High Court Backs Aristocrat on Software Patentability – It’s Time for IP Australia to Follow Suit

The High Court of Australia has denied an application by the Commissioner of Patents for special leave to appeal a decision of the Full Federal Court in which claims to a computer-implemented invention (CII), in the form of an electronic gaming machine (EGM), were found to be patent-eligible in Australia.  This brings to an end the long-running dispute over patentability of Aristocrat’s claims, and marks the first time since 1991 (IBM v Commissioner of Patents [1991] FCA 625) that any such dispute with the Commissioner over claims to a CII has concluded with a victory to the applicant/patentee. 

The significance of this outcome cannot be overstated.  In recent years we have seen many cases conclude with claims being found ineligible – i.e. not for a ‘manner of manufacture’ under Australian law – namely Grant v Commissioner of Patents [2006] FCAFC 120, Research Affiliates LLC v Commissioner of Patents [2014] FCAFC 150, Commissioner of Patents v RPL Central Pty Ltd [2015] FCAFC 177, Watson v Commissioner of Patents [2019] FCA 1015 (leave to appeal refused in Watson v Commissioner of Patents [2020] FCAFC 86), Repipe v Commissioner of Patents [2019] FCA 1956, and Commissioner of Patents v Rokt Pte Ltd [2020] FCAFC 86.  That is a lot of cases telling us what is not patent-eligible, with absolutely no guidance from the courts on where the boundary might lie on the positive side of patent-eligibility.  Finally, we have a decision of the Full Federal Court that sets out a reasonably clear and concise test which is then applied to eligible claims.  The High Court, in denying the Commissioner’s application for special leave to appeal, stated that the ‘Full Court applied established principles concerning the assessment of manner of manufacture and reached a unanimous and clear conclusion as to characterisation’: Commissioner of Patents v Aristocrat Technologies Australia Pty Ltd [2026] HCADisp 15, at [2].

Following a rather convoluted passage through the Federal Court, the Full Federal Court and the High Court, back to the primary judge and then to the (differently constituted) Full Court, the final word on patent-eligibility of Aristocrat’s claims is Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents [2025] FCAFC 131.  In this decision, the Full Court effectively overruled the reasons (though not the orders) of the earlier Full Court, and adopted the affirmative reasons of three High Court judges in the split decision Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents [2022] HCA 29 (see High Court’s Failure Exposes the Festering Eligibility Sore in Australia’s Patent Laws for more).  Somewhat unusually, this also involved, in a sense, ‘overruling’ the negative reasons of the other High Court judges, in a rare instance of three judges of an inferior court asserting precedence over three judges of a superior court (albeit with the support of three further judges of that superior court).  But that’s just a function of how weird this case became!

In what follows, I will briefly summarise how we got here, where the law stands in view of the Full Court’s 2025 decision, and the High Court’s reasons for refusing special leave to appeal.  Finally, I will review the current examination practice of the Australian Patent Office, and the prospects of change in the wake of the High Court’s decision.

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Tags: Appeal, Australia, Computer programs, Examination, High Court, Patent Office, Patentable subject matter

DABUS Down – High Court Dashes Hopes of ‘AI Inventor’ Advocates

On Friday 11 November 2022, three judges of the High Court of Australia (Gordon, Edelman and Gleeson JJ) refused – with costs – Stephen Thaler’s application for special leave to appeal a decision of the Full Court of the Federal Court of Australia determining that the (alleged) ‘AI inventor’ DABUS cannot be named as an inventor for the purposes of applying for a patent in Australia.  This brings to an end the efforts of Dr Thaler – and his ‘sponsor’, Artificial Inventor Project leader Professor Ryan Abbott – to achieve recognition for machine inventors under Australian law via the courts.  I have long argued that even if machines are capable of autonomous invention without human involvement (which remains, for the present, a dubious claim), it is far from obvious that granting patents for machine-generated inventions is economically or socially desirable.  The High Court’s refusal to weigh-in at this time places the issue back in the hands of the legislature to determine whether any change to the law is required.  However, any reforms should be preceded by a proper enquiry into the pros and cons, including consultation with experts, interested stakeholders, and the wider public.

