Case: 21-2251 Document: 95 Page: 1 Filed: 08/02/2023
NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
REALTIME DATA LLC, DBA IXO,
Plaintiff-Appellant
v.
ARRAY NETWORKS INC., NIMBUS DATA, INC.,
Defendants
FORTINET, INC., REDUXIO SYSTEMS, INC.,
QUEST SOFTWARE, INC., CTERA NETWORKS,
LTD., ARYAKA NETWORKS, INC., OPEN TEXT,
INC., MONGODB INC., EGNYTE, INC., PANZURA,
INC.,
Defendants-Appellees
______________________
2021-2251
______________________
Appeal from the United States District Court for the
District of Delaware in No. 1:17-cv-00800-CFC, Chief
Judge Colm F. Connolly.
-----------------------------------------------
REALTIME DATA LLC, DBA IXO,
Plaintiff-Appellant
v.
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2 REALTIME DATA LLC v. ARRAY NETWORKS INC.
SPECTRA LOGIC CORPORATION,
Defendant-Appellee
______________________
2021-2291
______________________
Appeal from the United States District Court for the
District of Delaware in No. 1:17-cv-00925-CFC, Chief
Judge Colm F. Connolly.
______________________
Decided: August 2, 2023
______________________
BRIAN DAVID LEDAHL, Russ August & Kabat, Los Ange-
les, CA, argued for plaintiff-appellant. Also represented by
MARC A. FENSTER, PAUL ANTHONY KROEGER, REZA MIRZAIE,
SHANI M. WILLIAMS.
JOHN NEUKOM, Debevoise & Plimpton LLP, San Fran-
cisco, CA, argued for all defendants-appellees. Defendant-
appellee Fortinet, Inc. also represented by DOUGLAS R.
NEMEC, Skadden, Arps, Slate, Meagher & Flom LLP, New
York, NY; JAMES Y. PAK, Palo Alto, CA.
GUY YONAY, Pearl Cohen Zedek Latzer Baratz LLP,
New York, NY, for defendants-appellees Reduxio Systems,
Inc., CTERA Networks, Ltd.
ALTON GEORGE BURKHALTER, Burkhalter Kessler
Clement & George LLP, Irvine, CA, for defendant-appellee
Panzura, Inc. Also represented by MAHSA MICHELLE
ROHANI.
THEODORE J. ANGELIS, K&L Gates LLP, Seattle, WA,
for defendant-appellee Quest Software, Inc. Also
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REALTIME DATA LLC v. ARRAY NETWORKS INC. 3
represented by NICHOLAS F. LENNING, ELIZABETH
WEISKOPF.
JOSHUA M. MASUR, Zuber Lawler LLP, Redwood City,
CA, for defendant-appellee Aryaka Networks, Inc.
TIMOTHY J. CARROLL, Venable LLP, Chicago, IL, for de-
fendant-appellee Open Text, Inc. Also represented by
LAURA A. WYTSMA, Los Angeles, CA.
HILARY L. PRESTON, Vinson & Elkins LLP, Austin, TX,
for defendant-appellee MongoDB Inc. Also represented by
PARKER DOUGLAS HANCOCK, Houston, TX.
RYAN T. BEARD, FisherBroyles LLP, Austin, TX, for de-
fendant-appellee Egnyte, Inc. Also represented by
CHRISTOPHER ROBERT KINKADE, Princeton, NJ.
ROBERT E. PURCELL, The Law Office of Robert E. Pur-
cell, PLLC, Syracuse, NY, for defendant-appellee Spectra
Logic Corporation.
GABRIEL K. BELL, Latham & Watkins LLP, Washing-
ton, DC, for amicus curiae Veritas Technologies LLC. Also
represented by AMIT MAKKER, San Francisco, CA.
______________________
Before NEWMAN, REYNA, and TARANTO, Circuit Judges.
Opinion for the court filed by Circuit Judge REYNA.
Dissenting opinion filed by Circuit Judge NEWMAN.
REYNA, Circuit Judge.
This case returns to us for the second time. Appellant
Realtime sued several companies, including some of the
Appellees, in the District of Delaware for infringing various
combinations of five patents related to methods and
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4 REALTIME DATA LLC v. ARRAY NETWORKS INC.
systems for data compression. Some of the Appellees
moved to dismiss under Federal Rule of Civil Procedure
12(b)(6) for, among other things, failure to state a claim,
arguing that the claims of the patents were patent ineligi-
ble under 35 U.S.C. § 101. The district court held a hearing
and orally announced that all of the claims from the five
patents were invalid under § 101. On appeal, this court
vacated and remanded for the district court to provide a
more detailed § 101 analysis. Realtime Data LLC v. Re-
duxio Systems, Inc., 831 F. App’x 492 (Fed. Cir. 2020)
(“Realtime I”).
On remand, the district court issued a written opinion
that found that the claims from all eight asserted patents
(by then, Realtime had asserted three more patents and
had added more parties) were invalid under § 101 because
the claims were directed to an abstract idea. Realtime Data
LLC v. Array Networks Inc., 537 F. Supp. 3d 591 (D. Del.
2021) (“Realtime II”). The court dismissed Realtime’s com-
plaints but allowed Realtime to amend them, which it did—
adding material and dropping a patent. On renewed mo-
tions to dismiss, the district court reaffirmed its prior anal-
ysis and dismissed the amended complaints—this time,
without leave to amend. Realtime Data LLC v. Array Net-
works Inc., 556 F. Supp. 3d 424 (D. Del. 2021) (“Realtime
III”).
Realtime appeals. For the reasons below, we affirm.
BACKGROUND
A. The Asserted Patents
The seven patents at issue here are U.S. Patent Nos.
9,054,728 (’728 patent), 8,933,825 (’825 patent), 8,717,203
(’203 patent), 9,116,908 (’908 patent), 7,415,530 (’530 pa-
tent), 10,019,458 (’458 patent), and 9,667,751 (’751 patent).
All generally relate to methods and systems for digital data
compression. Appellant’s Br. 15. The seven patents can be
broken into three families. Id.
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REALTIME DATA LLC v. ARRAY NETWORKS INC. 5
The family 1 patents. The ’728, ’825, and ’203 patents
are in the same family, share a specification, and are titled
“Data Compression Systems and Methods.” 1 The patents
address issues with lossless data compression techniques,
including the “fundamental problem” of their “content sen-
sitive behavior” or “data dependency,” which “implies that
the compression ratio achieved is highly contingent upon
the content of the data being compressed.” ’728 patent at
2:29–35. Another issue with lossless data compression
techniques is that “there are significant variations in the
compression ratio obtained when using a single lossless
data compression technique for data streams having differ-
ent data content and data size.” Id. at 2:41–45. According
to the patents, although “conventional content dependent
techniques,” which typically rely on file type descriptors
appended to file names, for example, “.doc” or “.txt,” may
be used to address these problems, those content depend-
ent techniques had “[f]undamental limitations.” Id. at
2:65–3:19; see also Appellant’s Br. 17.
