A curious feature of modern patentable subject matter analysis is that economic benefit is sometimes used as a reason to deny patentability, even though NRDC treated economic utility as a positive indicator of patentable subject matter.
This is the third part of a series of three articles exploring the recent CQMS Pty Ltd v Joy Global Surface Mining Inc [2026] APO 19 (18 August 2026) Hearing office decision[1]
An unexpected tension
One of the more interesting aspects of CQMS [2] is the role played by replacement costs. In making a replacement decision, the system considered matters such as replacement costs and downtime costs to make replacement recommendations.
These factors appeared to support the conclusion that the invention had the character of a business or decision-making scheme. At first glance that seems intuitive. But it creates an awkward tension with the foundational authorities.
Economic significance was always part of the test
One of the best-known passages in NRDC [3] refers to asking whether there is an artificially created state of affairs of economic utility.
Economic utility was presented as a reason for supporting patentability, not to reject patentability. The invention in NRDC produced a useful practical result within a field of economic activity – namely higher yield and thus higher profits in farming. Despite being a method that generated higher profits the core application was farming and thus the invention fell within the “useful arts”.
Aristocrat says the same thing
The Full Court’s 2025 Aristocrat decision similarly drew heavily upon NRDC.
The Court repeatedly referred to useful results, practical implementation and creating an artificial state of affairs. It also reaffirmed the relevance of economic utility in the NRDC sense. In other words, both NRDC and Aristocrat treat useful economic outcomes as relevant indicators pointing towards patentability.
The CQMS inversion
This is what makes the CQMS decision interesting.
Reducing downtime is economically beneficial. Reducing replacement costs is economically beneficial. Extending component life is economically beneficial.
Historically, those consequences would appear to support the existence of a useful result, particular given the field of mining technology. Yet in CQMS, the economic aspects of the invention appear to have contributed to the perception that the invention was directed to a decision-making scheme.
The result is something of an inversion.
- NRDC: economic utility supported patentability.
- CQMS: economic considerations contributed to treating the invention as a business scheme.
Whether that distinction is sustainable remains open to debate.
A better distinction
Perhaps the better distinction is not between technical and economic effects. Most commercially useful inventions have both. The better distinction may be:
- economic activity generated from technical implementation; versus
- purely economic activity detached from technical implementation.
Predictive maintenance systems seem firmly within the former category. The economic benefit arises because technical information concerning physical systems is used to make operational decisions.
Practical takeaways
Applicants should not be reluctant to discuss economic benefits. Rather, they should explain:
- why those benefits occur;
- how they arise from operation of the invention; and
- how they relate to physical systems, processes or equipment.
Economic utility should not be treated as something embarrassing that needs to be hidden. NRDC made it clear that economic utility was an important factor. Properly framed, it may reinforce the existence of a practical useful result. After all, a patent is a commercial tool to encourage innovation.
Final thoughts
Taken together, Aristocrat 2025 and CQMS reveal that the biggest battles in manner of manufacture law remain battles of characterisation.
How an invention is described often determines the characterisation outcome.
- Is it information processing, or application of information?
- Is it a business recommendation, or maintenance of machinery?
- Is it a business scheme, or an industrial process producing economic benefit?
The answers to those questions may determine whether a computer-implemented invention falls on the patentable or unpatentable side of the line. Aristocrat 2025 confirmed the NRDC approach was still good law, and that the real focus should be whether the computer implementation is an artificially created state of affairs of economic utility and not simply asking whether the invention improves a computer.
[1] CQMS Pty Ltd v Joy Global Surface Mining Inc [2026] APO 19 (18 August 2026) (‘CQMS’).
[2] CQMS Pty Ltd v Joy Global Surface Mining Inc [2026] APO 19 (18 August 2026) (‘CQMS’).
[3] National Research Development Corporation v Commissioner of Patents (1959) 102 CLR 252, 269–77 (‘NRDC’).
