Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents

[2022] HCATrans 104

[2022] HCATrans 104

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S40 of 2022

B e t w e e n -

ARISTOCRAT TECHNOLOGIES AUSTRALIA PTY LTD ACN 001 660 715

Appellant

and

COMMISSIONER OF PATENTS

Respondent

KIEFEL CJ
GAGELER J
KEANE J
GORDON J
EDELMAN J
STEWARD J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON FRIDAY, 10 JUNE 2022, AT 9.45 AM

(Continued from 9/6/22)

Copyright in the High Court of Australia

KIEFEL CJ:   Yes, Mr Dimitriadis.

MR DIMITRIADIS:   Thank you, your Honour.  Your Honours, at the end of the day yesterday I had completed what I wanted to say about the general principles of manner of manufacture, including the need to consider the claimed invention as a matter of substance not form – those topics are dealt with in paragraphs 3 and 4 of our outline of oral submissions.

May I now address very briefly the topic of the patentability of abstract ideas, which is dealt with in paragraph 5 of our outline.  As explained by the Full Court, including your Honour the Chief Justice, in Grant, the injunction against the grant of patents for abstract ideas has long been established in the case law.  Mr Shavin took your Honours to Grant yesterday and I will not go back to it.

Examples of unpatentable abstract ideas given in Grant included business schemes, commercial and financial schemes, working directions, methods of calculation and the like.  Games, and the rules for playing them, are another form of abstract idea for which patents have long been refused.  The Full Court below in the reasons of Justices Middleton and Perram at paragraph 16 cited a number of decisions in relation to games.

In short, the idea of a game, or game rules, no matter its ingenuity, is not patentable subject matter.  Ultimately games and rules for playing them are another form of abstract idea or scheme.  Just like business methods or schemes, they are intellectual information – it is just that they are directed at giving players enjoyment or encouraging them to play more, rather than other intellectual purposes such as finance or advertising and the like.

GAGELER J:   They are also directed, though, are they not, to physical things.  If you just take a card game, it is – the rules are about how you manipulate the cards.

MR DIMITRIADIS:   Yes.

GAGELER J:   So, it has a physical instantiation at some level.  There must be some deeper policy reason for differentiating those rules and calling them abstract from other sorts of rules that, when combined with the actual physical manipulation, result in a patentable invention.

MR DIMITRIADIS:   We submit that in this sense games and rules for playing them are no different in principle to other forms of schemes, such as a business scheme or an advertising scheme which will operate on physical things.  There will be physical advertisements, for example, or a business scheme may be expressed as relating to the provision of documents for particular purposes.  That involves some physical instantiation, but, nevertheless, the scheme itself – the abstract idea – is not patentable.  Something physical may be, and the question of characterisation requires a distinction being drawn between those two things. 

GORDON J:   Just picking up on that, when you talk about the game here, what are we actually talking about?  What is the bit that you say is the abstract idea or the intellectual idea?  I ask that for this reason:  are we talking about the feature gain, are we talking about the non‑configurable and figurable symbols working, generating something?  What is it we are actually talking about here? 

MR DIMITRIADIS:   Yes.  It applies to all of the features of the game, which we see in integers 1.8 through to 1.12 in the claim.  I will come back to the claim, your Honours ‑ ‑ ‑ 

GORDON J:   I do not seek to take you out of it, but at one point I would actually like you to identify for me what you say is the substance of this abstract idea which is unpatentable. 

MR DIMITRIADIS:   I will do that, your Honour.  In short, it is all of the features of the game - the steps of the game, the provision of symbols on reels and the like. 

GORDON J:   It cannot be 1.1 to 1.12.  So, at some point - not now, when you get to it – I really would be very grateful, with precision, for you to identify it. 

MR DIMITRIADIS:   I will do that, your Honour.  It includes the feature gain, but it is not necessarily limited to the feature gain.  The feature gain is one part of it.

KIEFEL CJ:   Is it 1.8 to 1.12, or 1.7?

MR DIMITRIADIS:   Your Honour, 1.7 to 1.12 is perhaps more accurate.  Integer 1.7 refers to the game controller carrying out the steps in 1.8 to 1.12.  So, 1.8 to 1.12 are the steps of the game if ‑ ‑ ‑

KIEFEL CJ:   I see.

EDELMAN J:   Mr Dimitriadis, is the game of Monopoly patentable?  When I say the game of Monopoly I mean the rules of the game combined with the board and the dice and the car and the dog and so on.

MR DIMITRIADIS:   The rules of the game are not patentable, your Honour, and there may be a question as to whether a physical embodiment used in the implementation of the game is patentable, but traditionally written material has not been patentable subject matter.

EDELMAN J:   I am asking about the whole of the game.  The claim is brought for the board, the dice, the car and the rules, all as part of a package.  Is that claim patentable?

MR DIMITRIADIS:   On the authorities relating to games, yes, it potentially could be, if in substance that is what the invention is directed to, the physical – including the physical embodiment.

EDELMAN J:   If one then accepts that the configurable symbols – if one assumes for the moment that the configurable symbols are novel, and that the configurable symbols were physical symbols rather than electronic icons, would that not be patentable?  How would that be any different from the game of Monopoly?

MR DIMITRIADIS:   Your Honour, if there were a claim directed to a physical thing which had the components necessary defined in the claim in order to produce the configurable symbols, that could potentially be patentable subject matter.

EDELMAN J:   So, the only difference then is the fact that the configurable symbols are digital rather than physical?

MR DIMITRIADIS:   That is not the only difference, your Honour.  That is an important difference, but also this.  When one looks at the claim, there is nothing in the claim over and above an instruction to provide the configurable symbols.  There is no mechanism claimed for providing them.  There is no software, for example.  There are no features of the gaming machine which are defined – which are able to produce the configurable symbols – that is the idea of producing them in effect which is stated in the claim.

GORDON J:   Mr Shavin says in response to that that you do not find the source code in other patentable physical products.  Why is this different?

MR DIMITRIADIS:   One does not need to have the source code.  One does not need a detailed specific embodiment of the code.  But one needs to have in a claim – if it is directed at something other than the idea or the scheme – some physical embodiment of a thing which will carry that scheme out.  We just do not have that here in this claim at any level of specificity.  In our submission, your Honour, it is at the level – using the language of the Full Court in Encompass and Rokt – of an instruction to implement the scheme.  That is what we see in integer 1.7 and 1.8 through to 1.12.

STEWARD J:   Is that word “physical” – is that the thing which may impede a computerised implementation of an abstract idea being patentable?  Is it the lack of physicality?

MR DIMITRIADIS:   The principle established by the cases, we respectfully submit, your Honour, is that the mere implementation of the abstract idea in a computer which will necessarily result in some physical instantiation is not enough.

STEWARD J:   But if it was a physical implementation – gears and levers, such as an analogue slot machine – that is different?

MR DIMITRIADIS: Yes, that is different if – one still needs to characterise the claimed invention, and it may be possible if the claim was framed in such broad terms as not to define any physical thing other than stating “apply configurable symbols in it”, it may well be a scheme in substance.  But if it had components defined in the claim which were configured to produce the configurable symbols, then it may well be a product in the traditional sense, a mechanical thing which would be patentable subject matter.  It comes back to the question of characterisation.

Your Honours, may I now turn to the recent Full Court decisions in this area, beginning with Research Affiliates, which are dealt with in paragraph 6 of our outline.  In our respectful submission, each of these decisions correctly applied the general principles laid out in NRDC and Myriad to the context of computer‑implemented inventions. 

It is worth spending a little time on these decisions because, firstly, they are challenged – or the reasoning in them is – but secondly, they provide a useful illustration, in our submission, of the application of the principles to a range of differently framed claims and, in our submission, demonstrate the coherence and correctness of the principles applied.

Your Honours, the first decision is Research Affiliates, which is in the bundle – Part D at tab 37.  It commences at page 1005 of the bundle.  The claim in suit here was directed to a computer‑implemented scheme for generating a weighted index of a portfolio of assets – such as a share portfolio – and the essence of the patentee’s argument, in this case, was that because it was implemented in a computer – which involved physical effects – and in the transformation of data in the RAM, it involved an artificially created state of affairs of economic significance which was patentable under NRDC.  That approach was rightly, in our submission, rejected by the Full Court.  We understand that Aristocrat accepts, at least, that the result in that case was correct. 

Your Honours, in our friends’ submissions yesterday, some criticism was made of the Full Court’s reliance - or reference to approaches in other jurisdictions, the UK and the US.  In our respectful submission, there was no error on the part of the Full Court in having regard to concepts or approaches deployed in other jurisdictions while recognising legislative differences that exist.  As your Honour the Chief Justice observed, that was done in, for example, the Apotex Case on methods of treatment. 

The Full Court in Research Affiliates was fully cognisant of the legislative differences, and that is acknowledged in a number of paragraphs of their Honours’ reasons, which I will point out to your Honours.  Importantly, also, the concepts drawn from the decisions in other jurisdictions were not applied as rigid rules, but rather in a process of reasoning by the Full Court on the facts of the case in order to assist in drawing a distinction between an unpatentable abstraction and a manner of manufacture. 

Your Honours, in paragraph 1 of the Full Court’s reasons, at the top of page 380 of the FCR, there is the question, which was referred to yesterday, stated by the Full Court in the last sentence:

this raises the question of whether computer implementation of an otherwise unpatentable business scheme is sufficient to make the claimed method properly the subject of letters patent.

So, that is what this decision and the following decisions consider.  Is an otherwise unpatentable business scheme or scheme made patentable by implementing it in a computer? 

Your Honours, in the section dealing with the overseas jurisdictions, without going to the detail, in paragraphs 14 and 15 there is an acknowledgement of the differences between the laws in the other – in those jurisdictions and Australia, and the need to take that into account.  We can also see that in paragraph 23 – acknowledgement of the legislative differences with the UK.  Also, for example, in paragraph 36, and again in paragraph 60, after concluding the discussion of the other jurisdictions and explaining what can be drawn from them.  Then, your Honours, in paragraph 65 at FCR 391, claim 1 is set out.  Your Honours will see it was in form:

A computer‑implemented method for generating an index . . . including –

a number of steps:  accessing data, processing it, accessing a weighting function and applying that function to generate an index.  It is worth noting, also, your Honours, in paragraph 71 at FCR 393, there were claims to your system, a computer system.  It is not set out, but there were computer system claims which claimed a product, a computer system configured to perform that method.  So, there were both types of claim in form – no distinction is drawn between them, quite appropriately. 

Then, at paragraph 102, under the heading “Consideration”, the court’s reasons on the facts of the case appear.  In the second part of that paragraph their Honours noted that the NRDC criteria of an:

artificially created state of affairs of economic significance . . . did not represent a sufficient or exhaustive statement of the –

concept of manner of manufacture.  Research Affiliates, the patentee’s argument is noted in paragraph 103.  In 104 there is a reference to the decision of the Supreme Court of the United States in Alice Corporation, drawing a distinction:

between mere implementation of an abstract idea in a computer and implementation of an abstract idea in a computer that creates an improvement in the computer. 

We note in that formulation the link between implementation and the improvement in the computer.  That is what results in or leads to the improvement in the computer, if there is something in the implementation over and above mere implementation.  In paragraph 106, the Full Court noted that:

The use of a computer necessarily involves the writing of information into the computer’s memory . . . “physical effects” –

and the question was whether that was sufficient to make the claimed method patentable.  In 107, their Honours said:

The determination whether the claimed invention is truly “an artificially created state of affairs” in satisfaction of NRDC is made not by some mechanistic application of the criterion of artificiality or physical effect, but by an understanding of the claimed invention itself.  The invention is to be understood as a matter of substance and not merely as a matter of form.

That is the statement that was approved by your Honour Justice Gageler and Justice Nettle in Myriad.  Then in 109 it is noted that:

The computer that may be utilised –

in the claimed method or system:

is described in general terms, without an indication that any unusual technical effect is utilised.  Although the specification states that “[t]hese computer program products may provide software to computer systems” and that “[t]he invention may be directed to such computer program products”, little further specificity is provided.

