Nearby Systems v. Whataburger: Three Location-Tech Patents, Dismissed With Prejudice
Nearby Systems LLC filed suit against Whataburger Restaurants LLC in the Eastern District of Texas asserting three location-based technology patents tied to Whataburger’s mobile and online ordering platform. The parties jointly stipulated to dismissal with prejudice under Rule 41(a)(1)(A)(ii) after 174 days — a timeline consistent with early resolution, likely through settlement.
Location-tech NPE targets Whataburger’s digital ordering platform
On November 20, 2024, Nearby Systems LLC filed an infringement action against Whataburger Restaurants LLC in the United States District Court for the Eastern District of Texas, asserting three patents: US11937145B2, US10469980B2, and US9532164B2. All three patents relate to location-based mobile technology, and the accused product was Whataburger’s consumer-facing digital platform at whataburger.com — consistent with location-aware ordering or geofencing functionality.
After 174 days, the parties filed a Joint Stipulation of Dismissal pursuant to Rule 41(a)(1)(A)(ii), and the Court accepted the stipulation on May 13, 2025, dismissing all claims with prejudice. Dismissal with prejudice is a final adjudication on the merits for claim-preclusion purposes, meaning Nearby Systems is permanently barred from reasserting the same patent claims against Whataburger. Notably, each party was ordered to bear its own costs and attorneys’ fees.
A 174-day resolution from filing to dismissal is notably brief for an EDTX patent case, strongly suggesting the parties reached a private settlement or licensing agreement before meaningful claim construction or discovery. The public record does not disclose financial terms, license scope, or which party drove the resolution. The lead case was explicitly kept open by the Court, indicating Nearby Systems maintains active litigation against other defendants in related proceedings.
Filing to Dismissed with Prejudice in 174 days
174 days — resolved significantly faster than the median EDTX patent trial, suggesting early negotiated resolution
Dismissed with prejudice: what the joint stipulation means for both parties
Rule 41(a)(1)(A)(ii) dismissal with prejudice is final and binding
A joint stipulation of dismissal under Rule 41(a)(1)(A)(ii) requires agreement from all parties who have appeared. When filed with prejudice, the dismissal operates as a final judgment on the merits under res judicata principles. Nearby Systems cannot refile the same claims — US11937145B2, US10469980B2, and US9532164B2 — against Whataburger in any federal court.
Permanent bar on refilingNearby Systems accepts a permanent bar — typical of negotiated settlement
Agreeing to dismissal with prejudice signals that Nearby Systems received consideration — most likely a lump-sum payment or licensing arrangement — in exchange for relinquishing its right to pursue these three patents against Whataburger. The with-prejudice designation is a meaningful concession by the plaintiff. No financial terms are disclosed in the public record.
Likely settled with considerationWhataburger secures claim preclusion on all three patents
Whataburger obtains permanent protection against these specific patent claims from Nearby Systems. However, the patents themselves remain in force and active in the lead case against other defendants. Each party bears its own costs, meaning no fee-shifting award was entered — Whataburger did not secure a finding of exceptional case under 35 U.S.C. § 285.
Claim-precluded, no fee awardLocation-tech IP risk persists for QSR digital platforms broadly
Nearby Systems’ continued litigation in the lead case against other parties suggests this is an active assertion campaign targeting location-based digital ordering technology across the quick-service restaurant sector. Companies operating geofencing, mobile check-in, or location-aware ordering features should treat these patents as live enforcement risks requiring FTO analysis and monitoring.
Active multi-defendant campaignFull party and counsel information
| Role | Name | Type | Detail |
|---|---|---|---|
| Plaintiff | Nearby Systems, LLC | Company | Location-technology patent assertion entity — holder of US11937145B2, US10469980B2, and US9532164B2Search in Eureka ↗ |
| Defendant | Whataburger | Individual | Whataburger Restaurants LLC — major U.S. quick-service restaurant chain operating digital ordering platformSearch 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 | James Travis Underwood | Attorney | Counsel for WhataburgerSearch in Eureka ↗ |
| Defendant counsel | Kristopher L. Reed | Attorney | Counsel for WhataburgerSearch in Eureka ↗ |
| Defendant counsel | Melissa Richards Smith | Attorney | Counsel for WhataburgerSearch in Eureka ↗ |
| Defendant law firm | Gillam & Smith LLP | Law Firm | Representing WhataburgerSearch in Eureka ↗ |
| Defendant law firm | Holland & Knight LLP | Law Firm | Representing WhataburgerSearch in Eureka ↗ |
| Presiding judge | Judge N/A | Judge | Texas Eastern District CourtSearch in Eureka ↗ |
Official order — verbatim text
The Court’s order accepts the parties’ joint stipulation and explicitly dismisses all claims with prejudice under Rule 41(a)(1)(A)(ii). The with-prejudice designation is legally significant: it constitutes a final judgment on the merits, triggering res judicata and permanently precluding Nearby Systems from reasserting US11937145B2, US10469980B2, or US9532164B2 against Whataburger. The Court’s directive to maintain the lead case open confirms this is a member-case resolution within a broader multi-defendant proceeding — the underlying patents remain in active litigation.
