Commerce officials said Tuesday the city of San Jose is donating two years of rent-free office space in San Jose City Hall, where more than 80 new patent judges and reviewers will help inventors and entrepreneurs cut through red tape. The California Assembly speaker's office is also donating $500,000 for the office.
"It's a great relief," said U.S. Rep. Mike Honda, D-Calif., who has pressed for years to bring the office to his constituents.
"This is going to really help our entrepreneurs protect intellectual property, help them attract capital, and bottom line, it's going to create jobs," Honda said.
San Jose is the nation's top patent-producing city, with more than 7,000 patents sought last year, and California is the nation's patent leader, with seven of the top 10 patent-producing cities. But for more than 200 years, patent seekers needed to visit offices in Alexandria, Va., if they wanted to meet with a patent judge.
"We should be able to make better use of the appeals process since we won't have to travel across the country, and it's going to be very convenient for inventors to walk into City Hall and ask their questions before they come to me," said Perkins Coie partner Michael Glenn, a longtime Silicon Valley patent attorney.
A 2011 law raised patent fees in exchange for promises from officials to use those new revenues to speed up the patent process and establish four satellite offices for the first time in the agency's 200-plus year history. The first opened in Detroit in July 2012, and permanent locations for others were selected in Denver and Dallas before sequestration; those are in the process of opening.
But in August, the General Services Administration — which owns and operates federal properties — said it was suspending its search for permanent patent office space in Silicon Valley, citing federal budget cuts known as sequestration. Technology leaders from industry heavyweights including Google Inc. objected on the grounds that patent offices are supported by the $2.8 billion in annual patent fees.
"Having a Silicon Valley office increases the communication between companies in this region and the patent office, and that communication works in a lot of different ways that are really important," said Suzanne Michel, senior patent counsel at Google, which has tens of thousands of applications pending.
While waiting, Silicon Valley Patent Office Director Michelle Lee, a former Google patent law division head, has been working since April out of a small, temporary space with just a handful of administrative judges in rooms borrowed from another government agency in Menlo Park.
During a teleconference with reporters Tuesday, Lee and acting Deputy U.S. Commerce Secretary Patrick Gallagher said the new, permanent office will be ready by the end of 2014 after renovations that include a robust, high speed Internet system and new hearing rooms.
"This is going to be of great importance to the vibrant Silicon Valley," Gallagher said.
The donated space is a unique arrangement for the U.S. Patent and Trademark Office, Gallaher said. Lee said the city of San Jose offered 40,000 square feet of permanent office space in its City Hall, with two years of free rent and three additional years of discounted rent.
Patent filers from throughout the western states as well as the Pacific Rim as expected to use the office, Lee said.
The next step, said Sen. Diane Feinstein, D-Calif., is to free up funds to continue operations once the gift from San Jose expires.
"These funds — which are actually fees from patent filings — should not be held hostage by the sequester," she said.
San Jose Mayor Chuck Reed noted that area universities including San Jose State and Stanford are a source for many patent applications and will also provide "much of the talent for staffing" the new office.
Carl Guardino, CEO of the Silicon Valley Leadership Group, which represents the region's leading tech firms, said the announcement, the result of more than four years of effort, is "a huge milestone today."
"Finally our inventors and entrepreneurs can have the government travel to the customer rather than the customer travel all the way to the government, which is prohibitive to innovation in America," he said.