Senators lay out patent reform agreement

The Senate Judiciary Committee's leaders finally revealed details of an agreement on patent reform.

Patent reform legislation has been introduced in each of past three Congresses and has remained contentious as the technology and pharmaceutical industries fight over major provisions.

The new manager's amendment includes measures to move to a first-inventor-to-file system, allow third parties to comment on pending patent applications, and allow the Patent and Trademark Office to set fees to address its back-log problem, among others.

"This compromise may not be everything that everyone wants, but it makes important reforms to the outdated patent system," Sen. Patrick Leahy (D-Vt.), chairman of the committee. He introduced the Patent Reform Act in March.

He has worked on the compromise since April with Sens. Orrin Hatch (R-Utah), Jeff Sessions (R-Ala.), Chuck Schumer (D-Ny), Jon Kyl (R-Ariz.) and Ted Kaufman (D-Del.).

Changes to current law are outlined below:

--Transitions the U.S. to a first-inventor-to-file system, which will other countries. When more than one application claiming the same invention is filed, priority of a right to a patent is based on the first-filed application. The U.S. currently uses a "first-to-invent" system, which seeks to determine which applicant actually invented it first.

--Makes important changes to improve patent quality, including by allowing third parties to comment on pending patent applications, and by establishing a new, first-window post-grant review proceeding to weed out a patent that should not have issued during the first year after the patent is granted.

--Changes the current system for administratively challenging the validity of a patent by preventing challengers from abusing the administrative process or pursuing bogus claims.

--Increases the power of the courts' in patent disputes, allowing judges to assess the legal basis for specific damages, to ensure consistency and fairness.

--Gives the PTO authority to set fees to reduce its backlog, but also requires a reduction of fees for small companies.

We'll provide reactions from the tech community shortly.