Cloud of Change v. Clover Holdings: POS Patent Dispute Ends in Dismissal With Prejudice
Cloud of Change, LLC asserted three patents covering web-based point-of-sale builder technology against Clover Holdings, Inc. in the Northern District of California. After nearly 900 days of litigation, the parties jointly moved to dismiss all claims with prejudice — suggesting a negotiated resolution was reached before trial.
Three POS Patents, One Joint Dismissal: A Closer Look
On June 20, 2023, Cloud of Change, LLC filed a patent infringement action against Clover Holdings, Inc. in the United States District Court for the Northern District of California before Judge Araceli Martinez-Olguin. Cloud of Change asserted three US patents — US11226793B2, US10083012B2, and US9400640B2 — all directed at web-based point-of-sale (POS) builder technology, against Clover Holdings’ products and services in that space.
The case closed on December 4, 2025, when the court granted the parties’ Joint Motion to Dismiss With Prejudice. All claims and causes of action were dismissed with prejudice, meaning Cloud of Change is permanently barred from reasserting the same claims against Clover Holdings in future litigation. A dismissal with prejudice entered by joint motion typically signals that the parties reached a negotiated resolution — most commonly a settlement or licensing agreement — though the specific terms remain confidential and are not reflected in the public record.
The 898-day duration suggests the matter progressed well into substantive litigation before resolution — consistent with parties completing claim construction, discovery, or early dispositive motion practice before reaching agreement. What drove the ultimate resolution remains unknown from the public record: whether Cloud of Change secured a license, whether Clover mounted a successful invalidity defense that prompted withdrawal, or whether commercial considerations outside the courtroom proved decisive. The joint nature of the dismissal motion, however, suggests cooperation rather than a one-sided capitulation.
Filing to Dismissed with Prejudice in 898 days
898 days — above the median for N.D. Cal. patent cases resolved pre-trial
Dismissed with prejudice: what the joint motion means for both parties
Dismissal with prejudice extinguishes all claims permanently
A dismissal with prejudice operates as a final adjudication on the merits under federal procedural rules. Cloud of Change cannot refile these claims — covering US11226793B2, US10083012B2, and US9400640B2 — against Clover Holdings in any future action. The joint nature of the motion signals mutual agreement, distinguishing this from a court-ordered termination following a failed claim.
Permanent bar on refilingCloud of Change forfeits any future infringement action against Clover
By agreeing to dismiss with prejudice, Cloud of Change surrendered the right to pursue Clover Holdings on these three patents going forward. This is consistent with either a licensing agreement yielding a negotiated payment — which would represent a commercial win — or a strategic withdrawal where continued litigation costs outweighed expected recovery. The public record does not confirm which scenario applies.
No future claims vs. CloverClover Holdings secures permanent resolution of this patent threat
For Clover Holdings, the with-prejudice dismissal eliminates ongoing litigation risk from these three POS patents. If a license was granted, Clover gains continued freedom to operate in the web-based POS builder space. If the dismissal reflects a successful defense posture, it confirms the patents posed insufficient threat to sustain litigation. Either way, Clover’s exposure to these specific patents is closed.
Exposure to these patents closedResolution leaves POS sector patent risk landscape partially unresolved
Because no merits ruling was issued, the validity and scope of all three asserted patents remain formally intact. Other POS platform providers cannot draw on a court ruling to challenge these patents through IPR estoppel or collateral estoppel. Cloud of Change retains the ability to assert the same patents against third-party competitors in the POS builder space — a risk factor for any company operating adjacent technology.
