SecProbe.io

March 1 4, 2013

Via E -mail
Robert Bzdick
Chief Executive Officer
Document Security Systems, Inc.
First Federal Plaza
28 Main Street East, Suite 1525
Rochester, NY 14614

Re: Document Security Systems, Inc.
Amendment No. 2 to Registration Statement on Form S -4
Filed February 13, 2013
File No. 333 -185134

Dear Mr. Bzdick:

We have reviewed your response letter dated February 13, 2013, and your amended
registration statement, and have the following comments.  Unless otherwise noted, references to
prior comments refer to our comment letter dated February 8, 201 3.

General

1. We note your disclosure on the cover page and throughout your prospectus indicating
that Lexington shareholders are expected to own 56% of the outstanding common stock
of the combined company on a fully diluted basis.  Please tell us how you calculated thi s
percentage.  Similarly, in your response letter, please  clarify how you determined that
Lexington shareholders are expected to own 51% of the outstanding common stock of the
combined company on a fully diluted basis if the 7,100,000 escrow shares are ter minated,
as disclosed on pages 30 and 175.

2. Please revise your Questions and Answers and Summary sections , and other sections of
your prospectus as appropriate , to clarify that Lexington shareholders will have voting
rights for the 7,100,000 shares of common stock held in escrow for one year  after the
closing of the merger even though those shares may be terminated if the conditions for
release of the escrow shares are not met.

3. Your illustrative examples indicating the number of securities to be issue d to Lexington
shareholders on an aggregate and per share basis are presented assuming the merger had
been completed on December 31, 2012.  On page 146, you disclose a recent sale of
4,285,718 shares of unregistered Lexington common stock at a price of $0. 35 per share to

Robert Bzdick
Document Security Systems, Inc.
March 1 4, 2013
Page 2

 certain Lexington shareholders that occurred on February 1, 2013.  Please provide us
with your analysis as to whether the recent issuance of Lexington common stock would
materially alter your illustrative examples.

4. In discussing the accou nting treatment of the merger, you disclose on page 175 that you
believe Lexington is the accounting acquirer of DSS.  Based on the information that you
provided to us, it appears there is a risk that events subsequent to the shareholder vote
and prior to the close of the merger may cause DSS to be deemed the accounting
acquirer.  Consider describing that possibility and any impact it could have on investors.

5. In addition to the Bascom patents, DSS will acquire as a result of the merger at  least $7.5
million in cash held by Lexington.  On page 59, you indicate that you anticipate there will
be $2,000,000 in legal fees related to the Lexington patents.  Please tell us what
consideration you have given to describing how the acquired cash will  be used by the
company.

Prospectus Cover Page

6. The second paragraph of your prospectus cover page still contains a very dense and
detailed description of the terms of your merger agreement and the securities that will be
exchanged or issued upon the cons ummation of the merger agreement.  Please consider
condensing this paragraph into one or a few brief sentences and include a cross -reference
to the detailed disclosure in the Merger Agreement section.

Risk Factors, page 45

7. Please consider adding or revis ing one or more risk factors to address the risk that the
value of the Bascom patents, which are Lexington’s most significant assets, depends
significantly on the success of your recent litigation proceedings.  Further, describe any
uncertainties associate d with monetizing the patents through such litigation. For example,
if these litigation proceedings are not successful  and that would erode the value of the
patents, consider making that clear in your disclosure.

The Merger

Background of the Merger, page 67

8. Please revise to provide the disclosure required by Item 4(b) of Form S -4 and Item
1015(b) of Regulation M -A.  In particular, please provide a summary of the ipCapital
analysis and report evaluated by the DSS board of directors in determining the fairness of
the merger, as noted on page 74 and briefly described on pages 71 through 73.  In
addition, please file the report as an exhibit.  Refer to Item 21(c) of Form S -4.

Robert Bzdick
Document Security Systems, Inc.
March 1 4, 2013
Page 3

 Lexington’s Business, page 138

9. It appears that Lexington has multiple fee agreements and arrangements tied to the
potential revenue stream from the Bascom patents that should be described.  For
example, please describe and quantify the material terms of the arrangements with
litigation law firms, Mr. Bascom’s cash considerations pursuant t o his agreement with
Lexington, and the agreement with IP Navigation Group, which are referenced on pages
59 and 60.  Further, please briefly describe these arrangements or agreements in your
Summary section, or other appropriate places in your prospectus,  so investors understand
that significant portions of your anticipated future revenue stream to be derived from
Lexington’s intellectual property assets are shared or to be paid to third parties.

Please contact Edwin Kim, Attorney -Advisor, at (202) 551 -3297 or, in his absence, me at
(202) 551 -3457 with any questions relating to your registration statement.  If you require further
assistance, you may contact Barbara C. Jacobs, Assistant Director, at (202) 551 -3735.

Sincerely,

 /s/ Maryse Mills -Apenteng

 Maryse Mills -Apenteng
 Special Counsel

cc:  Via E -Mail
 Philip Jones, CFO