SpectraNet Tech LLC v. Raft Tech Ltd

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: SpectraNet Technologies LLC (Delaware)
  • Defendant: Raft Technologies Ltd (Israel) and 3DB Communication Inc. (Delaware)
  • Plaintiff's Counsel: Skiermont Derby LLP
• Case Identification: 1:26-cv-05870, N.D. Ill., 05/20/2026
• Venue Allegations: Venue is alleged to be proper in the Northern District of Illinois because Defendant 3DB Communication Inc. has a regular and established place of business in the district, where it operates multiple microwave and shortwave antenna transmitter and receiver stations.
• Core Dispute: Plaintiff alleges that Defendants' ultra-low latency wireless communication systems, used for High-Frequency Trading (HFT), infringe three patents related to low-latency wireless messaging using ionospheric radio transmission.
• Technical Context: The technology involves using High Frequency (HF) radio waves, which travel faster through the atmosphere than light through fiber optic cables, to create low-latency data links for time-sensitive applications like financial trading.
• Key Procedural History: The complaint alleges that Defendants have been aware of the asserted patent family since at least May 17, 2021, when a parent to the patents-in-suit was cited by a USPTO examiner during the prosecution of a patent application owned by Defendant Raft. This allegation forms the basis for a claim of willful infringement.

Case Timeline

Date	Event
2012-07-24	Priority Date for '123, '694, and '002 Patents
2016-05-19	Date of last visit to Defendant's websites cited in the complaint
2021-03-23	'123 Patent Issued
2021-05-17	Alleged Date of Defendants' Pre-Suit Knowledge of Patent Family
2022-11-29	'694 Patent Issued
2024-07-12	Start of a date range in Defendant's publicly touted performance data
2025-09-09	'002 Patent Issued
2026-05-20	Complaint Filed

II. Technology and Patent(s)-in-Suit Analysis

U.S. Patent No. 10,959,123 - Low Latency Wireless Messaging

• Patent Identification: U.S. Patent No. 10,959,123, "Low Latency Wireless Messaging", issued March 23, 2021 (the "'123 Patent") Compl. ¶26

The Invention Explained

• Problem Addressed: The patent addresses the trade-off between different communication media. While ionospheric radio wave transmission offers lower propagation latency than fiber optics (as radio waves travel faster in air than light in glass), this advantage can be negated by "message size latency"-the processing time required for large messages, which is greater for radio transmissions (Compl. ¶33; Compl. ¶34, Compl. ¶¶col. 1:21-51).
• The Patented Solution: The invention proposes a method to minimize total latency by attacking both its components. It reduces message-size latency by encoding a message into a more compact format that is known in advance by the receiver Compl. ¶34 '123 Patent, col. 10:25-32 It then optimizes for propagation latency by determining specific physical-layer transmission parameters (e.g., frequency, modulation type, power) based on both the desired message latency and a predefined channel bandwidth, before transmitting the encoded message via an ionospheric path Compl. ¶35 '123 Patent, col. 3:9-15
• Technical Importance: For certain consumers, such as high-frequency traders, a latency difference of microseconds can translate into revenue differences of millions of dollars Compl. ¶31 '123 Patent, col. 1:48-51

Key Claims at a Glance

• The complaint asserts independent claim 1 Compl. ¶65
• The essential elements of independent claim 1 are:
  • receiving a request for a particular action to be performed;
  • encoding a particular value using a format derived to effect message latency into an encoded message for transmission to the remote receiving device over a frequency in an ionospheric HF frequency band, wherein the particular value is known a priori to the remote receiving device as corresponding to the particular action;
  • determining transmission parameters for transmission of the encoded message in the ionospheric HF frequency band based at least on (a) message latency and on (b) a predefined channel bandwidth; and
  • transmitting the encoded message in the ionospheric HF frequency band according to the determined transmission parameters to the remote receiving device.
• The complaint reserves the right to assert additional claims Compl. p. 17, n.1

U.S. Patent No. 11,516,694 - Low Latency Wireless Messaging

• Patent Identification: U.S. Patent No. 11,516,694, "Low Latency Wireless Messaging", issued November 29, 2022 (the "'694 Patent") Compl. ¶27

The Invention Explained

• Problem Addressed: The patent addresses the same latency problems in long-distance communication as the '123 Patent (Compl. ¶32; Compl. ¶33; Compl. ¶34, Compl. ¶¶col. 1:21-51).
• The Patented Solution: The solution is substantively identical to that of the '123 Patent, involving encoding a message and determining transmission parameters to reduce latency. This patent's claims, however, add an explicit requirement that the "encoded message is smaller than the particular message," reinforcing the goal of reducing message-size latency Compl. ¶38 '694 Patent, abstract
• Technical Importance: The technical importance is the same as for the '123 Patent, focusing on enabling ultra-low latency communication for applications like HFT where speed is critical Compl. ¶31 '694 Patent, col. 1:48-51

