In A First, FTC Targets A “Troll”

For the first time in its history, the Federal Trade Commission has brought an enforcement action against a patent assertion entity seeking to license its patent rights. A client alert from Greenberg Traurig details the allegations, and the settlement that the FTC concluded with the company, MPHJ Technology Investments LLC and its law firm, Farney Daniels L.P. The FTC says the company sent out thousand of letters, many to small businesses, stating the recipients were infringing its patents by using some common office equipment, that numerous companies had bought licenses, and that the recipient would be sued within two weeks if it didn’t also agree to pay for a license. The FTC maintains the last two statements puts this situation in their bailiwick because they were deceptive. In fact, according to the FTC, only two small businesses had agreed to the license demand and there were no real plans to litigate.