To be fair, the High Court did not appear to completely shut the door on patents being granted for machine-generated inventions under the existing law.  The judges who heard Thaler’s application seemed open to the possibility that a human inventor might be identified in such cases, or perhaps that there might be no inventor but that someone might nonetheless be entitled to obtain a patent on the invention.  However, this particular case provides the Court with no factual basis to consider such alternative options, and the judges therefore did not consider it a suitable case in which to grant special leave to appeal.

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Tags: Appeal, Artificial intelligence, Australia, DABUS, High Court, Inventorship, Patent law

High Court’s Failure Exposes the Festering Eligibility Sore in Australia’s Patent Laws

In a keenly-awaited – and thus hugely disappointing – ‘decision’, the High Court of Australia has failed to satisfactorily resolve the question of whether patent claims directed to electronic gaming machine (EGM) technology developed by Aristocrat Technologies Australia Pty Ltd are directed to patent-eligible subject matter: Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents [2022] HCA 29.  With Justice Gleeson calling in sick on the crucial days, arguments in Aristocrat’s appeal from the adverse decision of the Full Federal Court of Australia were heard by just six judges of the High Court, which astute readers will notice is an even number.  The diminished bench split 3:3, with Kiefel CJ, Gageler and Keane JJ finding Aristocrat’s claims unpatentable, while Gordon, Edelman and Steward JJ would have allowed the appeal, concluding that the claimed invention was patent-eligible.  In this situation, section 23(2)(a) of the Judiciary Act 1903 provides that ‘the decision appealed from shall be affirmed’.  It does not, however, provide that the reasons of the court appealed from are affirmed.  On the contrary, one thing on which all six High Court judges appear to be in agreement is that the two-step approach taken by the Full Federal Court majority was not correct.  We were hoping for some clarity on the patent-eligibility of computer-implemented inventions.  Instead, we have been delivered two opposing, but equally authoritative, outcomes in the High Court, along with a Full Federal Court decision that stands affirmed, but which has been disapproved.

To say that this is an unsatisfactory situation would be one of the great understatements in the history of Australian patent law.  Oh, how the mighty have fallen!  In its famous and rightly-lauded 1959 decision in the NRDC case ([1959] HCA 67) the High Court delivered a judgment on patent-eligibility of such wisdom and prescience that the Australian government chose to retain the archaic language of ‘manner of manufacture’ as the touchstone of eligibility in the Patents Act 1990, placing its trust in the courts to continue development of the law to flexibly embrace the emergence of new and unpredictable technologies.  Yet here we are in 2022, and the High Court has tripped over the now relatively mature technology of computer software and tumbled flat on its face.

What follows is, I concede, a lengthy article, even by my usual standards.  But I am attempting to take up some important issues, and to suggest a different way forward on the treatment of computer-implemented inventions in Australia.  Following a relatively brief review of what actually happened at the High Court, I attempt to determine what, exactly, the split decision means for the lower courts, and other decision-makers such as patent office examiners and hearing officers that are bound by the authority of the courts.  I then look at how we arrived at the unsatisfactory position in which we now find ourselves, and argue that division among judges is not a new feature in this area of the law, and has in fact been evident in the Federal Court for some years. 

This leads me to the view that judicial development of the ‘manner of manufacture’ test has failed us in relation to computer-implemented inventions.  I think that a new approach is required to bring some certainty and clarity to the law and its application.  Firstly, I suggest that it would be productive for IP Australia to consult more widely with stakeholders in developing its examination practice in the wake of the Aristocrat case.  Beyond this, I think the Australian government needs to clarify its policy in relation to the protection of digital innovation, and to reach a principled position on the appropriate balance between competition and the patent incentive in the case of computer-implemented inventions.  And if the current law is not working for us, then the parliament may need to consider a legislative solution.

