Duty of examining Patent Applications and issuing patents is the requirements that are met and rejecting applications when they are not. Every one of our examiners understands ands accurately and a clear stroke is more important now than ever before so that inventors can better understand the scope of their invention. So that others including competitors can have the information they need to make better informed Business Decisions on how to invest their limited research and Development Dollars and taking a patent license. This is why we launched our enhanced pet Quality Initiative at the end of last year soliciting an unprecedented amount of input and feedback from the public on how but agency can enhance the quality of the paths that it issues. Trial appeal boards also play an effective war role as a quality check on patents. Patents that are already issued. The board provides a faster and lowercost alternative to District Court litigation where the validity of the pact claim is in question. It will also have an important impact on the front end of patent system. By making patent applicants think more carefully about pursuing broad claims that may not ultimately be upheld, this is good. It ultimately drives down needless expensive and timeconsuming District Court litigation while also encouraging africans to seek patent rights of appropriate scope. But the accord still have an Important Role to play in bringing about needed improvements for the patent system. Recent decisions have tightened the standards of clarity for patent claims and made it easier for judges to award attorneys fees in pant infringement cases. These are welcome changes but we want to remember it, they are also incremental. Judges can only decide the cases before them and can do so only one case at a time and because their rulings can be appealed all the way to the Supreme Court judicial willingness to take time to propagate throughout our entire patent system and if we want changes that are uniform, systemic come and timely that save our Small Businesses and start ups, targeted and balanced legislation needed. They can be achieved via legislation. Which was wild pleas by patent reform legislation in congress. And these exchanges reduced the incentives by abusive Patent Litigation tactics. Can target and balanced reforms constrained and and level the Playing Field for all innovators. And patent suits, about patents allegedly infringed by providing financial incentives for parties both plaintiffs and defendants to take reasonable positions in litigation. By providing opportunities for manufacturers who are best suited and incentivized to step in and defense against infringement suits on behalf of their customers and end users and providing increased transparency of pant ownership to reduce barriers to patent licensing and patent sales. These reforms combined with other changes that are occurring in the judiciary and administratively, attributing the pant system to continue to remain an engine of innovation with strong, clear and balanced Property Rights of appropriate scope that are enforceable. These reforms will contribute to our competitiveness in todays increasingly global economy. Reallocating resources from wasteful litigation to productive Research Development and commercialization. These reforms will ensure of american innovators will continue to define the top of the global value chain. Even as the rest of the world rushes to catch up. Reform is not a crisis of faith about our patent system but a way of keeping faith with its goal of promoting innovation and technological progress. If i have learned anything in my experience in the private sector it is that no good Company Effort rest on its laurels. Is always looking for new ways to improve, streamline and adapt to the new realities of an everchanging environment. From my Vantage Point as head of the United States patent and Trademark Office i believe we should treat our patent system is the same way. We need to maintain what is best in our system but we must also strive to improve what can be improved guided by the constitutional mandate to incentivize innovation and the convictions that the best days of American Innovation are still ahead of us. Thank you for your attention and i look forward to continuing the discussion with my fellow panelists. [applause] thank you, michele. Please have a seat. But invite our other panelists to come on up. I have known both of these people for quite a long time. Take your cares, seats please. First, victoria, and many of you know, Victoria Espinel, president of p s a, but before that as the first intellectual property enforcement coordinator at the white house which was kind of a patent breaking job and before that you probably knew her from u. S. T r where she handled many negotiations and broke a lot of new ground in all three jobs so thank you for being here and also a known michael for a long time, Michael Waring is director of the Washington Office and executive director of federal relations with university of michigan, someone i have worked with many years of innovation topics and a real expert both in how washington works and how washington policies might help us about innovation. What i told them for the format and thinking of changing it while michele was speaking but i wont. Victoria and michael to briefly say something, respond to michelle ng and we will go into questions. At that point if you have something i will ask you to raise your hand please identify yourself, keep it as a question, not a speech and we will move ahead but victoria, why dont we turn to you . Thank you for inviting me to be here today, a pleasure to be here i thank you and michele for pulling together this event, and congratulations to you and your confirmation. Enduing great work that you have for many years and it