May 2024

When is trade mark use on an overseas website an infringement in Australia

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Last week reviewed the notice and take down / moderation procedure the majority of the Full Federal Court adopted to limit the injunction against Redbubble’s trade mark infringement. In the course of allowing Redbubble’s appeal, the Full Federal Court also unanimously flagged significant questions about when the use of a trade mark on a website overseas may constitute trade mark infringement in Australia.

On these matters, Perram and Downes JJ delivered the main reasons and Nicholas, Burley and Rofe JJ agreed.

Some more facts

You will recall, Redbubble operates a website to which creators can upload their designs and customers can then buy merchandise to which the customers have chosen to have the designs applied. Once a customer has placed an order, Redbubble undertakes the fulfilment function including having the products manufactured and delivered to the customer branded with Redbubble’s trade marks.

Redbubble’s servers (at least in this case) are in the United States.

This part of the appeal concerned the second part of the trial – transactions 8 to 11. In the case of these “transactions”, Hells Angels’ trade marks officer in Australia merely viewed the trade mark infringing images on Redbubble’s website; he did not even make a trap purchase. There was no evidence that anyone else in Australia ever viewed the images or bought them.

Did this infringe?

The short answer is “yes”. But it is how the Full Federal Court got there that will require careful consideration in the future.

At first instance

The starting proposition is that for trade mark infringement in Australia there must be unauthorised use of the trade mark (or a substantially identical or deceptively similar sign) as a trade mark – i.e. as a badge of origin.[1]

Way back in 2005, Merkel J had concluded in Ward v Brodie the fact that a website was accessible from Australia was not sufficient to establish use; it was necessary to show that the website was directed at or targeted Australia.[2]

At first instance in this case, Greenwood J having found that the trap purchases (transactions ##1 to 7) infringed also found that transactions ##8 to 11 infringed even without a purchase. In doing so, his Honour applied the proposition that he had propounded in his 2019 ruling (which also involved trap purchases) at [469]:

The capacity to engage, in Australia, through the website, as Mr Hansen did, constitutes use in Australia by Redbubble. [3]

The appeal

Redbubble had not disputed that proposition at trial. It did seek to raise it as Ground 1 of its appeal. As it had not sought to argue the ground at first instance, however, this would have required leave and ultimately it did not press it.

So, it was unnecessary for the Full Federal Court to deal with the issue. At [48], however, their Honours placed a question over the correctness of Greenwood J’s proposition. Perram and Downes JJ said:

For the reasons which follow, to the extent that [469] of the 2019 judgment deals with the situation disclosed by Examples 8 to 11, we would reserve the correctness of that statement for a case where it is directly raised.

In the following paragraphs, their Honours identified at least three issues which would need to be addressed.

Why is a trap ‘viewing’ not an authorised use

The first issue was why a trap viewing was not a direct infringement.

Here, Perram and Downes JJ considered the trap purchases in Ward v Brodie had not been infringing because (now repealed) s 123(1) of the Trade Marks Act had provided it was not an infringement to use a trade mark in relation to goods to which the trade mark had been applied by or with the consent of the trade mark owner.

With the repeal of that provision, however, that proposition could no longer be applied. Further, at [50] their Honours questioned whether the replacement provision, s 122A,[4] “could be pressed into service” instead. Although their Honours expressed no concluded view at this stage.

However, Perram and Downes JJ at [51] questioned Merkel J’s conclusion in Ward v Brodie that a trap purchase was not authorised use under s 8(1). As a consequence, their Honours considered it would also be arguable that at least some of the trap viewer’s actions in viewing the images (i.e. requesting Redbubble to serve the images to the trap viewer) might also be authorised use and so fall within the defence provided by s 122(1)(e).

Noting once again that these matters had not been argued and so did not need to be decided, at [52] Perram and Downes JJ considered whether authorised use could in fact be made out could be “highly dependent on the particular facts”.

The reason for this warning lay in the different nature of some of the trap “views”. Mr Hansen, the Hells Angels’ trade mark officer had navigated to the Redbubble website and specifically requested the image displayed in transaction #8. The Redbubble website, however, included a carousel feature. So that, when image #8 was displayed the website automatically presented to him other images (##9 and 11) which Redbubble recommended to him.

