16 Mar 2013

Recent software patent cases in Australia

Submitted by Troy Rollo

Justice Emmett recently delivered two software patent cases that serve as a very useful guide to the law on software patent cases in Australia.

Research Affiliates v Commissioner of Patents [2013] FCA 71 (Emmett J)

In this decision the sole question was whether the claimed invention was a “manner of manufacture”. Emmett J offered the following explanation for things can constitute a “manner of manufacture” (at [14]):

A manner of manufacture or kind of manufacture, must be construed as including the practice of making or the process of making, as well as the means of making the product or thing. Thus, even though an inventor may not use any newly devised mechanism, nor produce any new substance, he may nevertheless, by providing some new and useful effect through his practice or process, acquire a monopoly in such improved result, by explaining how that result is secured by his practice or process.

It should be added that “manner of manufacture” can also refer to the thing made. In that case “manner” has its meaning in the phrase “all manner of things”, and “manufacture” has its less common meaning being a thing made by the hand of man. That is, “manner of manufacture” includes all kinds of physical things not found in nature.

Emmett J went on to say (at [17]):

In the case of computer programs, it is necessary to look at the application of the program to produce a practical and useful result, so that more than mere information is involved. The method of a claimed invention will not be patentable if it does not produce an artificial state of affairs, in the sense of a concrete, tangible, physical or observable effect.

In this case the claims were to a program which generated an portfolio of securities for use as an index. The only physical effect was the storage of the portfolio in a file in memory, on disk, or on a flash drive. Emmett J found that this was the mere storage of information and not an artificial state of affairs. The portfolio could be stored in a person's memory, or written on paper, and the storage of it in a computer does not create the required artificiality (at [67]). The claimed invention did not improve the use of the computer, rather the use of the computer made the claimed invention, which was possible without the computer, more efficient (at [70]). The implementation by computer was no more than the modern equivalent of writing the portfolio on a piece of paper, and amounted to using the computer in the ordinary way (at [72]).

Dynamite Games v Azure Gaming Australia [2013] FCA 163

For his retirement from the Federal Court, Emmett J has left us with a comprehensive decision on software patents, going into some detail on a wide range of principles, even when not important to decide the case.

Dynamite and Azure are gaming machine companies. Emmett J decided the case on the question of inventive step (and innovative step), and invalidated the patents. but also went on to consider other issues that arise with software patents, including “manner of manufacture”, the nature and identification of an inventive step, novelty, analyzing claims and determining whether there has been infringement. If you are interested in software patent issues, this case is well worth a read, but impossible to summarise.

Reading the decision, you may get the impression that Emmett J had some remaining thoughts on how case law should develop in relation to software patent issues, and wanted to leave a judgment as a guide to future Federal Court judges, while he could still do so as one of them.