Protect your innovative technology-driven methods: Federal Court clarifies scope of IP protection

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17 September 2013 | By David Yates (Partner)

Two recent Court cases show how businesses can safeguard their most valuable technology-driven methods by securing patent protection. Businesses should consider what innovative methods they are using or are in the process of developing and explore whether they may gain a competitive advantage from patenting those processes.

The question of whether methods comprising the interaction of computers, software and databases can be patentable ‘inventions’ has been a complicated area of patent law for some time. Fortunately for innovators in this area, the Australian Federal Court has answered with a clear “yes”. 

However, the way in which the invention is explained in the patent application will be vital to success.

Federal Court explains what it takes for a ‘process’ to be patentable

In the recent case of RPL Central P/L v Commissioner of Patents, the Australian Federal Court held that a computer-implemented method, used for gathering evidence to assess an individual’s application for Recognition of Prior Learning (RPL) within the education and training sector, was a patentable invention.

The claims set out the steps by which a computer retrieves assessment criteria from the internet, processes this into question and answer format which is then presented to a user, and receives responses allowing an assessment of the RPL status.

An invented process is patentable if, among other things, it is a “manner of manufacture”. Under patent law, this means:

  • There must be a product, in the sense of an artificially created state of affairs, and something in which the new and useful effect may be observed.  It may be any physical phenomenon in which the effect may be observed. 
  • The process or method must have utility in practical affairs, that is, be of an industrial, commercial or trading character. 
  • The invention must belong to the useful arts, not the fine arts, in the sense that it must have value to the country in the field of economic endeavour.

The Commissioner of Patents argued against grant of the patent, submitting that the end product of the method was merely “intellectual information”, and whether it is stored on paper or in a computer or electronic storage device it belonged to the fine arts. 

However, the Court did not accept this, concluding the invention belongs to the useful arts, and has utility in practical affairs.  The invention produces a useful result.  It overcomes difficulties involved in seeking out relevant education providers, and enables the recognition of prior learning. 

The method solves a problem in the field of economic endeavour, being the educational sector of the economy.  For the same reasons the invention has utility in practical affairs and, given its application to the education sector, it can be said to be of an industrial, commercial or trading character.

The Court further concluded that the invention is a “product”, in that it gives rise to an artificially created state of affairs – specifically, it gives rise to a physical phenomenon in which a new and useful effect may be observed, in the sense of a concrete effect or phenomenon or manifestation or transformation. 

The Court accepted that there is a physical effect in the method, given that each step involves computer implementation and the transfer and transformation of data.  The method operates over an interconnected system where there is a transfer of information between destinations.  This transfer results in a physical manipulation of data stored on the computers resulting in a physical effect. 

It should be noted that the concept of manner of manufacture is a threshold question.  Any validity enquiry remains to be determined quite separately, and on different criteria (such as novelty and inventive step). 

A method merely implemented by a computer may be insufficient

The RPL Central decision contrasts with the outcome in Research Affiliates LLC v Commissioner of Patents earlier this year, which considered an application for a standard patent pertaining to computer-facilitated construction and use of passive portfolios and indexes for investments. 

The method included steps of accessing data, processing the data to identify assets to be included in the index, and applying an asset weighting to generate an index. 

The Court held the invention did not involve a manner of manufacture.  The claimed method did not result in an artificially created state of affairs.  The only physical result generated was a computer file containing the index, and that was simply because the method was implemented by means of a computer.  The index generated was nothing more than a set of data. 

While the patent specification appeared to be intended to create the impression of detailed computer implementation, the specification said almost nothing about how that was to be done.  There was no practical application in the method of the claimed invention for the improved use of computers.

Business should look to protect their most valuable processes

The Federal Court’s detailed discussion of the law in RPL Central gives important guidance on when innovative technology-driven methods will comprise a manner of manufacture and thus may be patentable. This decision has particular relevance for businesses that rely on proprietary processes or methods for their competitive advantage. We understand that the decision is under appeal to the Full Federal Court.

It is worthwhile considering the opportunity to protect those processes and in doing so protect and even enhance your competitive advantage.




The content of this publication is for reference purposes only. It is current at the date of publication. This content does not constitute legal advice and should not be relied upon as such. Legal advice about your specific circumstances should always be obtained before taking any action based on this publication.


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David Yates

Partner. Perth
+61 8 9460 1806

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