Then over at paragraph 114, which is at FCR 402, the Full Court said that:

The effect of Research Affiliates’ submissions is that the mere implementation of any abstract idea or scheme in a well‑known machine is sufficient to render that unpatentable subject matter patentable because it gives rise to an “artificial effect”.  This approach is inconsistent with NRDC and is one of form not substance.

At paragraph 116, the Full Court referred to NRDC again and the statement of referring to:

a separate result achieved by the claimed method that has its own economic utility consisting in the improvement.  

In this paragraph the Full Court observes that here – this is about halfway through – that that economic utility resided in the scheme:

that subject matter is truly the scheme, the idea, the index.  As set out in the specification it may be, and in the claimed method it is, implemented in a computer, but the ingenuity of the inventors, the end result of which is the invention, is directed to the idea, which is not patentable.  That method does not have an artificial effect falling squarely within the true concept of what must be produced by a process if it is to be held patentable -

Then in 118, the Full Court reiterates that:

the significance lies in the content of the data rather than any specific effect generated by the computer.  

The production of the index was not a specific effect:

The computer implementation is an essential integer of the claimed process.  That is, of course, important.

So, their Honours are not disregarding any elements of the claim.  A little further down:

However, in examining whether a claimed invention is properly the subject of letters patent, it is necessary to look not only at the integers of that claimed invention –

i.e. not only form:

but also at the substance of that invention.

Then in paragraph 119, which your Honours were taken to yesterday:

The claimed method in this case clearly involves what may well be an inventive idea, but it is an abstract idea.  The specification makes it apparent that any inventive step arises in the creation of the index as information and as a scheme.  There is no suggestion in the specification or the claims that any part of the inventive step lies in the computer implementation.  Rather, it is apparent that the scheme is merely implemented in a computer and a standard computer at that. It is no part of the claimed method that there is an improvement in what might broadly be called “computer technology”.

We say that process of reasoning is correct and consistent with the need to focus on the invention as a matter of substance, not form.

EDELMAN J:   Mr Dimitriadis, could that process of reasoning be said, at least in the last sentence, to be linked back to the passage at paragraph 104 that you took us to, which is the reference by Justice Thomas in Alice Corporation to the difference between implementation of an abstract idea in a computer and implementation of an abstract idea in a computer that creates an improvement in the computer?

MR DIMITRIADIS:   I think that is fair to say, your Honour.

EDELMAN J:   Would that then be equating the position in the section 18 with section 101 of the USC?

MR DIMITRIADIS:   I would not put it in those terms, your Honour, that it is equating the position.  It is drawing a concept developed in the – drawing on a concept developed in the US jurisprudence, drawing that distinction, but at a broad level ‑ ‑ ‑

EDELMAN J:   That is a jurisprudence which requires as part of the test that Justice Thomas is proposing a new and useful process.

MR DIMITRIADIS:   Yes, it arises in the context of section 101 in the US, but, your Honour, we submit that it is an appropriate criterion to be applied under the case law developed in this country, which is left to the development of the courts under section 18, by the provision that a manner of ‑ an invention must be a manner of manufacture in accordance with section 6 of the Statute of Monopolies, and that is as developed by the case law as we know.  It is legitimate to have regard to concepts drawn from the laws of other jurisdictions and to apply them if they are not inconsistent with the laws of this country, and it is not, we respectfully submit.  Ultimately this is directed at identifying the substance of the invention as distinct from its form and drawing a distinction between the unpatentable abstract idea and something more.

We note in this paragraph, your Honours, that again there is a reference to the improvement in computer technology, but that is linked to in the same series of statements the question of computer implementation and whether or not there is ingenuity or invention in the implementation.  They are two ways ultimately, we respectfully submit, of getting at the same thing.  Is there some invention that arises out of the way in which the abstract idea is being implemented in the computer, or is the only ingenuity in the abstract idea itself?  That is the distinction that has been drawn.

Then, your Honours, may I go to RPL, which is the next case.  This is at tab 31 in Part D, commencing at page 886 of the bundle.  This case concerned a computer‑implemented scheme for gathering evidence relevant to an individual’s competency relative to a recognised qualification standard.  There was a difference in this case in that this method, these steps, were not implemented on a single computer but, rather, required user interaction and the involvement of remote servers and a communications network.

The patentee argued that this was patentable because it involved configuration of suitably programmed computers, a new application of hardware and software, and an improvement in computer technology, and the Full Court disagreed.  Your Honours, may I take you to paragraph 7 first, which is at FCR 29.  Here, the Full Court commences its discussion of the patent application in suit and notes that the field of the invention relates generally to:

assessing the competency or qualification of individuals with respect to recognised standards.

Your Honours will note in the following paragraphs, there is a detailed account of aspects of the description in the patent which is given, which contains a considerable amount of detail on the computer technology used in this patent application.  There are descriptions of the servers, the communications network and the like – and you can see diagrams that illustrate that – and that continues right through until paragraph 35.

In short, this was a patent application in which there was a considerable amount of detail on the computer implementation but ultimately, read in context, it was generic detail – or conventional detail, in the sense that it used conventional computer technology to implement the scheme. 

At paragraph 36, at FCR 37, your Honours will see claim 1 set out.  This was directed to:

A method of gathering evidence relevant to an assessment of an individual’s competency relative to a recognised qualification standard -

including a number of steps.  Your Honours will see they were:

a computer retrieving via the Internet . . . a plurality of assessable criteria . . . 

the computer processing the plurality of assessable criteria . . . 

an assessment server presenting the automatically‑generated questions via the Internet to a computer of an individual requiring assessment; and

receiving from the individual . . . responses -

and, wherever responses included a particular matter, transferring files.  That was the method claim.  There was also a system claim.  Your Honours will see that at paragraph 38 on the next page.  This was directed to a system – a product – a physical thing in form:

A system for gathering evidence relevant to an assessment of an individual’s competency relative to a recognised qualification standard, the system including –

and then some components are set out.  Your Honours will see they included:

at least one server computer having a microprocessor, an associated memory or storage device, and a network interface . . . 

the memory or storage device including a data store -

containing matters relevant to the questions or criteria:

the memory or storage device further including instructions executable by the microprocessor such that the server computer is operable to –

That is halfway through the claim, and then some steps are set out:

present the questions . . . 

receive from the individual . . . responses

and store the responses.  Now, I emphasise that because that form of claim – which is ultimately directed at, in substance, the same thing as claim 1, in form looks like a physical thing, or a product, or a system.  There are some similarities with the form of the claim in this case.  Your Honours will see the first half or so of the claim refers to hardware and software components, the server, memory storage device and then the network interface, for example.

The second half of the claim sets out what was ultimately held to be the scheme, which the server computer was configured or operable to carry out – the scheme being:

present the questions . . . 

receive from the individual . . . responses -

et cetera and store the responses.

Your Honours, can I go to the Full Court’s reasoning on the facts in paragraph 96 at FCR 49?  The Full Court set out a paragraph which has been quoted in the subsequent cases which, in our submission, respectfully, is a very clear and cogent summary of the reasoning that has been applied in these cases:

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.

Just pausing there – we are in the context of inventions that involve the implementation of otherwise unpatentable abstract ideas in computers.  That is the context for this discussion, and that is the sort of case that the Full Court is referring to here.

GORDON J:   That is because there was a concession made that the actual thing itself was unpatentable subject matter and it was really just a question of characterisation of the invention itself.

MR DIMITRIADIS:   It was a question of characterisation – I had not picked up whether a concession was made ‑ ‑ ‑

GORDON J:   It was no dispute that if it was (a) then it was out, if it was (b) it was in.  It was just a question of whether or not it was a scheme, or whether it was.

MR DIMITRIADIS:   Yes, your Honour.  We submit that the same applies in this case.  Our friends do not suggest that if this claim is in substance directed to a scheme or rules of a game, that it is patentable.  They accepted that yesterday.  So, we are in the same territory here and it comes down a question of characterisation, in our submission.  Your Honours, just returning to paragraph 96:

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.

Your Honours, we see in that paragraph a link drawn between the various touchstones or concepts which have been used in these decisions to draw the relevant distinction – including the improvement in computer technology at the beginning of the paragraph, the corollary of that the use of the computer to implement a business method using the computer for its well‑known and well‑understood functions.  That is in the last sentence, and related to both of those things, whether or not there is any invention or ingenuity in the implementation in the computer, also called computerisation, in the second‑last sentence.  They are all related concepts, ultimately getting at the same thing in our submission.  In paragraph 98, the Full Court said that:

It is not a question of stating precise guidelines but of deciding, in each case, whether the claimed invention, as a matter of substance not form, is properly the subject of a patent.

We emphasise that because the Full Court here is not applying rigid rules, it is reasoning on the facts of the case to draw the distinction that I have referred to.  In paragraph 104, FCR 51, the Full Court noted that:

It is stated in the specification, and was accepted by the primary judge, that the method could not be carried out without the use of a computer.  This alone cannot render the claimed invention patentable if it involves simply the speed of processing and the creation of information for which computers are routinely used.  In those circumstances, the claimed invention is still to the business method itself.  A computer-implemented business method can be patentable where the invention lies in the way in which the method is carried out in the computer.  This necessitates some ingenuity in the way in which the computer is utilised -

We say that is a correct statement.  In paragraph 107:

Simply putting a business method or scheme into a computer is not patentable unless there is an invention in the way in which the computer carries out the scheme or method.  

The Full Court then moves on to consider the facts of the case in a little more detail.  In paragraph 110 at FCR 52, their Honours said:

RPL Central –

patent applicant:

does not claim any invention or ingenuity in any program or operation of a computer, or implementation by a computer to operate the method.  Accordingly, the ingenuity of the inventors must be in the steps of the method itself.  The method does utilise the speed and processing power and ability of a computer but there is no suggestion that this is other than a standard operation of generic computers with generic software to implement a business method . . . It is not suggested that the implementation of this idea formed part of the invention.  Indeed, no instruction as to such programming is provided in the specification other than the idea of turning the performance criteria provided by the NTIS into a question by prepending or otherwise inserting a form of words.

Then at 112:

Recognising that the claims are to a method and system comprising a combination of integers –

having regard to the whole of the claim:

it is necessary to understand where the inventiveness or ingenuity is said to lie. 

Their Honours then refer to the claims which were at paragraphs 36 and 38 that I took your Honours to, and said:

it is apparent that, other than the integers providing that the computer processes the criteria to generate corresponding questions and presents those questions to the user, the method does not include any steps that are outside the normal use of a computer.

What their Honours are noting there is that the steps of the method were within the normal uses of computers except for the presentation of the automatically generated questions, which were something different.  That was something new that was presented in this invention, but it was part of the scheme.  Their Honours go on to say, in the last sentence of this paragraph at the top of FCR 53:

It is not suggested that the presentation of the questions or the processing of the user’s responses involve ingenuity themselves or that this constitutes the requisite manner of manufacture.

We conclude that the claimed invention is to a scheme or a business method that is not properly the subject of letters patent.

We respectfully submit that conclusion was correct, and we note that special leave to appeal was refused from this decision. 

EDELMAN J:   The conclusion has to be correct in light of the concession in paragraph 110, that it was never:

suggested that the implementation of this idea formed part of the invention.

Once you concede that the implementation of the idea is not part of the invention, all you are left with is the idea.

MR DIMITRIADIS:   Yes, your Honour.  But we submit that paragraph 110 is the Full Court’s reasoning on the patent application.  In other words, that RPL does not claim, in the patent application, any ingenuity in that kind.  It is not a concession in the running of the case but, rather, the Full Court’s reasoning on the substance of the invention.

Your Honour, we note that back in paragraph 95, at FCR 49, there is a summary of RPL Central’s submissions which included that it was “a new application of hardware and software” and an improvement in existing processes leading to an improvement in computer technology.  So, we say the patent applicant was contending for that reading of the patent application, but it was not accepted by the Full Court.