To avoid problems associated with data dependency
and to improve efficacy, the patents describe “a system for
data compression that looks beyond the file type descriptor,
to the underlying data, to complete the desired compres-
sion.” Realtime I, 831 F. App’x at 493–94 (citing ’728 patent
at 3:59–5:11). The system uses a combination of content-
independent and content-dependent data compression and
decompression. See ’728 patent at Abstract, 1:34–37, 3:59–
62, 6:24–27.
The ’728 patent includes 25 claims. 2 Claim 25 recites:
1 Because these patents share a specification, when
appropriate, we will refer to the ’728 patent specification
for all three.
2 The district court implicitly treated a single claim
from each asserted patent as representative. See, e.g.,
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6 REALTIME DATA LLC v. ARRAY NETWORKS INC.
25. A computer implemented method comprising:
analyzing, using a processor, data within a
data block to identify one or more
parameters or attributes of the data within
the data block;
determining, using the processor, whether
to output the data block in a received form
or in a compressed form; and
outputting, using the processor, the data
block in the received form or the
compressed form based on the
determination,
wherein the outputting the data block in
the compressed form comprises
determining whether to compress the data
block with content dependent data
compression based on the one or more
Realtime II, 537 F. Supp. 3d at 599–602 (reproducing a sin-
gle claim from each patent). It also at times did so ex-
pressly. See id. at 606 (“I adopt claim 18 as representative
of the [’]825 patent for the purposes of § 101 subject-matter
eligibility.”); id. at 613–14 (“agree[ing]” that claim 9 of the
’458 patent and claim 1 of the ’751 patent were representa-
tive). Appellees assert that the claims that the district
court reproduced are representative. Realtime does not
meaningfully argue that, for eligibility purposes, there is
any distinctive significance between the claims that the
district court and the Appellees treat as representative and
the other claims in the respective patents. We thus treat
those claims as representative. See Berkheimer v. HP Inc.,
881 F.3d 1360, 1365 (Fed. Cir. 2018) (claims may be treated
as “representative” if a patentee makes no “meaningful ar-
gument for the distinctive significance of any claim limita-
tions not found in the representative claim”).
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REALTIME DATA LLC v. ARRAY NETWORKS INC. 7
parameters or attributes of the data within
the data block or to compress the data block
with a single data compression encoder;
and
wherein the analyzing of the data within
the data block to identify the one or more
parameters or attributes of the data
excludes analyzing based only on a
descriptor that is indicative of the one or
more parameters or attributes of the data
within the data block.
Id. at claim 25.
The ’825 patent includes 30 claims. Claim 18 recites:
18. A method comprising:
associating at least one encoder to each one
of a plurality of parameters or attributes of
data;
analyzing data within a data block to
determine whether a parameter or
attribute of the data within the data block
is identified for the data block;
wherein the analyzing of the data within
the data block to identify a parameter or
attribute of the data excludes analyzing
based only on a descriptor that is indicative
of the parameter or attribute of the data
within the data block;
identifying a first parameter or attribute of
the data of the data block;
compressing, if the first parameter or
attribute of the data is the same as one of
the plurality of parameter or attributes of
the data, the data block with the at least
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8 REALTIME DATA LLC v. ARRAY NETWORKS INC.
one encoder associated with the one of the
plurality of parameters or attributes of the
data that is the same as the first parameter
or attribute of the data to provide a
compressed data block; and
compressing, if the first parameter or
attribute of the data is not the same as one
of the plurality of parameters or attributes
of the data, the data block with a default
encoder to provide the compressed data
block.
’825 patent at claim 18.
The ’203 patent includes 30 claims. Claim 14 recites:
14. A system for decompressing, one or more
compressed data blocks included in one or more
data packets using a data decompression engine,
the one or more data packets being transmitted in
sequence from a source that is internal or external
to the data decompression engine, wherein a data
packet from among the one or more data packets
comprises a header containing control information
followed by one or more compressed data blocks of
the data packet the system comprising:
a data decompression processor configured
to analyze the data packet to identify one
or more recognizable data tokens
associated with the data packet, the one or
more recognizable data identifying a
selected encoder used to compress one or
more data blocks to provide the one or more
compressed data blocks, the encoder being
selected based on content of the one or more
data blocks on which a compression
algorithm was applied;
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REALTIME DATA LLC v. ARRAY NETWORKS INC. 9
one or more decompression decoders
configured to decompress a compressed
data block from among the one or more
compressed data blocks associated with the
data packet based on the one or more
recognizable data tokens; wherein:
the one or more decompression decoders
are further configured to decompress the
compressed data block utilizing content
dependent data decompression to provide a
first decompressed data block when the one
or more recognizable data tokens indicate
that the data block was encoded utilizing
content dependent data compression; and
the one or more decompression decoders
are further configured to decompress the
compressed data block utilizing content
independent data decompression to provide
a second decompressed data block when
the one or more recognizable data tokens
indicate that the data block was encoded
utilizing content independent data
compression; and
an output interface, coupled to the data
decompression engine, configured to output
a decompressed data packet including the
first or the second decompressed data
block.
’203 patent at claim 14.
The family 2 patents. The ’908, ’530, and ’458 patents
are in the same family, share a specification, and are titled
“System and Methods for Accelerated Data Storage and
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10 REALTIME DATA LLC v. ARRAY NETWORKS INC.
Retrieval.” 3 These patents are directed to “[s]ystems and
methods for providing accelerated data storage and re-
trieval utilizing lossless data compression and decompres-
sion.” ’908 patent at Abstract; see also id. at 1:15–18, 2:58–
60, 4:42–44. The patents describe certain drawbacks found
in prior art systems, including that “high performance disk
interface standards . . . offer only the promise of higher
data transfer rates through intermediate data buffering in
random access memory” and do not address the “funda-
mental problem” with physical media limitations, id. at
2:34–42; and that “[f]aster disk access data rates are only
achieved by the high[-]cost solution of simultaneously ac-
cessing multiple disk drives with a technique known . . . as
data striping,” id. at 2:42–45.
The patents purport to overcome these issues by using
a “data storage accelerator,” which “operates to increase
the effective data storage rate of” a “data storage device” or
“memory device.” Id. at 5:35–47; see also id. at 3:25–33.
The specification explains that “the data storage accelera-
tor . . . employs . . . any conventional data compression
method suitable for compressing data at a rate necessary
for obtaining accelerated data storage.” Id. at 16:49–54; see
also id. at 11:31–36. “[T]he data compression ratio of the
data storage accelerator . . . may be adjusted by applying a
different type of encoding process such as employing a sin-
gle encoder, multiple parallel or sequential encoders, or
any combination thereof.” Id. at 10:6–10. The specification
further explains that “[d]ata compression is performed by
an encoder module . . . which may comprise a set of encod-
ers . . . [that] may include any number . . . of those lossless
encoding techniques currently well known within the art.”
