Midland Court Keeps Skysong's Patent Case Against CrowdStrike, and a Federal Circuit Appeal Is Noticed the Next Day.

The appeal notice

A notice of appeal to the Federal Circuit was entered on October 27, 2026, as ECF No. 225 in Skysong Innovations, LLC v. CrowdStrike Inc., No. 7:25-cv-00040 (W.D. Tex.), a case pending in the Midland-Odessa Division before District Judge David Counts, with Magistrate Judge Derek T. Gilliland handling referred matters. The notice came one day after Judge Counts denied the defendants' motion to transfer venue under 28 U.S.C. 1404(a).

The parties and the patents

The complaint, filed January 31, 2025, says Skysong is a private nonprofit and the exclusive intellectual property management and technology transfer organization for Arizona State University. The defendants are CrowdStrike, Inc. and CrowdStrike Holdings, Inc. The complaint alleges, on information and belief, that both are Delaware corporations with their headquarters and principal place of business in the Western District of Texas, and says CrowdStrike Holdings is the parent of and wholly owns CrowdStrike, Inc. It accuses the Falcon Platform, including Falcon Exposure Management and Falcon Adversary Intelligence and related modules and functionality.

The original complaint asserted four patents: U.S. Patent 10,313,385, Systems and methods for data driven game theoretic cyber threat mitigation, issued June 4, 2019 (at least claim 8); U.S. Patent 11,275,900, Systems and methods for automatically assigning one or more labels to discussion topics shown in online forums on the dark web, issued March 15, 2022 (at least claim 12); U.S. Patent 11,775,831, Cascaded computing for convolutional neural networks, issued October 3, 2023 (at least claim 1); and U.S. Patent 11,892,897, Systems and methods for predicting which software vulnerabilities will be exploited by malicious hackers to prioritize for patching, issued February 6, 2024 (at least claim 1). The first amended complaint, filed May 16, 2025 (ECF No. 29), asserts five patents, adding U.S. Patent 10,574,721, issued February 25, 2020. The court's dismissal recommendation describes the amended complaint as accusing the Falcon Platform of infringing claim 1 of the '721 patent.

USPTO assignment records show the Arizona Board of Regents, on behalf of Arizona State University, assigned the '385, '900, '831 and '897 patents to Skysong in assignments executed January 29, 2025, two days before the complaint was filed, and assigned the '721 patent to Skysong in an assignment executed February 20, 2025.

What the court has decided so far

On February 2, 2026, Magistrate Judge Gilliland recommended granting in part and denying in part CrowdStrike's motion to dismiss the amended complaint. He recommended dismissing the claims for pre-suit inducement, pre-suit willfulness and post-suit willfulness without prejudice to repleading after fact discovery. He found that a March 2019 conference meeting between an inventor of three of the patents and one of CrowdStrike's founders, along with other unspecified interactions, did not plead enough facts to show pre-suit knowledge of the patents. He recommended denying the motion on post-suit inducement and on direct infringement of the '721 patent, which CrowdStrike had challenged as resting on a third-party company's documents. Judge Counts adopted the recommendation on February 17, 2026, with no objections filed.

After a claim construction hearing on March 11, 2026, Magistrate Judge Gilliland issued final constructions on March 12 and a memorandum explaining them on May 29, 2026 (ECF No. 148). He construed "browser" and "browser instance" in the '721 patent as "a web browser" and "an instance of a web browser," construed "before disclosure" in the '897 patent as "prior to disclosure to a public database," and construed "first set of most significant bits (MSBs)" in the '831 patent as "a first set of bits containing two or more high order bits, but less than all the bits, in a data set." He held "sensitive information presenting a security risk" in the '721 patent not indefinite, and gave the remaining disputed terms their plain and ordinary meaning.

The transfer ruling

CrowdStrike moved in October 2025 to transfer the case to the Northern District of California or, in the alternative, to the Austin Division of the Western District of Texas (ECF No. 62). Magistrate Judge Gilliland recommended denial. In the October 26, 2026 order (ECF No. 224), Judge Counts reviewed CrowdStrike's objections de novo, overruled them, adopted the recommendation and denied the motion.

The court held that CrowdStrike had not met the threshold requirement of showing the case could have been brought against both defendants in the Northern District of California. CrowdStrike had asked the court to exclude or sever CrowdStrike Holdings as a non-operating holding company, but the court declined, because CrowdStrike Holdings is accused of wholly owning and controlling its co-defendant's activities. The court said that alone was fatal to the main part of the motion.

The court also weighed the convenience factors. It found that access to sources of proof supported transfer, but with less weight because most evidence is electronic; that compulsory process was neutral; that the cost of attendance for willing witnesses weighed against transfer; and that practical problems weighed slightly against transfer, citing the Western District of Texas's smaller caseload, a transfer motion filed more than eight months after suit, and a trial date about four months away. Court congestion weighed against transfer, the local interest factor supported it, and the two remaining public factors were neutral. On the Austin alternative, the court declined to consider arguments not made to the magistrate judge and found that the reduced travel for Austin-area witnesses did not establish good cause for an intra-district transfer.

Other open matters on the docket

The docket shows that on September 10, 2026, CrowdStrike filed objections under seal to an order denying its motion to stay (ECF No. 194), with a redacted copy filed September 17, 2026. An October 2025 order set the final pretrial conference for January 14, 2027, in Midland before Judge Counts.

What to watch next

Watch for the Federal Circuit to docket the appeal, which will show the appeal number, the appellant, and the order under review, and for any ruling on the objections to the stay order. The case can end at any time, including by settlement or voluntary dismissal.