Nearby Systems v. Smoothie King: 4-Patent Location Tech Dispute Ends in 129 Days
Nearby Systems LLC filed suit against Smoothie King Franchises in the Eastern District of Texas, asserting four location-technology patents against the Smoothie King App. The parties jointly stipulated to dismissal with prejudice after just 129 days — a timeline consistent with an early-stage confidential settlement.
Four Location Patents, One App, and a Fast Exit in East Texas
On February 21, 2025, Nearby Systems LLC filed a patent infringement action against Smoothie King Franchises, Inc. in the Eastern District of Texas (Case No. 2:25-cv-00227). The complaint asserted four United States patents — US11937145B2, US12185177B2, US10469980B2, and US9532164B2 — all relating to location-based technology, against the Smoothie King mobile application. Nearby Systems is a non-practicing entity specialising in proximity and location-awareness IP.
The case closed on June 30, 2025, when both parties filed a Joint Stipulation of Dismissal under Rule 41(a)(1)(A)(ii). The court accepted and acknowledged the stipulation, dismissing all claims with prejudice. Each party was ordered to bear its own costs, expenses, and attorneys’ fees. Dismissal with prejudice means Nearby Systems is permanently barred from reasserting the same claims against Smoothie King on these four patents.
At 129 days from filing to closure, the case resolved well before any claim construction, Markman hearing, or merits ruling — a timeline that typically signals a confidential financial settlement or licensing agreement, though the public record is silent on specific terms. The ‘each party bears its own costs’ provision is standard in mutually negotiated resolutions and does not itself indicate which party obtained favourable commercial terms.
Filing to Dismissed with Prejudice in 129 days
129 days — resolved before any substantive court rulings, suggesting early resolution
Dismissed with prejudice: what the joint stipulation means for both parties
Rule 41(a)(1)(A)(ii) — dismissal by joint stipulation
Rule 41(a)(1)(A)(ii) allows parties to dismiss an action without a court order by filing a signed stipulation. Here, both Nearby Systems and Smoothie King signed and filed jointly. The court’s role is limited to acceptance and acknowledgement — it cannot alter the agreed terms. The ‘with prejudice’ designation was the parties’ own choice, not a judicial sanction.
Voluntary, bilateral, bindingWith prejudice: Nearby Systems cannot refile these patent claims
Dismissal with prejudice carries full res judicata effect. Nearby Systems LLC is permanently barred from reasserting the same four patents against Smoothie King Franchises for the same accused product — the Smoothie King App. This is a materially stronger outcome for Smoothie King than a dismissal without prejudice, which would permit refiling. The public record does not disclose whether a licence or payment accompanied the dismissal.
Permanent bar on refilingNearby Systems exits with no public win — but terms are confidential
Nearby Systems agreed to dismiss with prejudice, forfeiting its right to litigate these claims against Smoothie King in the future. This is consistent with either a confidential licensing payment (a common NPE resolution) or a determination that litigation economics did not favour continuation. The public record is silent on whether any consideration was exchanged.
No public merits rulingFour live patents remain enforceable against other defendants
The with-prejudice dismissal resolves only the dispute between these two parties. All four asserted patents — US11937145B2, US12185177B2, US10469980B2, and US9532164B2 — remain in force and can be asserted against other companies operating location-aware mobile applications. Retail, food-service, and hospitality app developers using proximity or geofencing technology should treat these patents as active enforcement risk.
Ongoing third-party riskFull party and counsel information
| Role | Name | Type | Detail |
|---|---|---|---|
| Plaintiff | Nearby Systems, LLC | Company | Location-technology NPE — holder of US11937145B2 and three related proximity patentsSearch in Eureka ↗ |
| Defendant | Smoothie King Franchises, Inc. | Company | Smoothie King Franchises, Inc. — franchisor operating a nationwide smoothie retail chainSearch in Eureka ↗ |
| Plaintiff counsel | Carey Matthew Rozier | Attorney | Counsel for Nearby Systems, LLCSearch in Eureka ↗ |
| Plaintiff counsel | James Francis McDonough , III | Attorney | Counsel for Nearby Systems, LLCSearch in Eureka ↗ |
| Plaintiff counsel | Jonathan Lloyd Hardt | Attorney | Counsel for Nearby Systems, LLCSearch in Eureka ↗ |
| Plaintiff law firm | Rozier Hardt McDonough PLLC | Law Firm | Representing Nearby Systems, LLCSearch in Eureka ↗ |
| Defendant counsel | Daniel T. Shvodian | Attorney | Counsel for Smoothie King Franchises, Inc.Search in Eureka ↗ |
| Defendant counsel | Helena E.D. Burns | Attorney | Counsel for Smoothie King Franchises, Inc.Search in Eureka ↗ |
| Defendant counsel | Marvin Craig Tyler | Attorney | Counsel for Smoothie King Franchises, Inc.Search in Eureka ↗ |
| Defendant law firm | Perkins Coie LLP | Law Firm | Representing Smoothie King Franchises, Inc.Search in Eureka ↗ |
| Presiding judge | Judge N/A | Judge | Texas Eastern District CourtSearch in Eureka ↗ |
Official order — verbatim text
The court’s order mirrors the parties’ stipulation verbatim, confirming that no judicial findings on liability, validity, or infringement were made. The phrase ‘has been resolved’ in the stipulation is the parties’ own characterisation — the court makes no independent finding as to how or on what terms. The ‘each party bears its own costs’ clause is bilateral and neutral, consistent with negotiated resolution rather than a litigated outcome.
