USPTO Downsizes HQ; Building Owner Faces Financial Troubles

The U.S. Patent and Trademark Office (USPTO) has called their 2.4 million square foot headquarters in Alexandria, Virginia home since 2005. But the agency does not actually own the cutting-edge facility located in the Carlyle neighborhood near the Potomac riverfront. Instead, the USPTO has leased the complex from New York-based real estate owner LCOR.

Several months ago, the USPTO announced it would be downsizing and relinquishing 800,000 square feet of space. The renewed 5-year lease covers 1.6 million square feet.  Still a big footprint, but one reflective of how the USPTO’s workplace and workforce have evolved over the past two decades.

When the agency first moved in, hoteling and work-from-home examiner programs were in place, but not the expectation. Fast forward to today and the USPTO has fully embraced telework along with opening satellite offices nationwide, reducing the need for everyone to be housed at HQ. Despite major examiner corps growth during this time, the footprint no longer needs to be so large.

However, the USPTO’s landlord LCOR now faces its own challenges filling the soon-to-be vacant space. The company continues to struggle finding replacement tenants, as office vacancy rates remain high nationwide.

Most recently, credit rating agency Moody’s downgraded LCOR’s credit outlook to “high risk of default” status. The downgrade reflects Moody’s view that LCOR may have trouble refinancing debt and have insufficient cash flow to cover interest payments unless new paying tenants are found.

I remember first visiting HQ way back then and thinking of the potential benefits of having a patent law office in an adjacent building.  Today, that imagined benefit seems much less so as it is likely that your examiner is sitting at home in another state.

78 thoughts on “USPTO Downsizes HQ; Building Owner Faces Financial Troubles

  1. 7

    “the agency does not actually own the cutting-edge facility located in the Carlyle neighborhood near the Potomac riverfront. Instead, the USPTO has leased the complex from New York-based real estate owner LCOR.”

    Wonder why a Federal Agency would contract with a private real estate developer to build a “Federal Building”. Could it be that the building could be constructed with non-union labor to lower costs?

    It was 2002-03, I was working in DC and took the Metro to King St. for an in-person interview with an examiner. Following the interview I sought out the Masonary general contractor portable to inquire about employment for my brother – a NYC union bricklayer. At this time office construction in NYC was at a stand still. My brother had worked off and on for about 2 years during the 2000 recession. As many of you know, the PTO building is a beautiful office complex made of glass, block, and brick.

    I walked into the portable and found the masonary foreman for the general contractor and inquired about the hourly wage for a brick/block mason. To my surprise he stated that the wage was $20 /hr with no benefts of any kind. I asked how can this be when this is a Federal Building? His answer was that this was not a Federal building, and therefore, there was no requirement to use union labor. The story I was told was that the building was to be leased by the agency for 30 years and then revert to a Federal building. Not sure if the foreman was completely correct, but I got the general idea. Many of you do not realize that the PTO building was constructed with undocumented labor.

    And you wonder why the unions gave up on the Dems and the resulting political shift.

    1. 7.1

      One of my feeds was making the distinction that the political party reversal of “R” and “D” has reached “concern for your blue collar worker,” but had not yet reached a de facto “support for unions.”

      The “D” elitist move (aka Sprint Left) has been underway for quite awhile (well before Hilary’s “deplorables” comment).

      1. 7.1.1

        I’ve lived long enough to see plenty of shifts. I constantly see people well right of center being called “moderates” simply the bulk of their colleagues are so far right, that even the hard right Joe Scarborough of the 1990s seems quite liberal by today’s GOP “moderates”. As you may recall if you’re old enough, after Newt Gingrich became Speaker of the House, moderate and liberal Republicans were virtually purged from Congress.

        1. 7.1.1.1

          Fair enough — I have always held that authoritarianism exists on BOTH the Left and the Right (even as an objective historical view has demonstrated that the authoritarian Left has been FAR worse over the last two centuries).

