HFT Solutions LLC v. Citadel Securities LLC

HFT Solutions LLC, a wholly-owned subsidiary of Network-1 Technologies, Inc. (NYSE:NTIP), has initiated a patent infringement lawsuit against Citadel Securities LLC, a prominent American market-making firm specializing in high-frequency trading (HFT). HFT Solutions operates as a non-practicing entity (NPE) or patent assertion entity (PAE), focused on acquiring and monetizing intellectual property. Citadel Securities, a major player in the financial markets, provides liquidity and trade execution to institutional and retail clients, heavily relying on advanced technology for its high-speed trading operations. The litigation targets Citadel Securities' high-frequency trading platforms and systems, specifically those that utilize Field-Programmable Gate Array (FPGA) hardware, which HFT Solutions alleges infringe its patents by achieving critical transaction latency gains.

The suit, filed on December 24, 2024, in the U.S. District Court for the Northern District of Illinois (Case No. 1:24-cv-13213), asserts infringement of three U.S. Patents: 10,931,286, 11,128,305, and 11,575,381. All three patents are titled "Field programmable gate array with external phase-locked loop" and describe technologies designed to reduce processing latency in FPGAs. This is achieved by using an external phase controller to synchronize receiver-side and transmitter-side clocks, thereby circumventing the need for an internal clock domain crossing circuit that can introduce undesirable delays—a crucial advantage in nanosecond-sensitive high-frequency trading environments. District Judge Sharon Johnson Coleman is presiding over the case. Notably, Citadel's early motion to dismiss under 35 U.S.C. § 101 for patent ineligibility was denied on December 1, 2025, allowing the case to proceed. Upcoming deadlines in 2026 include exchanges of claim terms, infringement contentions, and claim construction briefs.

This case is notable for targeting the highly specialized and competitive field of high-frequency trading, where technological innovation and speed are paramount. As HFT Solutions is a subsidiary of Network-1 Technologies, a company known for its intellectual property monetization strategy, this litigation represents an assertion pattern by an NPE against a major operating company in a high-value sector. While the Northern District of Illinois is a rising venue for patent litigation, particularly for design patent "Schedule A" cases, its significance for utility patent disputes against large financial institutions is less common than other prominent patent venues. The denial of Citadel's Section 101 motion highlights the court's view that the asserted FPGA-related inventions are eligible for patent protection, setting a key precedent for the litigation's progression.

The patent infringement lawsuit HFT Solutions LLC v. Citadel Securities LLC, Case No. 1:24-cv-13213, was filed in the U.S. District Court for the Northern District of Illinois on December 24, 2024, and remains open and ongoing. The plaintiff, HFT Solutions LLC, alleges infringement of U.S. Patent Nos. 10,931,286, 11,128,305, and 11,575,381.

Here are the key legal developments in chronological order:

• Filing & Initial Pleadings:

  • 2024-12-24: HFT Solutions LLC filed the patent infringement complaint against Citadel Securities LLC.
  • Citadel Securities LLC subsequently filed an answer to the complaint, though the specific date is not detailed in the provided snippets.

• Pre-trial Motions of Substance:

  • Citadel Securities LLC filed a motion to dismiss HFT Solutions' complaint under Federal Rule of Civil Procedure 12(b)(6), arguing that the asserted patent claims were ineligible under 35 U.S.C. § 101.
  • 2025-12-01: The Honorable Sharon Johnson Coleman denied Citadel's motion to dismiss, allowing the case to proceed.

• Discovery Milestones with Strategic Significance:

  • 2026-03-11: Deadline for Plaintiff HFT Solutions LLC to amend its pleadings or join parties, and for discovery requests to be served.
  • 2026-09-16: Deadline for Defendant Citadel Securities LLC to amend its pleadings or join parties, and for document production to be substantially completed.
  • 2026-10-28: Fact discovery is scheduled to close.
  • An expert discovery schedule will be set at a later date.

• Claim Construction (Markman) Schedule:

  • 2026-04-08: Parties exchanged Claim Terms and Proposed Constructions.
  • 2026-05-13: Opening Claim Construction Brief was due.
  • 2026-06-17: Responsive Claim Construction Brief is due.
  • 2026-07-01: Reply Claim Construction Brief is due.
  • 2026-07-08: Joint Claim Construction Chart is due.
  • A status hearing is set for June 16, 2026, at 9:45 AM.

• Final Disposition / Present Posture:

  • The case is currently active and proceeding through the claim construction and discovery phases. There have been no trial events, verdicts, settlements, or appeals to date.

• Parallel PTAB IPR/PGR Proceedings:

  • As of May 29, 2026, there are no publicly identified parallel Post-Grant Review (PGR) or Inter Partes Review (IPR) proceedings filed against U.S. Patent No. 11,575,381 by Citadel Securities LLC at the Patent Trial and Appeal Board (PTAB). While the patent 11,575,381 is also asserted in a separate case (HFT Solutions LLC v. Optiver US LLC et al., 7:25-cv-00415, filed 2025-09-08, in the Western District of Texas), this does not indicate a parallel PTAB proceeding initiated by Citadel in the Northern District of Illinois case.

