Patent Investment & Licensing Company - [2018] APO 1

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Investment & Licensing Company [2018] APO 1

Patent Application: 2016204374

Title:Method and Apparatus for Communicating Information about Networked Gaming Machines to Prospective Players

Patent Applicant:                   Patent Investment & Licensing Company
Delegate:  Xavier Gisz
Decision Date:  3 January 2018
Hearing Date:  Written submissions filed on 8 November 2017

Catchwords: PATENTS - examiner’s objections – system and method for encouraging play of electronic gaming machine by providing a recommendation – no patentable subject matter disclosed – application refused.

Representation: Patent attorney for the applicant: Golja Haines & Friend

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2016204374

Title:Method and Apparatus for Communicating Information about Networked Gaming Machines to Prospective Players

Patent Applicant: Patent Investment & Licensing Company
Date of Decision: 3 January 2018
DECISION
The claimed invention, as proposed to be amended, and any alleged invention in the specification, is not for a manner of manufacture.
The defect in respect to manner of manufacture is insurmountable in the present case.
The application is refused pursuant to subsection 49(2) of the Patents Act.
REASONS FOR DECISION
Background

Patent Investment & Licensing Company (the Applicant) filed patent application 2016204374 (the Application) on 24 June 2016. The application is a divisional application based on application 2013203548. That application is based on a US application 13/445,355. The earliest claimed priority date is 12 April 2012.
The present application was subjected to an examination report dated 25 August 2017. In that report the examiner repeated the manner of manufacture objection taken against the parent application (Australian patent application 2013203548). The report also contained a lack of unity objection and an objection under subsection 40(3A).
The examiner’s report also included the following passage:
“My report below includes objections that are equivalent to objections raised in previous examination reports. As there has now been several adverse reports in relation to this subject matter, the application will be referred to a Hearing Officer to consider whether to accept or refuse the application under s49 or to direct amendment under s107. If you wish to be heard on this matter, you have 1 month from the date of this report to request a hearing. Fee item 230 applies.”
The applicant subsequently requested to be heard on 25 September 2017. The hearing was conducted by way of written submissions. Submissions were filed on 8 November 2017. The Applicant filed proposed amendments with the submissions.
The examination of the present application is governed by the Patents Act 1990 (the Act) as amended by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012 (the Raising the Bar Act). Amendments to sections 7, 40 and 49 of the Act apply to the present case as a consequence of Schedule 1, items 55(1)(d) and 55(4)(a), and Schedule 6, item 133(7)(d) of the Raising the Bar Act – the application was made after 15 April 2013.
SPECIFICATION
The specification states that the invention relates generally to the field of networked gaming machines and more specifically to an apparatus and method for communicating information about networked gaming machines to players and prospective players.
The information is presented to the person via a ‘virtual persona’. The virtual persona can provide information such as recommendations on what or how the player should play and information about jackpots and ‘hot’ and ‘cold’ machines. This information provided to the player is based on data collected from the networked gaming machines.
The specification is frank about the motivation for the invention. The following excerpts are from pages 2-4 of the description:
“In many situations in life people find themselves in need of information, advice, or an opinion about a decision. After a decision is made and acted upon, many people find it satisfying to feel affirmed, and this is true regardless of the outcome. For example, if the outcome of the action is not as good as hoped, an empathetic response can be affirming. And of course if there is a successful outcome, some celebration and sympathetic joy is affirming.
One such situation is a decision to purchase goods or services that arises from a need or desire on the part of the prospective purchaser. This need or desire may arise spontaneously or it may be a result of marketing or advertising directed to a specific product or service. Another such situation is gaming. Much of the fun of gaming is anticipation of successful outcomes that result from making decisions according to the rules of the game. And this is true regardless of whether the gaming is for fun, for a fee, or based on a wager that might produce an award.
...
In gaming, especially where wagering is involved, and in purchasing goods and services, most people left to their own feel that they are in a somewhat adversarial role with the casino or seller, respectively. Most people who wager understand that the house has to take a cut of the total of all amounts wagered to stay in business and that the games are designed to generate that casino profit. In short, over time and on average, the players win less than they wager.
In connection with the purchase of goods or services, some sellers are more quality conscious or more ethical than others. This creates a market where some ostensibly equivalent purchases have more value than others. As a result, a consumer cast into a market without advice or knowledge may be apprehensive.
...
What is needed in these situations is a trusted advisor. Sometimes people turn to a friend for advice and support when making these kinds of decisions. A trusted personal friend is about the best advisor to be had. That person knows and understands the person making the decision, how the ramifications of various outcomes might affect the person, and what values the person holds that might influence the decision. A recommendation from such a trusted friend inspires confidence and hope. And regardless of the outcome that flows from the decision, nothing can match the presence of a close friend to provide affirmation, either celebratory when the outcome is good or empathetic and supportive when it is not.