          1. 7.1.1.1.2

            In my view, the US Political Right has simply been far more tolerant of the authoritarian Right than the US Political Left has been tolerant of authoritarian Left.

            1. 7.1.1.1.2.2

              Not seeing that.

              Quite in fact, Dr. Lindsay has had some very explicit exposes on how the truly far Right (at the authoritarian level) is well demarcated and viewed as “out of bounds” by most all of the Right, while the phrase Sprint Left is also well established (with the Authoritarian’s deeming even Left of Center as being “Far Right”).

              The best thing to prove my point would be Greg agreeing with your post while also sliding one of his inane hidden signals into his post.

        2. 7.1.1.2

          ..: and I would comfortably posit that the authoritarian Left is far more an imminent threat than the authoritarian Right (no matter the propaganda of the captured Main Stream Media, and in fact, that capture definitely plays a part in the level of danger).

          1. 7.1.1.2.1

            You can posit all you like but, as the saying goes, while you are entitled to your own opinion, you are not entitled to your own facts. The mindset behind the January 6th Insurrection is a clear and present danger to American Democracy.

              1. 7.1.1.2.1.1.1

                I’m just being polite to someone I respectfully disagree with, Greg. There are many issues relating to patent practice where anon and I are on the same page. We can agree to disagree on certain things but still be civil about it. When civility ends, civil war begins.

                1. I’m just being polite to someone I respectfully disagree with, Greg.

                  I admire that.

                  We can agree to disagree on certain things but still be civil about it. When civility ends, civil war begins.

                  Well said.

                2. Thanks ipguy — I would concur that we tend to agree more than we disagree, AND our disagreements tend to be OFF patent topics.

                  That being said, our current mismatch is on what is a fact and what is an opinion.

                  Each view the other’s position as opinion and each view their position as fact.

                  There may be a more nuanced truth in the middle ground, but I would add that for the instant context, I have the better position.

            1. 7.1.1.2.1.2

              Criminy…

              Your comment is awaiting moderation.

              September 8, 2023 at 6:26 pm

              Stop imbibing the propaganda.

              Jan 6th simply was not an insurrection.

              [ U g 1 y ? ] (out of control George Carlin filter)
              Certainly.

              But FAR more “mostly peaceful” than the immediate history of the Sprint Left movements.

              (Tell me again exactly who was the single causality of Jan. 6, tell me again how Chewbacca Man was having doors opened for him)

              1. 7.1.1.2.1.2.1

                Dennis,

                I apologize, I had no idea my comment woold veer off in this direction. I will not make the same mistake again.

                The comment was inteended to focu on the poor souls who had to shoulder and lay 30 lb concrete block for $20 per hour, no benefits, 7-8 hour a day

                1. [B]oth Reps. Cheney and Kinzinger are conservative Republicans by any measure.

                  Rep. Cheney retired from Congress with a 78% lifetime rating from the American Conservative Union, much higher than the rating of the woman who replaced Cheney as Chair of the House Republican Conference. Incidentally, if Cheney were such a faux-Republican, why did her fellow GOP representatives elect her as their conference chair?

                  By contrast, Rep. Kinzinger’s record put him on the left end of the GOP caucus, although still well to the right of the distribution for Congress overall.

                  Both supported Trump in the 2020 election. The above are simply facts.

                  The word “RINO” has no objective content, so any set of facts can be consistent with the assertion that someone is a “RINO.” Both Cheney and Kinzinger, however, were indisputably Trump-supporting members of the House GOP caucus as of 6 Jan 2021.

              2. 7.1.1.2.1.2.2

                The Bipartisan January 6th Committee addressed all of that in their report. It’s a very long read. It’s conclusions are supported with ample evidence.

                1. If your really believe that THAT committee was truly bipartisan, you have d r u n k WAY too much Kool-Aid.

                  (and this topic aside, I generally do find agreement with you, and the fact that the comment string has veered is another point of agreement — JB: no need to refrain from posting.)