Your Honours, the next case is Encompass, which is at tab 32 in Part D commencing at page 914.  In this case the claims were directed to a computer‑implemented method and apparatus for displaying information relating to one or more entities and a Full Court of five judges considered the previous decisions, explained how the reasoning in them should be understood ‑ and I will point your Honours to that ‑ and on the case at hand found that the method claims in suit were no more than an instruction to apply an abstract idea, being the steps of the method using generic, which we would also submit could be called conventional, computer technology.

Your Honours, at paragraph [11], at IPR 4, there is a general statement of what the method and apparatus of the invention related to, displaying information relating to entities.  At paragraph [28], at IPR 8, there is a summary of the steps in the method claims, “generating a network representation”, causing it “to be displayed to a user”, “in response to user input commands”, determining a user selected node, et cetera.  The claims themselves, I will not take your Honours to them, they appear in a schedule to the reasons in this publication at the end.

In paragraph [33], at IPR 9, your Honours will see that there is a reference to an apparatus claim.  So, in Encompass, like in RPL and Research Affiliates, there are product claims as well as method claims.  Then in relation to the court’s reasoning, which begins at paragraph [77], IRP 17, could I take your Honours to paragraph [79].  Their Honours refer to the “right question” in NRDC:

“Is this a proper subject of letters patent according to the principles which have been developed for the application of s 6 of the Statute of Monopolies?”

In paragraph [80] their Honours refer to the “question of characterisation” that is required for that purpose.  In [81] their Honours emphasised the need to consider the invention:

as a matter of substance, not merely as a matter of claim form -

and referred to the reasons in Myriad on that point.  Then in [82] and [83] their Honours discuss the NRDC criteria of an:

“artificially created state of affairs of economic significance” –

noting that that was not an exhaustive or determinative test, again referring to Myriad.  A similar point is made in [84] and [85] in relation to the CCOM Case, and that is reiterated both in relation to NRDC and CCOM in [86] and also over the page in [90].  Then in paragraph [91], this is at IPR 20, their Honours said that:

The decisions, and the language used, in Research Affiliates and RPL Central must be understood likewise.  In each case, the Full Court was seeking to describe the conceptual distinction between a manner of manufacture and an unpatentable abstraction.  In each case, the Full Court was explaining that a claimed method that is unpatentable does not change its legal character merely because the method is implemented by the instrumentality of a computer.

That is the distinction that is ultimately being drawn in these cases as a matter of characterising the claimed invention.  In [92] and [93], there is a further emphasis on the need to consider the claimed invention as a matter of substance, not form, and in [94], the Full Court explained that some of the other phrases used in Research Affiliates, such as:

“artificial” or “physical” effects, “technical contribution”–

should be understood in a similar way as seeking to explain:

that the claimed method in that case did not transcend, as a matter of substance, what remained an abstract idea –

In [95], their Honours set out the paragraph from RPL that I took your Honours to, paragraph 96 of RPL, which summarises the principles, and then in [99], their Honours turned to the case at hand – this is at IPR 21:

Turning to the present case, we accept the respondent’s submission that the method claims in suit are, in truth, no more than an instruction to apply an abstract idea (the steps of the method) using generic computer technology.

There is a further explanation of that further down in that paragraph at IPR 22, the last few lines:

But even if for present purposes “entity matching” –

Pausing there, that was one step about which there was some debate as to whether it was part of the claim or not, but their Honours say, even accepting if it:

is taken to be a step in the claimed method, neither it nor the other steps, individually or collectively, amount to anything more than a method in which an uncharacterised electronic processing device (for example, a computer) is employed as an intermediary to carry out the method steps–where the method itself is claimed in terms which amount to no more than an abstract idea or scheme.

Your Honours saw the summary of the method steps that their Honours were referring to, back at paragraph [28], generating a network representation by querying remote data sources, causing it to be displayed, et cetera.  Then, in [100], in response to a submission made by the appellant, Encompass, their Honours observed that:

It is left entirely to those wishing to use the method to devise, and then to implement, a suitable computer program for that purpose.  As we have said, all that the specification teaches is that the processing system be “suitably programmed”.

One does not necessarily need to have software in a claim, but this was in response to a submission that one would have to write software which could not be characterised as “generic” in order to implement the invention – the answer to that was, that was not what was claimed.

Then, in paragraph [101], in response to a submission that the claimed method could be seen as:

a high‑level description of a computer program –

i.e., carry out these steps in a computer, their Honours said:

If approached from this point of view, the method is really an idea for a computer program, it being left (as we have said) to the user to carry out that idea in an electronic processing device.  Indeed, the method, as claimed, is no different in principle to the methods claimed in Research Affiliates and RPL Central.

That conclusion also applied to the apparatus claims in paragraph [102].  So again, we submit that the application of the principles in that case was clear, coherent and correct.

Then, your Honours – this is the last of these cases I want to go to – Rokt.  That appears in Part D at tab 30 commencing at page 854.  In Rokt the Full Court was concerned with a claim to a computer‑implemented method for linking a user to an advertising message by way of an intermediate engagement offer involving a series of what your Honours will see are very detailed processing steps.  The Full Court again emphasised the importance of construing the claim and characterising the invention as a matter of substance, not form, and reiterated a number of the points made in Encompass.  Your Honours, at page 6, FCR 270, the patent application is discussed – paragraph 6:

The Field of the Invention is described in the specification to relate generally to digital advertising systems and methods.

So, this is in the digital advertising space.  There is a discussion of the content of the specification, as there was in the other cases that your Honours saw, including a considerable amount of detail on implementation, again ultimately held to be generic.  At paragraph 33 on page FCR 277, claim 1 is set out, and your Honours will see, as the Full Court observed, it was lengthy, and their Honours added integer numbers to it.  It was framed as:

A computer implemented method for linking a computer user to an advertising message by way of an intermediate engagement offer –

aiming to drive a higher level of engagement with the consumer.  There were various steps set out – “providing computer program code to be delivered”, “gathering engagement data”, “communicating the engagement data . . . to a remote advertising system”, “continuously evaluate the engagement data”.  In response to that, “selecting an engagement offer”, et cetera, and your Honours can see that right through to integer number (12) in the claim.

Then, your Honours, could I go to the court’s consideration of the facts in Rokt, which begins at paragraph 65 at FCR 285.  In particular in paragraph 67 their Honours quoted from paragraph [12] in Myriad in the reasons of the plurality, including your Honour the Chief Justice and Justice Keane, and emphasised the need to construe the claims:

in the light of the specification as a whole and the relevant prior art –

That is over at FCR 286.  In 68 their Honours observed that that inquiry could also:

be re‑cast by asking whether the invention as claimed is a proper subject of letters patent according to –

the right question in NRDC.  In 69 their Honours said that:

The common law conception of whether or not a computer implemented invention is a manner of manufacture requires distinguishing between a patentable subject matter and a mere scheme or plan and its application to computer technology . . . In each case, the Full Court has reiterated the importance of the task of characterising the invention claimed. This is a matter of substance, not merely of claim form:  Encompass at [80], [81].  It requires a definition of the allegedly patentable invention, based on the construction of the claims.

Then in paragraph 74, commencing at the bottom of page 287 of the FCR report, their Honours said:

the task of construing the specification involves arriving at a characterisation of the invention claimed in order to determine whether or not it is in substance for a manner of manufacture.  That involves the application of the common law principles developed to separate patentable inventions from schemes or methods of business -

as laid out in the earlier authorities:

The latter can, in the context of computer implementation, appear to be dressed in the clothes of invention.

That was the case in Research Affiliates, RPL Central and Encompass.  In short, in this field it is very easy to add a lot of detail on computer implementation or computer componentry and hardware into a claim which can have the effect of disguising what is, in truth, a claim to an abstract idea implemented in conventional computer technology so that it looks like something else.  That is what the Full Court is alive to in this paragraph.  Then, your Honours, could I go to paragraph 80 at FCR 289:

In each of Research Affiliates and RPL Central the Court was concerned to describe the conceptual distinction between a manner of manufacture and an unpatentable abstraction that was said to nonetheless be implemented using computer technology. In both cases the Full Court explained that a claimed method that is unpatentable does not change its legal character merely because the method is implemented by the instrumentality of a computer –

referring back to Encompass which made the same point. Then at 84 at FCR 290 the Full Court set out, as it did in Encompass, paragraph 96 from RPL summarising the principles.  In paragraph 91 the Full Court explained the use of the term “generic software” or the references to the “use of computers for their ‘well‑known’ purpose” – that was:

not a finding as to common general knowledge.  Rather, it is a reference to computer technology that is utilised for its basic, typical or well‑known functions.  The means of determining that this is so is primarily by a careful review of the specification in order to ascertain, by construing that document, whether the invention described and claimed is in substance any more than a scheme that utilises computers in such a way.  This is a question of characterising the invention –

What their Honours are saying there is that one arrives at the determination of whether or not there is a use of conventional computer technology for its well‑known and well‑understood functions by construing the claim in the light of the specification as a whole.  As their Honours earlier observed when quoting from Myriad, that needs to be done against the background of the common general knowledge, but one does not need to find in the common general knowledge the particular kind of implementation that is referred to in the claim or the patent. 

One understands from the common general knowledge what hardware and software aspects are conventional, but one then construes the claim in light of the specification to understand whether all that is being done is to use that computer technology for its well‑known and well‑understood functions. 

Then, your Honours, at paragraph 102 at FCR 295, their Honours dealt with the claim in suit.  Their Honours returned to the claim and gave a detailed consideration of its integers in paragraph 103, not discounting or disregarding those integers but having regard to all of them.  Passing down to 107 at FCR 296, their Honours observed that:

the problem that the invention sets out to address is to enhance consumer engagement levels.  The feature of the invention that solves the problem is the provision of an intermediate “engagement offer” –

As their Honours go on to explain, that consisted of the idea to present that intermediate engagement offer prior to the advertisement, and that was a feature of the scheme, or the abstract idea, not a feature of the computer implementation.  In paragraph 108, their Honours said:

There is no doubt that so understood, the invention is a scheme or, more accurately, a marketing scheme.  The question that arises is whether it can broadly be described as an improvement in computer technology; whether the computer is a mere tool in which the invention is performed or whether the invention lies in the computerisation -

referring again to RPL at [96].  Another word for “computerisation” of course is “implementation” – it is linking those concepts together again.  Then in 109, their Honours said that in their view:

nothing about the way that the specification describes the computer hardware or software indicates that either is any more than a vehicle for implementing the scheme, using computers for their ordinary purposes.

Their Honours observed in 110 through to 113 that the hardware and software was generally described with no particular detail on anything specific required to implement this particular scheme.  It was the most general application of computer technology and that applied to the claim and the description.  Then finally, their Honours’ conclusions in paragraph 115, which is at FCR 298.  Their Honours said:

In the present case, the claim amounts to an instruction to carry out the marketing scheme.  The level of abstraction at which it is expressed demonstrates that it does no more than provide a list of steps to be implemented using computer technology for its well‑known and understood functions.  Nothing in the specification suggests otherwise . . . Even if the scheme is new and ingenious, it is not made patentable merely because it can or must be implemented using computer technology.  Rather, the language of the specification and the broad statements of steps required to be taken in claim 1 do no more than locate the scheme in computer technology, using its well‑known and understood functions. The position is not distinguishable from that in Encompass.

Again, we submit, a correct application of the principles and a coherent application of the principles on the facts of that case.

Your Honours, the last case we have referred to in this part of our outline is the Repipe decision.  I will not go to that.  It is a short decision in which the Full Court applied the principles in the other decisions to a claim directed to a means of sharing workplace health and safety information.

At this point, your Honours, before I go to the patent in suit, may I emphasise the importance of the concept of manner of manufacture, and the distinct role that it plays as one of the requirements for a patentable invention.  It has been referred to as a threshold requirement.  It is the first requirement that one sees in section 18(1) and (1A).  It is additional to and precedes the separate requirement of novelty and inventive or innovative step, and the other requirement for patentability.  It is a fundamental requirement because it goes to the question of subject matter.  Is this the kind of thing that may be patentable according to the principles developed for the application of section 6 of the Statute of Monopolies?  If that question is answered in the negative, one does not get to a consideration of the other requirements including novelty, and inventive and innovative steps.