Id. at 11:66–12:5. In a preferred embodiment, “the
3 Because these patents share a specification, when
appropriate, we will refer to the ’908 patent specification
for all three.
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REALTIME DATA LLC v. ARRAY NETWORKS INC. 11
encoding techniques are based upon their ability to effec-
tively encode different types of input data.” Id. at 12:5–7.
This, the specification explains, is meant “to eliminate the
complexity and additional processing overhead associated
with multiplexing concurrent encoding techniques.” Id. at
12:31–33. A “compression type descriptor,” moreover, can
be appended to the encoded data block output “so as to in-
dicate the type of compression format of the encoded data
block.” Id. at 12:40–67.
The ’908 patent includes 30 claims. Claim 1 recites:
1. A system comprising:
a memory device; and
a data accelerator configured to compress:
(i) a first data block with a first
compression technique to provide a first
compressed data block; and (ii) a second
data block with a second compression
technique, different from the first
compression technique, to provide a second
compressed data block;
wherein the compressed first and second
data blocks are stored on the memory
device, and the compression and storage
occurs faster than the first and second data
blocks are able to be stored on the memory
device in uncompressed form.
Id. at claim 1.
The ’530 patent includes 26 claims. Claim 1 recites:
1. A system comprising:
a memory device; and
a data accelerator, wherein said data
accelerator is coupled to said memory
device, a data stream is received by said
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12 REALTIME DATA LLC v. ARRAY NETWORKS INC.
data accelerator in received form, said data
stream includes a first data block and a
second data block, said data stream is
compressed by said data accelerator to
provide a compressed data stream by
compressing said first data block with a
first compression technique and said
second data block with a second
compression technique, said first and
second compression techniques are
different, said compressed data stream is
stored on said memory device, said
compression and storage occurs faster than
said data stream is able to be stored on said
memory device in said received form, a first
data descriptor is stored on said memory
device indicative of said first compression
technique, and said first descriptor is
utilized to decompress the portion of said
compressed data stream associated with
said first data block.
’530 patent at claim 1.
The ’458 patent includes 22 claims. Claim 9 recites:
9. A method for accelerating data storage
comprising:
analyzing a first data block to determine a
parameter of the first data block;
applying a first encoder associated with the
determined parameter of the first data
block to create a first encoded, data block
wherein the first encoder utilizes a lossless
dictionary compression technique;
analyzing a second data block to determine
a parameter of the second data block;
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REALTIME DATA LLC v. ARRAY NETWORKS INC. 13
applying a second encoder associated with
the determined parameter of the second
data block to create a second encoded data
block, wherein the second encoder utilizes
a lossless compression technique different
than the lossless dictionary compression
technique; and
storing the first and second encoded data
blocks on a memory device, wherein
encoding and storage of the first encoded
data block occur faster than the first data
block is able to be stored on the memory
device in unencoded form.
’458 patent at claim 9.
The family 3 patent. The ’751 patent is titled “Data
Feed Acceleration” and relates to “systems and method[s]
for providing accelerated transmission of data . . . over a
communication channel using data compression and de-
compression to . . . effectively increase the bandwidth of
the communication channel and/or reduce the latency of
data transmission.” ’751 patent at 1:25–36. The specifica-
tion explains that “accelerated” transmission is “a process
of receiving a data stream for transmission over a commu-
nication channel, compressing the broadcast data in real-
time . . . at a compression rate that increases the effective
bandwidth of the communication channel, and transmit-
ting the compressed broadcast data over the communica-
tion channel.” Id. at 6:28–36. The ’751 patent describes
drawbacks with conventional data transmission systems,
including that “current methods of encryption and com-
pression take as much or substantially more time than the
actual time to transmit the uncompressed, unencrypted
data.” Id. at 3:31–33. A “problem within the current art,”
the ’751 patent explains, “is the latency induced by the act
of encryption, compression, decryption, and decompres-
sion.” Id. at 3:34–36.
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14 REALTIME DATA LLC v. ARRAY NETWORKS INC.
The ’751 patent asserts that it solves these problems
with a “data compression ratio [that] is substantial and re-
peatable on each data packet” and that has “no packet-to-
packet data dependency.” Id. at 7:55–66. The patent ex-
plains that compression can be “achieved” using one or
more “state machines,” which “are constructed based on a-
priori knowledge of the structure and content of one or
more given broadcast and data feeds” and which “com-
prise[] a set of compression tables that comprise infor-
mation for encoding the next character (text, integer, etc.)
or sequence of characters in the broadcast data feed, as well
as pointers which point to the next state (encoding table)
based on the character or character sequence.” Id. at 9:6–
16. The patent further explains that “[g]eneral purpose
computers, servers, workstations, personal digital assis-
tants, special purpose microprocessors, dedicated hard-
ware, or and [sic] combination thereof may be employed to
implement the present invention.” Id. at 8:23–26.
The ’751 patent includes 48 claims. Claim 1 recites:
1. A method for compressing data comprising:
analyzing content of a data block to identify
a parameter, attribute, or value of the data
block that excludes analyzing based solely
on reading a descriptor;
selecting an encoder associated with the
identified parameter, attribute, or value;
compressing data in the data block with the
selected encoder to produce a compressed
data block, wherein the compressing
includes utilizing a state machine; and
storing the compressed data block;
wherein the time of the compressing the
data block and the storing the compressed
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data block is less than the time of storing
the data block in uncompressed form.
Id. at claim 1.
B. Procedural History
Realtime filed suit alleging infringement of various
combinations of the claims of the ’728, ’203, ’908, ’530, and
’751 patents against Appellees Fortinet and Reduxio in No-
vember 2017, against Appellee Panzura in August 2018,
and against Appellee Aryaka in December 2018. Realtime
I, 831 F. App’x at 494. Fortinet, Reduxio, Panzura, and
Aryaka moved to dismiss for failure to state a claim in
2019. Id. at 494–95. They argued, among other things,
that the claims from those five patents were patent ineligi-
ble under 35 U.S.C. § 101. Id. at 495.
In 2019, the district court issued an oral ruling from
the bench dismissing those five patents for lack of subject
matter eligibility under § 101. Id. On appeal, this court
vacated and remanded, finding that the district court had
provided too cursory a ruling to allow for meaningful ap-
pellate review. Id. at 496–98. For example, we explained
that the district court failed to consider the claims as a
whole; to “seriously consider[]” claims beyond claim 25 of
the ’751 patent; or to carefully consider the “directed to”
question. Id.
Following remand, the district court issued a May 4,
2021 written opinion, in which it found that the seven pa-
tents at issue here (and another patent that Realtime later
dropped) invalid for claiming patent-ineligible subject mat-
ter. Realtime II, 537 F. Supp. 3d at 599. 4 In doing so, the
4 By this time, Realtime had sued additional parties
and added additional patents, and some of the new parties
had also filed motions to dismiss. Realtime II, 537 F. Supp.