It is possible to create hope and affirmation in circumstances similar to these utilizing a virtual persona. Such a persona may draw on historical information, either about the decision maker, the environment in which the decision maker operates, or both. The persona can inspire trust and confidence in a variety of ways, e.g., displaying the outcomes of past recommendations. In the case of several personae who advise about the same issue, such displayed results can produce competition for the allegiance of the decision maker based on the respective results of the personae. In addition, a persona can monitor outcomes and respond accordingly, either with celebration or with empathy.
What is more, a decision maker can be drawn into the "life" of the personae using computer technologies for analyzing text or other communications generated by the decision maker and responding accordingly. Beyond generation of trust, interest by the decision maker can be built by generating a story about the persona and, in the case of multiple personae, interactions among them. In these ways, a relationship with virtual personae can be built. The decision maker can come to know and appreciate the persona as a source of entertainment, information, hope, and affirmation. In such cases, the persona may be able to exert substantial influence on the acts of a person.”
The specification (as proposed to be amended) comprises 27 claims including two independent claims which are reproduced below:
1. A method for encouraging play of electronic gaming machines that when played generate random game outcomes, some of which result in an award, the electronic gaming machines being on a network of electronic gaming machines, the method comprising:
presenting a virtual persona on an electronic display that is operatively connected to the network;
receiving wagers via the electronic gaming machines from players playing games on the electronic gaming machines responsive to actuation of a wager input device by the player, a said wager input device being associated with each electronic gaming machine;
tracking wagers received on a plurality of the electronic gaming machines via a respective meter associated with each of the electronic gaming machines on which wagers are tracked;
making awards to players of the electronic gaming machines when the game outcome results in an award;
tracking awards made to players of a plurality of the electronic gaming machines via a respective meter associated with each of the electronic gaming machines on which wagers are tracked;
communicating meter data over the network from each of the plurality of electronic gaming machines on which wagers and awards are tracked to a database that is operatively connected to the network, a theoretical hold of each of the plurality of electronic gaming machines being stored in the database, the said theoretical hold comprising the average percentage of all wagers over a period of time that each of said plurality of electronic gaming machines is designed to retain;
determining an actual hold for each of the plurality of electronic gaming machines for a selected time period and storing the actual hold in the database, the said actual hold comprising the difference between the wagers in the meter data and at least the awards in the meter data for each of said plurality of electronic gaming machines;
determining a variance between the theoretical hold and the actual hold for each of the plurality of electronic gaming machines based on the meter data stored in the database, and storing the variance in the database;
ranking each of the plurality of electronic gaming machines based on a function of the respective variance of each of the plurality of electronic gaming machines;
accessing the database;
detecting signals on the network indicating electronic gaming machines being played;
determining which electronic gaming machines the detected signals correspond to;
causing the virtual persona to make a recommendation to play electronic gaming machines responsive to a network communication to the electronic display;
basing the recommendation on a said ranking of each of the plurality of electronic gaming machines determined from the meter data in the database communicated from each of the plurality of electronic gaming machines on which wagers and awards are tracked;
excluding the electronic gaming machines being played, at the time that the recommendation is made, from the electronic gaming machines that are in the recommendation to play;
receiving a wager, responsive to actuation of a said wager input device, from at least one of the players at one of the electronic gaming machines that is in the recommendation to play, after the recommendation is made;
presenting a second virtual persona on an electronic display;
causing the second virtual persona to make a second recommendation to play electronic gaming machines responsive to a network communication to the electronic display;
receiving a second wager, responsive to actuation of a said wager input device, from another one of the players at one of the electronic gaming machines that is in the second recommendation to play, after the second recommendation is made;
determining an average amount of actual jackpots paid by all of the plurality of electronic gaming machines for each of a predefined number of days using the meter data;
determining an accrued current amount of jackpots paid by all of the plurality of electronic gaming machines for the current day using the meter data;
displaying only one of the average amount of actual jackpots paid or the accrued current amount of jackpots paid, on the electronic display responsive to instructions from a microprocessor; and,
transitioning the electronic display from the displayed jackpot amount to display only the other jackpot amount responsive to instructions from the microprocessor to enable a player viewing the electronic display to quickly compare the average amount of actual jackpots paid and the accrued current amount of jackpots paid that are successively displayed on the electronic display.
