Body Fit Training (BFT), the Australian fitness franchise, has successfully defended a court action brought by F45 in the Australian Federal Court.
The lawsuit between the two Australian companies is part of an ongoing global dispute over business strategies and the use of technology.
It began in late 2019, when F45 filed a lawsuit in the Australian Federal Court against BFT over an alleged patent infringement, aiming to protect the way it manages its franchises through a central computer system.
F45 asserted that Body Fit had infringed its intellectual property rights in relation to the proprietory software it uses to manage its locations, however, Justice Nicholas ruled that F45 had no proprietary rights, while his ruling also stated that two F45 patents were invalid and should be revoked. He awarded costs against F45.
Joint CEOs of BFT, Cameron Falloon and Richard Burnet, said: ”The Federal Court has determined that both of F45’s innovation patents are invalid and that – even if those patents had been valid – BFT did not infringe them in any event."
The two companies are also locked in a legal battle in the US and although the result in the Australian courts will not decide the US case, it may influence the outcome.
BFT’s star is on the rise, with the company having sold the US and Canadian rights to its franchise business to Xponential Fitness in October 2021 for US$44m (AUS$66), plus additional payments based on growth, while retaining the master franchise rights for Australia, New Zealand and Singapore for itself.
At the time, industry commentators expressed the view that Xpontential would have been unlikely to invest if it felt F45’s court action had a chance of success.
The F45 patents
F45’s two patents were registered under different numbers, however, they were both recorded as being for “The remote configuration and operation of fitness studios from a central server.”
In his summing up, Justice Nicholas said: ”The invention is carried out using generic computing technology facilitating communications between a server with access to a database of files and one or more studio computers, which in turn communicate with displays located at the various exercise stations.
"The substance of the invention resides not in the actual physical arrangement of the exercise stations, but in the computer-implemented scheme that enables those physical arrangements to be made.
"It is the kind of scheme that has historically never been regarded as patentable subject matter,” he said. “The scheme is not made patentable merely because it is implemented using generic computing technology."