Patents valid; third parties remain at riskFull party and counsel information
| Role | Name | Type | Detail |
|---|---|---|---|
| Plaintiff | Cloud of Change, LLC | Company | Patent assertion entity — holder of US11226793B2, US10083012B2, and US9400640B2Search in Eureka ↗ |
| Defendant | Clover Holdings, Inc. | Company | Clover Holdings, Inc. — provider of cloud-based POS and commerce platform solutionsSearch in Eureka ↗ |
| Plaintiff counsel | Abelino Reyna | Attorney | Counsel for Cloud of Change, LLCSearch in Eureka ↗ |
| Plaintiff counsel | Barden Todd Patterson | Attorney | Counsel for Cloud of Change, LLCSearch in Eureka ↗ |
| Plaintiff counsel | Craig V. Depew | Attorney | Counsel for Cloud of Change, LLCSearch in Eureka ↗ |
| Plaintiff counsel | Edgar Neil Gonzalez | Attorney | Counsel for Cloud of Change, LLCSearch in Eureka ↗ |
| Plaintiff counsel | John Allen Yates | Attorney | Counsel for Cloud of Change, LLCSearch in Eureka ↗ |
| Plaintiff counsel | Jordan D. Brown | Attorney | Counsel for Cloud of Change, LLCSearch in Eureka ↗ |
| Plaintiff counsel | Joseph John Stevens | Attorney | Counsel for Cloud of Change, LLCSearch in Eureka ↗ |
| Plaintiff counsel | Kyrie Kimber Cameron | Attorney | Counsel for Cloud of Change, LLCSearch in Eureka ↗ |
| Plaintiff law firm | Patterson Sheridan LLP | Law Firm | Representing Cloud of Change, LLCSearch in Eureka ↗ |
| Defendant counsel | Amy L. Mahan | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | Caitlyn Elizabeth Hubbard | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | David Charles Marcus | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | Gregory H. Lantier | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | J. Stephen Ravel | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | Jason David Kipnis | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | Jeannette P. Leopold | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | Jennifer Graber | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | Kelly E. Ransom | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | Liv Leila Herriot | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | Ronald Gregory Israelsen | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | Sarah B Petty | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant counsel | Sarah Beigbeder Petty | Attorney | Counsel for Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant law firm | Kelly Hart & Hallman LLP (Austin) | Law Firm | Representing Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant law firm | Kelly Hart & Hallman LLP | Law Firm | Representing Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant law firm | Sidley Austin LLP | Law Firm | Representing Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant law firm | Wilmer Cutler Pickering Hale LLP | Law Firm | Representing Clover Holdings, Inc.Search in Eureka ↗ |
| Defendant law firm | Wilmer Cutler Pickering Hale & Dorr LLP | Law Firm | Representing Clover Holdings, Inc.Search in Eureka ↗ |
| Presiding judge | Judge Araceli Martinez-Olguin | Judge | California Northern District CourtSearch in Eureka ↗ |
Official order — verbatim text
The court’s order adopts the joint motion language verbatim, granting dismissal with prejudice of all claims and causes of action. The absence of any liability finding, damages award, or claim construction ruling means neither party obtained a merits-based precedent. For Clover Holdings, the order provides complete finality on these three patents. For Cloud of Change, the patents survive intact — preserving enforcement optionality against third parties operating in the web-based POS builder space.
US11226793B2, US10083012B2, US9400640B2 — Web-Based POS Builder Technology
The three asserted patents — US11226793B2 (App. No. 15/827948), US10083012B2 (App. No. 15/635097), and US9400640B2 (App. No. 12/012666) — cover web-based point-of-sale builder technology. The application numbers span different filing generations, with US9400640B2’s application number (12/012666) suggesting an earlier priority date than the later two, which is consistent with a continuation or continuation-in-part portfolio strategy designed to extend patent coverage as the technology evolved.
In the competitive POS software market — where players like Clover, Square, Toast, and Shopify compete for platform share — patents covering the core architecture for building and configuring web-based POS systems carry significant commercial leverage. A portfolio of three patents with potentially overlapping claims creates multiple invalidity hurdles for any challenger and signals that the patent holder may be pursuing a structured licensing program targeting operators of competing POS platforms rather than a single enforcement action.
Should your POS platform run an FTO against US11226793B2 and related patents?
Any company developing, deploying, or commercialising web-based point-of-sale builder tools — including SaaS POS platforms, commerce infrastructure providers, and white-label POS software vendors — should assess exposure to this three-patent portfolio. The absence of a claim construction or invalidity ruling from this case means scope ambiguity remains unresolved, and Cloud of Change retains full enforcement rights against parties not named in this action.
PatSnap Eureka’s FTO Search Agent can map the claim language across all three patents against your product architecture, identify relevant prior art that was not adjudicated in this case, and surface any continuation applications that may extend the portfolio beyond the three currently asserted patents. A structured FTO analysis now is more cost-effective than responding to a demand letter or complaint after the fact.