The geographical reach of s 120(1)

The second issue the Full Federal Court raised was the geographical reach of infringement under the Australian Act. That is, there must be use as a trade mark in Australia. The Act does not reach acts outside Australia (if they do not involve trade mark use in Australia).

Is viewing an overseas website from Australia enough

Thirdly, Perram and Downes JJ at [57] considered it is open to question whether a website overseas which is merely viewed by people from Australia (other than a trap “viewer”) without purchase would constitute use as a trade mark in Australia. Their Honours noted that the previous decisions (apart from Greenwood J’s decision under appeal) including Christian v Nestlé involved an actual trade in Australia.

Noting that Moorgate Tobacco v Philip Morris established a threshold requirement for trade mark use that there “be an actual trade or offer to trade in the goods in Australia”, their Honours explained at [62]:

The question of whether mere overseas projection without a local trade in the goods can amount to trade mark use in Australia is, in our view, a question of considerable difficulty. It is made potentially more complex in this case because although the website is hosted from servers in the United States there is no doubt that Redbubble conducts business in Australia. The difficulty is that that business does not appear to have involved, in the case of Examples 8 to 11, any more than projection into the Australian market without any consequent trade in goods bearing the marks. An important question is whether the necessary geographical nexus for use of a trade mark in Australia can be established by the mere fact that the trader is engaged in trade in Australia albeit not in relation to the infringing trade mark. The answers to these questions are not self-evident. (emphasis supplied)

At [63], Perram and Downes JJ concluded:

On the current state of the authorities, we regard the matter as undetermined. At no point in either of the trial judge’s decisions does his Honour traverse these issues. We would therefore not read [469] of the 2019 judgment as resolving them.

Perhaps the issue that concerned their Honours is that, in the bricks and mortar world, Yanx established that consumers in Australia who bought “Yanx” cigarettes in the USA and imported them into Australia for their own personal use did not use the Yanx trade mark as a trade mark. The transaction was completed in the USA and the goods, when imported for the consumers’ own personal use, was no longer in the course of trade.

On the other side of the ledger, however, Deane J said in Moorgate at 433 –434:

The cases establish that it is not necessary that there be an actual dealing in goods bearing the trade mark before there can be a local use of the mark as a trade mark. It may suffice that imported goods which have not actually reached Australia have been offered for sale in Australia under the mark (Re The Registered Trade Mark “Yanx”; Ex parte Amalgamated Tobacco Corporation Ltd., at pp 204–205) or that the mark has been used in an advertisement of the goods in the course of trade (The Shell Co. of Australia v. Esso Standard Oil (Australia) Ltd., at p 422). In such cases however, it is possible to identify an actual trade or offer to trade in the goods bearing the mark or an existing intention to offer or supply goods bearing the mark in trade. In the present case, there was not, at any relevant time, any actual trade or offer to trade in goods bearing the mark in Australia or any existing intention to offer or supply such goods in trade. There was no local use of the mark as a trade mark at all; there were merely preliminary discussions and negotiations about whether the mark would be so used.

One might think that a website which was directed at, or targeting, Australians was making an offer to trade here or had an existing intention to offer and supply here, even if there is no actual sale. At least arguably, that does not seem very different, if at all, to advertisements in magazines circulating in Australia with the aim of soliciting custom. Moreover, (and this may require evidence in a particular case), if one clicks on the “Buy Now” or “Purchase” button on most websites, the whole transaction is automated and does not involve a volitional decision by the website operator whether or not to complete the transaction.

So why did Redbubble infringe

At the risk of simplifying the arguments very significantly, Redbubble’s argument was a kind of de minimis argument that the infringing images were not available to consumers in the ordinary course of trade.

This argument had two main strands to it. One strand was that the Hells Angels had been able to identify the accused images only through a prolonged period totalling some 4.5 hours over approximately 7 hours – typing in “Hells Angels” and filtering for “Newest”. Redbubble contended this was not the behaviour exhibited by ordinary consumers who, for example, spent on average spent less than four minutes on the site. The other strand was the claimed short period of time the images were available on the website.

Perram and Downes JJ did not think the primary judge had erred in rejecting Redbubble’s argument. Their Honours further pointed out that, if Redbubble had wanted to prove that an image was unlikely to be found, it should have provided evidence of what a search would have revealed at the relevant time. The carousel function also contradicted the argument.