                2. As always, ipguy, you are a gentleman and do not engage in the prolific name-calling that others engage in, especially those others who refer to anyone to the Left of Pat Buchanan as being ‘Marxists”.

                3. anon, Reps. Cheney and Kinzinger are Conservative Republicans so it was a bipartisan committee.

                4. PPO,

                  You make my point for me, as your ‘thinking’ RHINOS like Cheney and Kinzinger make this bipartisan is beyond laughable.

                  Put
                  The
                  Kool-Aid
                  Down.

                5. “RHINOS like Cheney and Kinzinger”

                  In no way is that a centrist or “moderate” point of view. Both of them are mainstream conservative Republicans.

                6. You simply assert too much, ipguy.

                  By “any” measure is false on its face.

                  I suggest that you step away from the Main Stream Media propaganda that is attempting to “normalize” the clearly political nature of the Jan 6 event.

                7. [B]oth Reps. Cheney and Kinzinger are conservative Republicans by any measure.

                  Imagine the sort of world one must inhabit in order for this to seem like a debatable proposition…

                8. I simply assert the objective truth: Cheney and Kinzinger are conservative Republicans. As has been said, you are entitled to your own opinion, but you are not entitled to your own facts. If you wish to go on calling them RINO, that is your right to express your opinion.

                9. Your reply of “simply assert the objective truth” is objectively false, as you label a factual observation of “RINO” as merely opinion.

                  You yourself are expressing YOUR opinion, and turning around and want that opinion to be ‘facts.’

                  It just is not so.

                  Further, the basis of your actions is well-documented in the Sprint Left narrative (just look at the abundance of Greg’s gaslighting).

                10. I can say the Moon is made of igneous rock until the cows come home, and you will continue to insist the Moon is made of cheese and that I’m just expressing an opinion. Again, you’re entitled to your opinion, but yours is based on political dogma while mine is based on objective fact.

                  Call Cheney and Kinzinger RINOs all you want, but by all objective measures, they are conservative Republicans.

                  President Reagan once said, “I didn’t leave the Democratic party; it left me.” Perhaps in that sense, Cheney and Kinzinger are RINOs because the Republican Party has left them and any Republican who dares to cross former President Trump is deemed a RINO.

                11. Once again, you…

                  That “once again” indicates that you know that you are moving in a closed, conversational circle by this point. Everyone knows that you are right, but if you are hoping to have the last word here—or even more unlikely, to see your interlocutor concede—you are setting yourself quite an ambitious task.

                12. See above, and (without having you affirm Greg’s ‘arguments’ – as you have given no indication of such), I would add that there IS a certain amount of “company you keep” in that Greg is cheerleading (and propagandizing) the political side that you are espousing here, and that THAT is a negative for you.

  2. 6

    How does security work, when an examiner is working from home?! Much less a foreign born examiner? Say a Chinese or Russian born patent examiner? I don’t get how you can have any security at all. Anyone know?

    The PTO has never even mailed out even the most sensitive documents with tracking provided. If that gets lost or stolen it’s ‘not their problem’ & they can’t tell you what might have happened (and don’t care either)! If you lose any mail (or a check) to them, you better be able to explain why & get ready to pay a hefty penalty for that!

    Frankly I don’t think the USPTO has much of any ‘security’ at all. Probably trivial for any good hacker, much less country, to get whatever they want from them. They’ve probably been hacked several times already, but just never told anyone! Maybe even including Congress! The USPTO is a lost cause!

    1. 6.1

      How does security work, when an examiner is working from home?! … Anyone know?

      Probably more secure than most law firm security in the pandemic related “work from home” mode.

  3. 5

    I do feel like the examiners are more siloed. Used to be you felt like you were dealing with one brain among AUs and one culture with all the examiners.

    Not so much now.

