ONLINE cargo booking platforms with an apps that say when consignments arrive risk being sued and/or face demands for licence fees from Florida’s Shipping & Transit LLC, biggest filer of patent lawsuits in the US.
More than 100 mostly small companies have been sued in 2016 by Shipping & Transit, according to legal analytics firm Lex Machina, reports the Wall Street Journal. .Shipping & Transit doesn’t sell tracking systems, or anything else. Claiming patents “for providing status messages for cargo, shipments and people”, the company has sued dozens of major retailers as well as FedEx Corp and UPS, according to court records.
The company has extracted millions of dollars in payments, said people familiar with the legal actions. It typically demands licensing fees of US$25,000 to $45,000, amounts just small enough to discourage a legal battle.Despite hundreds of lawsuits filed by Shipping & Transit, a court has never ruled on the merits of its claims, according to Lex Machina.
CD Universe, of Wallingford, Connecticut, settled last month on confidential terms. “To fight it would have cost more than settling,” said a company spokesman. Ex-tennis pro Martin Kelly Jones, 55, a co-owner of Shipping & Transit, said the tracking of e-commerce packages relates to an idea he came up with in the 1980s to notify families of arriving school buses. “We are one of the pioneers of determining when something is arriving and being able to message that out,” Mr Jones said, adding that he spent millions of dollars trying unsuccessfully to bring a product to market.
Mr Jones filed the first patent held by Shipping & Transit in 1993 and additional ones through 2006, according to the company’s website. The company is going after smaller targets because “there is no large retailer that is not a licensee,” Mr. Jones said. Almost everybody settles, said Anthony Lo Cicero, an intellectual-property lawyer who has represented big retailers the company sued, “because the amounts are far less than the costs of fighting”. Just getting through discovery costs an average of $358,000, said the American Intellectual Property Law Association, in cases where what it called “non-practicing entities” seek less than $1 million. Cases brought to the new Patent Trial and Appeal Board run at least $23,000 just to file, and other costs can push the total above $200,000 – too much for many small firms – said Colleen Chien, an associate professor at Santa Clara University School of Law.