Putting aside the factual problems, their Honours considered there was a more general objection to Redbubble’s argument. This was not a case of a consumer using a general search engine like Google or Bing and having to filter results. Rather, it was a case involving a search of a specific website with specific functionality designed to facilitate locating desired iterms. Having noted the search function and the catalogue Redbubble provided were central components of its business model, their Honours at [81] rejected the argument:

one must distinguish between, on the one hand, the difficulties a consumer may encounter in finding what they are searching for on a website explicitly designed for the purpose of helping them do so and, on the other, the idea that such difficulties entail that the website is not engaged in the ordinary course of its trade. We do not think that the fact that it might be difficult to locate goods bearing infringing trade marks in a poorly laid out store can mean that the goods are not being offered for sale in the ordinary course of the trader’s business. We do not think any different principle applies to a website of the present kind.

Some other matters

Patches and badges of affiliation

At [226], Perram and Downes JJ appeared to suggest that the use of the Hell’s Angels trade mark as “patches” on jackets and the like to indicate exclusive membership of the club would not be use as a trade mark. Pointing out that there may be trade mark use where the sign serves dual purposes, Nicholas, Burely and Rofe JJ at [255] expressly reserved that proposition for future consideration.

Nominal damages?

It is also worth noting that the Full Federal Court rejected Greenwood J’s award of $8,250 as nominal damages (if indeed it was nominal) on the basis that such an amount could never be considered “nominal”, whether it was calculated as $750 per infringement or as $8,250 on a global basis.

After reviewing the amounts that had been awarded in other cases as nominal damages, the Full Federal Court at [127] awarded the sum of $20 per infringement making, in total, $100.

Given the error in calculating the damages, the award of additional damages ($70,000) was also set aside since the amount awarded as damages was relevant to that assessment even if the amount awarded as additional damages did not need to be proportionate.

Most of the factors listed in s 126(2) did not support an award of additional damages and, while there was a ‘mild’ need for general deterrence, the trivial quantum of infringements led to no additional damages being awarded.

Redbubble Ltd v Hells Angels Motorcycle Corporation (Australia) Pty Limited [2024] FCAFC 15

  1. Most recently confirmed by the High Court in Self Care IP Holdings Pty Ltd v Allergan Australia Pty Ltd [2023] HCA 8; 171 IPR 120 at [22] to [25].  ?
  2. See also Christian v Société Des Produits Nestlé SA (No 2) [2015] FCAFC 153; 327 ALR 630 at [78]. An approach recognising that, as a website on a server overseas is accessible by anyone in Australia with an internet connection, the trade mark owner’s rights would be set at nought if infringement could be avoided simply by setting up a website on the internet while at the same time the owner’s rights (and the Court’s powers of enforcement) are territorially limited: Lifestyle Equities CV v Amazon UK Services Ltd [2024] UKSC 8 at [3].  ?
  3. The emphasis is the Full Federal Court’s at [47].  ?
  4. I am not aware of any decided cases on the interpretation of this provision. In the meantime, my attempt to understand it can be found in Warwick A Rothnie, ‘Unparalled importing and trademarks in Australia,’ (2020) 21(3) Business Law International 229 (behind a paywall I’m afraid).  ?

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A notice and take down / moderation scheme for trade marks

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The Full Federal Court has allowed Redbubble’s appeal from the remedies granted for its eleven infringements of five Hells Angels’ registered trade marks. In doing so, the majority instituted a kind of monitoring and notice and take down system as a “safe harbour” against trade mark infringement. In addition, the Court raised questions about how use of a trade mark on a website overseas may, or may not, constitute infringing conduct in Australia.

Some background

Redbubble operates a website at www.redbubble.com. Creators can upload images to the website. Other users can browse the website, select one or more of these images for application to merchandise such as t-shirts and coffee mugs. Once the orders have been placed, Redbubble contracts for the merchandise to be manufactured and shipped to the purchaser. Redbubble provides the payment processing service, it also provides the fulfilment functions including communications such as order confirmation and invoices with the purchaser. Redbubble’s trade marks were on the communications, the goods ordered and the packaging.

The servers for Redbubble’s website, however, are located in the USA and the day to day management is carried out there.

The Hells Angels had successfully sued Redbubble in 2019 for infringement of the registered trade marks in issue.

In this round, in two decisions,[1] Greenwood J at first instance had found Redbubble infringed the Hells Angels registered trade marks by 11 transactions. The 11 transactions were trap purchases by Hells Angels Australia’s trade mark officer.

