District Court Granted Dismissal Because the Patent Recited a Patent-Ineligible Abstract Idea of Processing and Transmitting Data

Apr 7, 2022

Reading Time : 3 min

Plaintiff Magnacross LLC sued OKI Data Americas, Inc. for infringing U.S. Patent No. 6,917,304. The claim-at-issue recites a method of wirelessly transmitting data through a communications channel from at least two data sensors to a data processing means. The method includes the step of division of the channel into sub-channels having unequal data carrying capacities, and transmitting the data through the sub-channels from the data sensors, which require substantially different data rates for data transmission.

The court analyzed eligibility using the U.S. Supreme Court’s two-step Alice framework. In step one, the court determines whether the claims are “directed to” a patent-ineligible concept, such as an abstract idea. Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208, 217 (2014). If they are, the court proceeds to step two and considers “the elements of each claim both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application.”  Id.

Addressing step one, the court found that the claim “describes nothing beyond the division of the channel and allocating sensor data to sub-channels.” The court noted that the Federal Circuit has recognized that claims directed to gathering, processing and transmitting data are directed to an abstract idea; and the court determined that the claim is similar to claims held ineligible in Two-Way Media Ltd. v. Comcast Cable Communications, LLC, 874 F.3d 1329 (Fed. Cir. 2017). In Two-Way Media, the claims recited a method of transmitting packets of information over a network with a series of abstract steps (“converting,” “routing,” “controlling,” “monitoring” and “accumulating records”) using “result-based functional language.”

The court found that, like in Two-Way, the claim recites functional language (“division,” “transmitting” and “allocating”) without any means for achieving the purported technological improvement and without any guidance on the kind of structure or how the division is to be achieved. The court reasoned that the claim is not directed to an improvement to computer functionality, but rather a generic process in which computers are used as a tool to improve efficiency. The court further noted that the specification fails to identify a specific improvement and, instead, generally offers improvements in relation to prior proposals in the field.

Addressing step two, the court found that the claim does not recite an “inventive concept” because it recites generic terms and routine functions. According to the court, the specification acknowledges that the claimed “data sensors” were known, and that the invention is not directed to a certain type of data or limited to any particular application. The court also found nothing in the specification describing the “communications channel” as anything other than conventional, or describing the division of the channel into sub-channels as inventive.

Magnacross argued that the claim solves a problem particular to wireless data transmission from multiple sensors with different data rate requirements by asymmetrically dividing and allocating data to a communications channel. The court, however, found that improving the efficiency of a process, rather than the functionality, does not confer patent eligibility. The court also noted that Magnacross conceded that the claim relates to “how to more efficiently use bandwidth to transmit data [from data sensors].”

Practice Tip: Patent Owners should avoid describing and claiming the advance over the prior art in purely functional terms, in a result-oriented way that amounts to encompassing an abstract idea. Instead, Patent Owners should describe and claim technical details for tangible components in the claimed system and how the functionality of those components has been improved, showing that such components are technologically innovative and not generic. In the data transmission field, Patent Owners should describe and claim technological improvements to components in particular applications, and avoid relying only on generic efficiency improvements.

Magnacross LLC v. OKI Data Americas, Inc., No. 3:20-cv-1959-M (N.D. Tex.).

Share This Insight

Previous Entries

IP Newsflash

August 11, 2025

In considering a motion to dismiss infringement claims for two related patents, the District of Massachusetts recently held that pre-suit knowledge of a “parent” patent, without more, is insufficient to establish pre-suit knowledge of the “child” patent for purposes of indirect and willful infringement.

...

Read More

IP Newsflash

August 8, 2025

Following a jury verdict finding trade secret misappropriation, the District Court for the District of Massachusetts granted-in-part a plaintiff’s motion for a permanent injunction to prohibit defendants from using plaintiff’s trade secrets. The district court further required defendants to reassign to plaintiff patents and patent applications that disclosed or were derived from plaintiff’s trade secrets as part of its equitable relief.

...

Read More

IP Newsflash

August 6, 2025

In ruling on a recent motion to strike, a judge in the Eastern District of Texas permitted a damages expert to rely on a damages theory based on defendant’s “avoided costs,” holding that this theory did not run afoul of the “entire market value rule.”

...

Read More

IP Newsflash

August 5, 2025

The Federal Circuit recently vacated a decision by the Patent Trial and Appeal Board after concluding that the board’s analysis of licensing evidence offered as a secondary consideration of nonobviousness constituted legal error and was not supported by substantial evidence. According to the court, the board applied a more exacting and improperly heightened nexus standard than is required by law for license evidence.

...

Read More

IP Newsflash

August 5, 2025

A Northern District of California judge recently granted a motion to reconsider his summary judgment ruling that defendant was barred from raising certain “device art” due to IPR estoppel under 35 U.S.C. § 315(e)(2). In the original ruling, the judge adopted the broader rule that IPR estoppel applies to device art that is “materially identical” to patents or printed publications that petitioners raised, or could have raised, in an IPR. Following that ruling, however, the Federal Circuit issued its Ingenico decision adopting the narrower view that IPR estoppel applies only to “grounds” based on patents and printed publications and not to device-based grounds. Citing Ingenico as a “change of law,” defendant moved for reconsideration of the court’s ruling, and the court granted the motion.

...

Read More

IP Newsflash

August 5, 2025

In a recent decision designated as Informative, the USPTO Director determined that the Patent Trial and Appeal Board abused its discretion by instituting two inter partes review proceedings challenging the same patent, based on petitions advancing different constructions of the same claim term. The Director expressed concerns that permitting multiple petitions based on alternative claim constructions effectively circumvents word count limitations, strains board resources, and undermines procedural efficiency.

...

Read More

IP Newsflash

July 25, 2025

Earlier this year, the Federal Circuit’s decision in Qualcomm Inc. v. Apple Inc. (Qualcomm II) raised questions about the extent to which petitioners can rely on applicant admitted prior art (“AAPA”) in inter partes review proceedings.  The Federal Circuit’s recent decision in Shockwave Medical, Inc. v. Cardiovascular Sys., Inc. largely cabins the Qualcomm II decision to its particular facts and makes clear that AAPA can be used as evidence of background knowledge as part of an obviousness argument.

...

Read More

IP Newsflash

July 11, 2025

The Federal Circuit recently reversed a PTAB determination on remand that a patent was obvious over applicant admitted prior art (“AAPA”) in combination with prior art patents, holding that expressly designating AAPA as a “basis” for a ground is improper under 35 U.S.C. § 311(b). In doing so, the Court rejected the PTAB’s “blanket rule” that “AAPA used in combination with prior art patents or printed publications under § 311(b) is ipso facto not the basis or part of the basis of a ground.” Ultimately, while the case clarifies that expressly listing AAPA in an IPR ground is improper, the precise line between proper and improper uses of AAPA in other instances remains unclear.

...

Read More

© 2025 Akin Gump Strauss Hauer & Feld LLP. All rights reserved. Attorney advertising. This document is distributed for informational use only; it does not constitute legal advice and should not be used as such. Prior results do not guarantee a similar outcome. Akin is the practicing name of Akin Gump LLP, a New York limited liability partnership authorized and regulated by the Solicitors Regulation Authority under number 267321. A list of the partners is available for inspection at Eighth Floor, Ten Bishops Square, London E1 6EG. For more information about Akin Gump LLP, Akin Gump Strauss Hauer & Feld LLP and other associated entities under which the Akin Gump network operates worldwide, please see our Legal Notices page.