Key Claims at a Glance

• The complaint asserts independent claim 1 Compl. ¶85
• The essential elements of independent claim 1 are:
  • receiving a request to transmit a particular message to the remote receiving device;
  • encoding the particular message using a format derived to effect message latency into an encoded message... wherein the encoded message is known a priori... and wherein the encoded message is smaller than the particular message;
  • determining transmission parameters for transmission of the encoded message in the ionospheric HF frequency band based at least on (a) message latency and on (b) a predefined channel bandwidth; and
  • transmitting the encoded message over the frequency in the ionospheric HF frequency band using the determined transmission parameters.
• The complaint reserves the right to assert additional claims Compl. p. 17, n.1

U.S. Patent No. 12,414,002 - Low Latency Wireless Messaging (Multi-Patent Capsule)

• Patent Identification: U.S. Patent No. 12,414,002, "Low Latency Wireless Messaging", issued September 9, 2025 (the "'002 Patent") Compl. ¶28

Technology Synopsis

The '002 Patent is also directed to methods for reducing latency in HF radio communications. It claims a method of encoding a message into a smaller, known format and transmitting it using optimized parameters. A key distinction in its claims is the selection of transmission parameters based on an "estimated propagation latency," with the patent specifying that this estimation may be based on factors like time of day, solar cycle, number of ionospheric bounces, and distance Compl. ¶¶40-41 The patent also includes claims directed to the receiver-side method of decoding the message Compl. ¶42

Asserted Claims

Independent claim 1 Compl. ¶104

Accused Features

The accused features are Defendants' shortwave trading systems, which allegedly receive trade requests, encode them into smaller messages, determine transmission parameters based on latency and bandwidth constraints, and transmit them via an HF band Compl. ¶¶105-116

III. The Accused Instrumentality

Product Identification

The accused instrumentalities are Defendants' "ultra-low latency and transcontinental communication systems" that utilize "Skywave" radio frequency technology, specifically for clients in the High-Frequency Trading (HFT) market Compl. ¶45 Compl. ¶54

Functionality and Market Context

The complaint alleges that Defendants operate an end-to-end communication service connecting financial hubs, such as Chicago and Frankfurt, using HF radio signals to achieve lower latency than fiber optic networks Compl. ¶16 Compl. ¶18 Compl. ¶59 A diagram from a Defendant's presentation illustrates this system structure, showing a "Co-Location" site in Chicago communicating via HF radio with a "Co-Location" site in Frankfurt Compl. ¶18 To manage the bandwidth limitations of HF radio, the system allegedly encodes trading information into very small messages, such as "indicators" comprised of only a few bits, using a pre-agreed "vocabulary" known to the receiver Compl. ¶58 Compl. ¶70 Compl. ¶71 This service is marketed to HFT firms, where latency advantages of milliseconds or less are critical for "latency arbitrage" and can lead to significant profits Compl. ¶¶46-47

IV. Analysis of Infringement Allegations

'123 Patent Infringement Allegations

Claim Element (from Independent Claim 1)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
receiving a request for a particular action to be performed;	The accused system receives requests to perform a trade (e.g., buy or sell a security) on behalf of HFT clients.	¶68	col. 7:1-4
encoding a particular value using a format derived to effect message latency into an encoded message... wherein the particular value is known a priori to the remote receiving device as corresponding to the particular action;	Defendants' system encodes trade information into compact "indicators" using a limited, predefined "vocabulary" of symbols. A presentation slide shows specific signals for "Ask Increase" or "Bid Decrease" mapped to hexadecimal codes, which are known beforehand by the receiver to enable trading.	¶71	col. 10:25-46
determining transmission parameters for transmission of the encoded message... based at least on (a) message latency and on (b) a predefined channel bandwidth;	(a) Defendants are alleged to select parameters like modulation type and frequency to meet or beat latency requirements for HFT. (b) Defendants' FCC licenses define specific channel bandwidths (e.g., 96 kHz from designator "96K0") that they must operate within, which informs parameter determination.	¶73; ¶75	col. 3:9-15
transmitting the encoded message in the ionospheric HF frequency band according to the determined transmission parameters to the remote receiving device.	Defendants operate antenna stations in Illinois and elsewhere to transmit the encoded HFT messages as shortwave (HF) signals across the Atlantic Ocean to remote locations like Frankfurt.	¶67; ¶72	col. 3:18-24

'694 Patent Infringement Allegations

Claim Element (from Independent Claim 1)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
receiving a request to transmit a particular message to the remote receiving device;	The accused system receives requests to transmit a trade message on behalf of HFT clients.	¶87	col. 13:58-61
encoding the particular message... wherein the encoded message is known a priori... and wherein the encoded message is smaller than the particular message;	The system encodes trade messages into small "indicators" of several bits. The complaint alleges these messages are made "smaller than the particular message to fit within the limited available bandwidth and decrease latency."	¶89; ¶91	col. 13:62-65
determining transmission parameters for transmission of the encoded message... based at least on (a) message latency and on (b) a predefined channel bandwidth;	(a) Defendants allegedly select parameters to satisfy HFT latency constraints. (b) Defendants must determine parameters that comply with the predefined channel bandwidth specified in their FCC licenses.	¶92; ¶94	col. 14:3-10
transmitting the encoded message over the frequency in the ionospheric HF frequency band using the determined transmission parameters.	Defendants use their antenna network to transmit the encoded messages via HF radio signals between financial centers like Chicago and Frankfurt.	¶86; ¶95	col. 14:11-15

