Research Affiliates, LLC. - [2011] APO 101

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Research Affiliates, LLC. [2011] APO 101
Patent Application: 2010236045.

Title: Valuation Indifferent Non-Capitalization Weighted Index and Portfolio.
Patent Applicant: Research Affiliates, LLC.

Delegate:  M. G. Kraefft
Decision Date:            5 December 2011
Hearing Date:              Right to be heard waived - written submissions responsive to examiner’s reports

Catchwords: PATENTS – maintenance of examiner’s objection – alleged invention for generating an index of assets – whether a manner of manufacture – business method or system – application refused.

Representation: Applicant: Shelston IP.

IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Innovation Patent: 2010236045.

Title: Valuation Indifferent Non-Capitalization Weighted Index and Portfolio.
Patent Applicant: Research Affiliates, LLC.

Decision Date: 5 December 2011
DECISION
Claims 1-30 are not for a manner of manufacture and consequently do not comply with subsection 18(1)(a) of the Patents Act.
There is also nothing of substance in the specification as a whole from which claims to patentable subject matter could be drafted.
The application is refused.
REASONS FOR DECISION
BACKGROUND

Robert D. Arnott filed patent application 2010236045 on 27 October 2010. As a result of an assignment, the application is now proceeding in the name of Research Affiliates, LLC (“Research Affiliates”).
The Patent Office has issued three examination reports during the examination stage. Throughout these reports, the examiner has maintained an objection that the claims of the application are not for a manner of manufacture. Research Affiliates has twice proposed amendments under Section 104 of the Patents Act to the description and claims during the examination stage. However the issue of whether the claims are for a manner of manufacture has remained unresolved.
Application 2010236045 is a divisional application of application 2005213293. The latter application has been refused. See my decision Research Affiliates, LLC [2010] APO 31. That decision is presently on appeal to the Federal Court.
In respect to application 2010236045, in a letter dated 6 October 2011, Research Affiliates notified the Commissioner that it did not wish to be heard on the remaining objection and, in the event that the objection was maintained, requested that the Commissioner exercise the power under Subsection 49(2) of the Patents Act to refuse the application. In the event of refusal, Research Affiliates also indicated in that letter that it intended to rely on its right to appeal to the Federal Court, presumably to join the present divisional application with the parent application 2005213293 already before the Federal Court.
SPECIFICATION
The specification of application 2010236045, as filed, describes the field and background of the alleged invention in essentially the same terms as in the parent application. See [4] and [5] of the Research Affiliates (supra) decision for a brief summary.
The alleged invention is described in the body of the specification in terms of consistory clauses reflecting the broadest claims as filed. The alleged invention pertains to a method or system for passive investing that is based on indexes which are built with metrics other than market capitalization weighting, share price weighting or equal weighting. Examples of the metrics used…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

AGLC: Research Affiliates, LLC. [2011] APO 101
Case: [2011] APO 101
Decision Date: 5 December 2011

CaseChat Overview and Summary

Research Affiliates, LLC, a patent applicant, sought to patent a method for generating an index of assets that uses metrics other than market capitalization. The case before the Australian Patent Office involved the patentability of a method and system for passive investing based on indexes compiled using various financial and non-financial metrics. The applicant, Research Affiliates, LLC, filed an application (2010236045) which was a divisional application of an earlier refused application (2005213293). The primary legal issue was whether the claims in the application were for a manner of manufacture, as required by subsection 18(1)(a) of the Patents Act. The applicant waived its right to be heard, requesting that the application be refused if the objection was maintained. The court examined the claims and the specification to determine if they complied with the statutory requirements for patentability.

The court found that the claims in the application did not describe a manner of manufacture. The claims, which involve accessing data, processing it to select assets, and applying a weighting function, were held to lack the necessary inventive step for a manner of manufacture. The court noted that the specification described a passive investment scheme rather than a mechanical or industrial process. Additionally, the court concluded that the specification did not contain sufficient detail to draft claims for patentable subject matter. Consequently, the application was refused as it did not meet the criteria for patentability under the Patents Act. The applicant had the option to appeal the decision to the Federal Court.

Orders