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`[House Hearing, 112 Congress]
`[From the U.S. Government Printing Office]
`
` CROSSING THE FINISH LINE ON PATENT REFORM: WHAT CAN AND SHOULD BE DONE
`=======================================================================
` HEARING
` BEFORE THE
` SUBCOMMITTEE ON
` INTELLECTUAL PROPERTY,
` COMPETITION, AND THE INTERNET
` OF THE
` COMMITTEE ON THE JUDICIARY
` HOUSE OF REPRESENTATIVES
` ONE HUNDRED TWELFTH CONGRESS
` FIRST SESSION
` __________
` FEBRUARY 11, 2011
` __________
` Serial No. 112-8
` __________
` Printed for the use of the Committee on the Judiciary
`
` Available via the World Wide Web: http://judiciary.house.gov
`
` U.S. GOVERNMENT PRINTING OFFICE
`64-407 WASHINGTON : 2011
`-----------------------------------------------------------------------
`For sale by the Superintendent of Documents, U.S. Government Printing Office,
`http://bookstore.gpo.gov. For more information, contact the GPO Customer Contact Center, U.S. Government Printing Office. Phone 202(cid:31)09512(cid:31)0
` COMMITTEE ON THE JUDICIARY
` LAMAR SMITH, Texas, Chairman
`F. JAMES SENSENBRENNER, Jr., JOHN CONYERS, Jr., Michigan
` Wisconsin HOWARD L. BERMAN, California
`HOWARD COBLE, North Carolina JERROLD NADLER, New York
`ELTON GALLEGLY, California ROBERT C. ``BOBBY'' SCOTT,
`BOB GOODLATTE, Virginia Virginia
`DANIEL E. LUNGREN, California MELVIN L. WATT, North Carolina
`STEVE CHABOT, Ohio ZOE LOFGREN, California
`DARRELL E. ISSA, California SHEILA JACKSON LEE, Texas
`MIKE PENCE, Indiana MAXINE WATERS, California
`J. RANDY FORBES, Virginia STEVE COHEN, Tennessee
`STEVE KING, Iowa HENRY C. ``HANK'' JOHNSON, Jr.,
`TRENT FRANKS, Arizona Georgia
`LOUIE GOHMERT, Texas PEDRO PIERLUISI, Puerto Rico
`JIM JORDAN, Ohio MIKE QUIGLEY, Illinois
`TED POE, Texas JUDY CHU, California
`JASON CHAFFETZ, Utah TED DEUTCH, Florida
`TOM REED, New York LINDA T. SANCHEZ, California
`TIM GRIFFIN, Arkansas DEBBIE WASSERMAN SCHULTZ, Florida
`TOM MARINO, Pennsylvania
`TREY GOWDY, South Carolina
`DENNIS ROSS, Florida
`SANDY ADAMS, Florida
`BEN QUAYLE, Arizona
` Sean McLaughlin, Majority Chief of Staff and General Counsel
` Perry Apelbaum, Minority Staff Director and Chief Counsel
` ------
` Subcommittee on Intellectual Property, Competition, and the Internet
` BOB GOODLATTE, Virginia, Chairman
` HOWARD COBLE, North Carolina, Vice-Chairman
`F. JAMES SENSENBRENNER, Jr., MELVIN L. WATT, North Carolina
`Wisconsin JOHN CONYERS, Jr., Michigan
`STEVE CHABOT, Ohio HOWARD L. BERMAN, California
`DARRELL E. ISSA, California JUDY CHU, California
`MIKE PENCE, Indiana TED DEUTCH, Florida
`JIM JORDAN, Ohio LINDA T. SANCHEZ, California
`TED POE, Texas DEBBIE WASSERMAN SCHULTZ, Florida
`JASON CHAFFETZ, Utah JERROLD NADLER, New York
`TOM REED, New York ZOE LOFGREN, California
`TIM GRIFFIN, Arkansas SHEILA JACKSON LEE, Texas
`TOM MARINO, Pennsylvania MAXINE WATERS, California
`SANDY ADAMS, Florida
`BEN QUAYLE, Arizona
` Blaine Merritt, Chief Counsel
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` Stephanie Moore, Minority Counsel
`
` C O N T E N T S
` ----------
` FEBRUARY 11, 2011
` Page
` OPENING STATEMENTS
`The Honorable Bob Goodlatte, a Representative in Congress from
` the State of Virginia, and Chairman, Subcommittee on
` Intellectual Property, Competition, and the Internet........... 1
`The Honorable Melvin L. Watt, a Representative in Congress from
` the State of North Carolina, and Ranking Member, Subcommittee
` on Intellectual Property, Competition, and the Internet........ 2
`The Honorable Lamar Smith, a Representative in Congress from the
` State of Texas, and Chairman, Committee on the Judiciary....... 4
`The Honorable John Conyers, Jr., a Representative in Congress
` from the State of Michigan, Ranking Member, Committee on the
` Judiciary, and Member, Subcommittee on Intellectual Property,
` Competition, and the Internet.................................. 6
` WITNESSES
`David Simon, Associate General Counsel, Intellectual Property
` Policy, Intel Corporation, on behalf of the Coalition for
` Patent Fairness
` Oral Testimony................................................. 7
