Intel, Hewlett-Packard Fight Bush Plan on Patent Fees
Washington, April 10 (Bloomberg) -- Trade groups and companies such as Intel Corp., Minnesota Mining and Manufacturing Co. and Hewlett-Packard Co. are fighting a Bush administration plan to use about 15 percent of patent fees to help fund other government programs.
The U.S. Patent and Trademark Office is funded entirely by fees companies pay when they apply for patents or trademarks. President George W. Bush seeks to let the agency keep $1.14 billion, a boost of $100 million over last year, out of an anticipated $1.35 billion in fees to be collected in the fiscal year starting Oct. 1.
The companies that pay the fee say it's important that the patent office use all the fees it collects to clear up a backlog of applications; companies now wait more than two years for a decision. Congress has used some of the office's income for other purposes in recent years. The $207 million Bush proposed yesterday is the highest level ever.
``It's unacceptable,'' said Herb Wamsley, executive director of the Intellectual Property Owners Association, which includes Eli Lilly & Co. and General Electric Co. ``The patent office has a severe problem with the quality and timeliness of its work. It's already falling behind and this money shouldn't be withheld.''
The plan, included yesterday in Bush's fiscal 2002 budget request, would help meet the administration's goal of limiting the growth in federal spending to about 4 percent.
Priority for Companies
Bush is already facing efforts by businesses and outside groups to block other plans to limit spending.
For example, companies like Boeing Co. and Caterpillar Inc. are lobbying to maintain funding for the Export-Import Bank, which lends money to foreign buyers of U.S. goods, by 25 percent to $699 million in fiscal 2002.
U.S. broadcasters, including Viacom Inc., plan to fight Bush's proposal to charge them fees totaling $200 million annually for using analog airwaves they got for free.
The battle to stop, or at least limit, the diversion of patent fees is a priority for technology-based companies, and lobbyists say they're confident of at least a partial victory.
``Stopping diversion altogether will be a tough goal, but we expect the final number will be smaller,'' said Brian Adkins, a lobbyist with the Information Technology Industry Council, a group representing technology-based companies.
The Bush budget released yesterday gives the companies some ammunition. The administration said it expects the average time to act on patent applications will grow to 26.7 months in fiscal 2002 from 26.2 months this year.
The administration predicted the agency's workload will grow by about 12 percent next year. The patent office is expected to receive 367,800 patent applications in fiscal 2002, up from an estimated 328,400 this year, according to the budget request.
Track Record
Companies have fought past efforts to divert patent office funding with limited success.
Last year, the U.S. House of Representatives voted to withhold $295 million in patent office fees to fund other programs. Companies turned their attention to the Senate, and after months of lobbying that chamber passed a funding bill that allowed only $33 million to be withheld. A House-Senate compromise set the withholding at $161 million.
Companies and trade groups opposed to Bush's proposal already are setting up meetings with legislators, including Representative Frank Wolf of Virginia, Republican chairman of the House Appropriations subcommittee that oversees the patent office's budget; and Senator Fritz Hollings of South Carolina, senior Democrat on the corresponding Senate subcommittee.
They also are rallying around a bill introduced by Representative Howard Coble, a North Carolina Republican, that would require the patent office to spend all of the fees it generates.
Lobbyists gained some powerful allies last week. House and Senate Democratic leaders last week listed their technology goals, including a call for the patent office ``to keep all of the fees it generates every year.''
Apr/10/2001 11:50 ET
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