Put another way, unpatentable subject matter such as an abstract idea does not become patentable – and cannot become patentable – even if it is new or novel, or inventive or innovative, and that point was made in various passages I took your Honours to in the Full Court’s decisions.

Additionally, your Honours, as a threshold requirement for patentability, manner of manufacture has an important role to play, having regard to the way in which it is assessed compared with the other requirements for patentability.  I touched on this yesterday, if I may elaborate slightly.

The question of manner of manufacture turns upon the proper characterisation of the invention in the way that has been described and that involves the construction of the claim in light of the specification as a whole and the common general knowledge.  Novelty, on the other hand, turns upon a comparison with specific prior art external to the specification, typically a single publication, and it requires, firstly, knowledge that that prior art exists ‑ it may be obscure – and, secondly, a precise correspondence between the disclosure in that particular piece of prior art and what is claimed.  That is what is needed in short to make out an allegation of lack of novelty.

In many cases, for those reasons, an objection of lack of novelty may not simply be available, or if it is available may be relatively straightforward for an applicant to avoid by amending its claim, for example, to include an additional feature that is not present in the prior art.

Inventive and innovative step do not require such a precise correspondence between a particular piece of prior art and the claimed invention.  But, instead, they require an assessment of the nature and significance of the differences between what is disclosed in the prior art or the common general knowledge and the claimed invention.  For inventive step, that requires an assessment of what would have been obvious to the skilled person in the light of the prior art or the common general knowledge before the priority date, for example, what steps that person would have taken in addressing a particular problem that is addressed by the patent.

Innovative step requires an assessment of the way in which the differences between what is disclosed in the prior art and the claimed invention contribute to the way in which the invention works.  Both of those issues typically involve complex inquiries which depend upon expert evidence and may require resolution of detailed technical questions, and there are a number of cases that have come to this Court dealing with those types of disputes, including the AstraZeneca v Apotex Case which dealt with a method of treatment, and the Lockwood (No 2) Case which dealt with a mechanical invention.  They may be time consuming and expensive to resolve.

Against that background, your Honours, we submit that it is important that manner of manufacture function effectively as a threshold requirement, particularly in the examination of patent applications.  In recent years, as the Full Court decisions to which we have taken your Honours demonstrate, there has been a proliferation of patents, or patent applications, involving the use or deployment of conventional computer technology, and our friends referred yesterday to 1600 patents in the field of gaming.  Now, there is no evidence as to precisely what the claims of those patents relate to but, nevertheless, that point was made by our friends.

The principles of manner of manufacture which have been developed and applied by the Full Court are necessary, in our submission, given the ease with which an unpatentable abstract idea may appear to be “dressed in the clothes of invention” – to use the phrase from the Full Court in Rokt.  It is no answer for Aristocrat, with respect, to contend that manner of manufacture should be understood as a low threshold – that is not an apt description – or to suggest that the filter on patents in this area of computer implementation should be left to the requirements of novelty and inventive step.  For various policy reasons which I have touched on that would not be an appropriate application of the Act.

Your Honours, may I now address claim 1 of the patent in suit, and deal with the application of the principles I have just outlined to it?  This is dealt with in our written outline at paragraph 7.  I took your Honours yesterday to the findings on the common general knowledge in the primary judge’s reasons, and I will not go back to those.  I also showed your Honours the text of claim 1 in the primary judge’s reasons and made some points in relation to it.  I will come back to claim 1 in the patent.

But if I may reiterate, what the findings on the common general knowledge show is that the hardware and software components in the first half of the claim were standard components of gaming machines before the priority date.  All conventional gaming machines had a display, a random number generator, a game controller comprising processor and memory, and the like.  There was evidence before the primary judge that fully supported those findings.

May I go to the specification of the 967 Patent – which is to be read against the background of that common general knowledge.  That is in the appellant’s book of further materials, commencing at page 5 - your Honours, page 4 is the cover page.  If I may ask your Honours to go to the first page of the description proper, which is at page 7 of the appellant’s book of further materials.  I will use the page numbers in the description if I may – so this is page 1, if your Honours have that.  The first thing to note is the title of this patent – “A System and Method for Providing a Feature Game”.  That is the title, and that is what it is directed to.  Immediately the emphasis is on the game to be provided, in particular the feature game, which is part of the game which is defined in the second half of the claim.  In the background of the invention, at line 11, we are told that:

In existing gaming systems, feature games may be triggered for players in addition to the base game.  A feature game gives players an additional opportunity to win prizes, or the opportunity to win larger prizes, than would otherwise be available in the base game.  Feature games can also offer altered game play to enhance player enjoyment.

So, this is directed at - the provision of feature games is directed at enhancing player enjoyment.  Another way in which it was put before the primary judge was increasing player engagement.  As the Full Court observed, ultimately the purpose of that, of course, is to encourage players to play more.  In that sense, what is being dealt with here may be seen as a scheme or a business scheme designed to achieve that outcome.  There is a statement that:

A need exists for alternative gaming systems.

Over on page 3 of the patent, there is a heading at line 17, “Detailed Description of a Preferred Embodiment of the Invention”.  The text that precedes this are the consistory clauses which reflect the claims, and I was not going to take your Honours through that.  In this first paragraph, at line 18, there is a reference to:

example embodiments of gaming systems having components which are arranged to implement a base game, from which may be triggered a feature game.  In these embodiments, symbols are selected from a set of symbols comprising a plurality of configurable symbols and non‑configurable symbols.

We see later in the specification that a configurable symbol is one on which the value of the prize may change.  There is a statement then at line 21:

The gaming system incorporates a mechanism that enables the symbols to be configured.

We do not have any definition of that mechanism in this patent and, perhaps more importantly, it is not defined in the claim.  Then, we are told about an example of a gaming system being configured so:

when six of the configurable symbols are selected for display -

et cetera.  Then, under the heading at line 33, “General construction of gaming system”, we have a description of what is ultimately conventional or generic – to use another term – detail on gaming machines.  This is the part of the description that deals with the components – of hardware and software that form part of essentially all gaming machines before the priority date.  We are told, at line 34, that:

The gaming system can take a number of different forms.

It can be standalone or in a single machine.  Over the page, at page 4, line 15:

Irrespective of the form, the gaming system 1 has several core components.

The description goes on to describe those core components, which are the ones we ultimately see in the claim.  At line 26, the game controller is dealt with.  Your Honours will note the use of language here, it:

typically includes a processor . . . that processes the game play instructions . . . Typically, the game play rules are stored as program code . . . the term “processor” is used to refer generically to any device that can process game play instructions -

et cetera, et cetera, and examples are given.  The language of “typically” and “generically” makes it clear that what we are talking about here is a standard hardware or software component that forms part of gaming machines at the priority date, which have already been referred to in the background to the invention.  Then, at page 5, line 5, part way through that paragraph, we are told that:

The mid-trim . . . also houses a credit input mechanism . . . which in this example includes a coin input chute . . . and a bill collector . . . Other credit input mechanisms may also be employed -

and various examples are given.  Further down that page, page 5, line 23:

The display . . . shown . . . is in the form of a video display unit, particularly a liquid crystal display.

But various other alternatives are given that may be used – again general detail, nothing specific required by the implementation of this invention.  Over the page at page 6, at the top, line 1, the random number generator is dealt with.  It generates random numbers and there is a reference to:

Persons skilled in the art will appreciate that the reference to random numbers includes pseudo‑random numbers.

In other words, this is something within the skill and knowledge of a person skilled in this field.  Down at line 10, we are told that:

Additional hardware may be included as part of the gaming machine . . . or hardware may be omitted . . . buttons or touch screens are typically used –

Again, the language of “typically”:

For example, in some gaming machines a mechanical handle is used . . . Persons skilled in the art –

This is at line 15:

will also appreciate that a touch screen can be used to emulate other input devices -

Again, all generic conventional detail.  Over a couple of pages at page 8, line 5, we are told that:

Persons skilled in the art will appreciate that in accordance with known techniques, functionality at the server side of the network may be distributed -

There is a description there of the possibility of distributing of this functionality over a number of servers or computers.  Then, your Honours, at line 13, there is a heading, “Further detail of gaming system”, and I will not go through the detail of this part of the description, but this relates to the game.  Here, we see a description of the game play, the way in which the wager may be accepted, and the way in which symbols are displayed on reels, and the way in which that may lead to prizes being awarded.  That is dealt with in detail in this part of the specification from page 8 onwards. 

It is readily apparent that that is the focus of this description, that is the focus of the invention – the game, that is provided.  What we had already seen to this point is just generic detail as to what is comprised in a gaming machine.  Then at page 16, the last page of the description, from line 9, it is stated:

As indicated above, the method may be embodied in program code.  The program code could be supplied in a number of ways, for example on a tangible computer readable storage medium –

and examples are given:

Further, different parts of the program code can be executed by different devices . . . Persons skilled in the art, will appreciate that program code provides a series of instructions executable by the processor.

So, the detail of the implementation of the program code is left entirely to the person seeking to implement this patent.  It is not part of the invention.  Then your Honours will see at page 17, claim 1, which we have already looked at in the primary judge’s reasons.  In form, claim 1 is directed to a gaming machine comprising a number of features configured to implement a game.  Your Honours will see the first six integers from line 4 down to line 15.  They are integers 1.1 through to1.6 ‑ ‑ ‑ 

EDELMAN J:   Sorry, which page is this?

MR DIMITRIADIS:   This is page 17 of the specification, your Honour, claim 1.  Your Honours will see “a display’, “a credit input mechanism”, meters for monitoring credits, “a random number generator”, “a game play mechanism including a plurality of buttons”, and a “game controller comprising a processor and memory”.  Those are integers 1.1 to 1.6 and, we submit, as the Full Court held – all of the judges – they were standard conventional components of gaming machines before the priority date.  That, in short, if one draws a line under integer 1.6, in essence what one sees above that save for a reference to configurable symbols at the very end of 1.6, is a conventional gaming machine at the priority date.  Then we have integer 1.7.  This is at line 18.  It reads:

the game controller executing the game program code stored in the memory and responsive to initiation of the play of the game with the game play mechanism to –

and then there are some indented paragraphs.  Those indented paragraphs, beginning with “select a plurality of symbols”, “control the display”, et cetera, they are integers 1.8 through to 1.12.  So, the last one, when the free games end, that is 1.12. 

The game, to answer your Honour Justice Gordon’s question to me earlier, is reflected in integers 1.8 to1.12.  Those are the steps of the game – of the scheme – of the rules of the game.  Symbols will be selected from a first set of reels.  They will be displayed, that will be monitored.  A free game will be triggered in certain circumstances, and then free games will be conducted in a particular way and an award of credits will be made. 

Integer 1.7 is part of that section of the claim because it is the integer which is the preamble to those steps.  It states that:

the game controller executing the game program code stored in the memory and responsive to initiation of the play of the game –

will carry out those steps.  So, in substance, integers 1.7 through to 1.12 deal with the game.  In substance what they are is an instruction in 1.7 to implement a game in 1.8 to 1.12 on the conventional gaming machine which has been defined in integers 1.1 to 1.6.  That is what this claim is directed to. 

So understood, the gaming machine in claim 1 is a conventional gaming machine used for its well‑known and well‑understood functions to carry out an electronic game involving the selection and display of symbols on reels and the awarding of prizes.  The substance of the claimed invention and what distinguishes this gaming machine from others resides in the scheme or rules of the game itself, which is not patentable subject matter. 

We emphasise that we are not disregarding any elements of the claim in that submission – I have just referred to all of them.  It is a question of identifying what the invention claimed is in substance, not merely as a matter of form.

EDELMAN J:   It is a little bit more than just the rules or the scheme of the game, though, is it not, because it is also the pictures and the content and the presentation of the game. 

MR DIMITRIADIS:   That is referred to, but we submit that is nothing – there is nothing in substance in that over and above the rules of the game.  The idea of presenting a symbol to a player – of course it is stated that it will be displayed.  It is no different in principle to some of the claims in the cases to which I have taken your Honours, which involved displaying things to users on computers ‑ ‑ ‑ 

EDELMAN J:   Nor is it any different, in principle, from a piece of cardboard that might have Park Lane and Mayfair painted on it, according to the rules of the game.