` Prepared Statement............................................. 10
`Carl Horton, Chief Intellectual Property Counsel, General
` Electric, on behalf of the Coalition for 21st Century Patent
` Reform
` Oral Testimony................................................. 17
` Prepared Statement............................................. 19
`The Honorable Paul Michel (Ret.), former Chief Judge, U.S. Court
` of Appeals for the Federal Circuit
` Oral Testimony................................................. 32
` Prepared Statement............................................. 34
`
` CROSSING THE FINISH LINE ON PATENT REFORM: WHAT CAN AND SHOULD BE DONE
` ----------
`
` FRIDAY, FEBRUARY 11, 2011
` House of Representatives,
` Subcommittee on Intellectual Property,
` Competition, and the Internet,
` Committee on the Judiciary,
` Washington, DC.
` The Subcommittee met, pursuant to call, at 10:30 a.m., in
`room 2141, Rayburn House Office Building, the Honorable Bob
`Goodlatte (Chairman of the Subcommittee) presiding.
` Present: Representatives Goodlatte, Smith, Coble, Chabot,
`Pence, Poe, Jordan, Chaffetz, Reed, Griffin, Marino, Adams,
`Quayle, Watt, Conyers, Chu, Deutch, Wasserman Schultz, Nadler,
`Lofgren, Jackson Lee, and Waters.
` Staff Present: (Majority) Blaine Merritt, Subcommittee
`Chief Counsel; Vishal Amin, Counsel; Olivia Lee, Clerk; and
`Stephanie Moore, Minority Counsel.
` Mr. Goodlatte. The Subcommittee will come to order, and I
`will recognize myself for an opening statement.
` Nearly 60 years ago, Congress tackled the challenge of how
`to structure our patent laws for what was then the modern
`economy. Over those decades, we have gone from room-size
`computers with vacuum tubes to hand-held tablets, and black and
`white television to 3-D TV, and from wax cylinders and record
`players to digital downloads and streaming. Our patent laws
`have served us well, but as our industries have changed and new
`areas of the economy have emerged, our patent laws are
`beginning to show their age. That doesn't mean that we need to
`start from scratch, but there are areas where we need to make
`some reforms.
` Modernizing our patent system is necessary to meet the
`needs of our 21st century economy and necessary to create jobs
`and economic growth. When an inventor or startup is able to
`take their idea from the garage or the lab to the Patent
`Office, it gives them the exclusive right to make use of that
`invention. This right then enables them to raise capital and
`get their business off the ground.
` When improving our patent system, we need to take into
`consideration the work the Federal Government has done in
`addressing patent reform. Since we began debating comprehensive
`patent reform over a half decade ago, the Federal courts have
`issued numerous opinions that have touched on some of the very
`reforms we have been working on, including injunctions,
`willfulness, damages, and others. We need to assess those
`decisions carefully and factor them into any legislation we
`move.
` I hope that in today's hearing we will talk more about what
`can and should be done to achieve the meaningful patent reform
`legislation that has eluded prior Congresses. Reform means
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`putting forward commonsense ideas and not simply blanket
`opposition. Our goal is a patent system that allows for
`increased certainty, higher quality patents being issued, and
`reducing frivolous litigation.
` In the past few years, frivolous lawsuits against high-
`technology companies have doubled, costing on average $5
`million to defeat each one of these questionable suits. These
`costs take money away from worthwhile R&D that leads directly
`to job creation. These costs discourage entrepreneurs from even
`taking that first plunge toward establishing a business. And,
`inevitably, these costs discourage overall innovation,
`hindering our Nation's progress and future economic prosperity.
` Some may say that this is just the cost of doing business.
`If that is the case, then the cost of inaction is way too high.
`Congress has a constitutional duty here to ensure that we have
`an effective patent system.
