MPHJ Technology which sent out thousands of letters demanding $1,000 per worker from small businesses using basic scan-to-e-mail functions, has just received a kicking from a court.
The outfit claims to own several patents that cover those basic functions and has sent out more than 10,000 letters demanding payment.
It was the first patent troll ever to be sued by the government in which Vermont Attorney General Bill Sorrell accused MPHJ of making misleading statements in its demand letters.
The troll did not really bother to check that the targeted businesses were actually infringing its patents and sent letters to two Vermont nonprofits that help disabled residents and their caregivers.
MPHJ has not given up and is demanding that its case be heard in federal court and even suggesting that the Vermont attorney general should be punished for daring to stand up to it.
However a federal judge kicked the case back into state court and rejected MPHJ’s invitation to punish the state.
MPHJ appealed all the way to the US Court of Appeals for the Federal Circuit, insisting that its case was closely related to the validity of its patents and that Vermont should be forced into federal court, where all patent cases are heard.
However, now that final appeal didn’t work and a panel of Federal Circuit judges rejected MPHJ, saying it didn’t have jurisdiction to overturn the federal judge’s decision.
The Vermont case is one of three fronts where MPHJ is battling the government. In Nebraska, a judge agreed that its patent demand letters were constitutionally protected free speech which is a bizarre defence. That state’s attorney general, Jon Bruning, has appealed the decision. MPHJ also tried to sue the FTC, which the watchdog is fighting.
It is not clear if MPHJ will win or lose its case in Vermont. The outfit’s hand was strengthened when the drugs companies convinced the US senate not to bring in an anti-patent-troll reform bill. If it does win then it can hassle every small business in the US which happens to have a scanner.
