difficulty of the legal and technical issues, familiarity with the technical subject matter under consideration, the length and quality of the briefing by the appellants and the patent examiner, the number of individual patent claims argued, etc.. The only individuals in position to determine whether a case is unduly complex or should be considered a jumbo case, are the panel members after a decision has been reached. A peer review system would provide a more effective and more fair manner of rating the A peer panel of three or more performance of Examiners-in-Chief. Examiners-in Chief appointed to three-year, non-renewable terms by a chairman selected from the Board and appointed for a five-year non-renewable term, we believe, could fairly devise a system to ensure that Board members' work met fair quality and quantity standards. The panel should be granted the authority to propose removal action against an Examiner-in-Chief for poor performance or misconduct, with the final decision being made by the Board Chairman. The member should have full appeal rights, the same as Administrative Law Judges and others, to the Merit Systems Protection Board under 5 U.S.C., Section 7521. Senator DECONCINI. Thank you. Mr. Banner. STATEMENT OF DONALD W. BANNER, PRESIDENT, INTELLECTUAL PROPERTY OWNERS, INC., WASHINGTON, DC Mr. BANNER. Thank you, Mr. Chairman, for permitting us to testify and also for putting our full statement in the record. I will be very brief. First of all, I think our position is perfectly clear on the administration's authorization request of 3 years. We think it should be 1 year. We think it is necessary for Congress to get back into this review position. We feel that the time has come to make sweeping changes in the way the PTO is operated. The Office's people are hardworking and dedicated. They are doing their best to serve the public need, but they are shackled by an outdated and rigid bureaucratic system which needs substantial reform. The quality of the examination can be improved, the clerical and paper processing operations are inadequate, the automation program you have heard a lot about so I won't go into that in any particular detail. The PTO structure and administrative reform has been needed for many, many years. It was needed when I served as the Commissioner in 1978 and 1979, and it needs it in an even stronger way now. In the absence of such reform, I don't see how the Office can improve its operations. There is testimony in our written statement on this point and you will find a great many people who are former Commissioners who are referred to in the paper of the AIPLA. I think their testimony is unanimous that something has to be done and that it has to be done quickly. We are asking you to reinvent the PTO, Mr. Chairman. We believe the action should be taken by Congress soon to establish the PTO as a Government corporation. We have been studying the situations for a long time. Formally, in 1989 the National Academy of Public Administration prepared a report on making the PTO a Government corporation. We believe the Government corporation is the best solution to the problems. It should be established as an independent agency of the executive branch of the Federal Government. Its chief executive officer should possess management authority equivalent to the authority possessed by the CEO of a major private company. Such a corporation should have three main features. First of all, it should have the authority to borrow money through the issuance of bonds subject to limits set by the Congress. Second, it should have broad operating flexibility similar to that enjoyed by private businesses with regard to personnel systems, employee compensation, contracting for services, all costs including the location elements of the Office, and the ability to inject the entrepreneurial spirit into its operations. Third, it should have statutory advisory committees. Members would be users of the PTO appointed by the President to advise the Congress and the Commissioner on the operations of the PTO. Earlier I heard Mr. Comer express some regard that there would be a conflict of interest. I don't think there would be any conflict of interest at all. I think certainly if you don't ask the people who are using the system what they think about the way it is operating, you are putting your head in the sand. Furthermore, we are recommending that the Congress keep close control over all the operations of such a corporation in any event. Furthermore, there is another point that should not be overlooked. I would like to mention it because it was mentioned earlier today. We think this corporation should have a CEO appointed for a fixed period of time. We are recommending 6 years. As we all know, what happens today is that the Commissioner is changed with almost every administration. Certainly when the party in power changes, the Commissioners change. This is ridiculous. The Commissioner of PTO should not be political, it should be apolitical. There should be no political influence. I think it's a mistake to do anything else. Furthermore, with a fixed term, we wouldn't get into any of these interim situations where nobody quite knows what is happening. Furthermore, with the Crystal City leases expiring in 1996 for the most part, a satisfactory long-term solution to the space needs must be found in the near future. The rent charge to the PTO by GSA last year went from $29 million and next year will be $50 million. Some control over this must be exercised. A PTO corporation I think could much more effectively choose the proper location keeping in mind both efficiency and cost. GSA could do it. We recommend that the subcommittee develop close comprehensive legislation in the near future to establish the PTO as a Government corporation designed to provide the best possible service to its users. Finally, we urge the subcommittee to authorize substantial public funds for the PTO, as we have done before. We need that to cover the discounted patent fees for small entities. We need it for such long-range programs as building programs, depository library, and automation. It is necessary to do that in all fairness and all efficiency Thank you, Mr. Chairman. [The prepared statement of Mr. Banner follows:] IPO recommends authorizing funding of the Patent and Trademark Office (PTO) for only one year, and authorizing public funding of a portion of the PTO. The PTO's employees are hard-working, dedicated individuals who are doing their best to serve the Office's users, but they are shackled by an outdated, rigid, bureaucratic system that needs administrative reform. to IPO urges Congress reinvent the PTO as soon as possible by establishing it as a government corporation. The PTO corporation should be an independent agency of the executive branch of the federal government. Its chief executive officer would possess management authority equivalent to the authority possessed by the CEO of a major private company. The corporation would have the following main features: Authority for the PTO to borrow money through the A statutory advisory committee whose members would be With the Crystal City leases expiring in 1996, a satisfactory long-term solution to the PTO's office space needs must be found in the near future. The PTO corporation should be given authority to borrow money and to arrange for its own office space without involvement by the General Services Administration. 1255 TWENTY-THIRD STREET, N.W., SUITE 850, WASHINGTON, DC 20037 (202) 466-2396 |