12. A method for encouraging play of a plurality of electronic gaming machines that when played generate random game outcomes, some of which result in a jackpot, the electronic gaming machines being on a network of electronic gaming machines, the method comprising:
presenting a virtual persona on an electronic display that is operatively connected to the network;
receiving wagers via the electronic gaming machines from players playing games on the electronic gaming machines responsive to actuation of a wager input device by the player, a said wager input device being associated with each electronic gaming machine;
tracking wagers received on a plurality of the electronic gaming machines via a respective meter associated with each of the electronic gaming machines on which wagers are tracked paying jackpots to players of the electronic gaming machines when the game outcome results in a jackpot;
tracking jackpots paid to players of a plurality of the electronic gaming machines via a respective meter associated with each of the electronic gaming machines on which jackpots are tracked;
communicating meter data over the network from each of the plurality of electronic gaming machines on which jackpots are tracked to a database that is operatively connected to the network, a theoretical hold of each of the plurality of electronic gaming machines being stored in the database, the said theoretical hold comprising the average percentage of all wagers over a period of time that each of said plurality of electronic gaming machines is designed to retain;
determining an actual hold for each of the plurality of electronic gaming machines for a selected time period and storing the actual hold in the database, the said actual hold comprising the difference between the wagers in the meter data and at least the jackpots in the meter data for each of said plurality of electronic gaming machines;
determining a variance between the theoretical hold and the actual hold for each of the plurality of electronic gaming machines based on the meter data stored in the database, and storing the variance in the database;
ranking each of the plurality of electronic gaming machines based on a function of the respective variance of each of the plurality of electronic gaming machines;
accessing the database;
detecting signals on the network indicating electronic gaming machines being played;
determining which electronic gaming machines the detected signals correspond to;
causing the virtual persona to make a recommendation to play electronic gaming machines responsive to a network communication to the electronic display;
basing the recommendation on a said ranking of each of the plurality of electronic gaming machines determined from the meter data in the database communicated from each of the plurality of electronic gaming machines on which wagers and jackpots are tracked;
excluding the electronic gaming machines being played, at the time that the recommendation is made, from the electronic gaming machines that are in the recommendation to play;
receiving a wager, responsive to actuation of a said wager input device, from at least one of the players at one of the electronic gaming machines that is in the recommendation to play, after the recommendation is made;
presenting a second virtual persona on an electronic display;
causing the second virtual persona to make a second recommendation to play electronic gaming machines responsive to a network communication to the electronic display;
receiving a second wager, responsive to actuation of a said wager input device, from another one of the players at one of the electronic gaming machines that is in the second recommendation to play, after the second recommendation is made;
determining an average amount of actual jackpots paid by all of the plurality of electronic gaming machines for each of a predefined number of days using the meter data;
determining an accrued current amount of jackpots paid by all of the plurality of electronic gaming machines for the current day using the meter data;
displaying only one of the average amount of actual jackpots paid or the accrued current amount of jackpots paid, on the electronic display responsive to instructions from a microprocessor; and,
transitioning the electronic display from the displayed jackpot amount to display only the other jackpot amount responsive to instructions from the microprocessor to enable a player viewing the electronic display to quickly compare the average amount of actual jackpots paid and the accrued current amount of jackpots paid that are successively displayed on the electronic display.
Allowability of the amendments
The proposed amendments add features to the claims that do not extend beyond the specification as filed. Consequently the proposed amendments comply with s 102(1) and so this decision is be made on the basis of the proposed amendments.
The Examiner’s Objection
The examiner has objected that the present application is not for a manner of manufacture. The objection reads as follows:
“Claims 1-29 do not define a manner of manufacture as discussed in objection 1, 4, 6 & 8 of the previous examination reports.
In response to the previous examination report, the applicant submits that the present application is distinguished from the Research Affiliates case in that the present application is not directed towards the content of the data nor is the claimed invention an abstract idea. Rather, the alleged invention is directed towards providing players with recommendations as to which electronic gaming machines to play. This recommendation is based on determinations made using meter data from the actual electronic gaming machines being played.
In the latest set of amendments, the application amended the independent claim to recite the method in which said recommendation is made. That is:
a theoretical hold of each of the plurality of electronic gaming machines being stored in the database, the said theoretical hold comprising the average percentage of all wages over a period of time that each of said plurality of electronic gaming machines is designed to retain;
determining an actual hold for each of the plurality of electronic gaming machines for a selected time period and storing the actual hold in the database, the said actual hold comprising the difference between the wagers in the meter data and at least the awards in the meter data for each of said plurality of electronic gaming machines;
determining a variance between the theoretical hold and the actual hold for each of the plurality of electronic gaming machines based on the metered data stored in the database and storing the variance in the database;
ranking each of the plurality of electronic gaming machines based on a function of the respective variance of each of the plurality of electronic gaming machines.
The applicant then focused on the IBM case and asserts that the present application is more akin to the situation in the IBM case. Here, it appears that the applicant is asserting what was said in the closing passages of the decision in the IBM case:
Similarly here, the formula is applied to achieve an end, the production of an improved curve image. A method of producing that by computer, which is novel and inventive, is entitled to the protection of the patent laws.
That is, just because the present application is directed towards determining a variance between two or more sets of data and using a ranking system, does not automatically imply that the claim is devoid of patentable subject matter.
On the basis of the above point, I agree. However this is not the only consideration as to whether a claim contains patentable subject matter.
The IBM case is directed towards the production of an improved curve image by a computer. In this situation, it was not the method in which the curve was produced that rendered the claims to be patentable but rather, because it production of said curve resulting in an improvement in the operation of the computer system itself.
The current practice in relation to computer implemented inventions is supported by Research Affiliates LLC v Commissioner of Patents [2014] FCAFC 150, and is consistent with the recent judgement in Commissioner of Patents v RPL Central Pty Ltd [2015] FCAFC 177.