is fantastic. It is an honor to be up here with michael so our university, an incredibly important part of the innovation system and the prior job for the university, a pleasure to be with you. I of Victoria Espinel and my organization represents the Software Industry worldwide and one of the reasons my job is fun is because our companies are among the most Innovative Companies in the world and because of that they offer the largest hand holders in the world so we really believe in and clearly understand a well functioning patent system. We also believe what you said about keeping faith with the patent system that is important that our litigation system be set up in a way that doesnt allow bad actors to get our halfwit system id our patent system and so it is very important that there be changes to the litigation system to avoid the kind of abuses that has been happening today. It is hard for bad actors. And joy various pieces of legislation moving into the system, four things to focus on so i will mention this briefly and turn things over, we want to make sure that if anyone gets for the Patent Infringement they get genuine notice that a suit filed against them clearly lays out what the actual allegations are against them. That notice is important to having official litigation system and feared litigation system. Second with respect to where this is, cases of robbing the right chords and avoid form shopping, and bake litigation and discovery specifically as efficient as possible so therefore we think it would be best discover was delayed to be addressed to get them out of the way. We want to beat her frivolous cases being brought. Is important to be awarded in cases that are objectively unreasonable and an efficient mechanism to be awarded. Financial incentives have shifted some is not so easy and cost 40, they are better for the system as a whole and it will be stronger and better than it is today. And could talk at earthlink, to turn the mike over. Thank you very much for the invitation, always a pleasure to be here with michele and victoriana and talk about a topic we seem to be talking about for a long time, we went through three congresses where we wrestled with the notion of a patent system, what should depend system be, how to update it to make it fit with the international, our understanding of the patent system and did three congresses to pass the act and here we are less than four years later trying to make major changes to that legislation so that is an interesting dynamic interesting place to be and i shall also say before i get too far down the road, i worked for the university of michigan but i am not speaking on their behalf just representing the Higher Community at large including six associations that have banded together to work on behalf of the University System around the country and i am also not an attorney. As far as my colleagues here on the lot, havent been involved in negotiations specifically with congress on this issue but i am aware what is going on with this issue so i will respond the best i can to the questions and concerns and hopefully talk about things beyond legislation and there are other issues we are wrestling with. Let me start by saying, why universities care about patents and there was an allusion to the act in 1980 which was the watershed piece of legislation that almost didnt pass. It has in the waning hours of that Congress Thanks to the work of bob dole at the end of congress, trying to finish above the yearend able to get some approval by a couple senators to take hold of of this legislation and move the bill through congress. Until then the government when it funded research the government held the patent on a research. The government is not always good at business and a lot of the things that were created in University Labs and other places around the country that were funded didnt have a mechanism to get that invention, that idea out to the private sector to develop into a real product or new technology. They said lets do this differently, at universities have the patent and see if we can use that as leverage with licensees to try to create a marketplace for these ideas out of that was born the tech transfer of the system the we had at universities and the last 35 years and i submit it has been a very effective system for america. The most recent statistics from the university of Technology Managers association is it is created in the last 35 years 1 trillion in economic development, thousands and thousands of start up companies, 3 million jobs hundreds of new drugs we all are able to take advantage of to improve health care in the United States that is a wonderful legacy and other countries are trying to mimic that with their own versions around the country. That speaks well to the system, the patent is really the bridge from the lab to the marketplace from most discoveries so discoveries created in the lab bring ideas to the Tech Transfer Office and the Business People say that is an interesting idea interesting knowledge, interesting discovery, what could we do with that . If we had a patent should we get a patent first of all . A complicated thing expensive proposition, new knowledge, the we find a licensee who would want to develop that hand . Who would want to fund, provide further Research Dollars to finish up the work started a University Campus which is fairly basic and get that out to a new Startup Company or existing company and reap the benefits of that, all of us do as taxpayers and american citizens. It is the linchpin. I was at a forum a couple months ago and an invented scribe depend as collateral. A collateral that would then be used to attract the Venture Capital that will be needed to take that idea out of the lab and get it to the marketplace where people can take advantage of it and that is why