Promoting Electrotechnology Careers and Public Policy

14 July 2000

Senator Orrin Hatch
United States Senate
131 Russell Building
Washington, DC 20510

Dear Senator Hatch:

The Institute of Electrical and Electronics Engineers-United States of America (IEEE-USA) and the 220,000 electrical, electronics, and computer engineers who are U.S. members of the IEEE oppose the allocation of fees collected for the U.S Patent and Trademark Office (USPTO) as passed by the House of Representatives in the House Commerce-Justice-State appropriations bill (H.R.4690). If adopted, $295 million of USPTO fees would be diverted to fund other federal agencies. This diversion will force the USPTO to operate with 25% less than the total of fees paid by their patent and trademark applicants. As a result, the USPTO will have to reduce the size of its staff or increase the fees it collects.

1. If the USPTO reduces the size of its staff, trademark registrations and patents will take longer to issue, and the US technology industry will be injured by the delay. The capital formation markets that are so important to our technology industries abhor uncertainty. It is generally more difficult to access capital markets without intellectual property protection when compared to a company that is protected by patents and trademark registrations. Any delay in the issuance of patents and trademark registration will injure the ability of technology industries to access their capital markets for expansion capital.
2. On the other hand, if patent and trademark registration applicants are required to pay higher fees in order to fund the diversion of money to unrelated government agencies, fewer applications for patents and trademark registrations will be filed. The number of patents filed each year is more than a gauge of the state of technology, it is an inducement for others to innovate, to design around existing patents, and to lay claim to new technologies. This very inducement is at least partially responsible for the growth of the American economy. Alan Greenspan often speaks of how technology has been able to hold down inflation. Raising taxes on the technology innovators through increased patent and trademark fees will injure the economy.
3. The Patent and Trademark system serves to reduce the risks of commercial ventures. By diverting fees collected by the USPTO, Congress would be reintroducing risks into the new and innovative technology ventures, either by delaying the issuance of patents and trademark registrations (if the USPTO reduces staff) or by reducing the number of applications filed (if the USPTO raises the fees collected to make up for the diversion of funds).

IEEE-USA supports appropriate levels of public and private funding of both the public functions (dissemination of patents) and private functions (examination of applications) of the USPTO. The U.S. Congress should fund the USPTO's public functions, such as classifying, archiving, indexing, maintaining the patent library and associated patent depositories, and its general administration. Individual users should also pay for the USPTO's private functions, such as processing applications for patent and trademark registrations and other individual requests.

These structural changes notwithstanding, IEEE-USA opposes the reduction of the USPTO's operating budget and urges the Senate to restore the levels to the appropriate amount.

Thank you for your consideration. Should you have questions or seek further information on our positions, please contact Bill Williams at 202-785-0017.

Sincerely,

Merrill W. Buckley, Jr.
President, IEEE-USA

Glenn Tenney
Chair, IEEE-USA Intellectual Property Committee

(Sample of Letter Sent to Key Senate Appropriators)

The Institute of Electrical and Electronics Engineers - United States of America
1828 L Street, N.W., Suite 1202, Washington, DC 20036-5104
Office: (202) 785-0017 * Fax: (202) 785-0835 * E-mail: ieeeusa@ieee.org

| Top of Page | Policy Log | Public Policy Forum | IEEE-USA |

Last Update 14 July 2000
Staff Contact:  Vin O'Neill, v.oneill@ieee.org