    1. 5.1

      They are all clueless now! That’s the only ‘consistency’ there is there! No two examiners ever agree on anything & THAT’s who we entrust decisions about patents to now! To hell with the entire USPTO! It’s worse than worthless now. It wastes individuals & companies BILLIONS every year, ‘evaluating’ inventions they often don’t understand at all, get unfairly denied patents or get allowed as ‘junk patents’ that are later invalidated ‘by the same agency’. It’s as close to a legal ‘con’ as you can get! It’s all a crap shoot now, but one that definitely favors large corporations & monopolies (but also costing them billions every year)! Consumers pay for all that & inventors get the short end of the stick! Only the lawyers come out ahead!

      1. 5.1.1

        Your emotions are getting the better of you with your, “Consumers pay for all that & inventors get the short end of the stick! Only the lawyers come out ahead!

        How exactly are “consumers” paying for anything?

        Why are you targeting lawyers?

        1. 5.1.1.1

          Because they are being denied ‘new’, ‘better’ & cheaper technologies & products by the USPTO, as they focus on PROTECTING existing large entities & monopolies! How many small entities can afford to sue large entity infringers? How many startups can afford to get 10, 20 or 30 ‘valid’ patents a a new invention (as is now required, since ‘broad’ patents are no longer allowed)? And that’s just in one country! It makes NO ECONOMIC SENSE anymore. Better to do as Elon Musk does and just come out with new stuff before anyone else does. Better to just ‘corner the market’ first and/or go with (free) trade secrets & trademarks, that are just as good as patents now! Be first to market & your likelihood of success will be much greater than getting even a dozen patents! Just DO IT (and don’t expect any licensing deals because you will never get one).

          You have to produce & market your inventions now! No other way to become successful with them, or be rewarded for them. We also should have laws against ‘plagiarism’ in the U.S., which some other countries do have! Then, in many cases, you wouldn’t need patents at all! A jury could just LOOK at what was invented and described and who is entitled to credit & compensation for it. No need for legally intractable ‘claims’, devised by lawyers for lawyers. Legal claims are just ‘job security’ for lawyers! They aren’t necessary! The Nobel Prize committee doesn’t need ANY lawyers to decide who did what & when & who ‘did the most first’! Why is that? How can they figure that out without lawyers, judges & courts?! It’s usually pretty obvious who described what & when!

          What constitutes a scientific & technical advancement should not be decided by examiners or lawyers who are NOT ‘experts’ in many fields of MODERN science & technology, or what is new and what’s not new! They’d have to be studying for hours every day to do that! Examiners don’t have time to stay up to date on dozens of different technology & scientific disciplines, especially in the 21st century. Ironically ‘machines’ & AI COULD do that ‘easily’ (including keeping on on the latest laws & cases)! Time to replace most examiners & lawyers with AI now! Far superior way to analyze the vast amount of information needed to ‘fairly’ & ‘objectively’ determine who invented what & when. Would completely eliminate the possibility of invention theft (with or without patents). Would be totally ‘equitable’ (as the Founders intended), not like now where the rich always win! The lone inventor doesn’t stand a chance against giant corporations & monopolies in the 21st century! Something has to change or we won’t have anymore inventors in America (at least ‘real’ inventors, as opposed to just ’employees’ doing what they’re told to do). That’s not what America used to be about & that’s also why China could bury us soon! China doesn’t value lawyers over inventors when it comes to growing their GDP! The little guys need to be able to compete with the big guys! They can’t anymore HERE! Even China understands that!

  4. 4

    I remember when they first moved in, there were complaints it was not enough space. In fact, the reduced amount of space from Crystal City was set forth as one of the reasons why the art unit search rooms were eliminated.

  5. 3

    “But the agency does not actually own the cutting-edge facility located in the Carlyle neighborhood near the Potomac riverfront.” If it was built 20 years ago or more, how is it “cutting edge”?

    “the USPTO has fully embraced telework along with opening satellite offices nationwide, reducing the need for everyone to be housed at HQ…” This as private businesses like Amazon are telling workers to get back to the office.

