Perhaps one person in 50,000 can name the Director of the United States Patent & Trademark Office (USPTO), and fewer than half as many may actually care. So how and by whom that position is filled rarely, if ever, engenders the slightest controversy. But the recent naming of a new deputy director has raised eyebrows, for a couple of reasons, among those who care about the protection of technological innovation.
A little background: In early 2013, David Kappos resigned as director after nearly four years of distinguished service. Kappos’s deputy, Teresa Rea, then ably served as acting director until she left the following November, leaving both the director and deputy director posts vacant. Subsequently, the commissioner for Patents (who is subordinate to the deputy director) nominated Michelle Lee, the head of the San Jose, Calif. branch of the USPTO, to be deputy director, and on December 11, Secretary of Commerce Penny Pritzker formally appointed Ms. Lee to that position. With the director slot (which requires presidential appointment and Senate confirmation) still vacant, Lee is now the acting director of the USPTO.
{mosads}The appointment of Lee was unusual, to say the least. Normally, subordinate officers in an agency do not get to nominate their superiors, as the Patent commissioner did in this case. But the commissioner, while not legally entitled to serve as acting director, had apparently been empowered by Deputy Director Rea to “act as Director” upon Rea’s resignation, whereby Rea delegated to the commissioner the apparent authority to nominate the person who would be her superior.
The academics are having a field day. Some believe that the appointment of Lee is contrary to relevant statutory law, and is therefore legally questionable, while others are convinced that the appointment is fully supported by established principles of administrative law and statutory construction. The more interesting question, however, is why Lee was not nominated by the president to be director. With the filibuster abolished, the president could have nominated Miley Cyrus and seen her confirmed. But Lee is no political hack or neophyte; she is, by consensus, eminently qualified to be director. There would appear to be no reason, therefore, why her nomination as director would not have effortlessly sailed through the Senate. Perhaps the president has someone else in mind for director, but with the administration’s frequent emphasis on the importance of technological innovation (sparked by the patent system) one wonders why the critical post of USPTO director is still vacant more than a year after Kappos announced his resignation. Moreover, the failure to nominate Lee to the top post can only lead to speculation that something in her background would make her confirmation problematical. That would be a tremendous disservice to Lee.
Perhaps the most troubling issue surrounding Lee’s appointment is that about a week before the appointment became official, an email was sent to members of Business Forward announcing a “U.S. Patent & Trademark Office Roundtable on IP Protection & Patent Reform,” to be held at the USPTO on December 11, 2013 (the day Lee was to assume office).
While such “roundtables” had been conducted under both David Kappos and Teresa Rea, this one was different: For the first time, it would be “off the record and not for press purposes.” Why throw a cloak of secrecy on a discussion of potential executive and legislative actions “for improving our nation’s intellectual property system,” as the agenda is described in the email? Perhaps part of the answer is revealed when it is understood that Business Forward is an organization that has largely supported (by lobbying and public relations) the Obama administration’s economic policies, and whose members represent over fifty of the country’s largest corporations. While these Fortune 500® companies are responsible for a great deal of innovation, and thus have a substantial stake in how intellectual property rights are protected and enforced, their interests are often at odds with those of start-up ventures and other smaller businesses, whose efforts to bring new technology to market are frequently impeded by legal measures (such as the recently enacted America Invents Act) that are seen by many to favor big business at the expense of small enterprises.
The timing of the secret roundtable may have been coincidental, or it may explain why the administration bent itself into a pretzel to short-circuit the confirmation process. At least these questions must be asked: Was Lee involved in organizing and conducting the secret December 11 Roundtable? Will it be her policy, as acting director, to continue the practice of holding secret roundtables? If either of those questions is answered in the affirmative, her qualification to lead the USPTO would be called into question. Moreover, such answers would signal the potential use of the USPTO to further a political agenda that may not serve the interests of the nation’s innovation community.
Klein is a patent lawyer in private practice in Irvine, Calif. He was a member of the Patent Public Advisory Committee of the U.S. Patent and Trademark Office from 2003-2006.