US11937145B2 — Location-aware mobile application technology
The four asserted patents — US11937145B2, US12185177B2, US10469980B2, and US9532164B2 — derive from application numbers spanning US13/987520 (earliest priority) through US18/436421 (most recent), suggesting a continuation family built over multiple years. This family architecture is typical of NPE portfolios designed to pursue progressively newer claim language that tracks evolving mobile app implementations of location-awareness, geofencing, and proximity-based service delivery.
For the food-service, retail, and hospitality sectors, location-based mobile features — order-ahead, in-store arrival detection, loyalty triggers, and push notifications tied to proximity — are now table-stakes functionality. Any app incorporating these features may fall within the scope of one or more claims across this four-patent family. The breadth of the portfolio, spanning at least a decade of application filings, means that design-around strategies developed against older claims may not protect against the newer continuation claims.
Should your app team run an FTO against US11937145B2 and its family?
Any product team building or maintaining a consumer mobile application that uses geofencing, proximity detection, location-triggered notifications, or in-store arrival logic should evaluate freedom to operate against this four-patent family. The Smoothie King App was the accused product here, but the underlying location-aware functionality is common across retail, food-service, fitness, and hospitality apps. A pre-launch or pre-feature-release FTO analysis is significantly cheaper than defending an NPE suit in E.D. Texas.
PatSnap Eureka’s FTO Search Agent can map your app’s technical architecture against the claim language of US11937145B2, US12185177B2, US10469980B2, and US9532164B2 in minutes — identifying claim elements that may read on your implementation and surfacing prior art or design-around options. Eureka also tracks the full continuation family, alerting you when new related applications publish that could extend enforcement risk to updated product features.
Run a freedom-to-operate analysis on US11937145B2 to assess your product’s exposure
Run FTO in Eureka →Similar location-technology patent cases in E.D. Texas and beyond
Cases involving location-aware mobile app patents asserted by NPEs in the Eastern District of Texas, with comparable patent families and accused products.
What this case signals for the location-tech mobile app IP landscape
A fast, with-prejudice exit in East Texas from a four-patent NPE suit carries clear signals for any company running a location-aware consumer app.
East Texas remains a preferred venue for location-tech NPE filings
Nearby Systems chose the Eastern District of Texas — a historically plaintiff-friendly forum — to assert four location patents against a national franchisor’s mobile app. Companies with consumer-facing location-aware apps should monitor NPE filing patterns in this district and ensure their FTO analysis covers proximity and geofencing patent families.
Four-patent stacks increase settlement pressure significantly
Asserting four patents simultaneously raises the cost and complexity of invalidity defences. Even where individual patent claims may be vulnerable to IPR, the combined litigation burden often drives early resolution. Product teams relying on location-based features should evaluate whether their technology overlaps with any of the four Nearby Systems patent families before deployment.
Nearby v Smoothie — key questions answered
Nearby Systems LLC sued Smoothie King Franchises in the Eastern District of Texas asserting four location-technology patents against the Smoothie King App. The case was dismissed with prejudice by joint stipulation under Rule 41(a)(1)(A)(ii) after 129 days. Each party bears its own costs. No merits ruling was issued.
Nearby Systems asserted US11937145B2, US12185177B2, US10469980B2, and US9532164B2. These patents relate to location-aware and proximity-based mobile technology and appear to form a continuation family spanning application filings from US13/987520 through US18/436421.
Not necessarily. Dismissal with prejudice means Nearby Systems cannot refile the same claims against Smoothie King on these four patents. However, it does not constitute a finding of non-infringement or invalidity. The resolution is consistent with a confidential settlement or licensing agreement, though the public record does not confirm specific terms.
Yes. The with-prejudice dismissal resolves only the dispute between Nearby Systems and Smoothie King. All four patents remain in force and can be asserted against other parties. Companies operating location-aware mobile applications — particularly in retail, food-service, and hospitality — should treat these patents as active enforcement risk.
At 129 days, the case closed before any claim construction or substantive motions practice. This timeline is consistent with an early-stage confidential resolution — either a licensing agreement or a decision by one party that continued litigation was not economically justified. The public record does not disclose the specific reason for the rapid resolution.
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