Computer implemented inventions in Australia: The saga continues ...

Date: 2013-11-18
Author: Stuart Irvine

An ongoing issue in Australian patent law is the extent to which computer-implemented inventions are eligible subject matter for patentability.

Two single-judge Federal Court decisions on this matter have been handed down this year:

1. Justice Emmett’s 13 February decision of Research Affiliates LLC v Commissioner of Patents1 (Research Affiliates), finding that a computer implemented invention was not patentable subject matter; and

2. Justice Middleton’s 30 August decision of RPL Central Pty Ltd v Commissioner of Patents2 (RPL Central), finding that a computer implemented invention was patentable subject matter.

Today (18 November 2013) the appeal to the Research Affiliate’s decision was heard by the Full Court of the Federal Court, comprising Justices Kenny, Nicholas and Bennett. The Full Court reserved its decision. Hopefully the Full Court will provide clarity on this contentious issue. This article outlines some of the main arguments presented to the Full Court.

The Research Affiliates patent and Justice Emmett’s decision

The claim under consideration in the Research Affiliates patent is directed to a computer implemented method for generating an index in which assets are weighted.

To generate the index, the claimed method includes steps of accessing and processing data.

Justice Emmett found that the invention claimed in the Research Affiliates patent was not patentable subject matter because:3

  • the implementation of the method of claim 1 of the Research Affiliates patent is “no more than the modern equivalent of writing down the index on pieces of paper”;
  • the steps of the invention could “readily have been carried out manually”; and
  • the computer implementation aspect of the invention “is nothing more than the use of a computer for a purpose for which it is suitable”.

In deciding the Research Affiliate’s claim was not directed to patentable subject matter, Justice Emmett also relied on an apparent admission by Research Affiliates that the only physical result (a necessary requirement to be patentable subject matter) generated by the claimed method is a computer file containing the index. Justice Emmett held that the generation of such an index was not sufficient to confer subject matter eligibility, the reasoning being that if it did then any computer implemented scheme would be patentable.5

Justice Emmett also took into account the level of disclosure of the computer-implementation in the Research Affiliates patent specification, levelling a criticism that:

While the Specification appears to be intended to create the impression of detailed computer implementation, the Specification says almost nothing about how this is to be done.6

The appeal

At the hearing, Counsel for Research Affiliates argued that:

  • The Court should apply the principles as set out in National Research Development Corporation v Commissioner of Patents7 (NRDC), and applied in various cases since.
  • The invention claimed in the Research Affiliates patent does not fall into the subject matter exclusion of being a ‘mere idea’.
  • There are no express exclusions to the patentability of business methods under Australian law, but even if there was the invention in question is not a ‘mere’ business method or scheme as it is a method/idea with practical application on a computer.
  • The invention satisfies the requirement for an artificial state of affairs because both the index of weighted securities generated by the claimed method and the steps performed on a computer in so generating the index each involve a transformation of data.

In this regard Research Affiliates submitted that contrary to Justice Emmett’s comments, it did not accept that the only physical effect produced by the claimed method was the creation of the index.

Further, they argued that if NRDC is applied correctly the steps of a claimed method should not be subdivided in order to isolate the last step as conferring the ‘physical effect’.

  • The claimed invention relates to a computer-implemented method, with particular emphasis placed on the fact the claimed invention is not an abstract method but is tied down to practical implementation on a computer.
  • How and at what level the computer implementation of the invention is disclosed in the patent specification is not a relevant consideration to the enquiry of whether an invention is patentable subject matter or not, and is not in accordance with the principles for patentable subject matter as set out in NRDC.

Counsel for Research Affiliates also directed the Full Court to several aspects of Justice Middleton’s approach to patentable subject matter in the RPL Central decision. In particular, Research Affiliates submitted that:

  • The transformation of data in/by a computer results in a physical effect (as per paragraphs [139] and [143] of the RPL Central decision).
  • Features relating to computer implementation should not be stripped from of the claims in determining subject matter eligibility (as per paragraphs [157] and [158] of the RPL Central decision).

Counsel for the Commissioner of Patents raised two main arguments:

  • That the result of the claimed method, the index, is not enough to satisfy the requirement of an artificially created state of affairs as set out in NRDC.
  • That a method that is an abstract idea or business scheme should not become eligible patentable subject matter simply due to the fact that the method/scheme is implemented by a computer. In this regard, the Commissioner of Patents directed the Full Court to recent decisions in the US and UK regarding computer-implemented inventions, suggesting that they may be of assistance in the respect.

In response to the Commissioner’s arguments, Counsel for Research Affiliates submitted that Australian courts should be cautious in applying principles from overseas cases. Research Affiliates submitted that the Federal Court had itself noted that UK principles on patentable subject matter had developed differently to Australian law due to the influence of the European Patents Convention (citing CCOM). In relation to the US cases, Research Affiliates submitted that recent cases had not established clear guidance on computer-implemented inventions, and it was not clear which principle should apply or whether such principles were limited to the particular facts of those cases.

1. [2013] FCA 71
2. [2013] FCA 871
3. [2013] FCA 71 at 72
4. [2013] FCA 71 at 66
5. [2013] FCA 71 at 67
6. [2013] FCA 71 at 68
7. [1959] 102 CLR 252

The partner responsible for this area is Carl Harrap.