The patent community has had plenty to talk about with two recent actions by David J. Kappos, the Director of the United States Patent & Trademark Office (USPTO).

On November 20, 2012, in an address to the Center for American Progress, Director Kappos gave a full-throated defense of software patents in response to recent public criticisms of software patents stemming from the so-called “smartphone patent wars.” As part of the defense, Kappos recounted several recent efforts to improve overall patent quality, including the quality of software patents. (Read a summary of those efforts here). Then on Monday, November 26, 2012, Kappos announced to USPTO staff that he would be stepping down as Director in early 2013. (See reports here and here.) According to news reports, USPTO deputy director Teresa Stanek Rea will assume the role of acting director upon Kappos' departure in 2013. Kappos’ resignation seemed to catch a number of commentators by surprise and the USPTO has not yet provided further details or an official release.

SOFTWARE PATENTS: Protecting “a form of innovation that … dominates technological advancement.”

In his address to the Center for American Progress, Kappos was not shy in emphasizing the importance of protecting software innovations or in responding to criticisms of software patents. Referring to the so-called “smartphone patent wars” between popular companies such as Apple, Google, and Samsung, Kappos acknowledged that software patents have been controversial and that critics have questioned their value, even to the point of suggesting that software patents should be completely abolished. In response, Kappos seemed to suggest that much of the criticism was misplaced and unfounded. He pleaded “to those reporting and commenting on the smart-phone patent wars as if to suggest that the system is broken: let’s move beyond flippant rhetoric and instead engage in thoughtful discussion.”

In his address Kappos emphasized the economic and real-world value of software patents and the inventions they protect, stating that “software patents, like all patents, are a form of innovation currency.” He also emphasized that software-implemented innovations qualify for patent protection just as much as other ground-breaking innovations throughout history.

“Because many breathtaking software-implemented innovations power our modern world, at levels of efficiency and performance unthinkable even just a few years ago, patent protection is every bit as well-deserved for software-implemented innovation as for the innovations that enabled man to fly, and before that for the innovations that enabled man to light the dark with electricity, and before that for the innovations that enabled the industrial revolution. Every bit as well-deserved.”

Much of Kappos’ address focused on the role patents play in protecting processes and devices that are implemented with software. He disavowed the idea that patents are granted simply for lines of programming code or mere abstract ideas and sought to emphasize that software patents protect innovations that have an integrated nature of both software and hardware. At one point he described examples of notable software innovations integrated with hardware, including modern-day GPS features available in smartphones and the da Vinci Surgical System that includes software algorithms capable of guiding a robotic arm that holds a scalpel. Noting the contributions of individual inventors and business people behind the success of such software innovations, Kappos argued that criticism of software patents is unjustified discrimination against one particular form of innovation. He said that “[d]iscrimination against a form of innovation that is increasingly critical to technological advancement, indeed that in many areas dominates technological advancement, makes no sense.”

In what some will see as a concession to critics, Kappos admitted that the USPTO has “struggled over the years … with patentability determinations for software-implemented patent applications.” Critics may see part of those struggles as the USPTO granting too many broad software patents that have stifled innovation in the software industry. However, Kappos recounted several recent efforts by the USPTO, the courts, and Congress that he said are already working to improve overall patent quality, including software patent quality. Among the efforts and procedures are new examination guidelines, examiner technical training sessions, and patent quality measurements by the USPTO, refinements in the patent law by the courts, and new procedures for challenging patents provided by the America Invents Act, which recently went into effect. (Read a summary of the efforts mentioned by Kappos here.)

In the end, Director Kappos concluded that the history of software patents has been problematic, but that the USPTO is taking many steps, including under the new America Invents Act, to address these problems. He argued that it is simply incorrect and premature to conclude at this point that the system for software patents is “broken” and beyond fixing. Instead he said that the America Invents Act and other efforts already underway should be given a chance to address old problematic software patents and ensure the quality of new software patents.