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Kappos runs patent office like business

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When he joined the U.S. Patent & Trademark Office as director last August, David Kappos brought with him an operational business philosophy culled during 25-plus years of working for IBM.

That sense of running the agency like a business has allowed him to implement changes designed to reduce the enormous backlog of patent applications, while simultaneously improving the quality of those issued.

"Intellectual property is becoming the world's currency of innovation," said Kappos, who spoke to the San Diego Intellectual Property Law Association Thursday at the Del Mar Marriott as part of his recent visit to San Diego. "This shift reflects a new dynamic in which marketplace success is going to be much more based on people and what they've got in their heads and what they can create and invent, and much less on manufacturing costs."

He said the innovation derived from intellectual property is quickly becoming America's only sustainable source of competitive advantage.

He also said the time from when someone has an idea to when it reaches the marketplace is shrinking.

"The result is intellectual property is clearly becoming not only the necessary instrument but, in many cases, the only available instrument for innovators and businesses to capture value from the ideas they create," Kappos said.

The patent office has made progress on reducing the backlog of patent applications, getting it under 700,000 for the first time in a long time.

Part of the progress is due to Kappos' changing of the "count system," which is the way the patent office measures the productivity of its examiners.

He added a provision that gives examiners time credit for initiating interviews with patent applicants.

The result has been a 60 percent increase in the rate of interviews since the fiscal year began in October 2009.

The increase in communication has allowed examiners to help applicants find allowable subject matter more quickly, which, in turn, has pushed applications through the office more efficiently.

"We're the patent office, not the rejection office," he quipped.

The agency is in the process of adding approximately 2,000 more examiners to its 7,000-person staff, but Kappos has made sure to recruit experienced IP professionals.

More than 3,000 seasoned applicants responded to the first call for new hires.

With examiners fresh out of college, Kappos said it typically takes two years to get them trained to where they can be highly productive. With veteran IP members, that training period can be cut to two months.

Attrition also slowed from the office losing approximately 100 examiners a month to 18.

"We're still a long way from declaring victory, but things are actually looking somewhat hopeful at this point," Kappos said.

His main focus has been on quality leadership and attention to detail -- traits he picked up while at IBM (NYSE: IBM).

He also has reached out to the patent community in a very public way with a blog and making appearances like the one in San Diego, where he carefully listens to suggestions.

"I'm in this to fix the USPTO so that it works for you, for the IP community, so you can go out and secure protection for your clients and create jobs, put people to work, generate wealth and make our country successful," he said.


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