3d at 599.
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16 REALTIME DATA LLC v. ARRAY NETWORKS INC.
district court first rejected Realtime’s argument that the
court could not rule on a motion to dismiss because there
were factual assertions that prevented disposal at the
pleading stage. Id. at 604–05. The court found, for in-
stance, that the “patents themselves explain that the tech-
nologies and methods used in the claimed analyses were
well-known and routine.” Id. at 605. The court also found
that the 42 paragraphs in one of Realtime’s complaints,
which Realtime argued contained relevant factual asser-
tions, merely recited legal conclusions, quotations from the
patents, and conclusory allegations. Id. None, it found,
identify an inventive feature that is distinct from one of the
claimed abstract ideas. Id.
The district court next analyzed the specific patents.
Id. at 605–616. The court considered whether it was ap-
propriate to use representative claims (concluding that it
was) and applied the two-step ineligibility analysis set
forth in Alice Corp. v. CLS Bank International, 573 U.S.
208 (2014) for each patent. Id. It then summarized its
analysis and addressed Realtime’s arguments, which the
court found were applicable to every patent. Id. at 616–21.
As for Alice step one, the court found that every claim
from the asserted patents is “directed to the concept of ma-
nipulating information using compression.” Id. at 616.
And “[b]ecause data compression is, without more, simply
a form of data analysis, the claims are directed to abstract
ideas.” Id. The court found that the claims are not “highly
specific” and do not provide a “technical solution”: they fail
to teach “how to engineer an improved system,” how to “an-
alyze data,” or how to achieve the claimed “efficiency bene-
fits.” Id. at 616–17. The court found that these factors
distinguished the claims from those at issue in the cases
Realtime relied on—which were “necessarily rooted in com-
puter technology.” Id. at 618 n.4.
As for Alice step two, the court found that the claims
provided no additional features that would transform the
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REALTIME DATA LLC v. ARRAY NETWORKS INC. 17
claims into non-abstract subject matter: “they simply apply
an abstract idea on generic computers with generic tech-
niques.” Id. at 616. The court thus concluded that “all
claims of the asserted patent are invalid under § 101 for
lack of subject matter eligibility.” Id. at 621. The district
court gave Realtime the opportunity to file amended com-
plaints. Id. After Realtime did so, the defendants renewed
their motions to dismiss. See, e.g., J.A. 3411.
On August 23, 2021, the district court again dismissed,
finding once again that the patents were invalid under
§ 101. Realtime III, 556 F. Supp. 3d at 437. The court first
examined whether there were any material differences be-
tween Realtime’s prior complaints and its amended com-
plaints. Id. at 433. It found that nothing added changed
its prior § 101 analysis. Id. It then incorporated its legal
analysis from the Realtime II decision into its decision, re-
affirmed its determination that the claims are all invalid
under § 101, and granted dismissal. Id. at 435–36. At this
point, the district court did not offer Realtime leave to
amend.
Realtime appeals. We have jurisdiction under 28
U.S.C. § 1295(a)(1).
DISCUSSION
We review the grant of a Rule 12(b)(6) motion to dis-
miss under the law of the applicable regional circuit—here,
the Third Circuit. Endo Pharms. Inc. v. Teva Pharms.
USA, Inc., 919 F.3d 1347, 1352 (Fed. Cir. 2019). The Third
Circuit reviews de novo a district court’s grant of a motion
to dismiss for failure to state a claim under Rule 12(b)(6).
Id. (citing Ballentine v. United States, 486 F.3d 806, 808
(3d Cir. 2007)). To survive a motion to dismiss for failure
to state a claim, a complaint must allege “enough facts to
state a claim to relief that is plausible on its face.” Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007).
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18 REALTIME DATA LLC v. ARRAY NETWORKS INC.
Section 101 of the Patent Act states: “Whoever invents
or discovers any new and useful process, machine, manu-
facture, or composition of matter, or any new and useful
improvement thereof, may obtain a patent therefor, subject
to the conditions and requirements of this title.” 35 U.S.C.
§ 101. But § 101 “contains an important implicit exception:
Laws of nature, natural phenomena, and abstract ideas are
not patentable.” Alice, 573 U.S. at 216 (citations omitted).
The Supreme Court has articulated a two-step test for ex-
amining patent eligibility when a patent claim allegedly in-
volves such patent ineligible subject matter. Id. at 217–18.
Under the “Alice” test, a claim falls outside § 101 if (1) it is
directed to a patent-ineligible concept like an abstract idea,
and (2) it lacks elements sufficient to transform the claim
into a patent-eligible application. SAP Am., Inc. v. In-
vestPic, LLC, 898 F.3d 1161, 1166–67 (Fed. Cir. 2018).
We review § 101 patent eligibility under Federal Cir-
cuit law. Smart Sys. Innovations, LLC v. Chi. Transit
Auth., 873 F.3d 1364, 1367 (Fed. Cir. 2017). Eligibility is
ultimately a question of law that may be based on underly-
ing factual findings. Berkheimer v. HP Inc., 881 F.3d 1360,
1365 (Fed. Cir. 2018). And it may be resolved on a Rule
12(b)(6) motion “where the undisputed facts, considered
under the standards required by that Rule, require a hold-
ing of ineligibility under the substantive standards of law.”
SAP Am., 898 F.3d at 1166.
Here, the district court found that the claims of all
seven patents at issue are directed to abstract ideas and
that they do not recite elements that transform the subject
matter into an eligible application of the abstract ideas.
We agree.
A. Alice Step One
At Alice step one, we consider whether the claims are
directed to an abstract idea. In doing so, we review the
asserted claims, considered in light of the specification. Yu
Case: 21-2251 Document: 95 Page: 19 Filed: 08/02/2023
REALTIME DATA LLC v. ARRAY NETWORKS INC. 19
v. Apple, 1 F.4th 1040, 1043 (Fed. Cir. 2021) (citing TecSec,
Inc. v. Adobe Inc., 978 F.3d 1278, 1292 (Fed. Cir. 2020)).
The district court found that the claims from the as-
serted patents are directed to the abstract idea “of manip-
ulating information using compression.” Realtime II, 537
F. Supp. 3d at 616. Specifically, it found that the patents
are directed to the following abstract ideas:
• the ’728 and ’825 patents—“compressing data based
on the content of that data”;
• the ’203 patent—“compressing or decompressing
data based on the characteristics of that data where
a token is used to signify the compression method
used”;
• the ’908 and ’530 patents—“the combination of the
abstract idea of compressing two different data
blocks with different methods and the logical condi-
tion that compression and storage together are
faster than storage of the uncompressed data alone”;
• the ’458 patent—“compressing data using two dis-
tinct lossless compression algorithms such that the
time to compress and store the first data block is less
than the time to store the uncompressed data block”;
and
• the ’751 patent—“compressing data with a state ma-
chine under conditions where compressing and stor-
ing the data is faster than storing the uncompressed
data and where the compression method applied to
the data is based on the content of the data.”
