The move to find a permanent home for the Silicon Valley branch of the U.S. Patent and Trademark Office has been put on indefinite hold.
The General Services Administration, which manages the federal government's office space, has formally canceled its effort to secure space for the local patent office. The GSA notified the office of Rep. Mike Honda, D-San Jose, of its move Monday and has been contacting the property owners of the spaces it was considering, said Anthony Kusich, Honda's communications director.
A GSA representative said Tuesday in an email the agency is postponing its search for space for the regional office due to "unforeseen budget changes."
Carl Guardino, chairman of the Silicon Valley Leadership Group, called the move "frustrating," noting that the lobbying group and its allies in Congress had been working to set up a regional patent and trademark office in Silicon Valley for more than three years as a way to speed up the patent process.
"This smacks of politics, and it's very disappointing," Guardino said.
The move is a fallout of sequestration, the across-the-board budget cuts Congress imposed on the government after it failed to reach an agreement with President Barack Obama on reducing the deficit. With sequestration cutting $150 million out of the patent office budget, the agency was unsure it would have enough money to lease and staff a permanent Silicon Valley operation, said one congressional aide familiar with the matter.
Because the patent office is funded by fees assessed on patent and trademark applicants and not by the federal government's general tax revenue, Guardino and other observers thought it would and should be spared from sequestration. But the White House Office of Management and Budget this spring determined that it couldn't exempt the agency or other similarly funded agencies from the cuts.
Late last month, Honda and fellow Democratic representatives Zoe Lofgren and Anna Eshoo introduced a bill that would exempt the patent office from sequestration. Hearings on the bill should be held within several weeks, Kusich said.
Congress overhauled the nation's patent system in 2011 with the America Invents Act. That law mandated the opening of several regional patent offices around the country. The patent office selected Silicon Valley as the site of one of these regional branches last year.
The Silicon Valley branch opened at a temporary location in Menlo Park in May under the direction of Michelle Lee, a former Google (GOOG) employee. But the temporary office, which will continue to operate, has only about 4,700 square feet of space, a fraction of the 30,000 to 40,000 square feet the permanent office would offer, Kusich said.
Contact Troy Wolverton at 408-840-4285. Follow him at Twitter.com/troywolv.