Delaware Court Splits TQ Delta's Phase Scrambling Patents Under Section 101: The '243 Patent Survives, the '158 Patent Falls.

The case and the motion

TQ Delta filed TQ Delta, LLC v. DISH Network Corporation on July 17, 2015 against DISH Network Corporation, DISH Network LLC, DISH DBS Corporation, EchoStar Corporation, and EchoStar Technologies, L.L.C. On September 11, 2024, the defendants moved for summary judgment that claims 1, 2, 7, 12, 13, 14, 15, and 20 of the '243 patent and claims 1, 6, and 9 of the '158 patent are invalid under 35 U.S.C. 101 (D.I. 562). The two patents share a specification on multicarrier modulation, such as discrete multitone, in which data bits are carried on many carrier signals. As the opinion summarizes the specification, if the phases of the modulated carriers are not random, the peak-to-average power ratio (PAR) of the transmission signal can rise sharply, which can mean high power consumption or clipping. The patents describe scrambling the carriers' phase characteristics to address that problem.

Representative claims

The defendants treated claim 1 of each patent as representative. TQ Delta did not argue otherwise, and the court, applying Mobile Acuity Ltd. v. Blippar Ltd., 110 F.4th 1280 (Fed. Cir. 2024), and Berkheimer v. HP Inc., 881 F.3d 1360 (Fed. Cir. 2018), held that claim 1 of the '243 patent is representative of the asserted '243 claims and claim 1 of the '158 patent is representative of the asserted '158 claims.

The '243 patent: a concrete technological solution

Claim 1 of the '243 patent covers a method in a multicarrier communications transceiver that has a bit scrambler followed by a phase scrambler: scrambling a plurality of input bits with the bit scrambler to generate scrambled output bits, at least one of which differs from its input bit; scrambling, with the phase scrambler, a plurality of carrier phases associated with the scrambled output bits; and transmitting at least one scrambled output bit on a first carrier and on a second carrier. The defendants argued the claim is directed to data conversion stated in results-based functional language and compared it to Hawk Technology Systems, LLC v. Castle Retail, LLC, 60 F.4th 1349 (Fed. Cir. 2023).

The court agreed with TQ Delta. It relied on its earlier construction of "phase scrambler" as a "component operable to adjust the phases of the carrier signals, by pseudo-randomly varying amounts" (D.I. 202), and on Constellation Designs, LLC v. LG Electronics Inc., 189 F.4th 1111 (Fed. Cir. 2026), and Koninklijke KPN N.V. v. Gemalto M2M GmbH, 942 F.3d 1143 (Fed. Cir. 2019). Read as a whole, the court said, claim 1 "describes how to lower PAR by pseudo-randomly scrambling the phases of carrier signals," so the benefit described in the specification is in the claim language, and the claim is "directed to a specific technological solution that improves the functionality of the multicarrier communications transceiver." The court held the claim is not directed to an abstract idea, did not reach step two, and denied summary judgment on the '243 patent.

The '158 patent: calculating, not applying, the phase shift

Claim 1 of the '158 patent covers a method, in a multicarrier modulation system with two transceivers, of transmitting data bits from the first transceiver to the second; associating a carrier signal with a value determined by a pseudo-random number generator independently of the data bits the carrier carries; determining a phase shift for the carrier signal based at least on that value; and modulating at least one data bit on that carrier signal and on a second carrier signal. The defendants argued the steps stop at calculating a desired phase shift. The opinion notes that TQ Delta conceded that applying the phase adjustment to the carrier is not required by claim 1.

At step one the court compared the claim to Digitech Image Technologies, LLC v. Electronics for Imaging, Inc., 758 F.3d 1344 (Fed. Cir. 2014), and held that, absent an instruction to apply the phase shift to the phase of a carrier signal, the claim is directed to the abstract idea of calculating scrambled phases. It rejected TQ Delta's reliance on Carl Zeiss Stiftung v. Renishaw PLC, 945 F.2d 1173 (Fed. Cir. 1991), for the point that a claim need not recite every element needed for the practical utilization of the claimed subject matter, because that statement was made in the context of the utility requirement of section 101, not patent eligibility. At step two, the court held that the claimed ordered combination supplies no inventive concept, because the PAR reduction TQ Delta pointed to depends on applying the calculated phase shift, which the claim does not require. It granted summary judgment that the asserted '158 claims are invalid under section 101.

Practice pointers

The two rulings turn on the same specification and the same technical benefit, and the difference is whether the claim recites the step that produces the benefit. A claim that computes a value the specification says should be applied to a signal, without reciting the application, invites a Digitech comparison. Prior claim constructions carry weight at step one: the court read "phase scrambler" through its construction to find a concrete implementation in the '243 claim. And under Mobile Acuity, a patentee that offers no argument against representativeness lets one claim decide the eligibility of every asserted claim of that patent, as happened here for both patents.

What to watch next

The opinion is D.I. 744, and the court entered its order on the opinion the same day (D.I. 745). The docket shows further memorandum opinions and orders entered October 20 through 22, 2026 (D.I. 748 through 754), two of them under seal. Watch for what those rulings decide and for the schedule on the '243 claims.