His Honour went on to order declarations of infringement, damages of $8,250 and additional damages of $70,000. His Honour also ordered an injunction in general terms – for example:

Redbubble is restrained whether by itself, its officers, servants or agents or otherwise howsoever, from using the sign being the device described in Declaration 2 …, or any sign substantially identical with, or deceptively similar to, a sign consisting of the device, on the website operated by Redbubble in relation to trade in goods to which the sign can be applied, where such goods are goods in respect of which Trade Mark No. 526530, Trade Mark No. 723463 and Trade Mark No. 1257993 is registered.

On appeal, Redbubble did not challenge the infringement findings but sought to set aside the remedies.

The injunction

At the time of the judgment, creators were uploading to the website some 90,000 new images each day.

To address the risks of infringement, Redbubble adopted a two-pronged strategy.[2] First, it implemented a Notice and Take down / counter-notice scheme.

Secondly, it adopted what it called a Proactive Moderation Policy. This involved co-operating with rights holders to build up a stock of Reference Content, which it then used to monitor uploads and remove content assessed as too similar. Redbubble had extended the moderation policy to include some rights even without input from the rights owner. As part of this, Redbubble had been developing a software tool, RB Protect, with image matching and optical character recognition capabilities. This tool was limited to identifying identical images and had not yet developed to the point where it could do so in real time.[3]

At the time of the trial, Redbubble was conducting proactive moderation for some 477 rights holders (up from 200 in 2017). It had proactively moderated about two million artworks since January 2017 and terminated over one million uploader accounts.

On appeal, the Full Federal Court split 3:2 on the injunction issue.

All five judges were agreed that the injunctions ordered by Greenwood J were in error because they were not limited to restraining use of the trade marks as a trade marks; i.e., as badges of origin (see e.g Perram and Downes JJ at [213] – [214]).

There was a disagreement whether it was right to describe a trade mark owner who had proved infringement as having a prima facie right to a final injunction, or generally having such a right. Perram and Downes JJ would not have ordered any injunction. Nicholas, Burley and Rofe JJ ordered an injunction but, as noted above, instituted a “safe harbour” scheme based on Redbubble’s moderation policies.

Perram and Downes JJ

Perram and Downes JJ were concerned that describing a final injunction as a prima facie entitlement risked enlarging the trade mark owner’s rights beyond its statutory entitlement under s 20. Their Honours recognised that a final injunction was generally appropriate but emphasised the remedy, albeit statutory, nonetheless retained its equitable nature and was discretionary.

At [224], their Honours considered a good working rule was that an injunction may be refused if:

(a) the injury to the plaintiff’s legal rights is small;

(b) the injury is one which is capable of being estimated in money;

(c) the injury is one which can be adequately compensated by a small money payment; and

(d) it would be oppressive to the defendant to grant the injunction.

Adopting Shelfer v City of London Electric Lighting Co [1895] 1 Ch 287 at 322–323 and an article by Burley J and Angus Lang in (2018) 12 Journal of Equity 132 at 137–142.

The working rule was significant in this case. First, the evidence demonstrated that the only way Redbubble could comply with the usual form of injunction was to cease operating. Thus at [225] complying with the injunction would not just be inconvenient but grossly disproportionate to the right protected.

The remedy was grossly disproportionate because the Hells Angels had not demonstrated any loss and was not likely to suffer loss of any kind. At [226], Perram and Downes JJ explained:

We do not accept therefore that it would be correct to grant an injunction which could only be obeyed by Redbubble ceasing to trade. The shuttering of Redbubble’s business at the instance of a party which has suffered and is likely to suffer no loss of any kind falls within the working rule. If Hells Angels had demonstrated some actual or apprehended loss then the question would be much more difficult. Such a case might be presented by the owner of a trade mark which had a reputation for the exclusive nature of the products to which it was affixed (although there might be many other circumstances generating similar problems). For such a trader, even the intermittent appearance of its marks on Redbubble’s website for short periods of time could cause real harm to that goodwill and this could be so even without any sales. ….

In the “somewhat unusual circumstances of this case”, therefore, their Honours considered it was not appropriate to grant an injunction at all.

