Constellation Designs LLC v. LG Electronics Inc. et al. Archives

Settlement dispute not arising under patent law doesn’t “survive” Federal Circuit jurisdiction

by Tyler Jackson | Sep 17, 2026 | Patents

The US Court of Appeals for the Federal Circuit concluded that it lacked appellate jurisdiction over a contract dispute arising from a patent settlement agreement because resolving the dispute did not necessarily require deciding a substantial question of patent law. The Court transferred the appeal to the Fifth Circuit. T-Mobile US, Inc. v. KAIFI LLC, Case No. 25-1006 (Fed. Cir. Aug. 28, 2026) (Taranto, Schall, Chen, JJ.)

KAIFI sued T-Mobile in the US District Court for the Eastern District of Texas, alleging infringement of a patent directed to Wi-Fi calling technology. T-Mobile subsequently requested ex parte reexamination (EPR) of the patent. While the EPR remained pending, the parties settled the infringement action.

Under the settlement agreement, T-Mobile received a license to the patent, made an initial payment, and agreed to make an additional contingent payment if any “Asserted Claim survives the EPR.” The agreement defined the asserted claims as the patent claims KAIFI had accused T-Mobile of infringing and included a covenant by T-Mobile not to challenge the validity or enforceability of the licensed patents. Texas law governed the agreement.

The United States Patent & Trademark Office (USPTO) later issued a Reexamination Certificate confirming the patentability of multiple asserted claims without amendment. T-Mobile nevertheless declined to make the contingent payment and filed a declaratory judgment action. T-Mobile argued that a claim “survived” reexamination only if it retained sufficient scope to support KAIFI’s previously asserted infringement theory. T-Mobile also asserted frustration of purpose and lack of mutual assent. KAIFI counterclaimed for breach of contract.

The district court granted summary judgment for KAIFI, concluding that the settlement agreement was unambiguous and that an asserted claim “survives” an EPR if the USPTO confirms the claim as patentable in the Reexamination Certificate. The court ordered T-Mobile to make the additional payment under the agreement. T-Mobile appealed to the Federal Circuit.

The Federal Circuit independently considered its jurisdiction under 28 USC § 1295(a)(1). Because KAIFI’s breach of contract claim arose under state law, Federal Circuit jurisdiction depended on whether the claim fell within the “special and small category” of state-law claims satisfying the Supreme Court’s four-part test of Gunn v. Minton (2013). That test assesses whether a federal issue is:

Necessarily raised;
Actually disputed;
Substantial; and
Capable of resolution in federal court without disrupting the federal-state balance.

The Federal Circuit concluded that the first Gunn requirement was not satisfied because KAIFI could prevail on its contract claim without resolving any patent-law issue. One permissible interpretation of “survives the EPR” was its ordinary meaning, which is that an asserted claim survives when the USPTO confirms its patentability rather than cancels it. That interpretation required only consideration of the agreement and the Reexamination Certificate, not resolution of claim construction, prosecution disclaimer, inequitable conduct, or another issue of substantive patent law.

The Federal Circuit rejected T-Mobile’s argument that determining whether the claims “survived” necessarily required analyzing whether KAIFI altered the scope of the claims through positions taken during reexamination. The Court explained that T-Mobile’s theory was [...]

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Result-oriented claims fail to pass § 101 muster; industry standards may prove individual claim limitations

by Courtney Seams | Sep 10, 2026 | Patents

The US Court of Appeals for the Federal Circuit concluded that claims broadly directed to optimizing signal constellations for a particular result were patent ineligible, but upheld claims directed to specific constellations. The Court also confirmed that industry standards may be used on a limitation-by-limitation basis to prove infringement. Constellation Designs LLC v. LG Electronics Inc., et al., Case No. 24-1822 (Fed. Cir. Aug. 31, 2026) (Stoll, Lourie, JJ.; Oetken, District J., sitting by designation).

Constellation Designs sued LG for infringement of four patents directed to digital communication systems using signal constellations to transmit and decode data. Constellation accused LG televisions compatible with the ATSC 3.0 over-the-air television broadcast standard, specifically its A/322 protocol. The asserted claims fell into two groups: claims reciting geometrically spaced symbol constellations optimized for capacity using parallel decode (PD) capacity (optimization claims) and claims reciting specific non-uniform constellations (constellation claims).

The district court granted Constellation summary judgment that all asserted claims were patent eligible under 35 USC § 101. Following trial, a jury found that LG willfully infringed the asserted claims and awarded Constellation about $1.68 million in damages. The district court denied LG’s post-trial motions challenging infringement and damages, and entered an ongoing royalty of $6.75 per television. LG appealed.

