It’s been a busy year in software patents, all over the world. We’ve had decisions on this issue in Australia, headlined by Research Affiliates in February, and in the US the Federal Circuit split 5:5 in a case concerning an Australian company, Alice v CLS Bank in April. More recently, the New Zealand parliament passed a new Patents Act which excludes computer software “as such” from patentability.

All of those developments rejected or excluded computer software-related inventions from patentability. However, last week, Justice Middleton of the Federal Court handed down a decision in RPL Central v Commissioner of Patents which landed on the other side of the fence – he found a computer-implemented method and system “for assessment of the competency or qualifications of individuals with respect to recognised standards” to be patentable subject matter.

The patent application in question has an interesting history. It is an innovation patent (meaning it can be valid even if the ‘invention’ does not have an inventive step) which originally passed examination by IP Australia. It was then opposed by another party (Myall Australia Pty Ltd) on the grounds that the invention was not novel. The Hearing Officer, however, found that the invention was novel, but that it was not a “manner of manufacture” (the Australian test for patentable subject matter). Under Australian law, for an invention to be a “manner of manufacture”, one of the requirements is that it must involve some physical effect. In this case, the Hearing Officer accepted that there were some physical effects of the claimed invention, but stated that they were not “central to the purpose of the invention”:

While the internet and the computer facilitate the operation of the claimed method by retrieving, generating and conveying information, they are not central to the purpose of the claimed invention… [which] simply monopolises a scheme where the internet and the computer are used for mere convenience for operating the scheme.

This followed a long line of controversial Patent Office decisions in the computer software and business method fields, most notably Invention Pathways Pty Ltd in 2010, which required that the physical effect be “central” to the invention.

Justice Middleton directly tackled this issue in a lengthy judgment. After reviewing the claims of the patent, that explicitly referred to physical hardware that carried out the invention, the Court concluded that there was no express requirement in Australian law that the operation of a computer was “central” to the invention, rejecting the arguments of the Commissioner of Patents, and, in any event, computer implementation was considered to be central to claims of this application.

The effect of this decision could be far-reaching, affecting the validity of many granted patents, and affecting the examination of many pending patent applications that are currently rejected on the basis of the Research Affiliates decision.

However, this won’t be the last word on the issue. Research Affiliates is currently on appeal, and will be heard later this year by a panel which includes Justice Middleton. There are also several other cases on appeal, which address the issue of “manner of manufacture” in Australia.