Identified Points of Contention

• Scope Questions: The core of the dispute may center on the "determining transmission parameters" step. A question for the court will be whether selecting parameters to comply with a static FCC license Compl. ¶73 while having a general goal of low latency meets the claim requirement of "determining... based at least on (a) message latency and (b) a predefined channel bandwidth." The patents describe a "controller" with multiple "determinator" modules, which may suggest a more active, computational process than what is alleged '123 Patent, FIG. 3
• Technical Questions: The complaint alleges that parameters are selected based on "message latency," but the primary evidence cited for parameter selection is the "predefined channel bandwidth" from FCC licenses. A key technical question will be what evidence demonstrates that message latency is a specific input into the parameter determination process, as opposed to simply being the desired outcome of the overall system design.

V. Key Claim Terms for Construction

• The Term: "determining transmission parameters... based at least on (a) message latency and on (b) a predefined channel bandwidth"

• Context and Importance: This limitation is central to all asserted independent claims. The infringement case hinges on whether Defendants' alleged actions satisfy this two-part "basis" for "determining" parameters. Practitioners may focus on this term because its construction will define whether a general system configuration aimed at low latency is sufficient, or if a specific, dynamic calculation using latency and bandwidth as inputs is required.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The patents state the technology can be used to "determine transmission parameters that minimize message latency while still meeting predetermined channel bandwidth requirements" '123 Patent, col. 3:11-15 A defendant could argue that any selection of parameters that achieves this end result is "based on" these factors, even if they are not explicit inputs to a real-time algorithm.
  • Evidence for a Narrower Interpretation: The patents depict a "controller" (220) with distinct "determinator" modules for frequency, modulation, and power, suggesting an active, component-based calculation process '123 Patent, FIG. 3 The specification also provides a complex mathematical formula for calculating propagation delay, a component of message latency, implying it is a concrete value to be used in the determination, not an abstract goal '123 Patent, col. 9:1-15

• The Term: "message latency"

• Context and Importance: This term is the first basis for the "determining" step. Its definition is critical because it dictates what, specifically, the parameter determination must be "based on."

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: A defendant may argue for a plain and ordinary meaning, where "message latency" is simply the total end-to-end delay, and any action taken to reduce it is "based on" it.
  • Evidence for a Narrower Interpretation: The patent explicitly defines "message latency" as including "at least two components: message size latency and propagation latency" '123 Patent, col. 4:51-54 Plaintiff may argue that this definition requires the "determining" step to be based on one or both of these specific, defined components, rather than a general notion of delay.

VI. Other Allegations

• Indirect Infringement: The complaint alleges active inducement, asserting Defendants induce each other and related entities to infringe Compl. ¶79 Compl. ¶98 Compl. ¶119 It also alleges joint infringement theories based on agency and joint enterprise, citing the parent-subsidiary relationship and control between Raft Technologies Ltd and 3DB Communication Inc. Compl. ¶23 Compl. ¶78
• Willful Infringement: Willfulness is alleged based on pre-suit knowledge of the patent family. The complaint asserts that on May 17, 2021, a parent to the patents-in-suit (U.S. Patent No. 9,215,726) was cited by a USPTO examiner during the prosecution of a patent application owned by Defendant Raft. The complaint alleges that despite this awareness, Defendants continued their allegedly infringing conduct with objective recklessness Compl. ¶¶80-81 Compl. ¶¶99-100 Compl. ¶¶120-121

VII. Analyst's Conclusion: Key Questions for the Case

1. A central issue will be one of process scope: Does the claim limitation "determining transmission parameters... based at least on... message latency" require a dynamic, computational process where latency is a specific input, as the patent specification may suggest, or does it cover a more static configuration where system parameters are selected to comply with regulatory constraints (the channel bandwidth) within a system generally designed for low latency?
2. A key evidentiary question will be one of factual basis: What evidence will be presented to show that Defendants' selection of transmission parameters is concretely "based on" the specific technical factor of "message latency," rather than being generally configured for a low-latency environment while being directly constrained by the "predefined channel bandwidth" of their FCC licenses?
3. The willfulness claim will likely depend on the scope of knowledge: Does the citation of a parent patent during prosecution of a defendant's own application constitute knowledge of the asserted patents and an "objective high likelihood" of infringement sufficient to support a finding of egregious misconduct, particularly for patents that issued after the date of the alleged notice?