Business method patents have been deemed to be patentable in Australia for over 20 years. Although the requirements to successfully obtain such a patent are continuously being clarified and are thus constantly evolving, we can advise with certainty that there was no substantial change in the interpretation of the law following on from the recent Federal Court of Australia Judgment in Research Affiliates LLC v. Commissioner of Patents [2013] FCA 77.

In brief, the Patent Application concerned a method of using a computer to generate a financial Index. The steps included: accessing data; processing the data to identify appropriate assets; accessing a weighing function of the assets; and applying the weighing function to generate the Index. Interestingly, the weighing function “parameters”, which were defined in the broadest embodiment of the claimed invention to generate the financial Index, were defined in the negative. That is, the claim defined the parameters that were not used to form the Index, the effect being that the Applicant sought a patent for generating a financial Index using every possible known parameter bar those specifically defined in the Claims.

In this Judgment, the Court only considered whether or not the Application contained patentable subject matter and determined that the claimed invention was directed to a method of generating a set of data using a computer for a purpose for which it is known to be suitable and in which the generation of the data could have been carried out manually without the use of a computer. Factors that were considered to be detrimental to this Application were the lack of information in the Specification as to how the data is to be accessed, how the assets are to be identified, and how the weighing function is to be accessed and applied to each asset. We consider that if a full and frank disclosure had been provided in the Specification, and the Claims had been drafted in such a way that the method required a computer using an algorithm to transform data into useful data (i.e. the Index), which was then used to make a financial transaction, then the likelihood of the method being considered to be patentable subject matter would have been much higher.

The above Judgment has clarified that a mere scheme of implementing a computer to generate data that “could readily have been carried out manually” will not be sufficient to satisfy Australia’s “manner of manufacture” patentability requirement.

Accordingly, in order to obtain a business method patent in Australia, the invention must be directed to a method that not only requires a computer-implemented method, but also requires that the computer must transform the input data into new data, which is the socalled “artificially created state of affairs” used in Australian parlance, and that it must be a method in which a practical application of economic significance is achieved as a result thereof.

In Grant v. Commissioner of Patents [2006] FCAFC 120, the Courts rejected the idea that an invention required the application of science or technology. It is therefore considered that non-computer-implemented business method patents should similarly be obtainable, if the claimed method clearly defines a novel way of transforming input data or information into new and useful information, where that “transformation” must be a significant and central step to the operation of the invention, and where a practical application of economic significance is achieved.