In November of 2016, the Federal Circuit upheld a district court's invalidation of Affinity Lab's Patent No. 7,970,379 ("the '379 Patent), which was directed to a method and system for streaming regional broadcast signals to cellular telephones located outside the region served by the regional broadcaster. Affinity had sued a variety of defendants, including DirecTV, Major League Baseball, and the National Hockey League for infringing its patent by their use of streaming services to broadcast games to fans. Many major league sports companies like the MLB and NHL use streaming devices to enable subscribers to view games on their phones when outside of their local broadcast region. Due to complex broadcast rights and blackout requirements, fans cannot always watch their favorite teams while traveling without this type of streaming service. Streaming services also provide an additional revenue stream for major sports leagues.
At the district court level, the Magistrate Judge assigned to the case recommended that the '379 Patent be held invalid under the Alice test. Under the guidance of the Alice case, the court conducts a two-step test to determine if a patent is merely directed to an abstract idea (i.e., and therefore invalid). First the court looks to see whether the claim is directed to a patent-ineligible concept, i.e., a law of nature, a natural phenomenon, or an abstract idea. If it is, the court then looks to whether the elements of the claim, considered both individually and as an ordered combination, add enough to transform the nature of the claim into a patent-eligible application.
In applying the Alice test, the Magistrate Judge reasoned that all the patent did was take the abstract idea of broadcasting a game to a user who is outside of the game's broadcast region and apply it to a generic cellular telephone device acting as a generic computer. The district court accepted the Magistrate Judge's recommendation and entered judgment against the patent owner. The Federal Circuit upheld the decision. It reasoned that "[t]he practice of conveying regional content to out-of-region recipients has been employed by nearly every form of media that has a local distribution. . . As the magistrate judge noted, such out-of-region broadcasts have been commonplace since the late 20th century, in the form of systems delivering local radio and television broadcasts of sporting events to a national audience." The claims themselves did nothing to transform the nature of the claim into a patent-eligible application. The claims did not explain how the streaming was to be implemented, only that it was to be done. According to the Federal Circuit, the claims did nothing more than simply describe the abstract method.
Affinity petitioned the Supreme Court to review the Federal Circuit's decision, but the petition was denied.
Affinity Labs of Texas, LLC. v. DirecTV, LLC, 838 F.3d 1253 (Fed. Cir. 2016)
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