Realtime III, 556 F. Supp. 3d at 430.
Realtime argues that the claims of the asserted patents
are directed not to abstract ideas but “to specific improve-
ments to digital data compression, and do not simply recite
the use of an abstract mathematical formula, or a funda-
mental economic or business practice, on any general-
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20 REALTIME DATA LLC v. ARRAY NETWORKS INC.
purpose computer.” Appellant’s Reply Br. 13 (citing En-
fish, LLC v. Microsoft Corp., 822 F.3d 1327, 1338 (Fed. Cir.
2016)). Realtime contends that this court has “on multiple
occasions highlighted ‘an improved, particularized method
of digital data compression’ as an example of a non-ab-
stract, ‘technologically complex’ invention.” Appellant’s Br.
48 (quoting DDR Holdings v. Hotels.com, L.P., 773 F.3d
1245, 1259 (Fed. Cir. 2014)).
The district court found these arguments unpersua-
sive. “The asserted patents,” it explained, “do not in fact
offer a ‘technologically complex . . . improved, particular-
ized method’ for compression but instead recite abstract
ideas with only the most general directions to apply those
ideas.” Realtime II, 537 F. Supp. 3d at 621–22 (modifica-
tions in original). Indeed, the district court observed, the
claims do not disclose the “how”—“how to engineer an im-
proved system,” how to “analyze data,” or how to achieve
the claimed “efficiency benefits.” Id. at 616–17; see also
Realtime III, 556 F. Supp. 3d at 435 n.6 (“[W]hile the pa-
tents do disclose potential challenges (e.g., the problem of
selecting the best compression method for given data), they
do not teach how to address those challenges.”).
We agree. As we have “repeatedly” held, to avoid inel-
igibility, “a claim must have the specificity required to
transform the claim from one claiming only a result to one
claiming a way of achieving it.” Free Stream Media Corp.
v. Alphonso Inc., 996 F.3d 1355, 1363 (Fed. Cir. 2021)
(cleaned up) (citing SAP Am., 898 F.3d at 1167–68). We
have determined that “the claim itself . . . must go beyond
stating a functional result.” Am. Axle & Mfg., Inc. v.
Neapco Holdings LLC, 967 F.3d 1285, 1302 (Fed. Cir.
2020). The claim must “identify ‘how’ th[e] functional re-
sult is achieved by limiting the claim scope to structures
specified at some level of concreteness, in the case of a prod-
uct claim, or to concrete action, in the case of a method
claim.” Id.; see also Elec. Power Grp., LLC v. Alstom S.A.,
830 F.3d 1350, 1356 (Fed. Cir. 2016) (“[T]here is a critical
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REALTIME DATA LLC v. ARRAY NETWORKS INC. 21
difference between patenting a particular concrete solution
to a problem and attempting to patent the abstract idea of
a solution to the problem in general.” (citation omitted)).
The claims at issue here fail to do this. As the district
court explained, none of the claims at issue specifies any
particular technique to carry out the compression of data—
the particular rules for producing a smaller set of data out
of a larger starting set. Rather, they all take the availabil-
ity of compression techniques as a given and address the
threshold matter of choosing to use one or more such avail-
able techniques. And even as to making such a selection,
the claims are directed to only abstract ideas, calling for
unparticularized analysis of data and achievement of gen-
eral goals.
We begin our review with the family 1 patents. The
representative claim of the ’728 patent recites a method
that requires “analyzing” “data within a data block” using
a “processor” to “identify” certain unspecified “parameters”
or “attributes” of the data; “determining” whether to “out-
put” the data block in either a “received” or “compressed”
form; and “outputting” the data block in the determined
form; wherein outputting in compressed form comprises
determining whether to compress with “content dependent
data compression” (based on the parameters or attributes)
or to compress with a “single data compression encoder”;
and wherein analyzing the data “excludes analyzing based
only on a descriptor that is indicative” of the parameters or
attributes. ’728 patent at claim 25. But neither the claim
nor the specification ever explains how that data is to be
analyzed or compressed. See, e.g., id. at 7:11–22 (“The en-
coder set E1, E2, E3 . . . En may include any num-
ber . . . of . . . lossless encoding techniques currently well
known within the art . . . to provide a broad coverage of ex-
isting and future data types”). The claim, for example, does
not recite whether it analyzes data to determine the data’s
length, complexity, type, or structure. The sole guidance it
provides is that the analysis cannot be “based only on a
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22 REALTIME DATA LLC v. ARRAY NETWORKS INC.
descriptor.” But minimal narrowing does not make the
claim less abstract. BSG Tech LLC v. Buyseasons, Inc., 899
F.3d 1281, 1287 (Fed. Cir. 2018); see also SAP Am., 898
F.3d at 1169 (“further narrowing of what are still mathe-
matical operations” is still abstract).
The representative claim of the ’825 patent is similar.
It recites a method that requires “associating” at least one
“encoder” with unspecified “parameters” or “attributes” of
the data; “analyzing” the data within a “data block” to de-
termine whether the unspecified parameters or attributes
are identified; “identifying” a “parameter”; and “compress-
ing” the data. ’825 patent at claim 18. Like claim 25 of the
’728 patent, this claim also fails to recite how the data is to
be analyzed or compressed.
The representative claim of the ’203 patent fares no
better. It recites a decompression system that requires a
“data decompression processor” to “analyze” a “data
packet” to “identify” “data tokens” associated with the data
packet and which “identify[]” an “encoder used” for com-
pression; “decompression decoders” to “decompress” a
“compressed data block” based on the tokens associated
with the compression method; and an “output interface” to
“output” the decompressed data. ’203 patent at claim 14.
Neither the claim nor the specification explains how the
decompression is actually achieved. See id. at 14:66–15:3
(“The decoders D1 . . . Dn may include those lossless encod-
ing techniques currently well known within the art.”).
Turning to the family 2 patents, the representative
claim of the ’908 patent recites a system requiring a
“memory device” and a “data accelerator” to “compress” a
“first data block with a first compression technique” and a
“second data block with a second compression technique,”
wherein the compressed data blocks are stored on the
memory device and the “compression and storage occurs
faster” than storage of the uncompressed data alone. ’908
patent at claim 1. The claim does not recite specific
Case: 21-2251 Document: 95 Page: 23 Filed: 08/02/2023
REALTIME DATA LLC v. ARRAY NETWORKS INC. 23
compression techniques or explain how the data accelera-
tor selects those techniques. The specification simply notes
that “any” of many “conventional,” “well known,” or “widely
used” compression techniques can be used. Id. at 1:50–53,
4:48–54, 16:49–53, 11:31–45, 11:66–12:5, 13:45–57. Nei-
ther the claim nor the specification, moreover, explains
how the storage of the compressed data occurs “faster.” Id.
at 4:64–5:1 (stating that the “data storage accelerator” is
“configured to simultaneously or sequentially losslessly
compress data at a rate equivalent to or faster than the
transmission rate of an input data stream”).