In the Research Affiliates decision, the court first considered the position in other jurisdictions (at [15] to [59]) where the common conclusion was that where a set of claims merely involves "generic" computing instructions as to perform a set of instructions on a computer system, mere computer implementation was not sufficient to confer patentable subject matter. However where the instructions results in a technical effect so that performing the claimed invention results in an improvement in the technology itself, this was found to be sufficient for providing a technical contribution to the art and is therefore patentable subject matter. These considerations were also used in order to determine whether the claimed invention of the Research Affiliates case could be considered to contain patentable subject matter.
Looking at the claimed invention, the applicant asserts that (as distinguished from Research Affiliates), the alleged invention is not in the content of the data, but rather in the recommendations made. However it is not apparent how this differs from the excel file which was generated in Research Affiliates from performing a series of instructions via a computer program. Regardless of how the applicant characterises their alleged invention, one must still look towards the substance of the invention in order to decide if it contains sufficient matter to constitute patentable subject matter
In the Research Affiliates decision:
·Data is "gathered and processed".
·Data manipulation and calculations are performed in a series of "step" in order to select, weight and refine the data
·Once the above calculations are completed, the end result is an excel file.
In the present application:
·Data is "gathered and processed" - from a plurality of electronic gaming machines.
·Data is manipulated and calculations are performed in a series of "steps" (ie. theoretical hold and actual hold) in order to "rank" the data.
·Once the above calculations are completed, the end result is a list of recommendations presented to the player.
While the data in the present application is used in a large gaming establishment and are used for a specific purpose, the applicant has not established how performing the alleged invention results in an improvement of the computer system itself. Additionally (as raised in the previous report), the alleged invention is more appropriately directed towards a business innovation. The fact that the alleged invention is performed using "electronic gaming machines" is not sufficient to differentiate from (for example), if the same method was performed using a conventional computer system. Based on the claimed set of steps, the purpose of ranking the data is to suggest that a player should consider playing a gaming machine they may not have played in the past, or do not play very often. As currently understood, this merely seeks to extend the time a player spends in a gaming establishment.
In order to overcome the present manner of manufacture objection, the applicant is requested to provide amendments or arguments pointing out how the alleged invention results in an improvement of the technology associated with performing the claimed invention. That is, what is the substance of the invention and how does it provide a technical contribution to the art?”
The law

With respect to manner of manufacture, subsection 18(1) of the Patents Act 1990 states:
Subject to subsection (2), an invention is a patentable invention for the purposes of a standard patent if the invention, so far as claimed in any claim:
(a) is a manner of manufacture within the meaning of section 6 of the Statute of Monopolies;…
In National Research Development Corporation v Commissioner of Patents (“NRDC”), [1959] HCA 67, (1959) 102 CLR 252, the High Court provided a statement of the law in respect to manner of manufacture. At page 275, “… a process, to fall within the limits of patentability which the context of the Statute of Monopolies has supplied, must be one that offers some advantage which is material, in the sense that the process belongs to a useful art as distinct from a fine art …- that its value to the country is in the field of economic endeavour”. In discussing the “vendible product” proposition put forward by Morton J in Re G.E.C’s Application, (1942) 60 RPC 1, the High Court in NRDC upheld the validity of a patent for the use of previously unknown properties of a known chemical to effect a new purpose. At page 277:
“The effect produced by the appellant’s method exhibits the two essential qualities upon which “product” and “vendible” seem designed to insist. It is a “product” because it consists in an artificially created state of affairs, discernible by observing over a period the growth of weeds and crops respectively on sown land on which the method has been put into practice. And the significance of the product is economic; for it provides a remarkable advantage … for one of the most elemental activities by which man has served his material needs, the cultivation of the soil for the production of its fruits.”
The High Court though was not laying down a precise formulation that can be applied unthinkingly. In D’Arcy v Myriad Genetics Inc (“Myriad”), [2015] HCA 35, at [23]:
“This Court in NRDC did not prescribe a well-defined pathway for the development of the concept of “manner of manufacture” in its application to unimagined technologies with unimagined characteristics and implications. Rather, it authorised a case-by-case methodology.”
That case-by-case approach must have regard to the substance of the claimed invention, not simply the form of the claim. The point was made succinctly in the Myriad case by Gageler and Nettle JJ. At [144]:
“Whatever words have been used, the matter must be looked at as one of substance and effect must be given to the true nature of the claim.”
In Research Affiliates LLC v Commissioner of Patents [2013] FCA 71 Emmett J, in seeking to apply the NRDC test, stated that (with my emphasis in italicised bold):
For a method to be patentable, it must produce a product in which a new and useful effect may be observed. In the case of computer programs, it is necessary to look to the application of the program to produce a practical and useful result, so that more than mere information is involved. The method of a claimed invention will not be patentable if it does not produce an artificial state of affairs, in the sense of a concrete, tangible, physical or observable effect. Even if there is not a physically observable end result, in the sense of a tangible product, a claimed invention that is a method may nevertheless be patentable if it applies the method in a physical device. In such a case, an artificial state of affairs is produced in the physical device by the claimed method. Thus, a physical effect, in the sense of a concrete effect or phenomenon or manifestation or transformation, is required. It is sufficient if there is a component that was physically affected or a change in state or information in part of a machine. They can be regarded as physical effects. However, if the claimed invention is a mere scheme, an abstract idea or mere information, it will not be patentable as there is no physical consequence (Grant v Commissioner of Patents (2006) 154 FCR 62 at 70-71).