Nicholas, Burley and Rofe JJ

While agreeing that the award of a final injunction is discretionary, at [248] Nicholas, Burley and Rofe JJ considered at [248] that describing the right holder as having prima facie entitlement to a permanent injunction is both unexceptional and correct. Their Honours explained at [245]:

But generally speaking, unless the court is persuaded that there is no significant risk of further infringement occurring, or unless there exists some other discretionary reason for refusing the remedy, a final injunction will usually be granted against a party that is found to have infringed.

Further, at [249], their Honours agreed with Perram and Downes JJ that it is not necessary for the right owner to prove it will suffer irreparable harm or that damages will not be an adequate remedy.

It is also not necessary for the trade mark owner to prove that it is more probable than not that the infringer will commit further infringing acts. A final injunction might still be granted even if the Court considers the risk of repetition is “slight” or “negligible”.

In this case, there was admittedly a significant risk of repeat infringements. Indeed, the case itself involved repeat infringements.

Like Perram and Downes JJ, Nicholas, Burley and Rofe JJ considered a general injunction was not appropriate. The risk of repitition, however, meant an injunction was appropriate. Accordingly, at [251] their Honours limited its effects by specifying that the general injunction would not be breached by compliance with the moderation policies. Therefore, the general injunction was qualified:

3 The Appellant will not be in breach of orders 1 or 2 (the general injunction) if:

(a) it maintains a system involving the surveillance of its website at www.redbubble.com (the Website) and the removal of images that might infringe the marks referred to in orders 1 and 2 above which is no less rigorous than that which it had in place as at 24 August 2022 and is referred to in the affidavit of Mr Joel Barrett of that date as “Proactive Moderation”; and

(b) within seven days of an image to which orders 1 or 2 above refers being identified on the Website by the Appellants or its servants or agents, the Appellant removes the image from the Website.

4 Notwithstanding Order 3, the Appellant will be in breach of order 1 or order 2 if, on the First Respondent or the Second Respondent or both of them becoming aware of an image to which such order refers being available on the Website, and notifying the Appellant of the image by sending an email to legal@redbubble.com (or such other email address as notified by Appellant in writing from time to time):

(a) with the subject field ‘Hells Angels Complaint’;

(b) identifying the image by reference to the location of the image on the Website in the form http://www.redbubble.com/people/[username] /works/[work number and name]; and

(c) stating that the First Respondent and/or the Second Respondent considers that the image would breach Order 1, Order 2 or both,

the Appellant fails to remove the image or images from the Website within seven days of such email.

Perram and Downes JJ had considered such a limitation inappropriate as it required Redbubble to comply with its existing policies and, further, would be seen as giving the Court’s imprimatur to those policies.

Nicholas, Burely and Rofe JJ countered that the Order did not require Redbubble to maintain any surveillance system but would reduce the burden and risks of the usual form of injunction and was similar to the “site blocking” orders under the Copyright Act 1968. In addition, their Honours considered the making of the injunction in this form did not preclude a general injunction alone or different remedies in different cases. At [254]:

What injunctive relief (if any) should be granted at the suit of a different applicant who establishes that its rights have been infringed by Redbubble will depend on the right infringed (eg. copyright or trade mark), the circumstances of the infringement and the evidence, including any evidence of the surveillance and moderation policies and practices followed by Redbubble at the time any such proceeding is heard.

Concluding comments

Review of the discussion about use as a trade mark on websites outside Australia and damages will have to await another occasion.

The judicial acceptance of a notice and take down / moderation scheme for trade mark infringement is a significant development as such a scheme has been implemented in Australia only by statutory intervention in the Copyright Act 1968. The development does have echoes of a similar development in the United Kingdom (albeit in a different regulatory regime).[4]

It is important, however, to keep in mind that the Full Federal Court was very conscious of the limited impact of the infringements in this particular case and the Hells Angels’ very limited attack on Redbubble’s argument that it was not feasible yet to develop a system which did more than detect exact image matches as discussed by Perram and Downes JJ at [147] and [161] – [162].

Redbubble Ltd v Hells Angels Motorcycle Corporation (Australia) Pty Limited [2024] FCAFC 15 (Perram, Nicholas, Burley, Rofe and Downes JJ)

  1. The Hells Angels discovered several new transactions after the initial hearing on liability had been heard and successfully applied to re-open the trial to address transactions 8 to 11.  ?
  2. The strategy had not saved it from injunctions in the 2019 proceeding.  ?
  3. Greenwood J’s remedies decision at [90] – [107]; [104] cataloguing a history of 8 notifications or infringements by the Hells Angels since 2014.  ?
  4. Cartier International AG v British Sky Broadcasting Limited [2016] EWCA Civ 658 and the Supreme Court’s decision on who bears the costs of compliance: Cartier International AG v British Telecommunications Plc [2018] UKSC 28.  ?