The representative claim of the ’530 patent is similar
to claim 1 of the ’908 patent but adds storing a compression
technique “descriptor” and “utiliz[ing]” that descriptor to
decompress the data. ’530 patent at claim 1. These recita-
tions do not explain how the storage of the compressed data
occurs “faster,” do not say how the descriptor is imple-
mented, and are at most simply more abstract data manip-
ulation. See Hawk Tech. Sys., LLC v. Castle Retail, LLC,
60 F.4th 1349, 1357 (Fed. Cir. 2023) (“[C]onverting infor-
mation from one format to another—including changing
the format of video data or compressing it—is an abstract
idea.”). Requiring the compression to be done using an
identifier or data descriptor does not make the claims less
abstract. See PersonalWeb Techs. LLC v. Google LLC, 8
F.4th 1310, 1315–18 (Fed. Cir. 2021) (finding that claims
directed to the use of “an algorithm-generated content-
based identifier to perform the claimed data-management
functions” were abstract); Intell. Ventures I LLC v. Syman-
tec Corp., 838 F.3d 1307, 1313 (Fed. Cir. 2016) (finding that
claims for identifying digital data based on “file content
identifiers” were abstract).
The representative claim of the ’458 patent is similar
to those of the ’908 and ’530 patents. It recites a method
that requires “analyzing” a first and a second data block to
determine a “parameter” of those data blocks; “applying”
“encoder[s]” associated with the determined parameters to
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24 REALTIME DATA LLC v. ARRAY NETWORKS INC.
create a first and second encoded data block wherein the
encoders “utilize[]” a “lossless dictionary compression tech-
nique”; and “storing” the encoded data blocks on a memory
device, “wherein encoding and storage of the first encoded
data block occur faster than the first data block is able to
be stored on the memory device in unencoded form.” ’458
patent at claim 9. But requiring the analysis of data
blocks—without explaining how the data is to be ana-
lyzed—and the use of lossless compression techniques does
not make the claim any less abstract. See Hawk, 60 F.4th
at 1357; RecogniCorp, LLC v. Nintendo Co., Ltd., 855 F.3d
1322, 1327 (Fed. Cir. 2017) (“[P]rocess that start[s] with
data, add[s] an algorithm, and end[s] with a new form of
data [is] directed to an abstract idea.”); PersonalWeb
Techs., 8 F.4th at 1317 (“Stringing together the claimed
steps by ‘[a]dding one abstract idea . . . to an-
other,’ . . . amounts merely to the abstract idea of using a
content-based identifier to perform an abstract data-man-
agement function.” (citations omitted)). Neither the claim
nor the specification explains how the storage of the com-
pressed data occurs “faster.” ’458 patent at 4:67–5:4.
As for the family 3 patent, the representative claim of
the ’751 patent recites a method that requires “analyzing
content of a data block to identify a parameter, attribute,
or value” of the data block “that excludes analyzing based
solely on reading a descriptor”; “selecting an encoder”
based on that parameter; “compressing” the data at a cer-
tain rate using a “state machine”; “storing” the data;
“wherein the time of the compressing the data block and
the storing the compressed data block is less than the time
of storing the data block in uncompressed form.” ’751 pa-
tent at claim 1. This claim too states the result to be
achieved: compressing the data block and storing the com-
pressed data block in “less than the time of storing the data
block in the uncompressed form.” Id. Like the claims of
the family 2 patents, claim 1 of the ’751 patent does not
explain how to accomplish the result. Nor does the
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REALTIME DATA LLC v. ARRAY NETWORKS INC. 25
specification meaningfully do so. Id. at 6:28–36 (explaining
that “accelerated” transmission is “a process of receiving a
data stream for transmission over a communication chan-
nel, compressing the broadcast data . . . at a compression
rate that increases the effective bandwidth of the commu-
nication channel, and transmitting the compressed broad-
cast data over the communication channel”); see also id. at
7:11–14. And like the claims of the family 1 patents, claim
1 of the ’751 patent fails to explain how to “analyze” data.
In sum, the claims of the asserted patents are “data
manipulation” claims that are recited at a high “level of re-
sult-oriented generality” and that lack “sufficient recita-
tion of how the purported invention[s]” accomplish the
results. Koninklijke KPN N.V. v. Gemalto M2M GmbH,
942 F.3d 1143, 1152 (Fed. Cir. 2019) (citation omitted).
They thus “amount[] to a mere implementation of . . . ab-
stract idea[s].” Id.
Realtime argues that the claims at issue here are like
those we found eligible in Visual Memory LLC v. NVIDIA
Corp., 867 F.3d 1253 (Fed. Cir. 2017). See Realtime I, 831
F. App’x at 496 (“Realtime identified Visual Memory . . . as
the case most analogous to this one.”). We disagree. The
claims there recited “an enhanced computer memory sys-
tem” that used “programmable operational characteristics
configurable based on the type of processor” to “enabl[e] in-
teroperability with multiple different processors.” Visual
Memory, 867 F.3d at 1259–60. The patent explained that
the enhanced computer memory system “outperform[ed] a
prior art memory system . . . armed with ‘a cache many
times larger than the cumulative size of the subject
caches.’” Id. at 1259. As we later explained, “[t]he patent
did not merely claim this enhancement to the computer
memory system; it explained how it worked, appending
‘263 frames of computer code.’” Univ. of Fla. Research
Found., Inc. v. GE Co., 916 F.3d 1363, 1368 (Fed. Cir. 2019)
(distinguishing the claims in Visual Memory). The patents
here, by contrast, fail to explain the “how.”
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26 REALTIME DATA LLC v. ARRAY NETWORKS INC.
Because the claims of the asserted patents are directed
to abstract ideas, we examine the claims at Alice step two
to determine if the claims are transformed into subject
matter beyond the abstract ideas themselves.
B. Alice Step Two
At Alice step two, we look for an “inventive concept”—
“an element or combination of elements that is sufficient to
ensure that the patent in practice amounts to significantly
more than a patent upon the [ineligible concept] itself.” Al-
ice, 573 U.S. at 217–18 (citation and internal quotation
marks omitted). In so doing, we consider the claim ele-
ments—individually and as an ordered combination—“to
assess whether [they] transform the nature of the claim
into a patent-eligible application of the abstract idea.”