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Tags: Appeal, Australia, Computer programs, High Court, Patentable subject matter

Eligibility of Computer-Implemented Inventions Behind Unprecedented Numbers of Patent Office Rulings

Once upon a time – not so very long ago, in fact – it was rare for the Australian Patent Office to issue a formal published ruling on the patent-eligibility of claims submitted for examination.  Indeed, ex parte decisions (i.e. those involving only the applicant and the Office) were generally in the minority, and most of those related to pharmaceutical extensions of patent term, allowability of amendments, and extensions of time to meet various deadlines.  Historically, the overwhelming majority of decisions have related to inter partes proceedings, such as patent oppositions.  That is, however, no longer true.  Following a peak in 2015, inter partes decisions have been falling, while ex parte decisions have been generally on the rise since 2011.  In 2021, ex parte decisions outnumbered inter partes decisions for the first time.  And in 2022 more ex parte decisions have been issued so far (i.e. up until the end of July) than in any past full year, with inter partes decisions once again lagging behind.

The sole driver of the growth in ex parte decisions has been patent-eligibility according to the ‘manner of manufacture’ test under Australian patent law.  The number of published Patent Office decisions relating to subject-matter eligibility of patent claims has risen from fewer than one per year in the 2000-2009 decade to 19 decisions in 2021 and 21 decisions in just the first seven months of 2022.  Since 2010 there have been 115 published decisions on eligibility, with the claims at issue being found ineligible in 100 of those cases.  Almost all of these have related to computer-implemented inventions.

The issue here is not that some subject matter is ineligible for patent protection.  That has always been, and will always be, true.  But the massive increase in published decisions is indicative of a more insidious problem.  Applicants rarely request hearings to appeal rejections by a patent examiner, and when they do it is usually because they genuinely believe that the examiner has got it wrong, and that the additional effort and expense is justified by good prospects of a better outcome when the matter is considered by an experienced hearing officer.  The unprecedented rise in applicants requesting hearings on patent-eligibility is due to a lack of clarity and coherence in the law.  And the fact that those applicants are so frequently wasting their time and money reflects the fact that the Patent Office has been championing an interpretation of the law that is at odds with the way in which it is being interpreted by the applicants and the patent attorneys advising them.

To be clear, the Patent Office on the one hand, and applicants and their attorneys on the other, are looking at exactly the same case law, and arriving at completely different conclusions as to how that law applies to particular claims.  Over the period during which this situation has arisen, there have been five Full Bench decisions of the Federal Court of Australia that should have served to clarify the law, but which appear to have had the opposite effect.  (For the record, those decisions are Research Affiliates LLC v Commissioner of Patents [2014] FCAFC 150, Commissioner of Patents v RPL Central Pty Ltd [2015] FCAFC 177, Encompass Corporation Pty Ltd v InfoTrack Pty Ltd [2019] FCAFC 161, Commissioner of Patents v Rokt Pte Ltd [2020] FCAFC 86, and Commissioner of Patents v Aristocrat Technologies Australia Pty Ltd [2021] FCAFC 202.)

The Aristocrat decision is currently before the High Court, where it was heard on 9 and 10 June 2022 (transcripts at Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents [2022] HCATrans 103 and [2022] HCATrans 104).  While it might be hoped that the High Court will provide the clarity that has been lacking in the Federal Court decisions, I am not so optimistic.  Looking at what has been happening at the Patent Office over the past few years, I fear that whatever the High Court may have to say about the specific claims at issue in Aristocrat will be equally open to different interpretations when applied to different claims in other cases.

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Tags: Australia, Computer programs, High Court, Innovation policy, Patentable subject matter

Aristocrat’s EGM Inventions Set for Showdown in the High Court

On 10 March 2022, the High Court of Australia granted Aristocrat’s application for special leave to appeal the decision of a Full Bench of the Federal Court, which found its claims directed to an Electronic Gaming Machine (EGM) implementing a new ‘feature game’ to be ineligible for patenting under Australia’s ‘manner of manufacture’ test of subject matter.  The case – which is Case No. S40/2022 – has since been making rapid progress.  Aristocrat filed its written submissions [PDF, 711kB] on 20 April 2022.  Two parties have applied for leave to appear as amici curiae: the Institute of Patent and Trade Mark Attorneys of Australia (IPTA), which filed its written submissions [PDF, 483kB] on 5 May 2022; and Fédération Internationale des Conseils en Propriété Intellectuelle (FICPI), which filed its written submissions [PDF, 382kB] on 4 May 2022.  The Commissioner of Patents filed her written submissions in response [PDF, 718kB] on 11 May 2022.  Finally Aristocrat filed its reply [PDF, 310kB] on 20 May 2022.  The scene is now set for a hearing, which is set down to take place on 9 and 10 June 2022 before a Full Court of seven judges, which is somewhat unusual (a panel of five judges is more common) and suggests that the High Court may have decided that it is finally time to settle the question of patent-eligibility of computer-implemented inventions in Australia.

