Summary of key provisions of H.R. 1561

Posted by J. Matthew Buchanan

March 4, 2004

Yesterday, the House passed H.R. 1561, The United States Patent and Trademark Fee Modernization Act of 2004. The bill now moves to the Senate where it may change form and substance.

The version passed by the House includes the following key provisions:

1. Patent fees

Generally, they are increasing. This AP article has estimates of the costs for filing an application and maintaining an issued patent under the provisions of the bill, and estimates the overall increases at about 15%.

2. Outsourcing of searches

The bill allows the Director to establish a pilot program investigating the use of outside commercial searchers for the patentability searches made during examination. According to the AP article, this was one of the provisions objected to by those voting against the bill (the bill passed 379-28; roll call here).

3. Small entity fees

The bill requires the Director to conduct a study on the effect of patent fees on the ability of small entities to file patent applications. The bill states that the study shall examine “…whether a separate category of reduced patent fees is necessary to ensure adequate development of new technology by small entity inventors.”

4. PTO Funding, and the Reserve Fund

The bill establishes the “Patent and Trademark Fee Reserve Fund.” Basically, if the PTO collects fees in excess of the amount appropriated to the Office for the year, the excess must be deposited into this reserve fund. The Director then, by regulation, determines to whom the excess fees are paid (the bill requires that those receiving funds from the reserve must have paid PTO fees during that fiscal year).

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