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Obama is on the verge of picking a patent chief who opposed his patent reforms

Mark Wilson

The Obama administration has developed something of a split personality on patent issues. Last year, the White House unveiled a package of reformsdesigned to raise patent quality and reduce the abuse of low-quality patents by trolls. Yet thanks to David Kappos, Obama's choice to lead the US Patent and Trademark Office during his first term, the patent office has lowered standards for patent applications.

The president may be about to make the contradiction even worse. A rumor is swirling through the patent world that President Obama is about to name pharmaceutical executive Phil Johnson as the next head of the US Patent and Trademark Office, a post that has been vacant since Kappos quit in early 2013. The pick isn't official yet, and my reporting suggests it may not even be final. But if Obama does choose Johnson, it could deepen the divisions between the president's legislative agenda and his patent office.

Johnson lobbied against Obama's patent reforms

I've written before about the ideological spectrum in the patent reform debate. On one side are technology companies, grocery stores, retailers, and other groups who have grown frustrated with frivolous patent lawsuits and are lobbying for changes to deal with the problem. Opposing them have been pharmaceutical companies, patent attorneys, and other groups that benefit from the status quo.

As a longtime lobbyist and attorney at Johnson and Johnson, Phil Johnson is aligned with the forces opposing patent reform legislation. Indeed, Johnson testified before the Senate Judiciary Committee in December, a few days after the House passed a patent reform bill supported by the president. Johnson appeared on behalf the Coalition for 21st Century Patent, a coalition of pharmaceutical and industrial giants that has opposed significant changes to the patent system.

While Johnson didn't explicitly oppose the House bill or companion legislation being considered by the Senate, he did criticize several provisions of the legislation as too radical. He specifically singled out a proposal by Sen. Chuck Schumer (D-NY), to make it easier to invalidate low-quality software patents — a proposal that was endorsed by the White House last year.

Johnson and the organizations he represents were instrumental to the defeat of the Senate patent bill in May. His employer, Johnson and Johnson, signed a letter in April warning that "we cannot support changes to the patent system that substantially weaken all patents." I've reported that, after trial lawyers, the pharmaceutical industry was the group most responsible for stopping patent legislation in the Senate.

Why the patent office matters

As head of the patent office, Johnson wouldn't control the Obama Administration's legislative agenda. But he would have significant powers to shape the patent system during the two and a half years remaining in President Obama's term.

The man Obama chose to run the Patent Office during the president's first term, David Kappos, illustrates why the choice of patent office director matters. Kappos previously practiced patent law at IBM, which has one of the largest patent portfolios in the world. IBM lobbied against the same White House proposal to raise the quality of software patents that Johnson opposed in his December Senate testimony. While Kappos was not at IBM at the time, Kappos is a fervent software patent supporter.

Under George W. Bush, the patent office had made it significantly more difficult to obtain patents. One study found that, after correcting for applicants who re-file their applications, the fraction of patent applications that were granted fell from almost 100 percent at the beginning of Bush's term to 68 percent the year Bush left office.

Kappos reversed that trend. In an effort to clear the backlog of patent applications, he made it easier to get patents. The corrected approval rate soared to 92 percent by the 2013, the year he stepped down. In practical terms, this means that the Kappos patent office approved thousands of dubious patents that would have been rejected under his predecessors.

Of course, we don't know for sure what Johnson would do as head of the patent office. Perhaps he'll surprise us by showing greater patent skepticism in his new role than he did as a pharmaceutical lobbyist. But it seems more likely that Johnson will take many of the positions he developed as a lobbyist with him into the patent office.

That would lead to an administration at war with itself, with the White House lobbying for reforms to invalidate low-quality patents even as the Patent Office takes a permissive approach to granting new patents.