Patent Subject Matter Developments

1 Jan 2018


The Delegate of the Commissioner of Patents recently held that a system for facilitating governmental lottery play over an electronic network failed to meet the subject matter requirements of our Patents Act (Elot, Inc. [2017] APO 55 (7 November 2017)).


The decision is useful because the Delegate cites several useful cases, including the venerable NRDC High Court case. The Delegate also cites the England and Wales Court of Appeal (Civil Decision) of Aerotel  Ltd v Telco Holdings Ltd; Macrossan’s Application [2006] EWCA Civ 1371.


Distilled from these cases is the need to determine the substance of the invention. The substance of the invention is the contribution to the field of the invention that is alleged by the claims. The query is then whether that contribution is technical in nature.


The Delegate found that the substance of the invention was nothing more than a new scheme for facilitating governmental lottery play over an electronic network. The new scheme or method did not produce a practical and useful result outside the realm of business innovation. In other words, the contribution was not technical in nature.


Understanding patent claims can be a complex task. However, what is important is that the specification itself contains information that has technical value. This may allow amendments to the claims to overcome a subject matter rejection raised by a patent examiner.


The claims may still fail the test even though they describe technical features, such as servers and other devices. See, for example, this excerpt from the well-known “Myriad” case (D'Arcy v Myriad Genetics Inc [2015] HCA 35 (7 October 2015)): “Whatever words have been used, the matter must be looked at as one of substance and effect must be given to the true nature of the claim.” Also, in the 2015 case of Commissioner of Patents v RPL Central Pty Ltd (“RPL”), [2015] FCAFC 177, the Full Court of the Federal Court stated the same thing in the context of an invention that was in substance a scheme. At [96]:- “A claimed invention must be examined to ascertain whether it is in substance a scheme or plan or whether it can broadly be described as an improvement in computer technology. The basis for the analysis starts with the fact that a business method, or mere scheme, is not, per se, patentable. The fact that it is a scheme or business method does not exclude it from properly being the subject of letters patent, but it must be more than that.


It is apparent that there are no hard and fast rules. However, it is useful to go back to the principles that form the basis of patent law in general. Patents are intended to reward technical contributions to society. That word “technical” is critical. Where devices such as computers are involved, it usually requires some mechanism by means of which the operation of the device is improved. In other cases, the contribution must be more than just information.


This aspect of patent practice in Australia is currently in flux. However, all indications are that a more liberal approach to subject matter is not likely in the near future.

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Eagar & Associates Pty Ltd is a wholly-owned subsidiary of Eagar & Associates Holdings Pty Ltd. Each entity is a private incorporated company. Each registered attorney of Eagar & Associates Pty Ltd is bound by the Code of Conduct for Trans-Tasman patent and trade mark attorneys 2018