    The loss of institutional knowledge at the PTO in the past 20 years has been significant. The PTO’s telework policies exacerbate the problem.

    1. 3.1

      I agree regarding institutional knowledge. I cannot imagine trying to train new examiners long-distance. The same holds for young lawyers in law firms. We had such an advantage being able to just walk into a partner’s office to ask a question or just shoot the breeze. We would often get an anecdote from their practice that you just don’t get in an email.

      1. 3.1.1

        I cannot imagine trying to train new examiners long-distance. The same holds for young lawyers in law firms.

        +1

      2. 3.1.2

        You can’t call/text/Zoom/Teams/or anything else?

        Seriously, 9/10 days, I sit in my office and don’t talk to anyone the entire day. And that 1/10 could be handled some other way.

    2. 3.2

      “The PTO’s telework policies exacerbate the problem.”

      To some degree, yes. But the telework policies are an important part of a compensation package that features a shrinking base salary. I suspect that without telework, ceteris paribus, the knowledge loss would be far worse.

      1. 3.2.1

        Ben, have you heard any PTO rumors as to patent examiner retention rates or new examiner hiring rates lately? Is that affecting reported increases in pending applications and the decreases in issuances?

        1. 3.2.1.1

          The CPC routing transition and related changes exacerbated a lot of examiners leaving, and they are having trouble getting new hires because they pay so little. Starting in January the special pay rate for examiners will essentially be the same as the general pay schedule, and the year after it will be below the general pay schedule.

          1. 3.2.1.1.1

            “Starting in January the special pay rate for examiners will essentially be the same as the general pay schedule, and the year after it will be below the general pay schedule.”

            Just ridiculous. Guessing popa doesn’t care because most examiners are primaries and make gs14-15 money anyway.

            1. 3.2.1.1.1.1

              Unlimited OT and bump up the GS and SAA awards. I’m sure primaries would pump out more cut and paste, form paragraph schlock for a few more dollars.

        2. 3.2.1.2

          I don’t have numbers but the rumor is that first year retention is abysmal. Poor retention necessarily affects pendency but with some time lag. Management is already flailing about trying to goose production by increasing flexibility in compensation awards and overtime. I expect senior management to start instructing line management to be even more lax about quality and errors in the interest of keeping pendancy down. Buckle up!

          1. 3.2.1.2.1

            Instructed to be lax on quality….?

            Kindly back that nonsense up please.

            You do know it is easier and quicker to errantly reject, right?

            1. 3.2.1.2.2.1

              Yes – that’s some pretty interesting percentages of items that are not even “new” (RCE) filings across those business units.

              Is the “rest of the story” then at least a part of the fact that the RCE Gravy Train was ever so slightly derailed?

            2. 3.2.1.2.2.2

              That’s a really nice link. Those track 1’s are exploding, they need to cut em down some. They usually do nothing but have me having to go find art that the foreign office didn’t bother to go find, and now having to do so on a shortened timeline (and usually amendment short timeline too for some of them).

              1. 3.2.1.2.2.2.1

                Why the need to “cut them down?”

                I mean, other than your self-interest in having to do your job faster?

                1. “other than your self-interest in having to do your job faster?”

                  It’s not just self interest, having two of them come back as hyper-timelined throws the rest of the workflow off quite a bit. If it’s causing me problems then I’m sure it’s causing people that have even harder trouble with workflow worse problems. That can even happen for one of them if there’s already a lot of finals that happen to need to go out that bi-week/month.

              2. 3.2.1.2.2.2.2

                You do realize that “the foreign office” doesn’t “find” that art because they are focused on actually finding the closest prior art, not whatever 3, 4, 5+ references they can get from a kwic search that returns all the claim terms so they can cobble together an obvious “determination” based on the “reasoning” that under official notice it would have been inherently obvious to put them all together like pieces of a jigsaw puzzle?