In Grant v Commissioner of Patents [2006] FCAFC 120 ; 154 FCR 62 Justices Heerey, Kiefel and Bennet stated at 29 and 30 (with my emphasis in italicised bold):
“NRDC emphasised the need for the adaptability of the law of patents to cover technological developments. In NRDC the High Court looked to the application of the claimed method. That is similar to the approach of courts in the United States. A product of a method is something in which a new and useful effect may be observed. For claimed computer programs, the courts looked to the application of the program to produce a practical and useful result, so that more than “intellectual information” was involved. CCOM provides a useful analysis of the development of patent law in this context. The underlying principle, developed from the Statute of Monopolies, that business, commercial and financial schemes, which are “intellectual information” are not themselves properly the subject of letters patent, was maintained. As Gyles J concluded in Arrow Pharmaceuticals Ltd v Merck & Co Inc (2004) 213 ALR 182 at [87], cited by the Full Court in Merck at [23], a method that is in the nature of directions for use does not constitute an invention or a manner of manufacture. Neither in Merck, nor here, has some previously unrecognised property of an aspect of the method been discovered.
Contrary to Mr Grant’s submission, the method of his patent does not produce any artificial state of affairs, in the sense of a concrete, tangible, physical, or observable effect. It is quite different from the invention in Catuity, which was a method involving components such as smart cards and point of sale terminals, and produced tangible results in the writing of new information to the Behaviour file and the printing of the coupon (at [128]). While there was not a physically observable end result in the sense of a tangible product, the invention involved an application of an inventive method where part of the invention was the application and operation of the method in a physical device. Within the concept of NRDC an artificial state of affairs was produced, a state of affairs created by the application or effect of the method.”
In Research Affiliates LLC v Commissioner of Patents [2014] FCAFC 150 it was stated at 94:
“When the authorities in Australia prior to and including Grant are considered, a consistent approach emerges as to the relevance of:
·a distinction between a claim to a business scheme and claims to methods which in practice result in a new machine or process or an old machine giving a new and improved result – that is, a distinction between mere intellectual information and a method that affects the operation of an apparatus in a physical form (Grant at [18]);
·the fact that the claimed steps are foreign to the normal use of computers, such as the production of an improved curve image (IBM 2 at 225-226);
·the particular mode or manner of achieving an end result which is an artificially created state of affairs, such as the storage of data as to Chinese characters and retrieval of graphic representations to enable word processing (CCOM at 295);
·whether part of the invention is an inventive method which includes the application and operation in a physical device (Grant at [30]);
·the distinction drawn in Catuity, as explained in Grant (at [24]), between “a technological innovation which is patentable and a business innovation which is not”. In Catuity, Heerey J did not accept that a physically observable effect was necessarily required (at [128]) but the Full Court in Grant expressed the opinion that a physical effect in the sense of a concrete effect or phenomenon, or manifestation or transformation is required (at [32]).
·the fact that a physical effect is required does not make it sufficient to confer patentability;
·the fact that a method may be called a business method does not prevent it being properly the subject of letters patent (Grant at [26] citing Catuity at [125]-[126]);
·the fact that for claimed computer programs, the courts look to the application of the program to produce a practical and useful result, so that more than “intellectual information” is involved (Grant at [29]). A method that is in the nature of directions for use does not constitute an invention or a manner of manufacture in the absence of some previously unrecognised property of an aspect of the method (Grant at [29]).”
In Commissioner of Patents v RPL Central Pty Ltd (“RPL”), [2015] FCAFC 177, the Full Court of the Federal Court stated at [96] and [98]:
“A claimed invention must be examined to ascertain whether it is in substance a scheme or plan or whether it can broadly be described as an improvement in computer technology. The basis for the analysis starts with the fact that a business method, or mere scheme, is not, per se, patentable. The fact that it is a scheme or business method does not exclude it from properly being the subject of letters patent, but it must be more than that. There must be more than an abstract idea; it must involve the creation of an artificial state of affairs where the computer is integral to the invention, rather than a mere tool in which the invention is performed.”
“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”.
The Full Court of the Federal Court in RPL then detailed a number of considerations relevant to the determination and coming from earlier decisions of the Court. Summarising from [99] of RPL:
- It is necessary to ascertain whether the contribution to the claimed invention is technical in nature.
- One consideration is whether the invention solves a “technical” problem within the computer or outside the computer, or whether it results in an improvement in the functioning of the computer, irrespective of the data being processed.
- Does the claimed method merely require generic computer implementation?
- Is the computer merely the intermediary, configured to carry out the method using a computer readable medium containing program code for performing the method, but adding nothing to the substance of the idea?
