Well, several approaches come to mind. The most direct would be to use an off-the-shelf hardware logic simulator program to input the logic diagrams exactly as shown in the patent application. That would prove out the patent as well as implement it.

It's really a trivial class of problem that's been solved many times. There's a hardware implementation on a chip called a "UART" that's been in service almost without modification for almost as long as the patent's been around (kind of the Soyuz of chip designs). A UART is a serial to parallel data converter that has to recoognize and sync up to special bit patterns to know where the data bytes begin and end, which makes it a "state machine" of similar to the one described in the patent.

Speak of state machines, that describes pretty well a design I did for eBay for the browser side of their LiveAuctions real time bidding system. I'd get this stream of commands from a server, and the bit pattern of one would determine the interpretation of the next chunk of bits. That's a state machine, a system that moves from node to node in a network of states depending on the transition of input data from one state to another.

Or if you really wanted a good quality implementation of the patent's design, you could sit down and brute-force program it in some language like C. There'd be a network of if statements using boolean logic AND OR NOT to examine the current state of the incoming bits and decide where to branch when the next bit comes in.

It's the kind of system that has a history and a "memory" of it, in that the previous states determine where the system can go in the future.

BTW, the term "octal" refers to the base-eight number system, whose three bits range from 000 to 111, that is, integer values from zero to seven. Which makes an octal representation of data inherently do what the patent states is the goal: End up with an integer corresponding to the state of the three input bits. I'm not sure that this isn't a great deal of fuss over almost nothing. Sometimes patents are like that, somebody uses a sledgehammer to smash a flea, and this is beginning to sound like that kind of patent.

That is to say, Rube Goldbergish. It may not be practical, but it's entertaining.