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Aristocrat 2 or 3 or 4 or

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After Burley J dismissed Aristocrat’s remitted claims for innovation patents over an electronic gaming machine (EGM), Aristocrat has now sought leave to appeal.[1]

To recap

Aristocrat had three innovation patents – AU 2016101967, 2017101629 and 2017101097 – for an EGM with a new, free feature game and trigger. The Commissioner revoked the patents on the ground that they not a manner of manufacture on the basis that the substance of the invention was merely a game or the rules of a game.[2]

Burley J allowed Aristocrat’s appeal, finding that the claim 1 was a mechanism of a particular construction and so was a practical embodiment rather than a mere, abstract scheme.

Although it was accepted before their Honours that the claimed invention would be a manner of manufacture if the game had been implemented in a device made in the “traditional” way utlising cogs and spinning wheels rather than software, the Full Federal Court unanimously upheld the Commissioner’s appeal, albeit for different reasons.

As it had been sufficient for Burley J to deal with claim 1 only and Aristocrat contended there were further issues raised by the dependent claims, the Full Federal Court ordered that:

The proceedings are remitted to the primary judge for determination of any residual issues in light of the Full Court’s reasons including any issues which concern the position of [the residual claims] and the costs of the hearings before the primary judge. (emphasis supplied)

Before that could happen, however, the High Court subsequently granted leave to appeal – unusually for that time, on the papers. As I am sure you no doubt recall, three Judges (Kiefel CJ, Gageler and Keane JJ) of the High Court would have dismissed the appeal; three other Judges (Gordon, Edelman and Steward JJ) would have allowed it; Gleeson J was apparently unable to sit.

The High Court being equally divided, the decision of the Full Federal Court was affirmed.[3] Even the the three judges who would have dismissed the appeal, however, appeared to reject the principle propounded by the majority in the Full Federal Court. At [77], Kiefel CJ, Gageler and Keane JJ said:

…. the two?step analysis proposed by their Honours unnecessarily complicates the analysis of the crucial issue. As explained in Myriad, the crucial issue is as to the characterisation of the invention by reference to the terms of the specification having regard to the claim and in light of the common general knowledge. It is not apparent in the present case that asking whether the claimed invention is an advance in computer technology as opposed to gaming technology, or indeed is any advance in technology at all, is either necessary or helpful in addressing that issue. As Nicholas J explained, the issue is not one of an “advance” in the sense of inventiveness or novelty. In conformity with the decision in N V Philips, the issue is whether the implementation of what is otherwise an unpatentable idea or plan or game involves some adaptation or alteration of, or addition to, technology otherwise well?known in the common general knowledge to accommodate the exigencies of the new idea or plan or game. (citation omitted)

As the tied result in the High Court meant the Full Federal Court’s decision was affirmed, that in turn meant that the patentability of Aristocrat’s claimed invention was remitted to Burley J for determination of any residual issues.

On remitter

On remittal, Burley J rejected Aristocrat’s invitation to adopt the reasons of the three Judges in the High Court who would have allowed the appeal.

Burley J considered it was inappropriate to search for a principle, or principles, which a majority of the High Court judges had agreed on. Rather, pursuant to s 23(2)(a) of the Judiciary Act, the Full Federal Court’s decision had been affirmed and, accordingly, he was required to decide the residual issues in accordance with the order remitting those issues to him to be decided in light of the [majority’s] reasons.

His Honour concluded that the additional features specified in the dependent claims did not make any technical contribution that could be described as an advance in computer technology. Therefore, in accordance with the majority’s conclusions in the Full Federal Court, the claims with the additional features were still nonetheless not patentable subject matter.

Although patents are supposed to be available for any inventions in all fields of technology and without discrimination as to the field of technology,[4] Middleton and Perram JJ had ruled at [25] that, in a case of the kind before their Honours, it was not appropriate to inquire whether the claimed invention was a scheme as that “may reduce the richness of analysis called for.” Paradoxically given the narrowness of the approach compared to that of Nicholas J, their Honours held at [26] that the issue fell to be determined by two questions:

(a) Is the invention claimed a computer-implemented invention?

