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Super Committee Failure Signals Budget Problems for USPTO

By Robyn Hagan Cain on November 23, 2011 3:08 PM

Today is D-Day for the Congressional Super Committee tasked with resolving all of the country's financial woes, and there is no deal in sight.

This week, the Super Committee members admitted that they had failed to agree on a $1.2 trillion deficit reduction package, and would not attempt to extend the deadline to create a plan. Commentators have been debating whether this news will be good for President Obama in 2012, bad for Bush-era tax cuts, or a factor for the voting public beyond the initial doomsday announcement.

For intellectual property attorneys, Super Committee failure has unique significance.

The Leahy-Smith America Invents Act (AIA) will become effective next September. Under the AIA, the U.S. Patent and Trademark Office (USPTO) will morph from a mere examining agency into an adjudicatory body. One problem with this plan is that the AIA did not provide funding for the change.

Without the money to support the AIA changes, "the reforms mandated by the AIA will likely result in a greater patent backlog, significant additional delay in finalizing the value of disputed patents, and a confused and discouraged agency workforce, all of which will significantly delay the recovery of our national innovation-based economy," according to IP Watchdog.

The Super Committee, thanks the Senator Jon Kyl, would have been USPTO's budget savior. Senator Kyl "had pushed for a USPTO-funding provision in the Super Committee agreement that would give the agency full authority to spend fees collected," notes Patently-O.

Those fees would have been substantial.

For FY 2011, USPTO collected $209 million in fees above the USPTO's FY 2011 $2.09 billion appropriation. Due to fee diversion, however, the agency cannot use the funds.

Regardless of the Super Committee failure, the problem still needs to be addressed. Otherwise, USPTO will have to wait until October 2012 to begin collecting and accessing fees from a new reserve fund established in the Leahy-Smith AIA.

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