cants are really important and patents the things that universities need in order to do their job to get this tech transfer process working by and large so when we see legislation we think will make asserting patents more complicated, more expensive potentially more risky for inventors and their hand holders and licensees we get concerned. That is part of what the debate has been in congress, where to go from here. During those three congresses we worked on, it took that long to come to a consensus point of view and in the end when the bill passed everybody didnt get everything they wanted, they were able to live with the outcomes. I submit if you look at the situation today that is not the situation we have now with this legislation. We continue to have large segments of the country, universities included, with Major Concerns about the legislation being considered particularly in the house. I would throw that out for people to think about. The difference, the political situation in 2011 was fairly a consensus view. And now where we have such a divergence of viewpoints on other legislation. We care about these issues and are involved in these issues and work closely with groups and been at the table to negotiate with house and senate folks to work on these issues and why the university is feeling so strongly about patents. I feel strongly about that. I start with a general question by posed wall street by will begin with michele. One problem we are looking at is the transition in how we think about Economic Policy as we move into an economy that is driven more by intangible assets, like this is a big challenge for how we measure how we construct policy. Many of our policies are out of date but it is also as michele noted something that is the quotable problem. There are a lot of positive statistics you can say about the u. S. Patent system. Will be in any number of things you s p t o is a non appreciated through. One thing we begin in Patent Litigation, let me start by asking michele when you think about positive patent systems when you think about japan or the e. U. Or china, how do you think we stack up . Where is it we would want to improve our performance to be competitive . Let me ask victoria and michael to comment on that as well. Lets see. I think there is a lot we do right in this country and now the have the privilege of having a role i have speaking to many of the leaders in the world i do hear a lot about what were doing right and a sense of what they would rather not have a part of. And dave matter of time to strike the talent. Clearly something i thought the lot about but how it we account for trade balances is completely out of date. The go back to the topic at hand our ptl does tremendous work that you have taken on with vigor to improve to change the process to make sure they have the funding that they need. Was so i think it is lowes the patented system and more the with the litigation vince system is structured to take unfair advantages the problem. The issues that we have are not issues that we see in countries around the world because our litigation system is set up differently. I am keenly aware of that and what that will do is make it even stronger. I think when there are frustrations about the system because of the litigation process that can cast a pall to read people doubt that is bad collectively if you doubt whether a patent is a good thing but it is part of the system to make sure to clear up that litigation than the shadow of doubt cannot be cast out. Michele touched on balance of interest. That is the tricky part. What were doing is read litigating to do the positions but theyre not any easier to resolve. We would agree that day get the momandpop retailers threatening them with a 501,000 penalty because they use of pated technology and though wife by is wrong what is interesting but hr9 does not even deal with that issue. If you make people argue their entire case before it even comes to trial that will be tricky. The tavis some of this you cannot get them going to court is always a last resort and most of the time they think there may be some infringement. Either a licensed taken or the technology does not infringe. So these are all questions of balance and where does that need to be . I would submit a jardine anyone who goes to court and loses much show they have a value to their case goes too far to rebalance the system. That is what we do come back to. For the big parties and the small parties. It has now come out to raise those that had serious concerns about this legislation they think therell be some question of validity or the value to get it to stand up under scrutiny because people will not make those investments. We did invite michael. [laughter] the one that says if you lose it is not something we will support our companies are very innovative. We have a real interest to make sure it is not too difficult and we will all not support but we do think to be objectively unreasonable then you should be awarded and we think that will be helpful with the bad actors says of reasonable place but it sounds like then to hold up under scrutiny they are real innovators and then it will be held up under scrutiny. If i am not that concerned about having a system we have a strong path. I dont like that provision as a losing case system but the abuser case system if he would use the system plaintiff or defendant if you run recently asserted then you should pay. To defend a case for logger there you should have. So to make it more expensive to a gay didnt abuse and tactics. And were all in this sabo together universities, businesses co mpanies. Universities are incredible in chins of innovation reword not be where we are today without the contributions of universities but on the other hand, when they license technology out to the Startup C