` We also need to make sure that the PTO has the resources it
`needs to accomplish the tasks we will ask of it. Fee aversion
`is an unacceptable tax on our Nation's innovators, and it
`diverts funds the PTO needs to other unrelated government
`programs. We must address this issue.
` I look forward to hearing from our distinguished panel
`today. They represent a variety of perspectives and industries.
`And I look forward to working with my fellow colleagues in the
`House and Senate and the stakeholder community to take the
`steps necessary to ensure that meaningful patent reform is
`completed during this Congress.
` It is now my pleasure to recognize our Ranking Member, the
`gentleman from North Carolina, Mr. Watt.
` Mr. Watt. Thank you, Mr. Chairman; and thank you for
`convening this hearing on patent reform.
` The patent reform debate has percolated through Congress
`for several sessions now. We have seen several iterations of a
`patent reform bill in both Chambers, most recently S. 23, which
`passed out of the Senate Judiciary Committee last week.
` At the core of the debate lay at least two truths: one,
`discovery and innovation is the engine of economic growth and
`development domestically and throughout the world; and, two,
`the U.S. Patent and Trade Office, this Nation's primary mode of
`encouraging inventors and protecting their intellectual
`property, is overburdened and in need of adequate resources to
`perform its functions.
` The interplay between innovation, economic competitiveness
`and recovery and job creation has never been more widely
`acknowledged and supported than it is today. In fact, our very
`first hearing on the oversight of the PTO focused on the
`connection between job creation and innovation and showcased
`the increasingly important role of ideas in the global economy.
` The President's State of the Union address later that same
`evening reemphasized the Administration's commitment to
`encouraging and protecting innovators and their intellectual
`property.
` And just this week the Administration issued an executive
`order implementing provisions of the PRO-IP Act, the Conyers-
`Smith--also co-sponsored by Goodlatte-Watt--bill, signaling to
`the world and the community of innovators that intellectual
`property stimulation and protection are at the top of the
`Nation's agenda.
` Against this backdrop of consensus on the need to shore up
`the PTO and provide robust incentives and protections to our
`innovators, however, is the ongoing talk of deep, across-the-
`board budget cuts. I hope that we will all step back and make
`rational decisions about how the taxpayers' money should be
`spent in a way that continues, rather than retards, our course
`of economic recovery.
` Let me just say a word or two about our witnesses. I am
`pleased that we have a panel of witnesses who have been active
`participants in this debate over the years. These stakeholders
`possess intimate knowledge of where we have been and have
`informed perspectives on where we should be going. The 21st
`Century Coalition and the Coalition for Patent Reform both
`represent members that have skin in the game, while Judge
`Michel comes from a vantage point of adjudicating patent cases
`for decades. Each witness provides useful knowledge as we
`consider how best to fashion policy choices for intellectual-
`property-driven industries consistent with the needs of the
`country.
` I know that I speak for both myself and Chairman Goodlatte
`when I say that the importance of developing a complete record
`reflecting a full scope of views is at the heart of the panel
`assembled today and necessary for our Committee's work. Indeed,
`some of the laws and practices that prompted the effort to take
`on patent reform in earnest several years ago have changed.
`Hearing from these witnesses about what changes are adequate or
`inadequate, how they have affected their prior positions and
`current outlook is essential for us to understand the current
`landscape and to resist the urge to simply hold firm to
`positions that may no longer be constructive.
` Mr. Chairman, that is my prepared statement. I want to go
`off the reservation here a little bit. I don't get this
`opportunity to have industry people that I can send a shot over
`the bow very often. And I am new here, so I am going to take
`the luxury here, I think.
` I have been kind of assessing this against a backdrop where
`I come from focusing most of my attention in the financial
`services industry. I watched the financial services industry
`fail to do some things, fail to come together on some things
`until we were in an absolute chaotic disaster. And only then
`could our Committee, the Financial Services Committee, and
`Congress really take steps that were really necessary.
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` I think we are approaching in this situation not the kind
`of crisis that we faced in the financial industry, but we are
`approaching something that is very serious. Because we have
`been holding the PTO and its funding hostage to this whole
`discussion about patent reform. And nobody has been willing to
`kind of run over the industries because they are too powerful,
`just like in the financial services industry, and because we
`really think the industries ought to get together.