In Research Affiliates LLC v Commissioner of Patents, [2014] FCAFC 150, the Full Federal Court noted similarities in approach between Australia, the United Kingdom (“UK”) and the United States (“US”). In particular, the UK consideration of the “necessary technical contribution”, in the context of the statutory exclusions existing in the UK, was of relevance to an analysis of a necessary technical or artificial effect under Australian law (see [36], [45]). It follows that the UK cases may provide assistance in the present case.
In Aerotel Ltd v Telco Holdings Ltd; Macrossan’s Application, [2006] EWCA Civ 1371; [2007] RPC 7, the England and Wales Court of Appeal outlined a four-step “technical effect” approach in respect to the question of excluded subject matter under UK law. At [40]:
“(1) properly construe the claim
(2)   identify the actual contribution;
(3)   ask whether it falls solely within the excluded subject matter;
(4)   check whether the actual or alleged contribution is actually technical in nature.”
DETERMINATION OF MANNER OF MANUFACTURE
Discussion of case law
The Applicant made submissions that:
“...[T]he decision in the Aristocrat case [Aristocrat Technologies Pty Ltd v Konami Australia Pty Ltd [2015] FCA 735 (22 July 2015)] is clear that claims directed to “new and useful gaming machines and new and useful methods of operation producing new and improved results” do constitute a manner of manufacture.”
The case law on manner of manufacture, including the Aristocrat case, does not attempt to make blanket statements of patentability about particular fields of endeavour. Instead the case law has derived principles that can be applied to the facts of each case individually.
The Aristocrat case does not imply that “new and useful gaming machines and new and useful methods of operation producing new and improved results” necessarily constitute a manner of manufacture. Instead, it was decided that on the specific facts of that case, the claims were directed to patentable subject matter.
What is the substance of the claimed invention?
The case law is emphatic that it is the substance of the invention that must be considered when determining if an invention is directed to patentable subject matter. Once the substance of the invention is identified, it must then be determined whether it provides a technical contribution to the art.
The claimed invention includes the following steps: tracking the wagers and awards made on each gaming machine, determining the variance between the theoretical hold and actual hold of the gaming machines, ranking the machines based on their variance, recommending machines based on their ranking, determining average jackpots for a predetermined number of days, determining the accrued jackpots for the current day, successively displaying the actual jackpots and accrued jackpots to the player.
Various elements of the invention are considered common general knowledge or, at the very least, well known in the art. For example, the specification as proposed to be amended states at page 3 lines 18 to 20:
“There is prior art in which a map of the casino floor shows hot and cold machines via color codes, enabling a player to find a machine that is currently in the condition preferred by the player.”
Page 3 lines 5 to 7 states:
“For example, it is known in gaming to provide information to players about specific machines that are paying jackpots either above or below par, which is the theoretical hold percentage set by the game's pay table.”
Page 15 line 22 states:
“Player tracking systems using player tracking cards and card readers 46 are known in the art.”
Because these elements of the invention are acknowledged as known, they do not provide a contribution to the art and can be eliminated as possible candidates for where the substance of the invention resides.
As discussed below, the specification provides indications as to where the substance of the invention may reside.
The description states at page 28 lines 17 to 27:
“In one embodiment, the Friday average for each value, total jackpot number and total jackpot amount, is multiplied by a variable that ranges between about 0.8 and 1.2 to provide additional variation in the prediction. At the end of each business day, the daily coin in and coin out are used to calculate the actual hold for the preceding business day for each machine. This is subtracted from the corresponding theoretical hold for each machine. Each machine therefore has a number associated with it that indicates its variance from the theoretical hold for which it was configured. As a result, the machines can be ranked to determine, e.g., the top 10 hottest machines (those holding the least relative to their configured hold) and the top 10 coldest machine (those holding the most relative to their configured hold). These machines can be recommended to players, some of whom will be drawn to the hot machines and some to the cold. Each day, the identity of each recommended machine is stored at Database Server 98.”
Although the specification acknowledges that the concept of identifying hot and cold machines is known, it could be that the particular method of processing data to determine hot and cold machine is where the substance of the invention resides. Alternatively, the information which results from the processing of data could be where the substance of the invention resides.
At page 32 lines 16 to 20 the description states:
“In Fig. 10, Madame Fortuna displays the accrued current dollar amount of significant jackpots casino wide. In the transition between Figs. 9 and 10 the light ball gradually transforms into the golden crystal ball of Fig. 10, which includes the current accrued amount of actual significant jackpots for the day. This enables a viewer to quickly compare the forecasted amount for the day in Fig. 9 with the accrued actual count in Fig. 10.”
This particular presentation of information is a further alternative of where the substance of the invention may reside.
The specification states at page 4 lines 19 to 22:
“The decision maker can come to know and appreciate the persona as a source of entertainment, information, hope, and affirmation. In such cases, the persona may be able to exert substantial influence on the acts of a person.”
This influence on the player’s behaviour provides a yet further alternative of where the substance of the invention may reside.