(b) If so, can the invention claimed broadly be described as an advance in computer technology?

In the case of claim 1, the Full Federal Court found that it was only the integers comprising the feature game (see features 1.10 to 1.12 below) that distinguished the EGM from the state of the art. However, the implementation of the feature game did not involve any advance in computer technology and so claim 1 was not a manner of manufacture.

Claim 5 of the 967 Patent

Burley J identified the features of claim 5 of the 967 Patent (as you will appreciate, those numbered “1.” are from claim 1):

(1.0) A gaming machine comprising:

(1.1) a display;

(1.2) a credit input mechanism operable to establish credits on the gaming machine, the credit input mechanism including at least one of a coin input chute, a bill collector, a card reader and a ticket reader;

(1.3) meters configured for monitoring credits established via the credit input mechanism and changes to the established credits due to play of the gaming machine, the meters including a credit meter to which credit input via the credit input mechanism is added and a win meter;

(1.4) a random number generator;

(1.5) a game play mechanism including a plurality of buttons configured for operation by a player to input a wager from the established credits and to initiate a play of a game; and

(1.6) a game controller comprising a processor and memory storing (i) game program code, and (ii) symbol data defining reels, and wherein the game controller is operable to assign prize values to configurable symbols as required during play of the game,

(1.7) 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:

(1.8) select a plurality of symbols from a first set of reels defined by the symbol data using the random number generator;

(4.1) wherein each reel of the first set of reels comprises configurable symbols and non-configurable symbols and

(4.2) wherein the game controller is configured to assign prize values to each displayed configurable symbol.

(1.9) control the display to display the selected symbols in a plurality of columns of display positions during play of a base game;

(1.10) monitor play of the base game and trigger a feature game comprising free games in response to a trigger event occurring in play of the base game,

(1.11) conduct the free games on the display by, for each free game, (a) retaining configurable symbols on the display, (b) replacing non-configurable symbols by selecting, using the random number generator, symbols from a second set of reels defined by the symbol data for symbol positions not occupied by configurable symbols, and (c) controlling the display to display the symbols selected from the second set of reels, each of the second reels comprising a plurality of non-configurable symbols and a plurality of configurable symbols, and

(3.1) wherein the second set of reels comprises individual reels each corresponding to an individual display position.

(5.1) wherein the game controller is configured to increase a number of free games remaining in response to the selection of one or more additional configurable symbols in at least one of the free games.

(1.12) when the free games end, make an award of credits to the win meter or the credit meter based on a total of prize values assigned to collected configurable symbols.

Then his Honour held:

[135] Having regard to the findings of the majority decision of the Full Court, in my view, the only conclusion available is that dependent claim 5 of the 967 patent provides no additional features that would warrant a conclusion different to the conclusion reached by the majority decision in respect of claim 1 of the 967 patent. Having regard to dependent claim 5 of the 967 patent as set out above, integers 4.1 and 4.2 add features relating to the use of “configurable symbols” in the “first set of reels” for the first or base game identified in integer 1.8. Integer 3.1 adds that the second set of reels identified in integer 1.11 comprises individual reels each corresponding to an individual display position. Integer 5.1 refers to the game controller (identified in integer 1.6) being configured to increase a number of free games remaining in response to the selection of one or more additional configurable symbols in one or more of the free games.

[136] Taken collectively, the additional integers of dependent claim 5 of the 967 patent impose additional features or limitations on the conduct of the game referred to in claim 1. None, to adopt the language of the majority decision at [63], may be said to pertain to the development of computer technology. Each leaves it to the person designing the EGM to do the programming which gives effect to the family of games (or rules) which those integers define.

Similar reasoning applied for the other patents.

Aristocrat Technologies Australia Pty Limited v Commissioner of Patents (No 3) [2024] FCA 212

  1. Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents, NSD506 / 2024, filed on 26 April 2024. As Burley J’s decision is on appeal from the Commissioner, an appeal is not as of right but requires leave: Patents Act 1990 (Cth) s 158(2).  ?
  2. Patents Act s 18(1A)(a) and, for standard patents, 18(1)(a).  ?
  3. Judiciary Act 1903 (Cth) s 23(2)(a).  ?
  4. TRIPS art. 27.1  ?

Aristocrat 2 or 3 or 4 or Read More »

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