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State Takes Company To Court Over Patent Trolling

Patent trolls are companies that aggressively file—or threaten to file—patent lawsuits, often on technology they have no intention of manufacturing or marketing.  The practice is legal, but Vermont Attorney General Bill Sorrell says one such patent troll has run afoul of Vermont’s consumer protection laws.

The state claims that a firm named MPHJ Technology has been sending out letters to Vermont companies demanding they pay as much as $1,200 dollars per employee or be sued for patent-infringement.

MPHJ contends its patents cover anyone who scans documents so they can then be sent through e-mail. 

Sorrell says the company’s actions constitute deceptive business practices, which is why he’s taking them to court.

“This is not about the validity of the patents. Those are issues for federal courts," he explains.  "We are contending this is a state court violation. We want to litigate it in state court. And it doesn’t have to do with the validity of the patents, assuming that they do own patents. It’s rather their business practices."

The same day Sorrell filed suit against MPHJ Technologies, Governor Peter Shumlin signed a bill into law which will help to make patent trolling cases enforceable under civil statutes.

Vermont is the first state known to create this kind of law or to sue for patent trolling. However, some law experts question whether states have the ability to regulate patent activity.

Text of patent trolling lawsuit.