn’t as fast as we’d like it to be, but one leading indicator is the filing of patent applications.”

‘Locked Down’

Kappos said he has been working to improve the efficiency of the patent office and eliminate a backlog of applications that had reached 750,000.

“You can think of each one of these as a business, as some new product or service that’s sequestered in a government agency, that’s locked down, that’s inhibited from reaching the marketplace,” Kappos said. “To have 750,000 of these things sitting in a government agency is not good for innovation.”

In the 13 months he’s headed the agency, Kappos has worked to meet an interim goal of cutting the backlog to less than 700,000 by the end of this fiscal year. He said it would be the first time in three years that “the first significant digit of the USPTO’s backlog was anything other than a 7.” He said he wants to have an “inventory” of pending applications of 325,000 by 2015.

“We’re fans of his,” said Herb Wamsley, executive director of the Intellectual Property Owners Association, which represents companies including Intel Corp., Monsanto Co., Johnson & Johnson, and 3M Co. “He has been very energetic in creating a great many proposals and he’s very creative.”

Kappos had been vice president of the Washington-based group and was in line to be president before he was tapped by Commerce Secretary Gary Locke to head the patent office.

Candy and Overtime

Obama has proposed a $2.32 billion budget for the agency in the year starting Oct. 1, with a 15 percent increase in fees to help pay for changes Kappos is making. The agency is funded by the fees it collects.

To reach his goals, Kappos said he is drawing from his time at IBM, the world’s largest computer-services provider, to introduce more “business-related processes” at the agency. He has changed how examiners process applications, with more personal interviews with inventors early in the process. The agency is holding pep rallies and approving overtime, and Kappos is handing out candy to improve morale and productivity.

“I’m just running business plays at the USPTO and so far no one’s told me you can’t do this,” Kappos said. “So I keep running the plays I learned from 26 years in the business sector.”

Fast-Track Programs

There were 485,500 patent applications filed in fiscal 2009, and 190,121 patents issued, the most in the agency’s history. There were more patents issued in fiscal 2009 than applications filed in fiscal 1993, according to agency data.

Kappos created a special program that lets applicants with inventions that increase energy efficiency petition for a speedier review. The so-called green energy program has been so popular, a similar approach is being considered for other products including medical devices, Kappos said.

The agency also is developing a three-track system that would let applicants, for a fee, get their inventions reviewed in about a year. Kappos said he expects smaller businesses will take advantage of the program, which may begin in about a year.

Inventors of some medical devices may want fast processing, while drugmakers aren’t in a hurry because they’re also waiting on regulatory approval, Kappos said, likening the program to tiered pricing options by companies such as FedEx Corp.

“Not every package needs to go by ground delivery,” he said. “Some packages need to go by overnight, some packages ground delivery is fine, and some you say look I’ll just send it third-class, it’s bulk mail, it can take two weeks.”

Kappos also has changed the agency’s hiring practice -- selecting people who have more experience rather than those just coming out of college. The patent office plans to hire 1,000 examiners annually in fiscal years 2011 and 2012. It has about 6,200 examiners, up from 3,500 in fiscal 2002.

To contact the reporter on this story: Susan Decker in Washington at sdecker1@bloomberg.net.

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