Run a freedom-to-operate analysis on US11226793B2 to assess your product’s exposure
Run FTO in Eureka →Similar POS Software Patent Infringement Cases in N.D. California
Explore related patent infringement actions involving web-based POS and commerce platform software litigated in the Northern District of California.
Related patent case — similar technology
Comparable case in the same technology domain. Patent holder and defendant reached resolution after proceedings.
SettledRelated infringement action — same court
Comparable Web-based point of sale builder-adjacent infringement action. Patent enforcement dynamics analysed in depth.
Active · District CourtRelated invalidity challenge — appellate outcome
Combined invalidity and infringement action in the same technology space. Decided after substantive proceedings.
DecidedCloud of Change, LLC’s broader IP enforcement history
Cloud of Change, LLC’s full litigation history covering prior enforcement, licensing activity, and inter partes review proceedings.
Portfolio viewWhat this case signals for the web-based POS platform IP landscape
Three POS builder patents resolved quietly — but the IP risk for the broader sector remains live.
No merits ruling means these POS patents are still enforceable
The joint dismissal produced no invalidity finding and no claim construction ruling. All three Cloud of Change patents — US11226793B2, US10083012B2, and US9400640B2 — remain valid on their face. Any company in the web-based POS builder space should treat these patents as active enforcement risk and assess exposure accordingly.
Joint dismissals after 900 days typically signal a licensing resolution
When both parties agree to dismiss with prejudice well into litigation, a negotiated commercial resolution is the most probable explanation. For IP counsel, this pattern suggests Cloud of Change may be building a licensing program around its POS portfolio — making early FTO clearance and proactive monitoring commercially prudent for any POS platform operator.
Cloud of Change’s three-patent stack covers overlapping POS claim scope
The three asserted patents span application numbers filed across different years, suggesting a continuation-based portfolio strategy. Companies operating in the web-based POS builder space should map claim coverage across all three patents — not just the most recently issued — to identify the full perimeter of asserted IP and design-around opportunities.
N.D. Cal. venue choice signals expectation of tech-savvy claim construction
Filing in the Northern District of California for POS software patents is a deliberate forum choice — courts there have experienced patent judges and established software claim construction precedent. Defendants facing similar assertions in this venue should anticipate sophisticated claim construction disputes and prepare Alice/Section 101 arguments early in the case lifecycle.
Cloud v Clover — key questions answered
Cloud of Change asserted three patents: US11226793B2, US10083012B2, and US9400640B2. All three are directed at web-based point-of-sale builder technology. The case was filed in the Northern District of California on June 20, 2023 and closed December 4, 2025 via joint dismissal with prejudice.
The case was dismissed with prejudice pursuant to a Joint Motion to Dismiss filed by both parties and granted by Judge Araceli Martinez-Olguin. A joint dismissal with prejudice after 898 days of litigation typically suggests a negotiated resolution — most likely a settlement or licensing agreement — though the specific terms are not reflected in the public record.
No. The dismissal with prejudice bars Cloud of Change from reasserting these three patents specifically against Clover Holdings. It does not affect Cloud of Change’s rights against third parties. The patents remain valid and enforceable against other defendants operating in the web-based POS builder space.
The case was litigated in the United States District Court for the Northern District of California, Case No. 3:23-cv-03005. The presiding judge was the Honorable Araceli Martinez-Olguin. The case ran from June 20, 2023 to December 4, 2025 — a total of 898 days.
Cloud of Change was represented by Patterson Sheridan LLP. Clover Holdings assembled a larger defence team including Sidley Austin LLP, Wilmer Cutler Pickering Hale & Dorr LLP, and Kelly Hart & Hallman LLP. The disparity in defence team size suggests Clover Holdings mounted a robust litigation defence prior to resolution.
Don’t wait for a demand letter — clear your POS platform IP risk now
The Cloud of Change portfolio remains active and enforcement-ready against third parties. Run an FTO search and litigation monitoring workflow in PatSnap Eureka to stay ahead of POS software patent risk before it reaches your legal team.
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