FTC ends first case against a “patent troll” with a slap on the wrist

25 11 2014
Last year, Congress held a vigorous debate over so-called “patent trolls.” One of the poster children repeatedly held up as an example of patent abuse was MPHJ Technology, owned by a Texas lawyer named Jay Mac Rust. Working with the law firm Farney Daniels, Rust sent out more than 9,000 patent demand letters to small businesses around the country, telling recipients that their networked scanner system infringed on MPHJ patents and asking them to pay a royalty of around $1,000 per employee.

Congress ultimately didn’t pass a patent reform bill, but MPHJ became mired in legal battles with state and federal authorities. Rust’s company was investigated by the Federal Trade Commission, and then it took the surprising step of actually suing the FTC first.

That lawsuit got thrown out, and now Rust, MPHJ, and Farney Daniels have reached a settlement with the FTC. Under the terms of the settlement, Rust and his lawyers are barred from making “misleading or unsubstantiated representations” in any letters they send out. There is no monetary penalty.


The content in this post was found at http://arstechnica.com/tech-policy/2014/11/ftc-ends-first-case-against-a-patent-troll-with-a-slap-on-the-wrist/ and was not authored by the moderators of freeforafee.com. Clicking the title link will take you to the source of the post.



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