                I don’t think you do.

                1. “You do realize that “the foreign office” doesn’t “find” that art because they are focused on actually finding the closest prior art, not whatever 3, 4, 5+ references they can get from a kwic search that returns all the claim terms so they can cobble together an obvious “determination” based on the “reasoning” that under official notice it would have been inherently obvious to put them all together like pieces of a jigsaw puzzle?”

                  Fun fantasy, but I just now looked yesterday in one of my cases and the foreign office is, surprise surprise, using not one, but two of my references I put on the record as single reference 103’s. Derpa herpa.

                2. “Fun fantasy, but I just now looked yesterday in one of my cases and the foreign office is, surprise surprise, using not one, but two of my references I put on the record as single reference 103’s. Derpa herpa.”

                  There are several countries that will simply copy and paste the U.S. prosecution. The patents you get in those countries are worth the effort they put into their “examination.”

                3. “There are several countries that will simply copy and paste the U.S. prosecution. The patents you get in those countries are worth the effort they put into their “examination.””

                  Muh excuses muh excuses. It’s JP. You can decide how amazing or not amazing you think they are in their copy pasting and effort or whatever, but the “low effort and low results” is the whole reason I made the original post you originally responded to way above. JP guys are at least upper mid, if not upper class among offices in my experience. Which btw is why they made that rejection when the refs were spoon fed them. Derp herp.

          2. 3.2.1.2.3

            Total ‘crap’ now!!! Patents have become all but worthless now! If possible, better to just go with FREE trade secrets and trademarks & in particular rapid commercialization to get to market first (and lock it up)! That’s what Elon Musk has always done! He doesn’t give a damn about patents!

            1. 3.2.1.2.3.1

              Patents have become all but worthless now! If possible, better to just go with FREE trade secrets and trademarks & in particular rapid commercialization to get to market first (and lock it up)!

              Patents are still very worthwhile in R&D intensive industries. There are other industries (e.g., software) in which they have never been especially worthwhile, and it is no surprise that they continue to be worthless as a business investment in those industries.

              As you say, first mover advantage is very important in the software industry. It is (and always has been) so important that it completely dwarfs the advantages that patents achieve for actors in other industries.

              Despite their obvious irrelevance to the business realities of the software industry, there was a time there where patents were functional for running a shake-down racket against the software industry. This racket was only really worthwhile in the U.S. (which was the only market large enough to make the litigation costs pencil out against the possible settlement or judgment values), which made the racket incredibly sensitive to the particularities of U.S. law.

              Now that U.S. law has changed in ways that make the racket less profitable, the value of the patents relevant to that racket have correspondingly decline. The value of patents in other industries, however, remain largely unaffected.

    3. 3.3

      “If it was built 20 years ago or more, how is it “cutting edge”?”

      It’s still a pretty sweet building and has many upgrades throughout the years.

      “This as private businesses like Amazon are telling workers to get back to the office.”

      Yeah but for what reasons?

      “The loss of institutional knowledge at the PTO in the past 20 years has been significant. The PTO’s telework policies exacerbate the problem.”

      That is true for sure, that is one of the reasons why we have weekly meetings now.

  6. 2

    Thank goodness the PTO didn’t buy the building.

    (So shouldn’t their presumably materially reduced leasing cost be reflected in reduced patent / maintenance fees? Or at least no further increases for some years [except IPR & PGR fees; which should immediately be raised to what they actually cost the PTO]?)

    1. 2.1

      Might actually be a buying opportunity for the gov as a whole. Surely some other agency could use the space.

      “So shouldn’t their presumably materially reduced leasing cost be reflected in reduced patent / maintenance fees?”

      I’m sure it is, but it is miniscule.

  7. 1

    Two words: “externalized costs.”

    Long a Liberal favorite phrase, it becomes much more piercing if coupled with that dreaded “R” word of Responsibility.

    As my Uncle Ben would say, with great power comes great Responsibility.

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