Australian patents update: Aristocrat finally prevails, in long-running patentability dispute over electronic gaming machines

A Full Court of the Federal Court has ruled that certain patent claims to electronic gaming machines (EGMs, also known as "pokies" or "slot machines") are patentable subject matter, allowing an appeal and re-stating the law on the manner of manufacture requirement for computer-implemented inventions (CIIs): Aristocrat Technologies Australia Pty Ltd v Commissioner of Patents [2025] FCAFC 131.

This decision marks the latest milestone in the long-running dispute between Aristocrat and the Commissioner of Patents, which left the applicable law in limbo after a rare, equally divided (3:3) judgment of the High Court in 2022.

Key takeaways

• For now, the law regarding the "manner of manufacture" requirement is, at least in principle, the same as it has been for many decades – even since long before the advent of modern computers:  there needs to be an artificially created state of affairs with economic utility.

• In this case, each of Aristocrat's patent claims was characterised as a combination claim concerned with an altered EGM that produced an artificial state of affairs and a useful result, and accordingly was considered patentable subject matter.

• The Aristocrat decision may ease the road to patentability for certain CIIs (eg., potentially inventions that involve the use of generative AI to interact with a user), such inventions will still need to meet all other patentability requirements, including novelty and inventive step.

Aristocrat's patent claims

Aristocrat, one of the largest gaming service providers worldwide, owned four innovation patents entitled "A system and method for providing a feature game". In summary, the patents claimed an EGM with a feature game involving configurable and non-configurable symbols designed to enhance player engagement.

Innovations patents were Australia's answer to "petty patents": requiring only the lower threshold of an "innovative step" rather than an "inventive step", but also having a term of only 8 years, rather than the standard 20. The innovation patent system is being slowly phased out, with the last date for new innovation patent applications being in August 2021. As a curious quirk of the time this litigation has taken to run, Aristocrat's patents in this dispute all expired back in 2023 – but the issue of "manner of manufacture" applies equally to standard patents, so the issues in dispute remain important going forward.

Unusual litigation history

In 2018, the Commissioner decided to revoke the patents, on the basis that the substance of the invention was the abstract ideas or mere rules for a game, which cannot form patentable subject matter. In 2020, Justice Burley ruled that they were patentable subject matter. The litigation then took off in an unusual direction.

In 2021, a Full Court overturned the primary judge's first decision on the basis that a representative claim 1 of one patent was not a manner of manufacture. Their Honours remitted the matter to Justice Burley to consider the other patents and claims in suit. Aristocrat appealed.

In 2022, the High Court delivered a rare, equally divided (3:3) decision. All six judges disagreed with the reasons of the Full Court, but for markedly different reasons. As a quirk of procedural law, in this scenario, the Full Court's final orders are confirmed, meaning that the "representative" claim 1 of one of the patent in dispute had been finally determined as being invalid for want of patentable subject matter, and the matter was returned to the primary judge to consider the remaining patent claims in suit. In 2024, the primary judge determined that the remaining claims were likewise invalid for want of patentable subject matter, his Honour considering himself bound by the 2021 Full Court's reasons (despite the 2022 High Court's critiques). Aristocrat appealed.

On 16 September 2025, a newly constituted Full Court held that the primary judge was correct to rule as he did in 2024 (being bound, by precedent, to follow the previous Full Court's reasons): [104], [109]. However, the 2025 Full Court confirmed that they themselves were not bound to follow a previous Full Court decision – and so considered the matter anew for these remaining claims in suit that had not been finally determined by the judgments in 2021/2022.

Where we now stand regarding the "manner of manufacture" requirement

For an alleged invention to be patentable subject matter, it must be a "manner of manufacture" within the meaning of that term as it has evolved through case law going all the way back to the Statute of Monopolies 1623 (UK).

In a landmark decision in 1959, the High Court described the test as calling for an assessment of whether the claimed invention, properly understood, involves an "artificially created state of affairs with economic utility": National Research Development Corporation v Commissioner of Patents (1959) 102 CLR 252 (NRDC). The Full Court endorsed this long-standing statement of principle.

As the Full Court explained, an artificial state of affairs and useful result may manifest in a physical change in something, an improvement in computer technology or be created in a manner or method carried out on a computer. The artificial state of affairs and useful result need not be inventive or ingenious; the ingenuity may reside solely in the claimed idea, so long as the idea is then applied to produce an artificial state of affairs and a useful result.

In recent years, there has developed a body of case law regarding how this requirement should be assessed when considering computer-implemented inventions: inventions where an abstract concept or idea is implemented through the use of computer technology. While the alleged inventions in some cases have been held to be patentable subject matter, others have been held by the Australian Patent Office, or held by the Federal Court, as not.

CIIs can sometimes be patentable subject-matter

Mindful of the 2022 High Court critiques, the 2025 Full Court held that a two-step approach that had been endorsed by the 2021 Full Court ought not to be followed. Instead, the Full Court substantially endorsed the reasons of the 3 High Court judges who would have allowed the appeal in 2022 (referred to as the "allowing reasons" in the Full Court's reasons). On that approach, the Full Court held that the patent claims were indeed patentable subject matter, and so should not be revoked on that basis.

The Full Court's key findings included:

• The "allowing reasons" better aligned with the seminal reasoning of NRDC and the authorities that followed it, which rejected attempts to fetter the notion of "manner of manufacture" to an exact or rigid formula;

• The more appropriate test was to consider whether, "properly characterised, the subject matter that is alleged to be patentable is:

• an abstract idea which is manipulated on a computer [UNPATENTABLE]; or

• an abstract idea which is implemented on a computer to produce an artificial state of affairs and a useful result [PATENTABLE]";

• The integers of a claim should be considered holistically, without undue emphasis on the inventive aspects of the claim. In this case, due recognition needed to be given to the physical elements of the function and display of configurable symbols which, although non-inventive, were fundamental to the operation of the EGM. It was therefore fundamental to the alleged invention for the EGMs to produce an artificial state of affairs and a useful result;

• This test avoided the anomaly in which a computer-implemented EGM was unpatentable, whereas its older mechanical counterpart was patentable, such a result being contrary to the objects of the Australian patents system, which was designed to encourage invention and innovation.