Regular readers may recall I’ve blogged about the Grant case – a Federal Court case concerning the Patent Office’s refusal of an innovation patent for a method of structuring trusts etc so as to minimise tax. In general, when I’ve told people about this case, the reaction has been – what, someone tried to patent something like that? And it’s going to court even?

And yet, look at this Friday post from Public Knowledge. Apparently, in the US, the newest practice in the patent field is the patenting of tax strategies, or advice on how to avoid paying taxes: that is, individuals and corporations are patenting tax strategies as “business methods.”

In Australia, these things are not patentable. In July of this year, the Full Federal Court held that there were multiple reasons to refuse a patent here:

  • A physical effect in the sense of a concrete effect or phenomenon or manifestation or transformation is required. …the alleged invention is a mere scheme, an abstract idea, mere intellectual information, which has never been held to be patentable, despite the existence of such schemes over many years of the development of the principles that apply to manner of manufacture. There is no physical consequence at all;
  • “legal discoveries” are not patentable. The practice of the law requires, amongst other things, ingenuity and imagination which may produce new kinds of transactions or litigation arguments which could well warrant the description of discoveries. But they are not inventions. Legal advices, schemes, arguments and the like are not a manner of manufacture.
  • In any event, the end result was effected by a mere taking of sequential steps, a collocation of integers rather than a new combination. Assuming novelty, the proposed scheme represents a new use of known products (a trust, a gift, a loan and a security) with known properties for which their known properties make them suitable (the creation of a structure of financial rights and obligations or even a change in the person’s legal circumstances). That is not the proper subject of letters patent.

Despite all of this, it would appear that these arguments are still doing the rounds in the US.