Summarising the above, I have found that the substance of the invention could reside in any of the following:
1)        The invention resides in the processing of data related to gaming machines
2)        The invention resides in a recommendation and information
3)        The invention resides in the presentation of a recommendation and information
4)        The invention resides in the modification of the behaviour of the player
5)        A combination of any of the above four elements
The Applicant’s submissions are that the substance of the invention is as follows:
“Displaying the two jackpot amounts only one at a time on the electronic display largely, if not entirely, avoids the problem of a player, glancing at the electronic display, potentially confusing one jackpot amount with the other if they were to be displayed simultaneously. In contrast, transitioning the electronic display from displaying only one jackpot amount to displaying only the other jackpot amount results in the two different jackpot amounts being displayed consecutively, but not in an instantaneous manner, on the electronic display. This provides a technical solution that enables players to still quickly view and compare the figures being displayed for the two different jackpot amounts, but in a manner that avoids players potentially getting the two jackpot amounts mixed up, whilst the transitioning process acts as a further visual alert to players that the other jackpot amount is about to be displayed.
Thus, the amended claims 1 and 12 clearly define how the useful effect is produced through operation of the components in the network of electronic gaming machines, and thereby meet even the requirement for manner of manufacture set out in the decision in the Research Affiliates case.
The ingenuity of the inventors, or "substance" of the claimed invention is directed to a method of operating an electronic gaming machine that communicates to a player to assist the player in determining when, on which electronic gaming machine, and how much the player considers should be wagered.”
Although the Applicant’s submissions identify the third of the above identified options as being the substance of the invention – the presentation of information – I will consider all possibilities of where the substance of the invention could reside. This analysis is necessary since I must consider both: a) whether the invention as presently claimed is directed to a manner of manufacture, and b) whether there is anything in the invention as described (and thus could be defined in potential future amendments to the claims) which is directed to a manner of manufacture.
Does the substance of the invention provide a technical contribution?
I consider below whether each of the five above identified potential candidates for the substance of the invention provides a technical contribution.
1) The invention resides in the processing of data related to gaming machines
Generally, an invention involving the processing of data could be a considered patentable if it provides a technical contribution to the art. For example, a claim directed to computer processing apparatus for assembling text in Chinese language characters using a non-Chinese keyboard (CCOM v Jiejing 28 IPR 481; (1994) AIPC 91-079) and the production of an improved curve image by computer (International Business Machines Corporation v Commissioner of Patents (1991) 33 FCR 218) have been held to be patentable.

In this case, the processing of information leads to identification and ranking of “hot” and “cold” machines. The identification of these hot and cold machines of itself, by the Applicant’s own admission, is of no direct value to the player and thus does not provide an improvement to the gaming machine. The description as filed states at page 3 lines 14 to 20 (with my emphasis in underline):
“Many players have a preference for either a hot or a cold machine. If a machine is hot, he or she wants to take advantage and get their share. And some prefer a cold machine, the thinking being that it is overdue for a jackpot. Of course each outcome is random, but many players are superstitious, and casinos are happy to cater to them within the confines of gaming regulations. There is prior art in which a map of the casino floor shows hot and cold machines via color codes, enabling a player to find a machine that is currently in the condition preferred by the player.”
Similarly, calculating average actual jackpots for a predetermined number of days, and the accrued jackpots for the current day are considered to result in information, in itself, of no direct value to the player. Thus, regardless of how the data is processed, it does not provide an improvement to the gaming machine since the processing of data leads to information of no direct value.
Consequently, if the substance of the invention resides in the processing of data related to gaming machines, then this provides no technical contribution to the art.
2) The invention resides in information
Generally, a recommendation or prediction could be a considered a technical contribution to the art. For example, a recommendation or prediction of where to drill oil wells based on seismic data may be considered a technical contribution to the art.
One example of information provided to players is at page 34 lines 1 to 9:
“In this case it is a recommendation to play a cold game, by game name (which may include more than one machine) that is associated with Xandrick’s area of the casino. This could be one or more games randomly chosen from the list of top 10 coldest games in his area or games could be recommended in sequential order. Because the casino system in Fig. 3 can determine in substantially real time which machines are being played, those being played could be removed from the list and a machine that does not have a player could be recommended. Of course the list does not have to be limited to 10; it could be any number from one ranging up to all of the machines in Xandrick’s area – or casino wide.”
Another example of a recommendation is provided at page 31 line 28 to page 32 line 2 where it states:
“In fact, the recommendation need not be tied to the data; it could simply be for a machine, bank of machines, or theme of machines on which the casino would like to generate more play.”
I have found above that a recommendation to play a particular gaming machine, by the Applicant’s own admission, does not provide a direct benefit to the player and thus is not a technical contribution to the art.
Alternatively, it could be argued that that the recommendation provided some other benefit to the player (for example by increasing their enjoyment) or to the casino (for example by increasing the casino’s revenue). However, without any evidence that the claimed invention results in a measurable increase in other benefits (such as the player’s enjoyment), it cannot be found to be a concrete, tangible, physical or observable effect in this aspect of the invention. Furthermore, a method of increasing revenue is intrinsically a scheme and thus is not considered a technical contribution to the art.
Consequently, if the substance of the invention resides in a recommendation or information related to gaming machines, then this provides no technical contribution to the art.