MR DIMITRIADIS:   Well, your Honour, it is always necessary to characterise the invention as a matter of substance, not form, and I earlier submitted that one might, in principle, have a physical mechanical invention that may relate to a board game, but it would depend on the nature of the claim.

STEWARD J:   Can I ask you this then?  Is it more than just the rules of the game in the sense that what is described, I think at 1.1 mostly, is the means of having the rules of the game apply in a given game?  So, you have your rules of the game, a random number generation on your configurable and non‑configurable – I understand all of that – and then, you have to find a way of making that manifest itself such that a given individual may freely walk into a room and play that game.

MR DIMITRIADIS:   Your Honour, we submit that it is at the level of abstraction that is framed in this claim.  The rules of the game – it is describing a result, an idea.  Integer 1.11 refers to retaining configurable symbols, replacing them, using the random number generator with symbols from a second set of reels, et cetera.

STEWARD J:   And controlling the display?

MR DIMITRIADIS:   It refers to that, you Honour, but I think, your Honour ‑ ‑ ‑

STEWARD J:  Again, you will need to tell me, because I do not play these games.

MR DIMITRIADIS:   No.  I do not either, to tell your Honour the truth.  But this is describing what the user will see and it is in very general terms stating that that should happen, that the system will be configured to enable that to happen but there is nothing other than that idea.  There is no mechanism for enabling that to happen, which is defined in this claim.  It does not define how one is to select the configurable symbols, other than saying that it is using the random number generator. 

KIEFEL CJ:   It is just leaving it to the programmer.

MR DIMITRIADIS:   Precisely your Honour.  It is leaving it to the person seeking to implement this claim to do what your Honour Justice Steward put to me.  That is left to the person seeking to implement this patent.  It is not given to them in the claim.  In fact, the claim assumes that they will be able to do it because, we submit, it is generic, conventional programming of the kind that is used to implement a game.  All that we have here in this claim as a matter of substance is the idea of the game - put another way – an instruction to implement the game, the scheme, or the rules of the game – in a conventional gaming machine.  As a matter of substance, there is nothing more than that, just as there was nothing more than that in the other Full Court authorities to which I have taken your Honours in the somewhat different context.

KIEFEL CJ:   Mr Dimitriadis, that might be a convenient time for the Court to take its morning break.  The Court will adjourn for 15 minutes.

AT 11.01 AM SHORT ADJOURNMENT

UPON RESUMING AT 11.16 AM:

KEIFEL CJ:   Yes, Mr Dimitriadis.

MR DIMITRIADIS:   Thank you, your Honour.

KEIFEL CJ:   How are we travelling for time?

MR DIMITRIADIS:   Well, your Honour, I had a discussion with my friend and I am aiming to finish by 12 if that is convenient, and I do not think my friend expects to be very long.

KEIFEL CJ:   Thank you.

MR DIMITRIADIS:   Your Honours, I almost finished paragraph 7 of our outline of oral submissions.  There is one reference which we have given in that relevant to claim 1 and the consideration of that claim.  In subparagraph (e) we have given your Honours references to the expert evidence, which is in the respondent’s bundle of further materials.  I will not read you it.  It simply confirms the findings that were made to the effect that the hardware and software aspects of the claim were common to other gaming machines at the priority date.  All of the experts agreed in that.

Your Honours, seen in that light and having regard to my review of the patent specification before the break, we say this case is on all‑fours as a matter of principle with Research Affiliates, RPL, Encompass and Rokt.  It does not matter, in our respectful submission, that the computer in this case is a gaming machine, which is a special purpose computer, in a sense, to be used for the playing of games as opposed to a general-purpose computer, such as a laptop or perhaps an iPhone. 

What matters is that it is a conventional gaming machine or conventional computer of the kind employed in the relevant field at the priority date and that its components were utterly standard as at that priority date.  So, there is no difference in principle by reason of that matter, and that was correctly recognised by the Full Court.

Before I move on to the reasons below, which I will deal with as briefly as I can, may I reiterate the importance, in our submission, of a proper approach to the characterisation of the claimed invention in accordance with Myriad and the recent Full Court authorities?  Critically, as we have submitted, this requires considering the claimed invention as a matter of substance and, in the light of the specification, as a whole in the common general knowledge.  It does not and cannot, in our respectful submission, turn upon the form of the claim. 

If claim 1 of Aristocrat’s patent was differently framed and had read “a game comprising the following features implemented on a conventional gaming machine” and then set out the features in integers 1.8 to 1.12, there could be no dispute that it would not be patentable subject matter.  We would submit that Aristocrat and IPTA intervening must accept that proposition.

Similarly, if the claim had said “the use of a conventional gaming machine to provide a game having the following features” and then set out integers 1.8 to 1.12, again plainly it would not be patentable subject matter.  The same would apply if the claim were framed in other ways such as to a computer‑implemented method of providing a game having the specified features.  In substance, all of those formulations and claim 1 of the patent as drafted are to the same thing.  The question whether the claimed invention is a manner of manufacture cannot depend on differences in form of that kind.

KEANE J:   To test it in another way, if one thinks about other possibilities and all the other games that are played on computers, every different game would be - integers 1.7 to 1.12 would be different, everything else would be the same, but the only thing that distinguishes one from the other is the game.

MR DIMITRIADIS:   Yes, your Honour, and on the approach of our friends, we submit that we understand ‑ ‑ ‑

KEANE J:   Just the same as the only thing that distinguishes one board game from another is the rules.

MR DIMITRIADIS:   Yes, your Honour, and the vice of our friend’s approach and, we respectfully submit, of the primary judge’s approach which I am about to come to, is that because it reached the result that this was patentable because it was a gaming machine, the effect of that is to sanction or allow the patenting of a new set of game rules by the device of framing the claim as a conventional gaming machine…..to implement those rules, and that does not accord with the principles of manner of manufacture and the need to have regard to the invention of matter of substance, not form.  To borrow a phrase from your Honour Justice Gageler and Justice Nettle’s reasons in Myriad, patents are:

granted for inventions, not for the inventiveness of the drafting with which applicants choose to describe them.

Finally, your Honours, before I come to the primary judge’s reasons, we would submit respectfully that regulatory matters, in other words, the need potentially for a game to be adapted to comply with regulatory requirements, are not relevant, that the claim does not deal with that.  The claim is not directed to that and does not instruct the skilled person to do that or how to do it. 

Similarly, another matter referred by our friend, Mr Shavin, that the underlying mathematics of these games are very complicated, that is not relevant either.  The claim is not addressed to the mathematics.  It is left to the skilled person to implement the game, to develop the mathematics required to achieve it in a way that complies with the relevant return to player requirements, for example.

May I now address the primary judge’s approach briefly.  We deal with this in paragraph 8 of our outline.  In short, we submit his Honour erred by adopting the two‑stage inquiry for the assessment of whether a computer‑implemented invention is a manner of manufacture.

Your Honour the Chief Justice asked me yesterday why we said that was erroneous and I gave a short answer, but if I may elaborate now.  The approach which is set out at paragraph 91 of his Honour’s reasons involved two questions:  an initial question as to whether the claimed invention was a mere scheme, followed by a second question which importantly is to be asked only if the first is answered yes; and the second question is whether the computer‑implemented method is one where invention lay in the computerisation of the method.

The effect of that bifurcated approach was to leave entirely the question of the nature of the computerisation or the implementation of the method in the computer to the second stage.  It was not considered as part of the initial question of asking whether – in substance – the claimed invention was directed to a mere scheme. 

There are interrelated reasons why that inquiry was erroneous, in our respectful submission.  First, that distinction, that two‑stage approach, was not adopted in the authorities, and that is for good reason – because one cannot answer the question whether a computer‑implemented invention is a mere scheme or something more without regard to all of the context, including the specification as a whole and the common general knowledge, including the parts that deal with the computer implementation, in particular, without considering whether the implementation involves the use of conventional computer technology for its well‑known and well‑understood functions.       By bifurcating the inquiry, his Honour answered the initial question without considering those matters, which were left to the second question.  That is apparent from his Honour’s analysis. 

Secondly, the approach was also inconsistent, in our respectful submission, with the need to consider the claimed invention as a matter of substance, not form.  That can be seen in his Honour’s application of the two‑stage approach, where in answering the first question no, it is not a mere scheme, his Honour emphasised the hardware and software aspects of the claim in integers 1.1 to 1.6. 

His Honour relied on those features to characterise the invention as a device of a specific character or a mechanism of a particular construction.  Given the two‑stage inquiry, his Honour considered the form of the hardware and software components, in our respectful submission, and relied on them to conclude that the invention was not a mere scheme, and then never considered the nature of those components and the implementation in those components, which was the second part of his Honour’s approach.  We submit that is problematic for the reasons I have identified.

Our friends have also submitted that his Honour made a finding of fact that the invention was not a mere scheme.  We say respectfully it is not a finding of fact or not merely one, it is a question of characterisation of the claim.  In any event, his Honour’s finding resulted from the erroneous application of the two‑stage inquiry, in our respectful submission.  The Full Court reached a different view, of course.

May I now address the Full Court’s approach – this is at paragraph 9 of our outline.  May I identify first some propositions which we submit should be accepted in relation to their Honours’ approach.  I am dealing with all of the Full Court here, save to the extent that I indicate otherwise. 

Firstly, all three members of the Full Court correctly held that the primary judge’s two‑stage inquiry was erroneous and that it led his Honour to mischaracterise the claimed invention.  Secondly, all three members of the court cited the relevant statements of principle from NRDC, Myriad and the earlier Full Court decisions, and endeavoured to apply them.  In doing so, their Honours found that the invention – properly characterised – involved the use of a particular kind of computer – being a conventional gaming machine, or EGM – to implement an abstract idea in the form of a scheme or set of rules for playing a game.  We see that in both sets of reasons. 

In particular, their Honours found that the claimed features of the gaming machine – the hardware and software components were common to other gaming machines, and that what distinguished the gaming machine from others was the scheme or the rules of the game.  Their Honours also noted that it was left up to the person designing the gaming machine to do the programming necessary to implement the game.  So, we see those common threads in both decisions.

Thirdly, in their reasons, Justices Middleton and Perram focused on the question whether the claimed invention, being a computer‑implemented invention, could broadly be described as an advance in computer technology, and I dealt with this yesterday in response to a number of questions from the Court.

We say that did not involve any error or the imposition of a new test.  It is a concept that is clearly derived from and consistent with the other recent Full Court decisions, and it goes hand in hand with the other concepts deployed in those decisions, such as the corollary which is the use of conventional computer technology for its well‑known and well‑understood functions.

Fourthly, in his reasons, Justice Nicholas focused instead on the concept of whether the invention involved the use of computers for their well‑known and well‑understood functions, in other words, the corollary of the improvement in computer technology.  That did not involve any fundamental difference of principle for the same reasons.  His Honour also explained what his Honour meant and what was meant in some of the earlier authorities by use of the term “generic” in that context, effectively meaning conventional, in our submission.

Finally, as to the result, we submit that Justices Middleton and Perram were correct to conclude that the appeal could and should be resolved on the material before the court for the reasons I advanced yesterday, and that is that if, as found, the claimed invention was, in substance, an abstract idea then your scheme or set or rules for playing a game implemented using conventional computer technology or without any improvement in computer technology, it is not a manner of manufacture.  If the only ingenuity resides in the scheme, or set of rules for the game, that cannot confer patentability, and that is the end of the analysis.

As your Honours will have seen, Justice Nicholas would have remitted the matter to consider issues raised in a notice of contention filed by Aristocrat.  We submit that was unnecessary, given the conclusion I have just referred to, and was not appropriate for the reasons referred to by Justices Middleton and Perram, in any event.

