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Comment by ritchiea | Hacker News Reader

Government agencies don't really work like that. The PTO doesn't get to give itself raises based on profits. The PTO's behavior is based on legislation, court interpretation and a small sliver of their own interpretation after the direction they receive from those more powerful government bodies. Last year there were about 577,000 patent applications [1] at $180 each for a little over $100M in revenue. That's fantastic if you're most companies, but just a tiny portion of the federal budget.

The current patent situation is a failure of the federal government to understand and legislate contemporary technology, not a misalignment of incentives.

1. http://www.uspto.gov/web/offices/ac/ido/oeip/taf/us_stat.htm

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While I agree that there is a failure to understand contemporary technology, I also think the incentives given patent examiners are misaligned. They're rewarded for applications processed; they're not graded on the number of bad patents they reject.

A patent is a deal we, the people of the US, make with an inventor: add significantly to the sum total of our technical knowledge, and in exchange, we'll give you a time-limited monopoly on the technique you invented. The problem is that there isn't anyone unambiguously charged with making sure this is a good deal for us: that the knowledge we're getting is worth the price we're paying. It's technically the PTO's responsibility, and they do make some effort, but the incentives given patent examiners don't encourage them to be hard-nosed about it.

Currently, I don't think patents about to be granted are reviewed by the examiners' supervisors or anything like that. Seems to me there should be an internal committee that reviews every patent about to be granted by junior examiners, and an occasional one of those about to be granted by senior examiners, to verify its quality. Repeatedly approving applications that then get rejected by this committee should slow an examiner's promotion progress.

But right now, there isn't even a way to get a patent revoked in a court because of obviousness or triviality. Prior art is basically the only way to attack a patent.

It's the entire system that is built around the assumption that 'obviousness' is too difficult to measure objectively, and that protection is vastly more important than anything else, so we should always err on the side of protection when laying the boundary of what should be patentable and what not. In other words, better to have 1000 bad patents than running the risk of having 1 idea that should be patentable being rejected by accident.

No thought is given to the enormous damage this does to our industry.

i suppose obviousness could be 'tested' for if the end result of the patent can be deduced by only looking at the end result and not reading any of the patent filing.

Yes, I've had this thought too. Have a panel of engineers who get to see a description of the problem the invention supposedly solves, but get no information about how it solves it. If any of them come up with the same idea within a couple of days, it was obvious.

That isn't the whole story on incentives, at least from the USPTO's perspective. While it is true that the overall budget is set externally (by Congress, for the most part), the money that the patent offices is allowed to actually spend is limited by the fees they collect [1]. So while they can't directly get themselves raises by drumming up more fees, they do protect themselves from layoffs and pay cuts by keeping the fee pipeline going.

Separately, so far as I know, there's no reason to think that the USPTO is immune from typical bureaucratic incentive misalignment. More applications do mean more work and the simplest way to deal with more work is to get more people to do it. More people would increase the bureaucratic fiefdom of USPTO decisionmakers (who are first in line in terms of deciding how to handle more work) and the increased fees coming from the increased applications are at least a good starting point when arguing for a budget increase next year. This is a weaker incentive chain than "the USPTO isa business funded by filing fees", but it is still a significant one.

[1] http://www.patentlyo.com/patent/2011/08/usptos-future-budget...

Uh, where did you come up with $180 each?

The PTO revenue is vastly greater than that, and the vast majority is diverted to other agencies.

The actual PTO revenue is 2.2 billion in 2011

I googled and found a basic filing fee was $180. But even 2.2 billion isn't really enough to create significant monetary incentives for the government to issue patents given that the 2012 federal budget was 2.5 trillion. There are far greater monetary incentives to finding the right patent structure that allows companies to turn profits, pay taxes and hire people who also pay taxes.

The basic filing fee only includes literally submitting the application itself :)

There is an examination fee of 720, a search fee of 600, and an issue fee of 1780.

There are also often plenty of other fees :)

The actual fees for an average patent are closer to 10k per filing, sometimes a lot more.

Aha. Thanks for the info! Good to know.

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