Federal Circuit emphasizing “how” over “what.” But is that really enough?

| Ted M. Cannon

TDE Petroleum Data Solutions, Inc. v AKM Enterprise, Inc. is one of several recent Federal Circuit cases concluding that pure data processing claims—that is, claims directed to merely collecting, analyzing, and outputting data—are not patent-eligible subject matter under 35 U.S.C. § 101.  In TDE Petroleum, the Federal Circuit invalidated claims to a process of receiving reported data about an oil well operation, analyzing the data, and determining the state of the oil well operation.

In striking down the claims, the Federal Circuit noted that the “claims recite the what of the invention, but none of the how that is necessary to turn the abstract idea into a patent-eligible application.”  The court further observed that, while “the specification arguably provides specific embodiments” for the claimed method, the claims recite “none of those details.”  Notably, the claims did not recite using the oil well state determination to control an industrial process, such as, for example, by changing the operation of oil well equipment based on the determined oil well state.

A patent applicant may be tempted to conclude from the Federal Circuit’s language that pure data processing claims may be patent-eligible as long as they recite specific implementation details.  There are some cases that suggest this may be sufficient.  However, when viewed in the context of previous Supreme Court precedent, claiming specific implementation details, while helpful, may not be enough to make a pure data processing claim patent-eligible under 35 U.S.C. § 101.

For example, in Parker v. Flook, the Supreme Court invalidated claims directed to a process of calculating alarm limits because the “only novel feature of the method is a mathematical formula.”  The result likely would not have been different if the Parker claims had included more implementation details of precisely how the alarm limits were calculated.  By contrast, in Diamond v. Diehr, the Supreme Court found claims involving the use of a mathematical equation patentable because the claims were not directed merely to the equation but to an industrial “process of curing synthetic rubber.”  Thus, patent-eligibility in Flook and Diehr did not turn on whether the claimed data processing steps were detailed, but whether those steps were part of a larger industrial process.

Therefore, for technology involving an industrial process, rather than merely claiming data processing steps in significant detail, patent applicants should consider adding steps for controlling or otherwise interacting with the industrial process itself, similar to the claims found patent-eligible in Diehr.  For example, the TDE Petroleum claims may have fared better if they had been directed to an oil drilling apparatus that automatically controls a drilling operation (such as by adjusting drilling speed, drilling angle, or other parameters) based on the determination of an oil well state.