May I go to some aspects of the Full Court’s reasons.  In the reasons of Justices Middleton and Perram, briefly, at page 69 of the core appeal book, in paragraph 2 their Honours referred to and cited the relevant principles in this area, including by reference to NRDC and Myriad.  In paragraphs 6 and 7 their Honours set out the claim, having regard to all of the integers and the findings of the common general knowledge which I took your Honours to.

In paragraph 9 their Honours refer to the central question of characterisation that was required to be discerned by reading the terms in light of the specification as a whole and the relevant prior art as stated in Myriad.  Just pausing there, our friends for Aristocrat have criticised the first sentence of paragraph 9 on the footing that they say Justices Middleton and Perram did not treat this as a combination claim.

That is not right.  That is not what their Honours are saying there.  Their Honours clearly recognised it was a combination.  They set that out, and later in their reasons they were very concerned to emphasise that they were having regard to the whole of the claim.  The point being made here is that this was not said to be a claim of uninventive integers which only had inventiveness because of the combination, the reason being that before the primary judge and in the Full Court what was said by Aristocrat – and we get this from the specification – is that there are aspects of the game which were said to be inventive or innovative or an advance or remarkable, including the use of configurable symbols. 

So, this was a claim, as their Honours are pointing out, where parts of it were said to be inventive.  There is nothing wrong with that approach.  Their Honours focused, as your Honours will have seen, on the feature game as being the inventive, innovative aspect of the claim.  That is the only point their Honours were making in the first sentence of paragraph 9 and it is an uncontroversial point.

Then, your Honours, in paragraphs 14 and 15, their Honours noted that one could view the feature game – this is what their Honours were focusing on – in quite two ways, either as:

a definition of a family of games –

so akin to the rules of the game, or:

a method for increasing player interest in an EGM and hence for increasing revenue to the operator -

the latter being more in the nature of a business method or scheme.  Either characterisation is a characterisation of an abstract idea that it does not confer patentability, as their Honours say in the next paragraph.  We say, if one has regard to the feature game in integers 1.10 to 1.12 or particularly 1.11, that is a correct analysis.  The same analysis applies if one has regard to the whole of the game from integers 1.8 to 1.12 as implemented by integer 1.7.  It matters not.  It is the scheme or the rules of the game in either case.  Then, your Honours, in paragraph 18 – I took your Honours to this yesterday so I will be brief – their Honours make the point that:

The implementation of an abstraction –

i.e. an unpatentable abstract idea:

by means of an unspecified computer program to be executed on the computer . . . will not give rise to a patentable invention unless the implementation itself can be seen as pertaining to the development of computer technology rather than to its utilisation –

As a general statement, we submit that is a correct summary of the principles laid out in RPL.  It is one way of putting the matter.  Does it relate to the development of computer technology, rather than its utilisation?  Another way is, is there ingenuity or invention in the implementation in the computer, or, another way, does it merely involve the use of conventional computer technology for its well‑known and well‑understood purposes or functions?

GAGELER J:   Treating the word “computer” as covering any machine in which a computer is embedded.

MR DIMITRIADIS:   Your Honour, yes, but in this sense.  What we are dealing with here is the implementation of an otherwise unpatentable abstract idea.  That is all that is in the claim.  In other words, there is an abstract idea which is implemented in a computer.  I think when your Honour referred to “any machine in which a computer is contained”, a gaming machine is an example.  We submit this is not applicable to claims where there is some other physical embodiment. 

An example that is given by Justice Nicholas is a refrigerator.  We do not say this is directed at that scenario because the refrigerator is a physical thing which is directed at other purposes, doing physical things, not merely processing information and displaying it to a user, which a computer is and a gaming machine is.

GORDON J:   What is the distinction between the fridge and a gaming machine on that kind of analysis?  I am just testing the proposition.  You have the same physical thing doing things.  You put money in, play – entertainment and physically absent a computer you get the reels that Justice Edelman put to you.  What is the distinction?

MR DIMITRIADIS:   The distinction is that the refrigerator is there to perform a particular function of refrigerating food, for example, or drink.

GORDON J:   So, it has a separate function.  Is that the distinction?

MR DIMITRIADIS:   Yes.  A gaming machine is nothing more than a particular kind of computer which is designed for the playing of games.  That is all it is.  It does not have any other function.

KEANE J:   For all that we know, a computer that drives a – or regulates the operation of a refrigerator may have modifications that accommodate the exigencies of the operation of a washing machine or a refrigerator or any other form of appliance.

MR DIMITRIADIS:   Yes.

KEANE J:   But we are not concerned with that here because EGMs are EGMs.

MR DIMITRIADIS:   Yes, your Honour, and the only purpose of an EGM is to implement a game.

KEANE J:   It may be that if you have a new special game, it may be there may be some modification of the computer to accommodate the specifics of the new game.

MR DIMITRIADIS:   Indeed, your Honour, and the majority’s test allows for that.  That would be on their analysis an improvement in the computer or ‑ ‑ ‑

KEANE J:   Well, you probably draw unnecessary fire when you use the word “improvement” because that is always – it is so easy to see that as sounding like novelty.  But it is just talking about an adjustment to the technology to accommodate the new game, the new idea.

MR DIMITRIADIS:   Yes, we respectfully would accept that, your Honour, and we submit that is how the Full Court majority’s references to an improvement in computer technology should be understood.  Then, your Honours, I have dealt with paragraphs 26 and 27 in the Full Court’s majority’s reasons and I will not go back to that.  We say it is simply an application of the concept of the improvement or advance, adaptation in computer technology as being an appropriate touchstone in this area.

In 25 and 28 their Honours found that the primary judge erred in his two‑stage inquiry and we respectfully submit that was correct.  In 29 their Honours emphasised that it was necessary to consider the question of characterisation as a matter of substance, not form – again, a correct statement and application of principle.

Then in the reasoning on the case – again, I referred to this yesterday – there is a detail of consideration in their Honours’ reasons as to whether an EGM is a computer and their Honours concluded that it was, for the reasons their Honours set out.  That was in response to a debate that was raised by Aristocrat before the Full Court.  But, in short, their Honours concluded that, yes, this was a computer‑implemented invention because the EGM was a computer and because the invention was in substance an abstract idea being implemented on that computer. 

The question then was, did that implementation involve any, to use their Honours’ language, advance in computer technology.  Another way of putting it, as your Honour Justice Keane raised, is whether there has been any adaptation of the computer.  Another way of putting it, as Justice Nicholas did, is to ask whether it involved the use of conventional computer technology for its well‑known and well‑understood functions.  Their Honours ultimately concluded that it did not satisfy that requirement for patentability and therefore was in substance a mere scheme without any improvement in computer technology or advance, and therefore it was not a manner of manufacture.  We say that was a correct result.

Their Honours, at the end of their Honours’ reasons, in paragraphs 94 through to 96, dealt with the issue of the notice of contention and why that did not lead to any different result, including procedurally, because the relevant material was not brought forward by Aristocrat before the Full Court to support its notice of contention.

Can I say this?  There is a statement in paragraph 65 of their Honours’ reasons, which our friends have emphasised, where a submission of Aristocrat was noted that the idea of configurable symbols was to be seen as advances in computer technology.  That was rejected.  Their Honours then said they may constitute advances in gaming technology, but they are not advances in computer technology. 

Now, we submit and accept that, of course, a patentable advance in another area of technology may give rise to patentable subject matter.  There is no dispute about that.  But these inventions, or the invention claimed in this case, do not involve any patentable advance in the area of gaming.  The reason for that is what we have submitted which is that the only contribution, or ingenuity, resides in the scheme or rules for the game, which is not patentable subject matter. 

Once one reaches that position and concludes that the invention is in substance an unpatentable abstract idea implemented on a conventional gaming machine, there is no room for patentable subject matter.  So, their Honours’ reference to a potential advance in gaming technology should not be understood to indicate that.  It is clear that their Honours did not consider that there was any patentable subject matter in this claim.

KEANE J:   So, is that just an unnecessary flourish, that last sentence?

MR DIMITRIADIS:   Yes, your Honour.  That they do not constitute patentable advances in gaming technology is very clear, we would respectfully submit.  At the level of abstraction to which the features are referred to in the claim, they are no more than an instruction or an idea, to vary the reels, or use configurable symbols in the way that is referred to here.  There is no technical problem or solution or contribution that is being addressed.

Your Honours, may I deal with Justice Nicholas’ reasons?  They commence at core appeal book page 98.  His Honour referred to the applicable principles, which I will not take time with.  In paragraph 112, his Honour dealt with the use of the term “generic” that I have referred to, and what that means.  In paragraph 116, his Honour, referring to the statements in RPL and Research Affiliates said that they:

recognise that it is not appropriate to adopt an excessively rigid or formulaic approach to the question whether a computer implemented scheme is a manner of manufacture.  This is especially true in situations where there may be no clear distinction between the field to which the invention belongs, and the field of computer technology.  There may well be a technological innovation in the field of technology to which the invention belongs even though it cannot be said that there has been some technological innovation in the field of computers.

We accept that statement, but it does not apply to the facts of this case.  Then in 119, on the next page, his Honour said:

Ultimately, the question is whether what may have begun as a mere scheme, an abstract idea or mere information, has been transformed in some definite and tangible way so as to result in a product or method providing the required artificial effect.  There must be some technical contribution either in the field of computer technology . . . or in some other field of technology to which the invention belongs.

We would emphasise “technical” and “technology” in that statement:

As the authorities to which I have referred make clear, that transformation is unlikely to be achieved by taking an inherently unpatentable scheme and implementing it utilising generic computer technology for its well‑known and well‑understood functionality that does not involve any ingenuity in the way in which the computer is utilised.

We submit that is a correct statement and applied to this case means that there is no patentable subject matter.  The example of “a refrigerator” is given in paragraph 120 that I referred to earlier.

Then his Honour’s reasoning on the facts of the case appears in paragraph 135 and following.  His Honour found that the two‑stage inquiry of the primary judge was erroneous in 135.  We submit that was a correct finding.  His Honour found, in essence, that the gaming machine was a computer in 136 through to 138.  In 138, it:

is either a computer or an apparatus that incorporates a computer.  Whether it is classified as a computer or as an apparatus that incorporates a computer does not alter the analysis in this case because the substance of the invention, as described and claimed, resides in the game program code which embodies a computer implemented scheme or set of rules for the playing of a game -

i.e., there is nothing else we have here.  It is the scheme implemented on a computer and the question is whether that is patentable.  In 139, his Honour found that the game code and the instructions referred to in the claim at that level of abstraction were:

abstract information in the nature of a scheme or set of rules governing the playing of a game.

That is in the last sentence of 139.  In 140:

The question is then whether there is anything about the way in which the game code causes the EGM to operate which can be regarded as having transformed –

that into patentable subject matter.  In 141 his Honour found:

The specification does not identify any technological problem to which the patent purports to provide a solution.  Nor did the expert evidence (insofar as it was made available to us) suggest that the invention described and claimed in the specification was directed to any technical problem in the field of gaming machines or gaming systems.  Rather, as the specification makes clear, the purpose of the invention is to create a new game that includes a feature game giving players the opportunity to win prizes that could not be won in the base game.  Ultimately, the purpose of the invention is to provide players with a different and more enjoyable playing experience.  The invention is not directed to a technological problem residing either inside or outside the computer.

We submit that should be the end of the analysis, consistently with the majority, and that there is no manner of manufacture here.  His Honour goes on to note that there were no specific findings made about the nature of the configurable symbols and the effect produced by them and would have remitted the matter for further consideration of that.  But as his Honour noted in 142:

The fact that a game is made more interesting to players is not in itself such an effect –

a relevant technical effect.  We submit there is no room for any contribution to be made to patentable subject matter by the use of configurable symbols at the level of abstraction that they are referred to in the claim.

KIEFEL CJ:   This arose on a notice of contention, and no evidence was put on to support the notice of contention?

MR DIMITRIADIS:   There was evidence at first instance, as Justice Nicholas points out here.  It was not touched ‑ ‑ ‑

KIEFEL CJ:   But the primary judge did not make any findings on it.

MR DIMITRIADIS:   No.  That is why Aristocrat had a notice of contention in the Full Court.