3) The invention resides in presentation of information about jackpots
Any presentation of information characterised solely by the content of that information is non-patentable. However, the presentation of information may be patentable if it results in a technical contribution to the art, for example by providing a practical advantage or solving a technical problem.
The Applicant has made submissions that:
“[Successively displaying the jackpot amounts] provides a technical solution that enables players to still quickly view and compare the figures being displayed for the two different jackpot amounts, but in a manner that avoids players potentially getting the two jackpot amounts mixed up, whilst the transitioning process acts as a further visual alert to players that the other jackpot amount is about to be displayed.”
The corresponding part of the description as filed states at page 36 lines 3 to 13:
“In Fig. 9, Madame Fortuna displays the daily, casino-wide, dollar-amount of predicted jackpots generated as described above. In the transition between Figs. 8 and 9, the amulet enlarges, begins to glow, and rotates, appearing to move toward a viewer of the display. The glow increases until it appears as in Fig. 9 as a ball of light with a prediction on jackpots for the day. In the present implementation, the ball of light rotates, thus creating an attractive visual effect as the radial light rays turn about the center of the light ball.
In Fig. 10, Madame Fortuna displays the accrued current dollar amount of significant jackpots casino wide. In the transition between Figs. 9 and 10 the light ball gradually transforms into the golden crystal ball of Fig. 10, which includes the current accrued amount of actual significant jackpots for the day. This enables a viewer to quickly compare the forecasted amount for the day in Fig. 9 with the accrued actual count in Fig. 10.”
Figures 8-10 are reproduced below:
The Applicant has argued that sequentially displaying the jackpots is a solution to the technical problem of “players potentially getting the two jackpot amounts mixed up”.
There is nothing in the description that supports the assertion that player confusion is a technical problem that needs to be overcome and very little to support the assertion that successively displaying and transitioning between jackpots provides a practical advantage or technical solution. Indeed, the entire alleged problem to be overcome and the alleged technical solution rests on the sentence stating:
“This enables a viewer to quickly compare the forecasted amount for the day in Fig. 9 with the accrued actual count in Fig. 10.”
The speed or clarity in which the player can compare forecast and accrued jackpots when the jackpots are presented successively (and with a transition) is not compared with any other way of presenting this information. Without evidence or a comparative example, the assertions made in the submissions are not persuasive. Furthermore, even if I were to accept that the information is presented to the player in a clearer manner, I would not be satisfied that this achieves a technical effect in this case since, as I have found above, the information is of no direct benefit to the player.
I consider that the successive (and transitioning) display of jackpot information is an aesthetic choice and is characterised solely by the content of the information; it is a mere presentation of intellectual information.
Consequently, if the substance of the invention resides in the presentation of a recommendation and information related to gaming machines, then this provides no technical contribution to the art.
4) The invention resides in modification of player behaviour
Generally, modification of a person’s behaviour could be considered a considered a well-defined result. For example, a method of eliminating obsessive compulsive behaviour from a person afflicted with such a condition may be considered a technical contribution to the art.
One example of behaviour modification is provided at page 4 lines 19 to 22:
“The decision maker can come to know and appreciate the persona as a source of entertainment, information, hope, and affirmation. In such cases, the persona may be able to exert substantial influence on the acts of a person.”
Another example is provided at page 37 lines 10 to 15:
“In one aspect, the personae can communicate with enrolled players, or players who have otherwise provided contact information, who are not currently in the casino. For example, the hot and cold machine information could be provided to players not currently in the casino via text, email, dialog box, or otherwise. Similarly, characters could offer incentives to such players to come to the casino or to initiate online gaming, if permissible when casino traffic is low or whenever the casino operator wishes to encourage such players to gamble.”
I do not consider that allegedly modifying a person’s behaviour in playing a gaming machine in this case provides a technical contribution for the following reasons.
Firstly, there is no evidence that the information provided to the player actually changes their behaviour. Secondly, even if there were evidence that it had a measurable effect on players then that effect would have to be shown to be of practical utility to be considered to make a technical contribution to the art. For example, if the result was a measurable and significant reduction in compulsive behaviour as determined through rigorous scientific experiments, then this might be considered to be of practical utility.
Consequently, if the substance of the invention resides in the modification of player behaviour, then this provides no technical contribution to the art.
5) The invention resides in a combination of the above
I have found that none of the ways to view the substance of the invention provide a technical contribution to the art. Furthermore, I cannot see how any combination of those ways of viewing the substance of the invention could somehow result in a technical contribution to the art.
Conclusion on the substance of the invention
I have found that none of the possible ways to view the substance of the invention, either individually or in combination, provide a technical contribution to the art. An invention that does not provide a technical contribution to the art cannot be an invention that is a manner of manufacture under s 18(1)(a).
Conclusion
I have found the invention, both as defined in the claims and as described in the specification, is not a manner of manufacture. Consequently, I conclude the defect in respect to manner of manufacture is insurmountable in the present case. I refuse the application.
Xavier Gisz
Delegate of the Commissioner of Patents