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On Christmas, the U.S. Patent Office (PTO) announced that international patent applications filed in the United States can now be examined in Korea for only $218 instead of the regular fee of $600. While this might seem like welcome holiday news for patent applicants, it highlights the end of the U.S. “can do” attitude that used to be at the heart of American ingenuity. Can’t compete with the low wages paid in Korea? “Don’t beat them, join them” is the new American attitude, starting with Wal-Mart and now at the PTO itself. Not only are the jobs of U.S. patent examiners put at risk from this new instance of outsourcing, but the established principle of territoriality of patent rights is sacrificed. Now Koreans will be helping to determine what is patentable in our country. Former colonies of colonial empires used to follow a similar approach: They issued “revalidation” patents based on patents issued by their mother country. Maybe the U.S. court system could similarly save money and reduce backlog, by offering litigants the opportunity to have their cases decided quickly by judges in India upon review of the briefs, transcripts and deposition videotapes? A silly idea? Only if you agree that administration of the rule of law-including the awarding of constitutionally based patent rights (Article I, Section 8)-is a core function for our national government. Losing our edge The PTO’s move to issue U.S. patents based on searches conducted abroad signals the extent to which our country has lost its technological edge. We rely on foreign imports, mainly from the Far East, to meet our needs for computers, cameras, audio gear, household furnishings and office equipment. If the United States ever got into a conflict with China, the U.S. Army would be in deep trouble. There are no more U.S. sources for most of the technical equipment we rely on to do our daily work. Without technological imports from the Far East, we would be sent back to the quill pen era. The PTO previously announced “strategic initiative” plans to save money (and clear up the huge backlog of pending U.S. patent applications) by outsourcing some of its work to private contractors located within the United States. However, those plans stressed that all work would be done by U.S. citizens, on U.S. soil. The PTO’s Christmas announcement of outsourced searches to be conducted in Korea hence represents a major break from the PTO’s prior contemplated outsourcing efforts. Maybe the PTO thinks that applicants will prefer the quality of searching that they will get in Korea. Indeed, for certain technologies, such as liquid crystal display (LCD) technology and television sets, Korean technology may well be more advanced than U.S. technology-since those goods are no longer even made here. The fundamental problem may not be the action of the PTO, but the loss of our technological edge itself, which the new PTO outsourcing serves to highlight. Those LCD devices are vital to our national defense-you can’t fly a plane (military or civilian) without them any more. We all know the risks of dependence on foreign oil supplies, so why put ourselves further at risk by depending on foreign suppliers for electronic and other high-tech goods (like computer drives and memory chips) that are vital to both our defense and civilian productivity? Isn’t this an issue for the Department of Homeland Security? They won’t be able to read those intercepted e-mails from China, without their (made in China) computer monitors. It sounds funny-but International Business Machines Corp. just sold its personal computer hardware business to Lenovo Group Ltd., a company backed by the Chinese government. Unfortunately, in negotiations tied to the General Agreement on Tariffs and Trade/World Trade Organization, the United States bargained away its right to impose tariffs on such foreign goods, in exchange for more protection for U.S. intellectual property rights in “developing” countries like China (surely a misnomer at this point, given our huge balance of payments deficit to China and its consequent large holdings of U.S. government securities). Large IP owners like Microsoft Corp. and Universal Studios benefit from taxpayer-assisted IP enforcement in China (which they don’t need-they can afford to hire private IP attorneys there), while the (formerly) broad base of U.S. manufacturing enterprise is left to suffer from unfair foreign competition unregulated by wage and hours standards, environmental protection rules or even basic human rights. The job of the PTO is to foster innovation in this country. When the PTO effectively decides that patent searching can’t be even done here efficiently and economically any more, but has to be turned over to foreign sources to get the job done on time and save a buck, the very idea of American ingenuity seems to have gone the way of the buggy whip. Robert Kunstadt is managing attorney of the New York-based IP boutique R. Kunstadt P.C., editor-in-chief of the International Trademark Association’s The Trademark Reporter and inventor of the “Born to Rock” electric guitar (U.S. Patent 4,915,009).

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