KIEFEL CJ:   I see.

MR DIMITRIADIS:   Effectively, Aristocrat elected not to prosecute that notice of contention, and submitted that it should be remitted.  Justices Middleton and Perram would not have remitted it – not on claim 1 - this is all about claim 1 – there is a remitter on other claims, which were agreed to be dealt with later.  Justice Nicholas said his Honour would have remitted it.  We submit that is overly cautious in the circumstances, and not appropriate, given that the notice of contention effectively was not prosecuted. 

So, that is what we say about Justice Nicholas’ reasons, your Honours, and we say the same thing about the question of any remitter from this Court.  There should not be one in circumstances where there is a firm foundation for the conclusion that there is no manner of manufacture, and also where the notice of contention was not prosecuted below.  Again, Aristocrat has not brought forward material before your Honours to seek to make out any alternative case. 

Next, your Honours, in our outline of oral submissions, we deal with the topic of other jurisdictions – this is in paragraph 11.  I will address this very briefly.  As we have already submitted, the Full Court in its series of decisions did not wrongly import rules from other jurisdictions but had regard to the approach adopted and concepts which had been formulated in those other jurisdictions. 

It is also apparent, in our submission, that the principles in the other jurisdictions lead, broadly speaking, to similar results in that the mere implementation of an unpatentable abstract idea in a computer is not patentable.  We get that from the Aerotel decision in the United Kingdom, which was discussed in Research Affiliates, that your Honours were taken to by Ms Cochrane.  The approach under Aerotel, without going to it, involves looking at what the inventor has actually contributed as a matter of substance, not form, and if the only contribution resides in patent ineligible subject matter, such as a scheme or a computer program, it does not support a finding of patentability.  There is an analogy with the principles developed by the Full Court there. 

As to the United States position, also dealt with in Research Affiliates, it is not for the Commissioner, in this case, to comment on whether the state of law in another jurisdiction is in chaos or not, as submitted by Aristocrat and FICPI.  What is clear is the law laid out by the Supreme Court in the United States.  We would note that some of the references given in the submissions to comments about confusion in the law in the United States are from lower courts and dissenting judgments.

Alice Corporation is clear.  A unanimous Full Court held that merely requiring generic computer implementation does not transform an unpatentable abstract idea into a patent eligible invention.  That is entirely consistent with the principles developed by the Full Court, and a correct application of principle, regardless of the particular legislative structure in any jurisdiction.

We have also given your Honours references in paragraph 11 to the New Zealand statute.  I will not go to it because of the time, but section 11 deals with computer programs, contains an exclusion – as does the United Kingdom for computer programs as such - in terms provides that if the only contribution is in the computer program, it does not confer patentability, and interestingly includes examples in the structure of the section as to an invention that may be patentable and one that may not be. 

The patentable invention – an example which is given is a washing machine that works in an improved way because of a computer program implemented on a computer that is interacting with that washing machine.  Because it results in a more efficient washing machine and more efficiently washed clothes, it may be a patentable invention.

The other example that is given is one that is more in the nature of a scheme – the execution of a process for completing legal documents in a computer – not patentable subject matter – entirely consistent with the principles developed by the Full Court in Australia.

Finally, your Honours, may I say something in response to the submissions of the interveners, including IPTA but also FICPI.  We respectfully submit that they misconstrue and misunderstand the effect of the Full Court’s approach.  Inventions in other fields of technology are not excluded merely because they involve the use of computers – that is effectively the point that is put. 

The phrase “computer‑implemented invention”, in this context, denotes one that involves only the implementation of an otherwise unpatentable idea – abstract idea – on a computer.  That is the subject matter and the area to which the Full Court authorities are directed and that is what they are concerned with.  Where there is other content in the claim – such as the washing machine or the refrigerator – different considerations will apply.  So, the Full Court’s approach does not exclude those other kinds of inventions from being patentable.

We also submit in answer to both interveners that the Full Court’s approach, in this case in the earlier authorities, is consistent with Australia’s international obligations, including under the TRIPS Agreement, Article 27.  We have explained why in our written submissions.  In short, the TRIPS Agreement provides that patents should be available for inventions without discrimination as to the field of technology.  What is said against us is that, that is what the Full Court’s approach does.  That is incorrect.  It does not discriminate as to the field of technology. 

Importantly, the TRIPS Agreement does not define what an invention is.  It leaves that to those implementing the international obligations to do so.  In giving effect to Article 27, Parliament has imposed a requirement that an invention be a manner of manufacture in accordance with section 6 of the Statute of Monopolies.  That requirement is not in dispute.  It is not said to be inconsistent with Australia’s international obligations.

A claimed invention which is in substance an abstract idea is not, and has never been, a manner of manufacture.  It falls outside the operation of Article 27 of the TRIPS Agreement and no issue of discrimination arises.  That is the point ultimately dealt with by the Full Court’s decision.  The same reasoning applies in relation to the Australia‑US Free Trade Agreement which includes a similar position.

As to the approach propounded by IPTA, which your Honours have been taken to for the assessment of patentability in this area, the effect of it is to say one cannot disregard any essential integer, one has to consider the claim as a whole.  At that level of generality, that is of course not controversial.  But what that approach appears to leave out is the need to consider the invention as a matter of substance not form. 

As I have submitted, we do not disregard any elements of the claim on the approach the Commissioner propounds and the principles laid out by the Full Court, but one takes them all into account and identifies what in substance is the claimed invention – and that is an appropriate approach.

We inferred from IPTA’s submissions at paragraphs 34 to 36 – and your Honours will no doubt look at those – that what was contended was that even Research Affiliates was wrongly decided, or at least wrongly reasoned, because elements of the claims were discounted, and that is not correct, in our respectful submission. 

Your Honours, to the extent that IPTA and FICPI in their written submissions otherwise echoed submissions made by Aristocrat, we rely on the responses that we have given to Aristocrat’s submissions.  Thank you, your Honours.

EDELMAN J:   Mr Dimitriadis, just before you sit down ‑ ‑ ‑

MR DIMITRIADIS:   Yes, your Honour?

EDELMAN J:   ‑ ‑ ‑ can I just ask you one question?  It is not this case, but would there be patentable subject matter or a manner of manufacture in a game that consisted of a claim which focused upon new and novel source code to be implemented into a computer?

MR DIMITRIADIS:   Potentially, yes, your Honour, because the source code could be indicative of the ingenuity and the implementation.  This is how you implement it in the computer.  Here is a means of doing it.

EDELMAN J:   What is the difference then between that and this case, other than arguably absence of novelty of the source code?

MR DIMITRIADIS:   The difference is – well, one difference, and it is the important one - the level of abstraction at which the claim is expressed.  In the claim here, it is expressed as a level of abstraction which is a mere scheme because it is effectively an instruction to apply the steps of the method in the computer and it does not identify anything unconventional or anything that involves any ingenuity in how to do that, just the fact of it.  In your Honour’s example, if the claim did refer to source code and it was novel or ingenious or innovative, there may well be a foundation for concluding a different result.

KEANE J:   And it was disclosed.

MR DIMITRIADIS:   Yes, your Honour.  It would be disclosed.  It would not be left to the skilled person to devise that source code.  Thank you, your Honours.

KEIFEL CJ:   Thank you, Mr Dimitriadis.  Mr Shavin.

MR SHAVIN:   May it please the Court.  May I respond just to the last exchange between my friend and the Court in the context of the level of abstraction in the claim.  We remind the Court of the content of the claim in CCOM and the level of abstraction there is relevantly not different to here, but it was not suggested that in any way that detracted from the patentability of the claim.  Otherwise, I refer in that context to what was said yesterday.  But it is significant to compare the form of those two claims and that is because it is not appropriate to put anything more than the function on to character of the invention in the claim and everything else is something that can be developed by the person skilled in the art.

Now, that leads to a proposition that arose yesterday – raised yesterday by your Honour Justice Keane as to a bespoke adaptation.  As to that we make three responses.  The first of all is the primary judge at 31 where the common general knowledge of EGMs were distinguished by features introduced to provide different ways to engage, and the primary judge at 95, where there was a particular outcome.  Of course, in this case, novelty and obviousness have been accepted by the Commissioner. 

In response to a question raised by your Honour Justice Edelman, we do point to the fact that in the claim it is clear that the game controller is identified as having a number of functional elements which transform this EGM to giving something which the Commissioner has accepted is non‑obvious and is novel.  Thus, it is incorrect to say that there are just rules of the game in the claim – a proposition even the majority below did not accept at paragraph 6 - that it is a machine, and when one looks at the elements, 1.8 to 1.12, what one is seeing is what it is the game controller must do to achieve the outcome.

EDELMAN J:   Well, more than that.  It contains elements that are not part of the rules of the game but are there for the rules to operate upon, like the configurable symbols and so on. 

MR SHAVIN:   We respectfully adopt that.  That, I respond also to Justice Keane, shows how there is a specific adaptation in the sense that your Honour raised this question yesterday.  So that it is, in our respectful submission, an error to simply describe this as a set of game rules.  Can I go back, first of all, to the question of characterisation and make the following four brief propositions.  

Our friends said it is not an EGM by an interaction to implement simply a set of instructions to implement a new game on an EGM.  We say as to that, first, it involves ignoring every integer.  We refer the Court to paragraph 155 in Ariosa to which we referred yesterday.  Secondly, it is in conflict with the majority of the Full Court at 61 which accepted that it is a physical apparatus that is claimed.  That is the invention.  Thirdly, we would embrace the primary judge at 98 based on the expert evidence.  Fourth, it is a combination claim, that you cannot ignore the known integers.  We refer the Court to NRDC at 264, to Sir Keith Aickin in Minnesota Mining v Beiersdorf at 266. 

It is incorrect to suggest that we did not rely upon the elements of the integer – of the combination, including known integers.  We refer to our supplementary materials – there were a series of paragraphs – would the Court pardon me for just one moment, I have just misplaced - in the book of further materials which is at tab – in the applicant’s book of further materials, can we refer to the transcript before the Full Court at pages 38 to 43, particularly 38 and 39, at 45, point 2 and 45, point 13 to 14. 

In each of those pages we asserted to the Full Court that it was important to understand that there was a combination including known integers and new integers, and as the High Court said in NRDC at 264, to which we referred yesterday, it is a mistake to look for invention in every integer.  What is important is the combination. 

The Court will recall I took the Court quite carefully to those passages.  This again underlies the error, we say with respect, that has been adopted by our friends in seeking to say the invention is to be confined to that which they assert to be novel rather than to looking at the whole of the combination, whereas we have seen the hardware features have been adapted to enable the implementation of the new game with a specification in the claim of the characteristics that those features must possess to enable the combination to produce what the Commissioner accepts is a novel and inventive outcome.

Next, we would identify that the submissions advanced by our friends yesterday afternoon that there was no artificially created state of affairs because the relevant effect was the effect on people using the machine, and as a sense of enjoyment was not physical, there was not a relevant satisfaction of the first criteria – page 277 of NRDC.  We say with love and affection that that is just simply wrong, that in fact when one considers pages 276 and 277 of NRDC, what one finds is that the outcome of the method is a product because it consists of an artificially created state of affairs. 

Thus, that which must contain the characteristics of an artificially created state of affairs of economic utility must be the claimed invention.  One does not look outside the specification to speculate on the impact on the user.  It would be like saying that a chair cannot be an artificially created state of affairs because it gives a level of comfort to someone who sits on it.  That is an irrelevant consideration. 

Thus, we say here we plainly have an artificially created state of affairs because we have a machine of a particular characteristic, as the primary judge found, having considered the expert evidence.  It would be like looking at a pharmaceutical composition and saying it makes somebody happy, therefore that is not an artificially created state of affairs.  You look at the pharmaceutical composition.  That is the artificially created state of affairs.  You look at the electronic gaming machine.

The Commissioner has not challenged the patent application on the basis - on the face of the specification it is not novel or inventive.  That is not part of the reason for rejection, nor the basis of it being advanced.  There has been no reliance by the Commissioner in considering the patent application upon a non‑compliance with Microcell or Philips of accepted novelty and inventive step.  There is no basis in our friend’s treatment to support contentions that the face of the specification does not disclose a new invention when the Commissioner accepts that the invention is novel and non‑obvious. 

