Does not compute: patent for computer-implement business methods rejected
Commissioner of Patents v RPL Central Pty Ltd  FCAFC 177
Patents – method of manufacture – business method patents – whether questionnaire and assessment method implemented using computers patentable – patent invalid
The Full Court here (Kenny, Bennett and Nicholas JJ) granted leave for the Commissioner to appeal a decision of Justice Middleton and allowed that appeal. As a result, RPL Central’s application for a patent has been refused on the ground that the claimed invention was not a manner of manufactuer under section 18(1A)(a) of the Patents Act 1990 (Cth). An application for special leave to appeal this decision has been lodged with the High Court.
Section 18(1A)(a) provides that an invention is a patentable invention for the purposes of an innovation patent if the invention, so far as claimed in any claim, is “a manner of manufacture within the meaning of section 6 of the Statute of Monopolies”. The same requirement exists for standard patents under section 18(1)(a) of the Act.
The field of the invention for the patent application relates to assessing the competency or qualification of individuals with respect to recognised standards and is particularly applicable to improving the manner in which recognition of prior learning (RPL) is conducted within the Australian Vocational Education and Training (VET) sector.
As part of the background of the invention, the patent application describes the requirement within the education and training sector to evaluate the existing skills, knowledge and/or experience of an individual in order to assess suitability for enrolment within a particular training course, or to determine whether the individual has satisfied the requirements to obtain a particular qualification and/or exemption for a particular course of study. In order to complete the RPL assessment, the person’s competency is assessed to determine whether he or she is able to meet the requirements, skills, knowledge and/or expectations of a person who has completed the equivalent training course, or who has gained relevant practical experience in the workforce.
The patent application goes on to set out problems with the existing RPL process and states that an objective of the invention is
“to provide an improvement to the existing situation through technological means. In particular, the invention recognises the need for an automated tool that can facilitate the centralised collection of assessment information from individuals, and provide improved access to RPL processes independently of a particular organisation (eg RTO or TAFE) that is chosen to issue a corresponding qualification or Statement of Attainment.”
In summary, claim 1 involves a “method of gathering evidence relevant to an assessment of an individual’s competency relative to a recognised qualification standard, including the steps of”:
- using a computer to retrieve the criteria using the Internet. This involves the user using conventional web-browser software;
- the computer processing the criteria to generate corresponding questions relating to the competency of the individual to satisfy the elements of competency and performance criteria associated with the recognised qualification standard;
- a server presenting those automatically generated questions; and
- the individual answers the questions and uploads documentation from his or her computer.
In summary, claim 1 involves a “system for gathering evidence relevant to an assessment of an individual’s competency relative to a recognised qualification standard, the system including”:
- at least one (server) computer with a microprocessor, a memory or storage device and an interface providing access to the Internet;
- the memory or storage device including a data store which contains questions relating to the competency of the individual to satisfy the criteria associated with the recognised qualification standard. Each question is associated with performance criteria, which are retrieved via the Internet, the questions are automatically-generated by computerised processing of competency and performance criteria;
- the memory or storage device being operable to present the questions via the Internet to the computer of an individual, to receive from the individual a series of responses to the questions, which includes, if he or she chooses to do so, uploading documentation from his or her computer and to store the individual’s responses.
A delegate of the Commissioner rejected the patent application on the basis that it failed to disclose a manner of manufacture. In coming to that conclusion, the delegate found that the claimed invention defines a method for gathering information where the data retrieval, processing and storage of information appear to have no physical effect other than would arise in the computer with standard software and conventional use. The delegate stated that there is no substantial effect or transformation in generating the questions by concatenating text matters and that, 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. He considered that the claimed invention ‘simply monopolises a scheme where the internet and the computer are used for mere convenience for operating the scheme’. He held that the invention defined in claim 1 fell short of having the ‘requisite physical effect in the sense of a concrete effect or phenomenon or manifestation or transformation’.
RPL Central appealed that decision and Justice Middleton upheld the appeal. His Honour concluded that the invention belongs to the useful arts and not to the fine arts and that it does have utility in practical affairs. His Honour’s conclusion that the subject of the patent application produces a useful result was not challenged on appeal. His Honour also concluded that the invention satisfied the “vendible” requirement of the vendible product test as articulated by the High Court in NRDC and concluded that the invention was a product, in that it gave rise to an artificially created state of affairs. His Honour observed that “it is important to note that the involvement of the computer in the invention is described in these claims in such a manner that it is inextricably linked with the invention itself” and accepted RPL Central’s submission that “[O]verall, the invention comprises a method and a system including, in practice, programmed computers operating together and employing data communications within a networked environment.”
Middleton J rejected the Commissioner’s submission that the appropriate way of determining patentability was to ascertain whether the claimed invention could be performed without the use of a computer and, if one were to strip away the computer aspects of claim 1, one would be left with only a method for performing an aspect of the business. The primary Judge said that even if this were true, he did not accept that that was the appropriate way to approach the question of manner of manufacture and that one should not subtract from the invention any aspect of computer implementation and then look to see what remained. His Honour said that this was not consistent with Australian authority and that it failed to give effect to the plain words of the claims of the patent application, which clearly prescribed computer implementation or involvement as an essential feature of the invention – ‘the magnitude of the task performed by the invention (as previously described) and the express terms of the claims themselves mean that the computer is an essential part of the invention claimed, as it enables the method to be performed.’
The Full Court’s reasoning in rejecting the contention that the invention was a manner of manufacture is explained in its opening statement in its consideration of the matter: “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. There must be more than an abstract idea; it must involve the creation of an artificial state of affairs where the computer is integral to the invention, rather than a mere tool in which the invention is performed. Where the claimed invention is to a computerised business method, the invention must lie in that computerisation. It is not a patentable invention simply to “put” a business method “into” a computer to implement the business method using the computer for its well-known and understood functions.” (Emphasis added).
The Full Court rejected the notion that the mere presence of an artificial effect and economic utility, without more, was sufficient to give rise to a manner of manufacture. Similarly, they did not accept that it was sufficient that the scheme could not practically be implemented without a computer, even where the computer was integral to the working of the scheme, where the use of the computer does not involve anything inventive or out of the ordinary. In the present case, the ingenuity was in the scheme itself, not how the computer implemented the scheme.
Their Honours observed that reference to the terminology used in NRDC is apposite, though not conclusive on the question of patentability – therefore, while an invention may involve an “artificially created state of affairs of economic significance” (which would suffice for a large number of cases) that is not conclusive of patentability. Their Honours also noted that this case did not involve a new class of claim involving a significant extension of the concept of manner of manufacture which would necessitate, since the High Court decision in D’Arcy, a consideration of whether the grant of a patent for such a class would have a “chilling effect” on research, or otherwise enliven factors to which the High Court referred.
It will be interesting to see whether the High Court feels it is necessary to delve again into the depths of manner of manufacture.