` I am kind of sending the shot over the bow that it is
`really time, after 6 or 8 years, for the industries to get
`together and sit down and work out their differences on these
`issues so that we can move patent reform forward, so that we
`can move PTO funding forward and not hold those two things
`hostage to each other before we get to a crisis situation. We
`are approaching that in the backlog of patent applications we
`have at the PTO. And so I am earnestly suggesting to the
`industries that they come back to the table and try to roll up
`their sleeves and find common ground on a patent reform bill so
`that we can move this process forward.
` I know that is gratuitous. It wasn't in my prepared
`statements, but I hope it is taken constructively.
` Thank you, Mr. Chairman. I yield back.
` Mr. Goodlatte. I thank the gentleman. I know it will be.
` It is now my pleasure to recognize the Chairman of the full
`Committee, someone who has worked long and diligently on this
`issue, the gentleman from Texas, Mr. Smith.
` Mr. Smith. Thank you, Mr. Chairman.
` Mr. Chairman, let me say at the outset that I think this is
`one of the most important Subcommittee hearings that the full
`Judiciary Committee will have this year, and I am particularly
`pleased with the Members who serve on this Subcommittee because
`they are all knowledgeable, they are all interested, and many
`of them have district interests as well that will be important
`as we move forward in the process.
` And I would only say to the Ranking Member, whose comments
`I appreciated, that I am not sure this is a shot across the
`bow, because I don't think that warning is necessarily needed.
`I think everybody, as the gentleman concluded, is eager to move
`forward in a bipartisan process and try to accomplish the task
`so that we don't end up with a situation as we did with some of
`the financial regulatory reform as well. So I thought his
`comments were very appropriate, and I think that we all would
`agree with what the gentleman said. And it is nice to have him
`as Ranking Member.
` Mr. Chairman, the foresight of the Founders to create an
`intellectual property system demonstrates their understanding
`of how patent rights ultimately benefit the American people. In
`January, our Subcommittee touched on this theme when we
`conducted our first hearing of the year on the importance of
`the Patent and Trademark Office. We learned that the
`technological innovation derived from our intellectual property
`is linked to three-quarters of America's post-World War II
`economic growth.
` A recent study valued U.S. intellectual property at
`approximately $5 trillion, or about half of the U.S. gross
`domestic product. American IP industries now account for over
`half of all U.S. exports and represent 40 percent of our
`economic growth.
` Just a digression here, these companies, the intellectual
`property companies--many of whom are high-tech companies--
`actually represent about 5 percent of all the companies in
`America, and yet they account for 40 percent of our economic
`growth. So if we are going to have a healthy economy, we are
`going to have to have a healthy high-tech sector, intellectual
`property sector as well. These industries provide millions of
`Americans with well-paying jobs.
` By any set of metrics, intellectual property is a driver in
`our national economy, one that creates wealth and jobs. And our
`patent laws, which provide a time-limited monopoly to inventors
`in exchange for their creative talents, are the key to
`perpetuating this prosperity. The original Patent Act was
`written in 1790 and has been amended multiple times over the
`past 220 years, and it is time for further change. We can't act
`like disinterested spectators as frivolous lawsuits that
`typically cost $5 million each to defend prevent true inventors
`and industrious companies from creating amazing products and
`generating high-paying jobs. So we need to update our patent
`laws.
` We must work with the Senate to enact a bill that enhances
`patent quality, discourages frivolous litigation, harmonizes
`international patent principles, and enforces core rights.
` Our Committee undertook this initiative more than 5 years
`ago because patent changes are necessary to bolster the
`American economy and our Nation's global competitiveness. Every
`industry directly or indirectly affected by patents, including
`finance, automotive, manufacturing, high tech and
`pharmaceuticals will benefit if we do our job correctly.
` The purpose of today's hearing is not to recycle and recite
`each argument made by every stakeholder who participated in the
`debate. We don't have time for this. Instead, we must identify
`common ground and establish priorities. That is why today's
`hearing will focus on the doable, the practical, and ultimately
`achievable patent reform.
` We have all followed the recent developments in the Senate
`Judiciary Committee which reported their bill on February 3;
`and I am pleased that Chairman Leahy, Ranking Member Grassley,
`and other interested Senators are working to develop further
`revisions in advance of floor consideration. I met at some
`length with Senator Leahy a couple of weeks ago, and I am
`absolutely convinced that we are going to be able to find
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`common ground.
` We have been developing a bill on the House side for our
`Committee as well. While the Senate vehicle is a good start, I
`am hoping we can work together with the other body to make
`additional improvements. We need a few more tweaks to inhibit
`the abuses that gave rise to the project back in 2005.
