Between July 1969 and December 1972, 12 humans walked on the moon. Since the Alice decision, a comparable period of time, only five have won an eligibility appeal to the CAFC.
Since the Supreme Court’s decision in Alice v. CLS Bank, the opinion has been used to invalidate over 450 patents. Among them is my client TDE Petroleum Data Solutions, Inc.’s U.S. Patent No. 6,892,812. The ‘812 patent claims a method and system for determining the state of well operations and performing process review. The claims provide a novel implementation of existing sensor technology to control and improve drilling operations. Until the CAFC stopped following the Supreme Court’s decision in Diamond v. Diehr, the ‘812 patent was unquestionably patent eligible.
The representative claim considered by the Court of Appeals for the Federal Circuit (CAFC) was claim 1 of the ‘812 patent, which covers:
An automated method for determining the state of a well operation, comprising:
storing a plurality of states for a well operation;
receiving mechanical and hydraulic data reported for the well operation from a plurality of systems; and
determining that at least some of the data is valid by comparing the at least some of the data to at least one limit, the at least one limit indicative of a threshold at which the at least some of the data do not accurately represent the mechanical or hydraulic condition purportedly represented by the at least some of the data; and
when the at least some of the data are valid, based on the mechanical and hydraulic data, automatically selecting one of the states as the state of the well operation.
Unfortunately, the CAFC has recently affirmed the dismissal of my client’s suit on the basis that the patent ineligibility of the ‘812 patent’s, which the Court determined were “directed to” an abstract idea. Under the Alice test, the CAFC determined that the claims recite nothing more than “collecting information, analyzing it, and displaying certain results of the collection and analysis,” which are “a familiar class of claims ‘directed to’ a patent ineligible concept.” See page 4, CAFC’s August 15, 2016 Opinion, TDE v. AKM (Appeal No. 16-1004). The Federal Circuit relied on the judicially created “abstractness” exception to patent eligibility to reach this result.
In reaching its decision, the CAFC ignored the U.S. Supreme Court’s decision in Diamond v. Diehr, 450 U.S. 175 (1981). The claims in dispute are unlike the claims in Alice, which merely applied conventional computer functionality to a financial problem. Here, TDE’s claims are materially the same as Diehr’s claims and solve technological problems in the industry using existing sensors in a novel implementation to improve the drilling process itself.
A comparison of the claims of the Diehr patent application, held patent-eligible by the Supreme Court, to the ‘812 patent’s claims demonstrates that far from being abstract, both claim the same four parts of similar technological/industrial processes. Namely: (A) storing a data base; (B) collecting raw data representative of the machinery performing the process; (C) transforming the raw data into interpreted data; and, (D) interpreting the transformed data and, if necessary, controlling the industrial process. In Diehr, the industrial process that was improved was curing rubber. In the case of the ‘812 patent’s claims, the industrial process that is improved is “an automated process for determining that state of the well operation,” (preamble, claim 1, ‘812 patent) and, if necessary, controlling the operation of an oil rig.
By finding such claims patent ineligible, the CAFC’s decision threatens patent eligibility in multiple fields of innovation and renders all software using existing hardware components as inherently suspect. Alice is intended to guard against patent claims that merely use a computer as a tool to implement an abstract idea, not claims, as here, which improve the process itself; in this case an industrial process, which has always been considered patent eligible until now.
The TDE decision will also stifle innovation by rendering patents ineligible that claim software that receives data from industrial equipment, analyzes the data and improves the process by controlling it. Far from merely “collecting information, analyzing it and displaying the results and analysis,” computer controlled industrial processes are at the heart of the American economy and should be entitled to patent protection. The CAFC’s rulings further threaten any system whose improvements are based in software, as opposed to novel hardware. Many fields of innovation are furthered by solutions that solve technological problems using novel implementations of existing hardware.
Anyone concerned about the CAFC’s overturning of the Supreme Court’s Diamond v. Diehr decision and its effect on innovation in the United States should submit an amicus brief to the United States Supreme Court in support of TDE’s Writ of Certiorari. TDE plans on filing its Writ on January 13, 2017 and any amicus will be due no later than 30 days later, i.e. February 10, 2017.
Together, we can change the IP world! Join me and TDE in making this happen. I can be reached at email@example.com.
You can also go to our webpage www.pronova-tde.com/changingtheipworld for further information.