The House Judiciary Committee's Subcommittee on Courts, Intellectual Property, Artificial Intelligence, and the Internet held an oversight hearing on September 2, 2026 to consider its role in renewing the U.S. Patent and Trademark Office's fee-setting authority, IPWatchdog reported. Throughout the hearing, Subcommittee Chairman Darrell Issa (R-CA) expressed skepticism about USPTO Director John Squires' recent changes to discretionary denial practice at the Patent Trial and Appeal Board (PTAB) and wondered whether renewal of the authority under the America Invents Act (AIA) should be conditioned on reforms to the agency's policy. Issa noted that Congress had approved a short-term extension of fee-setting authority through December 12 — it was originally set to expire September 16 — giving lawmakers additional time to consider reauthorization.

Issa argued that the USPTO's expansion of discretionary denials in IPR proceedings has 'undercut the core purpose' of the AIA: the PTAB was intended to provide an efficient mechanism for testing patent validity and reducing pressure on federal courts, not to deny review repeatedly without reaching the merits. He also referenced reports that ex parte reexaminations have declined, asking whether the Office even needs fee-setting authority given the self-imposed reduction in proceedings and associated revenue — 'Are they not flush with cash under the existing system?' — and suggested Congress could resume directly authorizing fees unless the USPTO demonstrates it is fully implementing the AIA. Ranking Member Hank Johnson (D-GA) disagreed, calling Issa's concerns 'partisan' and based on 'political ideology over merit'; he supports reauthorization, arguing individual PTAB policies should be considered separately, though he criticized the administration for disbanding the Patent Public Advisory Committee (PPAC) in March 2025 and leaving only four of nine required voting members appointed.

The four witnesses — former USPTO Acting Director Teresa Rea, ACT President Morgan Reed, University of Texas law professor Melissa Wasserman, and former USPTO Director David Kappos — generally agreed fee-setting authority should be renewed but differed on conditions, and all urged that the PPAC be fully reconstituted. Rea said the Supreme Court's Loper Bright decision ended judicial deference to agency interpretations, so Congress should clarify 'aggregate costs,' consider limits on increases beyond inflation, and require regular reports and reasoned written decisions. Reed supported renewal only with conditions, saying the USPTO has 'broken trust' in the AIA and warning that generative AI could compound the problem by making it cheaper to draft large numbers of applications. Wasserman focused on fee-structure incentives — upfront application fees cover only about half of examination costs, creating reliance on issue and maintenance fees — and backed renewal with a sunset and consideration of collecting more examination costs before allowance while retaining small- and micro-entity discounts.

Kappos made the strongest case for long-term renewal not conditioned on policy changes, recommending a seven- or eight-year extension and arguing that the entirely fee-funded agency needs flexibility to maintain reserves, modernize technology and sustain examiner hiring; existing procedural checks already make fee changes 'highly deliberative' — the most recent fee rule took 21 months from advisory committee notice to effective date. In a heated exchange, Issa and Kappos debated whether PTAB proceedings were intended to operate concurrently with district court litigation, with Kappos citing AIA legislative history describing the PTAB as an alternative to district court. The U.S. Chamber of Commerce and the Council for Innovation Promotion both submitted statements urging renewal, with C4IP calling for a long-term extension.

Original Link：https://ipwatchdog.com/2026/09/02/issa-hesitant-to-renew-uspto-fee-setting-authority-amid-ptab-changes/