US court overturns $40-million USD patent infringement verdict against Shopify

Shopify calls the judgment “a significant victory in the battle against patent trolls.”

Canadian e-commerce giant Shopify has convinced a Delaware, US court to overturn a 2022 patent-infringement decision.

In August 2022, a US federal jury awarded California-based plaintiff Express Mobile $40 million USD in damages after finding that Shopify’s website-building tools infringed upon some of the American company’s patents. 

US judge finds insufficient evidence to support previous 2022 jury ruling of patent infringement on the part of Shopify.

At the time, Shopify told BetaKit that it planned to contest this verdict. This challenge has now been successful.

Last week, US District Judge Richard Andrews ruled there was insufficient evidence to support the jury’s finding of patent infringement on the part of Shopify relating to its add-to-cart and YouTube functionalities.

“This judgment marks a significant victory in the battle against patent trolls, who orchestrate hundreds of patent litigation cases each year with no accountability,” Shopify spokesperson Jackie Warren told BetaKit. “Patent trolls abuse the hard work and success of innovative businesses, and we’ll continue to aggressively pursue all legal avenues to defend against this type of exploitation.” 

BetaKit has reached out to Express Mobile for comment on the decision.

Express Mobile has also sued dozens of other tech companies for infringing its patents, including Google, Meta, and Amazon. The firm holds patents associated with internet and mobile tech developed by Express Mobile founder Steven Rempell, a former IBM engineer.

As Shopify has grown, the company has increasingly become the target of lawsuits, with a list of claims against it ranging from electronic payments patent infringement to textbook copyright, trademark infringement, and responsibility for data breaches impacting its platform.

RELATED: Shopify plans to contest $40-million Express Mobile patent infringement verdict

Shopify was first contacted by Express Mobile’s lawyer in 2018 concerning alleged patent infringement. Express Mobile sued Shopify in 2019 after Shopify asked a Delaware court for a declaration that it did not infringe upon Express Mobile’s patents. 

Express Mobile argued that Shopify’s website-building tools infringed upon five of its patents. In 2022, following a five-day trial, a Delaware jury ruled that Shopify violated three of Express Mobile’s patents and awarded Express Mobile $40 million in damages payable via lump sum.

Shopify challenged this ruling, and in his May 17 judgment, Andrews agreed with two of its assertions. He found that there was insufficient evidence demonstrating any Shopify merchant enabled the functionalities accused of violating Express Mobile’s patents. Andrews also found that the Shopify features in question did not fully meet the technical criteria described in Express Mobile’s patents.

Feature image courtesy Burst.

Josh Scott

Josh Scott

Josh Scott is a BetaKit reporter focused on telling in-depth Canadian tech stories and breaking news. His coverage is more complete than his moustache.

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