The Aristocrat case raises interesting questions.  The claims of the patents at issue recite various hardware elements, some of which are common to all computers and some of which are specific to EGMs, along with software-implemented processes comprising the ‘feature game’.  (A ‘feature game’ is a secondary, or bonus, game triggered by the occurrence of a defined event in the ‘base’ game of spinning reels.)  It is common ground that the hardware elements are well-known in the field of electronic casino gaming, and that the new and inventive contribution resides wholly in the feature game implementation. 

At first instance, the primary judge (Justice Burley) considered that the appropriate approach to such a case involves a ‘two step’ analysis.  The first step is to construe the patent specification, from the perspective of the person skilled in the relevant art, to identify the claimed invention.  This is to be determined as a matter of substance, and not merely based on the particular form of the claims.  If the invention thus identified comprises patent-ineligible subject matter, such as a mere scheme, idea, or business method, then the second step involves an enquiry into whether the claimed computerisation involves some further contribution sufficient to render the invention patent-eligible.  Applying this approach to Aristocrat’s claims, Burley J found at the first step that Aristocrat’s claims were for ‘a machine of a particular construction which implements a gaming function’.  As a result, the question of patent-eligibility was resolved immediately – an EGM is not a mere scheme or a business method, and is thus a ‘manner of manufacture’.  There was, the judge concluded, no need to proceed with step two.

On appeal, a Full Bench of the Federal Court rejected the test proposed by the primary judge.  The majority (Middleton and Perram JJ) proposed an alternative two step test which asks firstly whether the claimed invention is ‘a computer-implemented invention’ and then – if so – ‘can the invention claimed broadly be described as an advance in computer technology’.  They determined that Aristocrat’s EGM was in substance a computer-implemented invention, and that the asserted contribution of the claimed invention ‘pertains only to the use of a computer’ and not to ‘the development or advance of computer technology’, such that the claims were not directed to patent-eligible subject matter.  In a separate judgment (which Aristocrat characterises as a ‘dissent’), Nicholas J arrived at the same ultimate conclusion, but disagreed with the majority that ‘an advance in computer technology’ is necessary for a computer-implemented invention to be patent-eligible.  In his view, such an invention may be patent-eligible if it results in innovation in ‘different fields of technology’ where technical problems that lie ‘outside the computer’ may be solved using ‘generic computing technology.  He proposed that the proceeding therefore be remitted to the primary judge to consider whether the inventions may be patentable as an advance in the field of gaming technology.

With all of these different lines of reasoning present in the judgments of the lower courts, the stage is surely set for a showdown before the High Court.  So what are the main arguments that each of the parties will be relying upon?

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Tags: Appeal, Australia, Computer programs, Games, High Court, Patentable subject matter

RPL Central Requests Leave to Appeal Software Patent Eligibility Ruling to High Court of Australia

On 7 January 2016, RPL Central Pty Ltd filed an application with the High Court of Australia, requesting ‘special leave’ to appeal December’s ruling of a Full Bench of the Federal Court of Australia that its patent claims covering a computer-implemented method of evidence gathering for recognition of prior learning (RPL) were not directed to patent-eligible subject matter (i.e. a ‘manner of manufacture’) under Australian law.

The fact that the special leave application has been filed has now been published on the Federal Court website.

How Does the Special Leave Process Work?

It is important to understand that there is no automatic right to have an appeal heard by the High Court.  Any party wishing to appeal must persuade the Court in a preliminary hearing that special reasons exist which justify the appeal being heard.  These special leave hearings are brief and potentially brutal.  Under Rule 41.11.3 of the High Court Rules 2004 the applicant (in this case, RPL Central) is permitted just 20 minutes to present its case for the grant of leave.  The respondent (in this case, the Commissioner of Patents) then also has 20 minutes, typically used to argue that the case is insufficiently exceptional to justify a hearing by the High Court.  Finally, the applicant has a further five minutes to reply.  The Court then renders its decision on the application on-the-spot.