` Politics is the art of the possible. I supported stronger
`language on such issues as apportionment of damages, willful
`infringement, and venue, but we have reached a point where no
`one member, industry, company, trade association, or advocacy
`group is going to be completely happy with the outcome, though
`I do hope they will be, say, 60 or 65 percent happy.
` All of us should maintain a holistic perspective as we
`develop a bipartisan, bicameral bill; and we must keep our
`common goal in mind: Better patents increase productivity and
`lead to economic prosperity. A modernized patent system will
`rev the engine of American competitiveness, put inventors and
`innovators in gear, and drive economic growth and job creation.
` I look forward to hearing from our witnesses today, Mr.
`Chairman, and once again appreciate the Subcommittee having a
`hearing on this subject. I yield back.
` Mr. Goodlatte. I thank the Chairman.
` Now it is my pleasure to recognize the Ranking Member of
`the full Committee, the gentleman from Michigan, Mr. Conyers.
` Mr. Conyers. Thank you, Mr. Chairman and Members.
` I just wanted to particularly thank former Judge Michel for
`being with us today. He has a distinguished background. I
`welcome all our witnesses, but Judge Michel's commitment to
`public service is extraordinary to me, and I am glad he is
`here.
` The only thing I would like to say with this opportunity
`that comes to me is that somewhere in the appropriations
`process the funds that are paid into the Patent and Trademark
`Office never get back to the Patent and Trademark Office. I
`think this is something that this distinguished Committee ought
`to look at and see what we can do about right away, because
`they are hurting.
` I know that there are conservative Members in the body in
`the 112th Congress that want to cut $100 billion from the
`budget, and then some want to cut $32 billion from the budget,
`and then now I think the figure has gone up to $64 billion in
`the budget, so I am glad that we are going out this afternoon.
`I will be holding my breath when we come back on Monday.
` But this doesn't involve those kind of breath-taking
`reductions from the Federal budget. This involves giving the
`Patent and Trademark Office funds that they have already
`collected. They go into the mysterious Byzantine process of the
`Appropriations Committee behind closed doors; and, lo and
`behold, they never get the funds they have already raised. This
`is creating a serious negative impact on the whole concept of
`patents and trademarks; and, to me, that is the number one
`issue that this Committee and these distinguished witnesses can
`assist us in trying to resolve.
` Thank you for your generosity, Mr. Chairman.
` Mr. Goodlatte. I thank the gentleman. And, without
`objection, other Members' opening statements will be made a
`part of the record.
` It is now my pleasure to introduce the very distinguished
`panel of witnesses we have today. Each of the witnesses'
`written statements will be entered into the record in its
`entirety, and I ask that each witness summarize his testimony
`in 5 minutes or less. To help you stay within that time, there
`is a timing light on your table. When the light switches from
`green to yellow, you will have 1 minute to conclude your
`testimony. When the light turns red, it signals that the
`witness' 5 minutes have expired.
` Before I introduce the witnesses, I would like to ask them
`to stand and be sworn in.
` [Witnesses sworn.]
` Mr. Goodlatte. Thank you, and you may be seated.
` Our first witness is David Simon, Intel Corporation's
`Associate General Counsel for Intellectual Property Policy. He
`will be testifying on behalf of the Coalition for Patent
`Fairness.
` Prior to joining Intel in 1997, David was in private
`practice in Los Angeles for 15 years and specialized in
`intellectual property matters, including licensing and high-
`technology law. He has been a featured speaker at a number of
`intellectual property seminars. He holds a B.S. In electrical
`engineering from MIT and a J.D. From Georgetown University.
` Mr. Simon has testified before the House and Senate IP
`Committees on the need for patent reform and has been an active
`participant in the industry and bar group negotiations to
`arrive at a compromised bill. He currently is a member of the
`Board of Directors of the Intellectual Property Owners
`Association and the Coalition for Patent Fairness.
` Our next witness is Carl Horton, Chief IP Counsel for
`General Electric. He will be testifying on behalf of the
`Coalition for 21st Century Patent Reform.
` Earlier in his career, Mr. Horton served as the lead IP
`counsel for GE's health care business, its electrical
`distribution and control business, and its industrial systems
`business. He has also worked as an IP counsel for several of
`GE's plastic and advanced materials divisions.
` Prior to joining GE, Mr. Horton worked at the IP law firm
`of Burns, Doane, Swecker, & Mathis in Alexandria, Virginia. He
`received a chemical engineering degree with honors from the
`University of Utah and a J.D. Cum laude from George Washington
`University.
