Patentable Subject Matter: Second Bite of the Apple® Sweeter than a Cripps Pink®

While those in the ICT space wait with baited breath on the outcome of Encompass Corporation Pty Ltd v InfoTrack Pty Ltd, NSD734/2018 (the Encompass appeal, reported here) for guidance on the subject matter eligibility of computer-implemented inventions, a recent decision has perhaps softened the position of the Australian Patent Office.

In Apple, Inc. [2019] APO 32 (19 July 2019) (Apple, Inc.) the Delegate of the Commissioner of Patents appears to have taken a ‘holistic’ approach in identifying the substance of an invention for manner of manufacture as it relates to computer implemented inventions. The decision follows the recent softening of practice at the UK IPO and suggests that the Australian Patent Office (APO) may take a less hard-line approach in future.

While not expressly excluded under Australian law, software or methods that are implemented as computer software or a related product are only patentable if what is claimed ‘as a matter of substance’ meets the requirements for a manner of manufacture and in particular is not a mere scheme, abstract idea or mere information. These principles rely on a number of recent judgments including Research Affiliates[1], which involved consideration of the UK Court of Appeal decision in Aerotel[2]. Aerotel set out a well-known four step test for assessing subject matter eligibility, which in part required the Court to consider what an invention ‘has really added to human knowledge’ by looking at the ‘substance’ and not the form of the invention. Soon after, in Australia, Myriad[3] confirmed that the starting point for the resolution of the ‘manner of manufacture’ issue is the identification of what in ‘substance’ each relevant claim is for.

Relevant to the question of ’substance’ is the definition of the invention which depends upon the construction of the relevant claims read in light of the specification as a whole and the relevant prior art base. However, there is currently a lack of clarity about whether prior art can or should be taken into account when identifying the ‘substance’ during a manner of manufacture assessment. For example, is the same prior art base taken into consideration when assessing manner of manufacture as is used when assessing inventive step? Interestingly on the basis that identification of the substance of the invention is an issue before the Full Court in Encompass, Apple unsuccessfully sought to extend the filing of submissions until after the decision is handed down.

Despite pressing on, the Delegate does offer some guidance on assessing the ‘substance’ of an invention, highlighting the importance of not applying too narrow a view, particularly where the general tasks performed by the computer system may be external to the computer, or if the invention solves a technical problem related to the running of computers generally. Importantly, the Delegate offers at [74] that:

‘…one should not immediately conclude that an application is not for a manner of manufacture just because it may fall, generally, within what typically constitutes excluded subject matter. Rather, an assessment of where the substance of the invention may lie should be approached, with a holistic point of view.’

The idea of taking a holistic view largely follows Rokt[4], where Robinson J cautioned against focusing on elements of an invention in isolation. Rokt recognised that the invention brought together a combination of new and known elements to form a working combination that had not previously been achieved, involving the use of computers in a way foreign to their normal use. In Apple, Inc., the invention was directed to a method of reusing animation sequences, which was responsible for a number of benefits on known portable electronic devices.

Interestingly, this holistic approach is similar to that taken in the UK following The Landmark Graphics[5] decisions. When applying the Aerotel test, the formulation of the contribution should not involve a forensic analysis, and a more holistic or flexible description of the contribution should be used. Relevantly, in a previous decision relating to the same application[6], the Australian Delegate echoed this very sentiment expressed by the UK hearing officer in Landmark Graphics.

Apple, Inc. should provide some comfort to applicants in the ICT space until Encompass – particularly where there is disagreement between the applicant and the APO as to identifying the substance of an invention.  However, the bigger issue of whether considerations such as novelty, inventive step and common general knowledge should be conflated with the manner of manufacture test will need to wait until the Full Court hands down its judgment in Encompass hopefully later this year.

For more information about patent subject matter requirements in Australia, please contact me (Adam Pepper) or Mark Williams.

[1] Research Affiliates LLC v Commissioner of Patents [2014] FCAFC 150 (10 November 2014)

[2] Aerotel Ltd v Telco Holdings Ltd; Re Macrossan’s Application [2006] EWCA Civ 1371; [2007] 1 All ER 225 (Aerotel)

[3] D’Arcy v Myriad Genetics Inc (Myriad)

[4] Rokt Pte Ltd v Commissioner of Patents [2018] FCA 1988

[5] BL O/112/18; see also BL O/155/18; BL O/138/18; BL O/140/18; BL O/143/18; BL O/148/18; BL O/154/18

[6] Apple Inc. [2018] APO 54 (20 August 2018) at [71]

BSc, BEng(Hons), GradCertSocSc, MIP

Adam has over a decade of commercial research and development experience and is qualified in both electronic engineering and applied physics, having obtained dual Bachelor degrees with Honours from RMIT University.