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Tags: Appeal, Australia, Business processes, Computer programs, High Court, Patentable subject matter

The ‘Skilled Person’ is a ‘Pale Shadow’ and a ‘Tool’ – Australian High Court Rules on Obviousness

Last week I predicted that the High Court would affirm the finding of five judges of the Federal Court of Australia that AstraZenenca’s patents covering low-dosage forms of the cholesterol-lowering drug marketed as CRESTOR (having the active ingredient rosuvastatin) are invalid on grounds of obviousness.

In the much-anticipated decision in AstraZeneca AB v Apotex Pty Ltd (et al) [2015] HCA 30, five judges of the High Court, in four distinct concurring opinions, have unanimously fulfilled that prediction.  In doing so, they have successfully disappointed anybody who was hoping for some interesting developments in the law of obviousness in Australia, and gladdened the hearts of those who value certainty and stability in the law, notwithstanding that there may be opportunities for improvement.

There were two issues before the High Court.  Firstly there was what I have previously called the ‘selection’ question.  The law applicable to the rosuvastatin patents permits the use of a single prior art document as the basis for assessing obviousness, and has nothing to say about the process by which that document is identified, other than that it must be information that would be ‘ascertained, understood and regarded as relevant’.  The High Court has confirmed that the fact that a selected document might be just one of many that would meet this requirement, and that all of the others would result in the skilled person heading off down a different path, does not expressly enter into the inquiry.  As a result, the Federal Court panel was correct in finding the rosuvastatin low-dose patents invalid for obviousness.

Secondly, there was the ‘starting point’ question, which addresses whether the perspective from which the contribution of the invention should be viewed is that of the inventor, as stated in the patent specification, or some other perspective determined on the basis of evidence and/or the prior art.  This was potentially the more interesting and controversial issue, because there have (arguably) been inconsistent findings on this question at the Federal Court level.  The High Court dodged the issue, by finding it unnecessary to address the ‘starting point’ question in view of its finding on the first question.  As a result, the decision of the Federal Court panel, that the starting point is determined objectively, and not from the subjective position of the inventor, remains undisturbed.

In an effort, perhaps, to keep things interesting, Chief Justice French provided some additional characterisation of the ‘person skilled in the relevant art’.  While it is not news that this is not a real person, but rather a hypothetical construct created for the purposes of patent law, we can now add to the list of dehumanising qualities that he or she is but a ‘pale shadow of a real person’ and a ‘tool of analysis’!

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Tags: Appeal, Australia, High Court, Obviousness

Australian High Court to Rule on Obviousness

At 10.15am this coming Wednesday (2 September 2015) the Australian High Court will hand down its decision in the appeal by AstraZeneca AB against last year’s ruling, by a a special five-judge panel of the Federal Court of Australia, that its two patents relating to the cholesterol-lowering drug marketed as CRESTOR (having the active ingredient rosuvastatin) are invalid.

The decision will be significant in clarifying the law relating to obviousness in Australia.  There are potentially two questions at stake in this regard:

1. What is the appropriate ‘starting point’ for assessing whether or not a claimed invention is obvious?
2. Does the Australian law limit or prohibit ‘selection’ of a favourable prior art document from a potentially large field of candidates as a basis for finding an invention obvious?

We will soon know what the High Court thinks on these two questions.  This article provides a background on the issues before the court, and some of the arguments that it has been weighing up in coming to its decision.

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Tags: Appeal, Australia, High Court, Obviousness

Patentability of Genes May Turn on Claim Construction

A Full Bench of all seven judges of the High Court of Australia heard oral arguments in the appeal by Yvonne D’Arcy in the Myriad Genetics BRCA gene patent case starting on Tuesday 16 June 2015, and continuing through the morning of Wednesday 17 June 2015.  Transcripts of the first day and the second day of the proceedings are available.