` Our final witness is Paul Michel, who was appointed to the
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`United States Court of Appeals for the Federal Circuit in 1988
`and assumed the duties of chief judge in 2004 before retiring
`last May. During his career as a jurist, Judge Michel handled
`thousands of appeals and wrote more than 800 opinions,
`approximately one-third of which were patent cases.
` Prior to his appointment to the bench, Judge Michel served
`in the executive and legislative branches for 22 years. His
`work experience includes stints as an Assistant District
`Attorney, an assistant special Watergate prosecutor, an
`assistant counsel for the Senate Select Committee on
`Intelligence, Acting Deputy Attorney General, and counsel and
`chief of staff to former Senator Arlen Specter. Judge Michel is
`a graduate of Williams College and the Virginia School of Law.
` Welcome to you all, and we will begin with Mr. Simon's
`opening statement.
` Mr. Watt. Mr. Chairman, before you do that, I practiced law
`for 22 years and never mispronounced a judge's name, so I want
`to just apologize to the judge.
` Mr. Goodlatte. Thank you for emphasizing that.
` Mr. Watt. I know how important that is. I may have to go
`back into the practice of law one day.
` TESTIMONY OF DAVID SIMON, ASSOCIATE GENERAL COUNSEL,
` INTELLECTUAL PROPERTY POLICY, INTEL CORPORATION, ON BEHALF OF
` THE COALITION FOR PATENT FAIRNESS
` Mr. Simon. Thank you, Mr. Chairman and Ranking Member Watt.
` I am here on behalf of Intel Corporation and the Coalition
`for Patent Fairness.
` For Intel, innovation is our lifeblood. Every 18 months,
`what was our state-of-the-art product is now obsolete; and, as
`a result, we have to constantly continue to innovate. And in
`doing that we also have to literally invest billions of dollars
`to design the products, get the process ready, build the
`factories--of which every year for the last few years we have
`been investing about $5 billion a year in our factories in this
`country to make mostly processors. And that is really important
`for us.
` As the Chairman recognized in his opening comments and
`Chairman Smith recognized in an op-ed piece, patents do help
`protect innovation when they are the right patents; and when
`they are the wrong patents, they actually hurt innovation. And
`it is very important for us to make sure this does not
`continue.
` Since we started this effort on patent reform several years
`ago, there were a number of issues that at that time were very
`critical to us. Thanks in part to the leadership of this
`Committee and the courts, many of those issues have now gone
`away, and I think many of them will contribute to those issues
`having gone away--if not in the bill will contribute to
`reaching an accommodation between all concerned on patent
`reform.
` On the other hand, what we still face is people recognize
`that they can use patents as a way to hold up industry. These
`are patents, many of which, when we read them, they are on very
`esoteric subjects, but for those who are experts in the field
`recognize that they should not have issued. For that reason,
`this remains an important issue for us; and to us we think that
`the way to deal with this is primarily through the Patent and
`Trademark Office.
` As both the Chairman and the Ranking Member said, get the
`patent office its money--we are very open to you even giving it
`more money if the office is going to get that money--and to use
`that to modernize the office systems, but not merely to
`modernize the computer systems so that they can send each other
`e-mail. But also the systems that the Patent and Trademark
`Office, unfortunately, uses today in the examination of patents
`do not take advantage of the technology to actually
`affirmatively do that examination.
` Just by way of example, and as outlined in more detail in
`my testimony, one of the things that the Patent and Trademark
`Office is supposed to do is to read through the patent
`application and make sure that the claims--which are these run-
`on sentences, as you all know, at the end of the patent--
`actually are supported by the specification. That is a
`difficult task to do when you have many other things to do as
`an examiner, and computers can really help that. And to us that
`is where we think the efforts should really be devoted first
`and foremost before we start hiring additional staff.
` It is not that the office doesn't need the additional
`staff, as Chief Judge Michel points out, but they need the
`right tools to do the job. Because just hiring additional staff
`and having relatively inexperienced examiners turned loose on
`applications is not going to help issue good-quality patents,
`and that is what we really need. When we have good-quality
`patents, industry understands what is a good quality patent. We
`are willing to pay, if we happen to be using somebody else's
`patent, when it is a good-quality patent, but we are not
`willing to be held up by people who think that the patent
`system is a method of being a business lottery.
` As the Chairman rightly pointed out, this litigation is
`expensive. We frequently find ourselves being told that we
`ought to settle because the cost of the settlement is going to
`be much less than the cost of