Addressing patent eligibility, the Federal Circuit distinguished between the optimization claims and the constellation claims. At step one of the Alice framework, the Court concluded that the optimization claims were directed to the abstract idea of optimizing a constellation for PD capacity. The claims recited a desired result (improved capacity at a reduced signal-to-noise ratio) but did not recite how to achieve that result. The Court analogized the claims to the result-oriented claims found ineligible in other cases, explaining that the claims broadly covered essentially all ways of optimizing a constellation for PD capacity.

Although the specification described techniques for performing the optimization, the claims did not recite those details. The Federal Circuit explained that the § 101 inquiry focuses on the claim language and that technical details disclosed only in the specification cannot be imported into the claims to establish eligibility. At Alice step two, the Court found no inventive concept because Constellation’s alleged inventive concept (optimizing non-uniform constellations based on PD capacity) was the abstract idea itself. The Court therefore vacated the district court’s summary judgment of eligibility as to the optimization claims.

The Federal Circuit reached a different conclusion as to the constellation claims. Those claims did not broadly claim optimization but instead recited specific constellations developed using techniques described in the patents. The Court found that this distinction “makes all the difference” because the constellation claims recited a concrete implementation of a technological improvement directed to overcoming limitations in constellation capacity. The Court therefore affirmed the district court’s finding that those claims were patent eligible.

The Federal Circuit also affirmed the denial of LG’s motion for judgment as a matter of law of noninfringement. At trial, Constellation relied on the ATSC 3.0/A/322 standard to establish that the accused device met [...]

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Lost in the constellation: Result-oriented claims miss the mark under § 101

by Keval Amin | May 7, 2026 | Patents

Addressing issues related to patent eligibility, infringement, and damages, the US Court of Appeals for the Federal Circuit vacated in part, affirmed in part, and remanded, finding that certain result-oriented claims were directed to an abstract idea, lacked an inventive concept, and were therefore not patent eligible. Constellation Designs, LLC v. LG Electronics Inc., et al., Case No. 24-1822 (Fed. Cir. Apr. 28, 2026) (Lourie, Stoll, Oetken, JJ.)

Constellation sued LG for infringing its patents directed to communication systems employing non-uniform constellations, which are signal configurations designed to improve data transmission capacity compared to conventional uniform constellations. The accused products were LG televisions compliant with the ATSC 3.0 broadcast standard.

Constellation successfully moved for summary judgment in its favor on patent eligibility under 35 U.S.C. § 101. At trial, Constellation asserted nine claims across four patents, which the parties grouped into two categories: “optimization claims,” which recited constellations optimized for capacity, and “constellation claims,” which recited specific non-uniform constellation configurations. A jury found willful infringement and awarded damages. The district court denied LG’s motions for judgment as a matter of law (JMOL) of noninfringement and no damages. LG appealed.

On the patent eligibility issue, the Federal Circuit applied the two-step Alice framework and vacated the district court’s ruling as to the optimization claims. At step one, the Court found those claims directed to the abstract idea of optimizing a constellation for parallel decoding capacity. The Court emphasized that the claims were written in a result-oriented manner, reciting a constellation “optimized” for capacity without specifying how that optimization was achieved. Although the claims did not cover every possible optimization technique, they were broad enough to encompass all ways of optimizing a constellation for parallel decoding capacity. The Court rejected Constellation’s reliance on technical details in the specification and reiterated that the § 101 inquiry focuses on the claim language, not unclaimed implementation details. At step two, the Court found no inventive concept, explaining that Constellation’s alleged innovation was the abstract idea itself and that arguments based on novelty or nonobviousness do not satisfy § 101.

In contrast, the Federal Circuit affirmed the district court’s eligibility determination for the constellation claims. The Court explained that representative claims recited specific, concrete configurations (such as unequally spaced constellation points, distinct labeling, and overlapping point locations) amounting to a particular technological solution to a defined problem. Because those claims were not directed to an abstract idea, the Court did not proceed to step two.

On infringement, the Federal Circuit affirmed the denial of JMOL. The Court clarified that a patentee may rely on industry standard compliance to prove some claim limitations while using product-specific evidence for others, as long as the standard is sufficiently specific and either mandatory or shown to be implemented in the accused products. Applying that framework, the Court found that substantial evidence supported the jury’s verdict.

As for damages, the Federal Circuit affirmed the denial of LG’s JMOL motion and its challenge to the admissibility of Constellation’s damages expert. The Court [...]

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