Two-Way Media Ltd. v. Comcast Cable Commc’ns, LLC,
874 F.3d 1329, 1338 (Fed. Cir. 2017) (citation omitted).
The inventive concept must amount to more than “well-un-
derstood, routine, or conventional activities.” Alice, 573
U.S. at 225 (cleaned up). And the “mere recitation of con-
crete, tangible components is insufficient to confer patent
eligibility to an otherwise abstract idea.” In re TLI
Commc’ns, LLC Patent Litig., 823 F.3d 607, 613 (Fed. Cir.
2016). At the same time, “an inventive concept can be
found in the non-conventional and non-generic arrange-
ment of known, conventional pieces.” BASCOM Glob. In-
ternet Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341,
1350 (Fed. Cir. 2016).
The district court found that the claims from the as-
serted patents “simply apply an abstract idea on generic
computers with generic techniques.” Realtime II, 537 F.
Supp. 3d at 616. It thus found that the claims failed Alice
step two. We agree.
Realtime argues that “the disclosed inventions . . . pro-
vide specific, unconventional technological solutions that
improve computer functionality and overcome problems
specifically arising in the realm of compression of digital
Case: 21-2251 Document: 95 Page: 27 Filed: 08/02/2023
REALTIME DATA LLC v. ARRAY NETWORKS INC. 27
computer data.” Appellant’s Br. 63. But this “amounts to
no more than a restatement of the assertion that the de-
sired results are an advance.” Am. Axle & Mfg., 967 F.3d
at 1299. As explained above, the claims here merely claim
a result and are thus directed to ineligible subject matter.
“‘[A] claimed invention’s use of the ineligible concept to
which it is directed cannot supply the inventive concept’ re-
quired to cross the line into eligibility.” Id. (quoting BSG
Tech, 899 F.3d at 1290).
As for the specific patents, Realtime contends that the
claims of the family 1 patents “require specific, unconven-
tional combinations of specially configured computer ele-
ments,” like using content dependent and content
independent data compression, encoders, and processors.
Appellant’s Br. 60–61. The common specification of the
family 1 patents, however, does not purport to require the
use of any special processor. See, e.g., ’728 patent at 6:32–
37 (“[T]he system modules described herein are preferably
implemented in software as an application program that is
executable by, e.g., a general purpose computer or any ma-
chine or device having any suitable and preferred micro-
processor architecture.”). The same goes for the “encoders.”
See, e.g., id. at 7:13–17 (“The encoder set . . . may include
any number . . . of those lossless encoding techniques cur-
rently well known within the art . . . .”); id. at 6:30–32
(“[T]he present invention may be implemented in various
forms of hardware, software, firmware, or a combination
thereof.”). And the common specification explains that
data can be analyzed “using methods known by those
skilled in the art to extract the data compression type de-
scriptor associated with the data block,” id. at 14:59–64,
that “there are many conventional content dependent tech-
niques,” id. at 2:67–3:2, and that it was known that the ef-
fectiveness of data compression is “highly contingent upon
the content of the data being compressed,” id. at 2:33–35.
Realtime also argues that “analyzing the data to iden-
tify one or more parameters or attributes and performing
Case: 21-2251 Document: 95 Page: 28 Filed: 08/02/2023
28 REALTIME DATA LLC v. ARRAY NETWORKS INC.
compression with a plurality of different encoders based on
that analysis” is a “non-conventional” function and that us-
ing “multiple encoders to compress data blocks based on an
analysis of the specific content or type of the data being en-
coded without relying solely on a descriptor” is what the
common specification of the family 1 patents “makes clear”
is the “inventive concept.” Appellant’s Br. 64–65. But
these are themselves abstract ideas and thus cannot pro-
vide an inventive concept. BSG Tech, 899 F.3d at 1290.
As for the family 2 patents, Realtime contends that
they solve “problems in conventional digital data compres-
sion systems,” like “bandwidth limitations,” by requiring
“specific, unconventional combinations of specially config-
ured elements.” Appellant’s Br. 61. Realtime, for example,
points to ’908 patent claim 1’s “memory device” and “data
accelerator,” the latter of which Realtime argues is “uncon-
ventional” because it “requires two different compression
techniques and the structural capability of compressing
and storing digital data faster than the digital data can be
stored in uncompressed form.” Id. But the “memory de-
vice” is simply a generic computer component. See ’908 pa-
tent at 5:42–47 (“The memory storage device 45 may be
volatile or non-volatile in nature, or any combination
thereof. Storage devices as known within the current art
include all forms of random access memory . . . .”). The
compression techniques are generic, well-known, and con-
ventional. See, e.g., id. at 1:51–53, 11:31–45, 11:65–12:10,
13:45–48, 16:52–53. And using a “data accelerator” to store
data “faster” amounts to using a generic component “to in-
crease the speed or efficiency of the process” and thus “does
not confer patent eligibility on an otherwise abstract idea.”
PersonalWeb Techs., 8 F.4th at 1319 (citations omitted).
Using multiple compression techniques and compressing
and storing data on a generic component faster than if it
were uncompressed data, moreover, is an abstract idea and
cannot provide an inventive concept. BSG Tech, 899 F.3d
at 1290.
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REALTIME DATA LLC v. ARRAY NETWORKS INC. 29
Realtime also highlights that claim 1 of the ’530 patent
adds using a descriptor to decompress the compressed
data. Appellant’s Br. 61–62. The ’530 patent specification,
however, confirms that using a descriptor to decompress
data is conventional, explaining that “other data decom-
pression systems and methods known to those skilled in
the art may be employed for providing accelerated data re-
trieval.” ’530 patent at 14:42–48. Realtime also directs us
to an encoder performing compression in claim 1 of the ’458
patent. Yet neither the claim nor the specification de-
scribes specific, unconventional encoding or compression
techniques. So Realtime’s reliance on the encoder is mis-
placed. See Adaptive Streaming Inc. v. Netflix, Inc., 836 F.
App’x 900, 904 (Fed. Cir. 2020) (nonprecedential) (finding
that claims failed Alice step two where there was “no iden-
tification in the claims or written description of specific,
unconventional encoding, decoding, compression, or broad-
casting techniques”).
As for family 3, Realtime asserts that the ’751 patent
addresses problems in the prior art like “latency” and
solves them “by providing an unconventional compression
system allowing for a multiplication of bandwidth and a re-
duction in transmission latency.” Appellant’s Br. 62.
Realtime points to claim 25’s requirement of “a data server”
that is implemented on “processors” and “memory sys-
tems,” and that is configured to “analyze” data, “select” an
encoder, “compress” the data using a “state machine,” and
“store” the data. Id. But Realtime fails to explain how a
“data server,” “processor,” and “memory system” are any-
thing but generic computer components, and indeed, “it is
hard to imagine a patent claim that recites hardware limi-
tations in more generic terms.” In re Bd. of Trs. of Leland
Stanford Junior Univ., 989 F.3d 1367, 1374 (Fed. Cir.