US11937145B2, US10469980B2, US9532164B2 — Location-based mobile technology patents
The three asserted patents — US11937145B2, US10469980B2, and US9532164B2 — form a portfolio covering location-based mobile technology, with application numbers spanning US16/570298, US15/346599, and US13/987520 respectively. The staggered application dates suggest a continuation or continuation-in-part family structure, with the earliest application (US13/987520) likely establishing the foundational priority claim. The technology domain covers proximity detection, geofencing, and location-aware communications — capabilities directly relevant to QSR mobile ordering and customer location services.
This portfolio’s relevance to Whataburger’s digital platform at whataburger.com is consistent with location-triggered ordering features, curbside pickup geofencing, or in-app location services that major QSR chains have deployed in recent years. The multi-continuation structure suggests Nearby Systems deliberately broadened claim scope over successive applications to capture evolving commercial implementations — a common NPE portfolio strategy. With the lead case still active, these patents represent a live enforcement risk for any QSR or retail company operating comparable location-based digital features.
Should you run an FTO against US11937145B2, US10469980B2, and US9532164B2?
Any company operating location-aware mobile ordering, geofencing for curbside pickup, or proximity-based customer engagement features should treat this patent portfolio as a priority FTO target. The Nearby Systems portfolio appears structured as a continuation family, meaning claim scope may differ materially across all three patents — a single FTO must map each patent’s independent claims against your specific product implementation. QSR brands, retail delivery platforms, and hospitality operators are particularly exposed.
PatSnap Eureka’s FTO Search Agent can map each of the three asserted patents against your product’s location-technology feature set, identify relevant prior art that may constrain claim scope, and flag claim language that courts have previously construed in analogous EDTX proceedings. With Nearby Systems’ lead case still open and active, real-time docket monitoring through PatSnap can alert your team if your company is named as a new member defendant.
Run a freedom-to-operate analysis on US11937145B2 to assess your product’s exposure
Run FTO in Eureka →Similar location-technology patent cases in Texas Eastern District Court
Related NPE infringement actions involving location-based mobile technology patents filed in the Texas Eastern District Court against QSR and digital platform defendants.
What this case signals for QSR and location-tech IP enforcement
Nearby Systems’ rapid resolution with Whataburger, while maintaining the lead case, is a textbook NPE enforcement pattern worth tracking.
EDTX remains the venue of choice for location-tech NPE campaigns
The Eastern District of Texas continues to attract multi-defendant patent assertion campaigns involving mobile and location-based technology. The court’s familiarity with NPE litigation and predictable scheduling orders makes it strategically attractive for plaintiffs running parallel cases against multiple QSR and retail defendants.
Early resolution without fee-shifting suggests Whataburger paid to exit
The absence of a § 285 exceptional-case motion and the mutual cost-bearing order are consistent with a negotiated exit before substantive litigation costs escalated. For defendants in the remaining member cases, Whataburger’s resolution timeline — 174 days — may inform their own settlement calculus.
Nearby v Whataburger — key questions answered
Dismissal with prejudice in Case No. 2:24-cv-00954 means all patent infringement claims asserted by Nearby Systems LLC against Whataburger Restaurants LLC — covering US11937145B2, US10469980B2, and US9532164B2 — are permanently extinguished. Nearby Systems cannot refile these same claims against Whataburger in any federal court. The dismissal functions as a final judgment on the merits for res judicata purposes.
The public record does not disclose whether a financial settlement was reached. The joint stipulation of dismissal with prejudice, filed under Rule 41(a)(1)(A)(ii), is consistent with a negotiated resolution — typically involving a payment or license — but no terms are publicly available. The mutual cost-bearing order suggests neither party sought a fee-shifting award under 35 U.S.C. § 285.
Nearby Systems asserted three patents: US11937145B2 (application US16/570298), US10469980B2 (application US15/346599), and US9532164B2 (application US13/987520). All three relate to location-based mobile technology. The staggered application numbers suggest a continuation patent family designed to maintain and broaden coverage over evolving location-aware digital platform implementations.
Yes. The Court’s order explicitly directed the Clerk to maintain the lead case as open because other defendants remain in the litigation. Nearby Systems filed this action as a multi-defendant proceeding, and the Whataburger dismissal resolves only one member case. The three asserted patents remain in active enforcement against remaining defendants in the lead docket.
The Eastern District of Texas is a historically preferred venue for NPE patent assertion campaigns due to its familiarity with complex patent litigation, predictable scheduling, and historically plaintiff-friendly procedural reputation. Filing in EDTX is consistent with Nearby Systems’ multi-defendant campaign strategy. Whataburger’s presence and digital platform operations in Texas would also support venue under 28 U.S.C. § 1400(b).
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