Patent Office Accused of Allowing Politics to Decide Inventors’ Rights

WASHINGTON — Congress is trying to develop a method of depoliticizing a patent system closely tied to the vitality of the U.S. economic system.

Patents are a centerpiece of American technology and foreign trade, particularly in competition with China.

Legal disputes over who owns the rights to the inventions can involve “sometimes billions of dollars,” said Rep. Henry Johnson, D-Ga., during a congressional hearing Thursday.

In recent years, inventors and even some judges have complained that political policy rather than the merits of patent applications determines who wins or keeps a patent.

“We want due process, we want transparency,” said Rep. Darrell Issa, R-Calif. “To get both, we’re going to have to make changes in the current system.”

Due process refers to the 14th Amendment’s guarantee of procedural protections — such as hearings before a judge — before the government can deprive anyone of “life, liberty or property.” The judges are supposed to make decisions free of bias or political influence.

The House Judiciary Subcommittee on Courts, Intellectual Property and the Internet was spurred to action by a recent Government Accountability Report.

It found that 75% of administrative patent judges reported pressure from administrators at the U.S. Patent and Trademark Office to allow them to intervene in their rulings. Typically, the administrators were trying to enforce a trade policy.

Decisions from the agency’s Patent Trial and Appeal Board must “be based on the facts presented,” Issa said. Instead, “There was a behind-closed-doors process.”

The Patent Trial and Appeal Board is an adjudicative body within the Patent and Trademark Office. The PTAB’s 229 judges rule on appeals from patent examiners’ decisions and adjudicate whether inventors can keep patents when they are challenged by third parties.

Congress set up the PTAB 10 years ago to streamline the patent process that previously became bogged down in years of lawsuits.

Initially, it worked fine as a better alternative to the time and expense of traditional courts, said Richard Torczon, a patent attorney and former administrative patent judge.

“I just think the culture drifted over the years,” Torczon said.

As the PTAB evolved, political pressure grew to align the rulings with policies of the sitting presidential administrations, according to the Government Accountability Office report. The pressure was exerted through management oversight of the judges’ job performance.

“Many judges we surveyed said director-created policy and guidance had an effect on their ability to decide cases independently,” the GAO report said.

One of the problems pointed out by lawmakers was the lack of appeal rights when someone loses before the PTAB. Current law does not allow appeals.

Legislative solutions the subcommittee is considering would allow claimants before the PTAB to appeal to federal courts. Lawmakers also are thinking about ways to enforce rules banning patent administrators from influencing judges’ decisions.

“We do believe there needs to be congressional action,” Issa said.

The internal review comes at a time of intense political pressure on the Patent and Trademark Office as it seeks to protect U.S. technology and trade.

The U.S. government accuses China of state-sponsored intellectual property thefts and unfair competition to beat out American companies. Any efforts to protect U.S. patent rights have largely failed in Chinese courts.

This week, the Patent and Trademark Office made what appears to be an incremental improvement in its international enforcement of patent rights.

The Patent and Trademark Office’s director signed a memorandum of understanding with the World Intellectual Property Organization to expand use of the international organization’s Arbitration and Mediation Center to resolve patent disputes between owners in different countries.

Tom can be reached at [email protected] and @TomRamstack