2021) (explaining that patent reciting a method carried out
by a “computer” with a “processor” and a “memory” failed
to require a “specialized computer or a computer with a
specialized memory or processor”). And as for the “state
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30 REALTIME DATA LLC v. ARRAY NETWORKS INC.
machine,” Realtime has acknowledged that such machines
are “well-known computer components.” J.A. 4921 at
31:19–20.
Realtime further contends that the ’751 patent pro-
vides “unconventional technological solutions in digital
data transmission,” by, for instance, providing “transmis-
sion and transparent multiplication of digital data commu-
nication bandwidth, as well as a potential reduction of the
latency associated with data transmission of conventional
systems.” Appellant’s Br. 69. Data transmission, however,
is an abstract idea that does not provide an inventive con-
cept. See Two-Way Media, 874 F.3d at 1340–41. And
Realtime’s assertion of a potential reduction of the latency
“amounts to no more than a restatement of the assertion
that the desired results are an advance.” Am. Axle & Mfg.,
967 F.3d at 1299.
In short, we see nothing in the individual limitations
or their ordered combination that transform the claims into
patent-eligible subject matter. “[M]erely reciting an ab-
stract idea performed on a set of generic computer compo-
nents, as [the claims] do[] here, would ‘not contain an
inventive concept.’” Two-Way Media, 874 F.3d at 1339
(quoting BASCOM, 827 F.3d at 1350).
CONCLUSION
We have considered Realtime’s other arguments and
find them unpersuasive. For the above reasons, we hold
that the claims of the asserted patents are directed to pa-
tent-ineligible subject matter. We thus affirm the district
court’s dismissal under Rule 12(b)(6) based on subject-mat-
ter ineligibility under 35 U.S.C. § 101.
AFFIRMED
COSTS
No costs.
Case: 21-2251 Document: 95 Page: 31 Filed: 08/02/2023
NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
REALTIME DATA LLC, DBA IXO,
Plaintiff-Appellant
v.
ARRAY NETWORKS INC., NIMBUS DATA, INC.,
Defendants
FORTINET, INC., REDUXIO SYSTEMS, INC.,
QUEST SOFTWARE, INC., CTERA NETWORKS,
LTD., ARYAKA NETWORKS, INC., OPEN TEXT,
INC., MONGODB INC., EGNYTE, INC., PANZURA,
INC.,
Defendants-Appellees
______________________
2021-2251
______________________
Appeal from the United States District Court for the
District of Delaware in No. 1:17-cv-00800-CFC, Chief
Judge Colm F. Connolly.
-----------------------------------------------
REALTIME DATA LLC, DBA IXO,
Plaintiff-Appellant
v.
Case: 21-2251 Document: 95 Page: 32 Filed: 08/02/2023
2 REALTIME DATA LLC v. ARRAY NETWORKS INC.
SPECTRA LOGIC CORPORATION,
Defendant-Appellee
______________________
2021-2291
______________________
Appeal from the United States District Court for the
District of Delaware in No. 1:17-cv-00925-CFC, Chief
Judge Colm F. Connolly.
______________________
NEWMAN, Circuit Judge, dissenting.
This is properly an enablement case. The panel today
invalidates patent claims under 35 U.S.C. § 101 by apply-
ing the test for judicial exceptions to patent eligibility as
presented by the Supreme Court in Alice and as enlarged
by the Federal Circuit. I write separately to note once
again that § 101 was never intended to bar categories of
invention in this way. This judicial exception to eligibility
is an unnecessary and confusing creation of the courts.
This case is an example, for the enablement requirement
of § 112 is better suited to determining validity of these
claims than is the distortion of § 101. I respectfully dissent,
and would remand for determination of validity under
§ 112.
The current law of § 101 has diverged from its histori-
cal purpose. Numerous scholars, practitioners, and Con-
gresspeople have observed that the current law of § 101
creates uncertainty and stifles innovation. As I have sum-
marized:
At the time of the Domestic Policy Review, the
meaning of § 101 was not a topic of concern. Sec-
tion 101 was understood as an introduction to the
statute, not as a limitation on patentable subject
Case: 21-2251 Document: 95 Page: 33 Filed: 08/02/2023
REALTIME DATA LLC v. ARRAY NETWORKS INC. 3
matter. The interpretation of patentable subject
matter today is unsatisfactory; it is time to clarify
the principles of patentable subject matter, and to
apply principles supportive of innovation.
Pauline Newman, The Birth of the Federal Circuit, AIPLA
Q.J. 515, 518 (2022).
Representative Doug Collins, then the ranking mem-
ber of the House Judiciary Committee, complained about
this court’s application of § 101, stating:
It’s unthinkable . . . . The courts have misstated
the law several times, which deprives many inno-
vative products of adequate protection. Congress
must establish a new eligibility test to encourage
investment in developing new U.S. technologies
and ensure American inventors aren’t at a global
disadvantage.
Rep. Doug Collins, Press Release, House of Representa-
tives Judiciary Committee, Office of the Ranking Member
(Oct. 4, 2019), https://republicans-judiciary.house.gov/
press-release/collins-calls-for-new-patent-eligibility-test-
following-flawed-court-ruling/ (discussing Am. Axle &
Mfg., Inc. v. Neapco Holdings LLC, 939 F.3d 1355 (Fed. Cir.
2019), opinion withdrawn and replaced by 967 F.3d 1285
(Fed. Cir. 2020)).
Senator Chris Coons, chair of the Senate Subcommit-
tee on Intellectual Property, recently stated:
More than a decade after the Supreme Court
waded into patent eligibility law, uncertainty re-
mains about what areas of innovation are eligible
for patent protection. Critical technologies like
medical diagnostics and artificial intelligence can
be protected with patents in Europe and China, but
not in the United States.
Case: 21-2251 Document: 95 Page: 34 Filed: 08/02/2023
4 REALTIME DATA LLC v. ARRAY NETWORKS INC.
Sen. Chris Coons, quoted in Sen. Thom Tillis, Press Release
(June 22, 2023), https://www.tillis.senate.gov/2023/6/tillis-
coons-introduce-landmark-legislation-to-restore-ameri-
can-innovation. Senator Tillis, ranking member of the
same subcommittee, added:
I have long said that clear, strong, and predictable
patent rights are imperative to enable investments
in the broad array of innovative technologies that
are critical to the economic and global competitive-
ness of the United States, and to its national secu-
rity . . . . Unfortunately, our current Supreme
Court’s patent eligibility jurisprudence is under-
mining American innovation and allowing foreign
adversaries like China to overtake us in key tech-
nology innovations.
Sen. Thom Tillis, id.
Eligibility law has been called a “morass of seemingly
conflicting judicial decisions.” Michael Xun Liu, Subject
matter Eligibility and Functional Claiming in Software Pa-
tents, 20 N.C. J.L. & Tech. 227, 266 (2018). We should not
wade further into this morass.
This case is another example that conforms with our
flawed precedent. I respectfully dissent. I would remand
for determination of validity under § 112 and, if applicable,
§§ 102 and 103.