The Office now lacks a director and will soon also lack a deputy director. It is also facing budget sequestration, a form of across-the-board cuts to government services imposed by Congress after the breakdown of negotiations with the Obama administration. Under sequestration, the Office will be required to hand over 5% of its income, or $150 million, to the US Treasury.
Rea emailed USPTO staff on Thursday, saying she will be leaving the agency "in the near future". Though the exact date of her departure has yet to be confirmed, sources told Managing IP that Rea plans to continue as deputy director long enough to ensure a smooth leadership transition.
Rea's departure follows the resignation of former director David Kappos, who left in January this year. As deputy director, Rea had temporarily taken on the director's duties following his departure and was considered a potential candidate for the permanent director position. The USPTO will now have to fill both vacancies.
Managing IP understands that Bob Armitage, a recently retired senior vice president and general counsel at Eli Lilly who was considered a strong candidate by many in the IP industry, has taken himself out of the running. Armitage has yet to confirm and was unavailable for comment.
A spokesperson for the USPTO said the organisation does not have any further personnel announcements at this time. According to the USPTO's succession plan, Commissioner of Patents Peggy Focarino is next in line to take over the duties of director while a permanent replacement is found.
Who can follow Kappos?
Bob Stoll, a former USPTO commissioner for patents who retired in 2011 after a 34-year government career, said he believes the Office is struggling to find a candidate with suitable experience who is willing to take on such a challenging role for the relatively modest level of pay.
Under Title 35 USC 3, a USPTO director must be a US citizen, appointed by the President with the Senate's approval, with a professional background and experience in patent or trade mark law.
Stoll, now a partner of Drinker Biddle & Reath, said candidates may also see Kappos as a tough act to follow.
Kappos has been described as "the strongest USPTO leader we have had in at least a generation" by Judge Paul Michel, retired chief judge of the Federal Circuit. Under the leadership of Kappos, the patent backlog was reduced by 20%, despite an average annual increase of 5% per year in patent applications.
Stoll said he hopes the Office will approach other "talented" potential candidates, such as Nick Godici, a past commissioner for patents, Esther Kepplinger, a past deputy commissioner for patents, or Edward "Kaz" Kazenske, senior director of patent prosecution strategy and relations for Microsoft and a past deputy commissioner for patents.
"I would hope it would take no more than a couple of months because it's very damaging to have that position open, particularly when the USPTO is subject to sequestration," he said.
"I think with a strong leader in place, an argument could be made that the Office should not be subject to sequestration. So I think that with these budget issues it's critical to get someone into the position as soon as possible."
Former USPTO director Q Todd Dickinson, executive director of AIPLA, said sequestration represents "the biggest challenge for the Office now".
"I think all the issues of the USPTO are more difficult to deal with without a permanent leader in place," he said. "We have also got harmonisation issues to deal with."
"With Ms Rea announcing her departure shortly we will have a lot of holes to fill."
Process stands in the way
Dickinson said the increasingly complicated process of gaining approval for potential candidates may be partly responsible for the delay. "When I was confirmed 15 years ago I was confirmed twice and it was a very tough process," he said. "It's become significantly more difficult since then."
Sources told Managing IP it was likely the new candidate will be from a law firm or in-house counsel, rather than an internal appointment.
AIPLA president Jeff Lewis wrote to the Office of Management and Budget in May to protest against sequestration being applied to the USPTO.
Writing on behalf of AIPLA's 15,000 members, Lewis said the USPTO should be exempt from sequestration because the Office relies entirely on user fees to fund its services.
He said the USPTO's recent success in reducing the patent backlog, which was partly achieved by hiring more examiners, would be impeded if sequestration was applied to the Office.
As a result of sequestration, the USPTO's search for a permanent site for its new Silicon Valley office has been put on hold. Plans to move from temporary to permanent spaces for the agency's satellite offices in Denver and Dallas have also been postponed.
In June, 17 members of Congress wrote to the Subcommittee on Commerce, Justice and Science of the House Appropriations Committee, calling for the USPTO to be excluded from sequestration. Congressman Mike Honda, Congresswoman Zoe Lofgren and Congresswoman Anna Eshoo, who were among the signatories, also introduced the Patent And Trademarks Encourage New Technology (PATENT) Jobs Act, which sought to exempt the USPTO from the cuts.
Teresa Stanek Rea’s letter to USPTO staff: |
Dear Colleagues, It has been a tremendous honor and a true pleasure to serve with you as Deputy Director and Acting Director of the USPTO, America's own "innovation agency." It is with deep appreciation and gratitude that I inform you that I have decided to leave the agency in the near future. I joined the United States Patent and Trademark Office in March of 2011 as Deputy Director and have been privileged to serve at an historic time for this agency. As deputy to Dave Kappos I was fortunate enough to participate as our agency implemented historic patent reforms, as well as our ongoing efforts to modernize our entire way of serving and engaging our stakeholders and the public in all areas of our operations. Since I became Acting Director we have together endured the difficulties of sequestration, but we are weathering that financial storm with clear thinking and bold determination. My fondest memories of my time with this agency will be all of those moments I engaged with each of you on matters large and small. You are some of the most hard-working and dedicated individuals I have ever had the privilege of working with, and our stakeholders and the American public are better off for your service. You have exercised true vision in ensuring we set the standard for excellence in government, and that is reflected in our rapid rise in the rankings of one of the top places to work in the federal government. It is my anticipation that we will soon welcome a new Director who will continue guiding the excellent work of the agency. Until then, I will do everything I can to ensure a smooth transition. Thank you for the privilege of serving with you. Terry |