Plaintiff HFT Solutions LLC is represented by attorneys from Russ August & Kabat. The firm's primary office for these attorneys is in Los Angeles, California.

The following attorneys are counsel of record for HFT Solutions LLC:

• Dale Chang (Lead Counsel)

  • Firm: Russ August & Kabat, Los Angeles, California.
  • Experience: Mr. Chang is a partner who represents clients in high-stakes patent and trade secret litigation across various venues, including federal district courts, the International Trade Commission (ITC), and the Patent Trial and Appeal Board (PTAB). He has played significant roles in over 20 trials, including securing multi-million dollar jury verdicts in patent suits. Mr. Chang filed the initial complaint in this case.

• Paul A. Kroeger (Lead Counsel)

  • Firm: Russ August & Kabat, Los Angeles, California.
  • Experience: Mr. Kroeger is a litigation partner focusing on complex business and intellectual property litigation at both the trial and appellate court levels. He has been recognized as a Southern California Super Lawyer from 2017-2025 (and 2026).

• Marc A. Fenster (Lead Counsel)

  • Firm: Russ August & Kabat, Los Angeles, California.
  • Experience: Mr. Fenster is a founding partner of Russ August & Kabat and leads the firm's patent litigation group, which is known for securing substantial patent verdicts. [Marc Fenster - Russ August & Kabat Law. https://www.raklaw.com/attorneys/marc-a-fenster/ Accessed 2026-05-29]

• Brian D. Ledahl (Lead Counsel)

  • Firm: Russ August & Kabat, Los Angeles, California.
  • Experience: Mr. Ledahl is a partner at Russ August & Kabat, with a practice focused on intellectual property and commercial litigation, including patent, copyright, and trademark cases. [Brian D. Ledahl - Russ August & Kabat Law. https://www.raklaw.com/attorneys/brian-d-ledahl/ Accessed 2026-05-29]

• Joshua M. Scheufler (Lead Counsel)

  • Firm: Russ August & Kabat, Los Angeles, California.
  • Experience: Mr. Scheufler is a partner at Russ August & Kabat focusing on intellectual property litigation, including patent, copyright, trademark, and trade secret disputes. [Joshua M. Scheufler - Russ August & Kabat Law. https://www.raklaw.com/attorneys/joshua-m-scheufler/ Accessed 2026-05-29]

While Russ August & Kabat maintains offices in Los Angeles and Dallas [Russ August & Kabat - Contact Us. https://www.raklaw.com/contact-us/ Accessed 2026-05-29], and attorneys like Sarah W. Wang from the firm are admitted to the Northern District of Illinois, the available docket information explicitly lists the above five attorneys as representing HFT Solutions LLC. There is no explicit mention of separate local counsel in the provided snippets for the initial filings in this specific case.

Defendant Citadel Securities LLC is represented by attorneys from Bartlit Beck Herman Palenchar Scott LLP.

The counsel of record for Citadel Securities LLC in HFT Solutions LLC v. Citadel Securities LLC includes:

• Mark L. Levine
  • Role: Partner (likely lead or significant counsel).
  • Firm: Bartlit Beck Herman Palenchar Scott LLP, Chicago office.
  • Experience Note: Mark Levine is a seasoned trial lawyer with extensive experience in high-stakes intellectual property litigation, including patent infringement cases, particularly in the technology sector. His practice often involves complex commercial disputes and has represented major technology and financial firms.
• Matthew R. Ford
  • Role: Partner.
  • Firm: Bartlit Beck Herman Palenchar Scott LLP, Chicago office.
  • Experience Note: Matthew Ford focuses on intellectual property and complex commercial litigation. He has represented clients in patent, trade secret, and contract disputes across various industries.
• Meg Fasulo
  • Role: Partner.
  • Firm: Bartlit Beck Herman Palenchar Scott LLP, Chicago office.
  • Experience Note: Meg Fasulo's practice includes patent litigation and other complex civil litigation. She has experience representing clients in federal courts nationwide.
• Sean W. Gallagher
  • Role: Partner.
  • Firm: Bartlit Beck Herman Palenchar Scott LLP, Chicago office.
  • Experience Note: Sean Gallagher has represented clients in a range of complex litigation matters, including patent infringement and other intellectual property disputes.
• Taylor J. Kelson
  • Role: Associate.
  • Firm: Bartlit Beck Herman Palenchar Scott LLP, Chicago office.
  • Experience Note: Taylor Kelson works on complex commercial litigation, including intellectual property matters.
• Nevin M. Gewertz
  • Role: Associate.
  • Firm: Bartlit Beck Herman Palenchar Scott LLP, Chicago office.
  • Experience Note: Nevin Gewertz is involved in complex litigation, including patent disputes.

Note: While a specific "lead counsel" designation is not always explicit on public dockets, partners with more extensive experience like Mark L. Levine often take on lead roles in such cases. The office location for Bartlit Beck Herman Palenchar Scott LLP is generally understood to be Chicago, where the Northern District of Illinois court is located, making them local counsel by default.