Now, when one goes back to Microcell, of course, it was a negative test.  Is there an admission on the face of the specification that there is no invention?  That conclusion cannot lie with an acceptance by the Commissioner that the invention is novel and non‑obvious.  It is simply a fundamentally inconsistent conclusion.  The acceptance after prosecution was that there was no ground of objection on the basis of novelty or obviousness.

EDELMAN J:   Well, it is only fundamentally inconsistent because of the way it is characterised.  If the Commissioner characterises it very, very narrowly as involving a scheme or a plan, then it becomes very difficult to say that this particular game, scheme, plan is not novel.  If the Commissioner had characterised it very broadly as a gaming machine, it would have been very easy to say that it is not novel.

MR SHAVIN:   But that characterisation – the way which your Honour has framed it, which reflects what our friends have said – demonstrates the flaw in the characterisation because it ignores the elements of the claim.

EDELMAN J:   Yes, although it may be that neither your characterisation nor the Commissioner’s characterisation are correct.

MR SHAVIN:   Well, I know that your Honour and I have had a disagreement as to whether I have had four – or maybe now five – characterisations, or whether I have in fact had one substantive characterisation.  I do not propose to explore that in reply with your Honour, but I think your Honour understands that the way in which we approach it as a matter of substance, we say although I have used different language  -for which I apologise – the essence of the characterisation has not changed in a material way.

If the level of detail is comparable to that which is demonstrative of a patentable invention – and we do refer the Court to CCOM - we do say there is a physical element, and we refer to the primary judge at paragraph 16.  We refer the Court to the claims considered in CCOM in Burroughs and International Business Machines and, in each of those, in our respectful submission, one finds what one finds here, a characterisation of the functionality. 

The functionality in the combination gives rise to an invention, the invention being neither obvious nor anticipated and that – if, ultimately, when one is looking at the question of detail - is a matter relevant to the satisfaction of the requirements of section 40.  Once one understands that one has, in fact, got a combination – that is, discloses an invention – whether the detail of the invention is described is sufficient is a matter for section 40(2)(a) - go back to sufficiency…..and that is an appropriate place to test that, rather than trying to incorporate it into this threshold – which, as Chief Justice French described in Apotex in citing from the IPAC report, and then particularly from the explanatory memorandum for the 1990 Act – was intended to be a distinction between the fine arts and useful arts, whereas our friend’s submission, we say, seeks to override the explanatory memorandum and say, “No, no, no, the government got it wrong.  The legislature did not mean what it said in the explanatory memorandum” - we have this much higher threshold.

Your Honour Justice Edelman made an observation concerning section 101 and the decision of the United States Supreme Court in Alice, and something that was echoed later in his submissions by our learned friend.  We remind the Court of the terms of section 101, and the emphasis in those terms on an improvement to a machine, which echoes in an improvement to a computer, which we say with respect is no part of the Australian law, derived from section 6 of the Statute of Monopolies.

The way in which that test has been relied upon our friends, that the implementation must show an advance in computer technology – even accepting, as your Honour put to me yesterday, that those words should be described as having a very low threshold rather than the higher threshold that we submitted they might carry - does then raise the question as to what is meant by, and what is the significance of, the question of implementation.

Our friends have submitted that any ingenuity must lie in the implementation of the idea.  There must be an improvement in computer technology, an advance – recognising as has been said that the word “advance” is a loaded word and I am not seeking to draw anything from that.  But NRDC at 264 made it clear that once you have an idea – this came from Lord Justice Fletcher Moulton - it is not an answer to say, but it is easy to implement. 

That is the whole essence of that core discussion by this Court in NRDC that if the invention is in the idea, one has to look at the implementation but not say, once you have the idea to implement it is easy.  It was said to be fundamentally flawed to reject it as an invention if the implementation was not inventive.

Thus it was that we say, with respect, that the principles articulated in the Federal Court in Grant where one is looking to a particular practical application is absolutely the right principle.  No part of that principle incorporates a requirement that there be an inventive advance in the implementation itself.  It simply must be a particular practical application of the invention, of the inventive idea. 

We refer the Court in this context to Lockwood (No 2) - which we both refer to – we apologise, it is not in the joint bundle, (2007) 235 CLR 173 at paragraph 60. What this Court said at paragraph 60 is that:

In a sense, an idea simpliciter cannot be patented, as no patent will be granted except to a manner of manufacture within s 6 of the Statute of Monopolies.  An idea which is part, even the main part, of an inventive step “has got to end in a new method of manufacture”.  When an idea is incorporated into a means for carrying out an idea, the idea itself can be taken into account when considering validity, and inventiveness may repose largely in the idea.  As a matter of language, it is almost inevitable that the subject matter of an invention which involves an improvement to a known combination will be spoken of as “an idea” or “a concept”, as occurred here, and invention may lie in “the idea of taking the step in question”.  To the extent that such language is used, an inventive step can be “having an insight which, although simple, genuinely requires an act of insight rather than a mere development and application of existing ideas”.

Thus, in our respectful submission, the answer to ‑ as was our friend’s constant refrain – but there is no advance in computer technology, no improvement in the computer, no improvement disclosed in the computer implementation, is not the touchstone for the existence of a manner of manufacture.  Where the touchstone can be in the idea of the improved combination even if, as Sir Keith Aickin observed in Minnesota Mining, each element of that combination could itself be known.  As this Court said in NRDC at 264, it is wrong to say of a man that you must show that every element of a combination is an integer.

Our friends said that the two‑stage approach adopted by the primary judge was not supported in the authorities.  We refer the Court back to the early sentences in paragraph 96 of RPL Central to which we took the Court yesterday.  I will not take the Court now, but I simply remind the Court that the first proposition was to find out whether there is a scheme, and then when you have a scheme you consider certain aspects of it.

What the primary judge did was correct.  He adopted what the Full Court had said in RPL and said, well, my starting point is, is there a scheme?  No, there is not a scheme.  Does he have to look at the implementation?  No, he does not, because the dependence on the matter being articulated as a scheme or not as a scheme is not subject to finding invention in the implementation.

Your Honours Justices Gageler, Justice Edelman and Justice Steward observed questions whether the physical apparatus used for playing games, such as games on a board, is patentable subject matter.  We have referred the Court to paragraph 16 of the majority which acknowledged that authorities to the effect that, of course, a physical – a game or set of game rules in an apparatus may indeed be patentable subject matter, and our friends say that in paragraph 23 of their submissions, written submissions, where they note that the rules of a game are not patentable but when reduced into a physical apparatus they can be.  We observed in our reply that, of course, here we have in fact got any concept of the game put into a particularly adapted apparatus as claimed in the way to which we have referred.

There are two other propositions.  Our friends referred to paragraphs 26 and 27 of the majority’s decision which follow this interesting proposed alternative approach.  As to that, we have the following responsive propositions that we would seek to advance.

First, it is plain that paragraph 26 follows paragraph 25 – I do not mean that in a simplistic sense that one is after the other on the page – but it is plain when one considers the content of paragraph 25, that paragraph 26 follows from it rather than from an earlier part of the majority reasons.

The second is that paragraphs 26 and 27 creating a proposed alternative approach are not confined to circumstances where there has been found to be a mere scheme.  In other words, they are not confined to the position where there has been a mere scheme dropped in a computer.  They do apply as an unqualified rule – a rigid rule to any device containing a processor and memory. 

So, they do capture – as Justice Nicholas understood it too – a refrigerator, a washing machine, my piece of equipment for remote brain surgery – each of these can be identified in the approach of the majority as a computer.  In our respectful submission, that proposed alternative approach – there is no relationship to the teachings in this Court of what constitutes a manner of manufacture.

Finally, can I deal with a matter of remitter.  As the Court knows, we have at each point of the process observed that if the Court did not accept our primary submission, which is at this – the approach of the primary judge in characterising the claim as not only a scheme was correct, so the appeal should be allowed on that basis – that in fact there ought to be a remitter.  It was not that we abandoned the remitter below.  The majority noted at paragraph 96:

Mr Shavin submitted that the matters addressed in the notice of contention should be remitted to the primary judge for two reasons:  first, because his Honour – having concluded that Claim 1 was not for a mere scheme – did not embark on the alternative analysis and therefore the Full Court does not have the benefit of relevant factual findings -

The fact is that, as we demonstrated in our written submissions, there was a large volume of evidence directed to showing that a technical problem – that more than one technical problems, at least two sets of technical problems - were addressed by the invention constituted new and inventive technical solutions to technical problems.

There were three witnesses whose evidence was adduced, who were tested orally in concurrent evidence in “hot tubs” and it seems to us that, being cognisant of that, and the Full Court not having the benefit of the factual conclusions of the trial judge, it was not consistent with the approach of this Court in Robinson Helicopter to say that in the absence of the trial judge, the Full Court should embark upon that, not having seen the witnesses but, rather, it was appropriate that those matters be remitted to the trial judge and require him to deal with that part of the case that he found unnecessary to include in his reasons.

So that there was not an abandonment of the notice of contention, but a recognition that, as a matter of appropriate and efficient conduct of the court’s business, it was not efficient for an intermediate appellate court to look at the transcript in the absence of any advice or guidance by the primary judge as to his conclusions, having heard the evidence orally. 

There were two witnesses that were flown from the United States by our friends, who participated in that “hot tub”.  There was cross‑examination over several days of those witnesses and discussion by the witnesses in a concurrent session in the ordinary course.  It appeared to us that the primary judge, not having commented upon that or drawn his conclusions, any Full Court should first have the benefit of that analysis.  So, that is not an abandonment of the notice of contention, but it is a recognition procedurally of what was the most efficient and convenient course for a Full Court to adopt.

EDELMAN J:   Which ground of appeal does this challenge to the Full Court’s conclusions on this point relate to?

GAGELER J:   And, related to that, are you seeking orders other than those you have indicated in your notice of appeal?

MR SHAVIN:   We have not specifically dealt with it, I think, your Honour, when I look at it now.  It was dealt with in the sense that in our submissions we identified that it was appropriate that if the Court did not accept our primary submission, then the approach of the dissent below ought to be adopted, but we have not included that, and I would need to seek leave of this Court to amend the notice of appeal to incorporate an alternative order.

KIEFEL CJ:   Are you able to formulate the terms of that?

MR SHAVIN:  If I could be given two minutes by the Court I would seek to do so.

EDELMAN J:   You would need to formulate an alternative ground as well, and the respondent would need to respond to that.

MR SHAVIN:   Yes.  The substance - if I can respond to that - I can add in additional ground 7.  The substance of course has been debated in the course of this appeal, it having been raised explicitly by us in our principal submissions and dealt with by our friends so that, in our principal submissions ‑ ‑ ‑

GORDON J:    I thought you only dealt with it in your reply at paragraphs 21 to 23. 

MR SHAVIN:   I think you make – on reflection I think that your Honour may be right.  Yes, your Honour is right.  So that it was being dealt with of course during the oral hearing.  I think your Honour is right that the first time it was dealt with in writing was in paragraph 22, and the ground of appeal that we would seek to frame would be a ground that was consistent with the matters that are raised in paragraph 22.  If I had two minutes or so with my colleagues, I could frame that and frame the relief that was sought.

KIEFEL CJ:   Perhaps you should make an application in writing with short written submissions as to why it should be allowed within seven days, and Mr Dimitriadis could respond by submissions in writing within a further seven days.

MR SHAVIN:   I am indebted to your Honour if I could do that.

KIEFEL CJ:   The matter will then be dealt with as part of the determination of the appeal.

MR SHAVIN:   On the papers.  Thank you, your Honour.  We appreciate that.  I think subject to any further way in which we can assist the Court, those are our submissions in reply.

KIEFEL CJ:   Yes, thank you, Mr Shavin.  The Court reserves its decision in this matter and adjourns to 10.00 am on Wednesday, 15 June.

AT 12.30 PM THE MATTER WAS ADJOURNED