As a preliminary matter, the High Court determined on Monday 15 June 2015 that it would not allow the application by the Institute of Patent and Trade Mark Attorneys of Australia (IPTA) to intervene in the case as amicus curiae.  I wrote previously about IPTA’s application, and subsequently about the opposition by the Commonwealth, and I am not at all surprised that the High Court turned IPTA down.

Based on the transcripts, it appears that there are up to four key issues that may determine the outcome of the appeal, i.e. whether or not Myriad’s claims to the isolated BRCA genes (and, by extension, all other patent claims directed to naturally-occurring genes that have been isolated from their natural environment) are proper subject matter for a patent under Australia’s ‘manner of manufacture’ test for patent-eligibility.

Those four issues are:

1. the proper construction (i.e. interpretation) of Myriad’s claims – more particularly whether they are, in substance, directed to a molecule or to ‘information’;
2. whether or not the test for ‘manner of manufacture’ requires a nexus between what is ‘artificial’ in an invention, and its economic value (and, if so, whether such a nexus exists in the case of isolated genes);
3. the desirability of consistency with the laws of Australia’s major trading partners and, if this is desirable, which of these other countries we should follow; and
4. the significance of the Australian Parliament’s repeated decisions not to introduce an express exclusion from patentability for ‘products of nature’ when the opportunity has arisen.

Reading the transcripts, it is not at all clear to me which way the seven judges (individually, or as a group) are likely to rule in this case.  While they certainly interrogated David Shavin QC (Queen’s Counsel appearing for Myriad) far more vigorously than David Catterns QC (Queen’s Counsel appearing for Ms D’Arcy), my impression is that Mr Shavin had answers for all of the judges’ questions and that, on balance, Myriad’s case is more consistent with the Australian authorities on patent-eligibility.  At the same time, however, it appears that at least some of the judges are disposed to rule against the patentability of isolated genes.

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Tags: Australia, Genetic technology, High Court, Patent law, Patentable subject matter

Can the High Court Fix Australia’s Obviousness Problem?

Australia has an obvious problem with obviousness.  For over three decades, we have been out-of-step on inventive step.  The law of obviousness under the Patents Act 1952 was originally messed up by the High Court in the ‘3M Case’ (Minnesota Mining & Manufacturing Co v Beiersdorf (Australia) Ltd [1980] HCA 9).  There have since been three legislative attempts to fix it – with the original enactment of the Patents Act 1990, with the changes in the Patents Amendment Act 2001, and most recently with the passage of the Intellectual Property Laws Amendment (Raising the Bar) Act 2012.

I have written previously about Australia’s Four Laws of Inventive Step, and I once called the 3M Case ‘possibly the second worst ever patent judgment by the High Court of Australia’.  I was wrong.  In terms of its lasting negative impact on Australian patent law, 3M is clearly Number One.  The judgment I called the worst, Philips v Mirabella [1995] HCA 15 – for all its intrinsic awfulness – has been effectively quarantined, and for the most part no longer causes us too much trouble.  3M, however, lives on in the continuing failure of all attempts at legislative correction to produce laws consistent with the approach taken in the rest of the developed world.

In the latest chapter of this ongoing saga, on the 13th and 14th of May the Australian High Court heard oral arguments in the appeal by pharmaceutical company AstraZeneca AB against last year’s ruling of an expanded five-judge Full Bench of the Federal Court of Australia that its two patents relating to the cholesterol-lowering drug marketed as CRESTOR (active ingredient rosuvastatin) are invalid.  (I previously wrote about that decision in What is the Starting Point for Inventive Step?)

For truly dedicated watchers of Australian patent law, transcripts of day 1 and day 2 of the hearing are available.  Alternatively, the High Court web site hosts audio-visual recordings of the proceedings – each of day 1 and day 2 being in excess of four hours of not-always-riveting television.

It is clear from the arguments presented to the Court that Australia’s troubles with obviousness are not over.  And while the High Court now has an opportunity to make things a little better (or, at least, to avoid making them any worse again), ultimately I think that the only real solution will be to scrap our existing prescriptive approach to inventive step in favour of the kind of open enquiry into obviousness that is available under the laws of other developed nations.

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Tags: Appeal, Australia, High Court, Obviousness