Federal Court Shoots Down Patent Troll’s Attempt To Circumvent State Law

Patent assertion firm MPHJ attempted to have the Vermont AG’s consumer protection case removed to federal court, but the district court remanded the case to state court, noting that Vermont was “targeting bad faith conduct irrespective of whether the letter recipients were patent infringers or not, on the basis that MPHJ’s bad faith conduct would be unlawful even if MPHJ’s patents were valid and the conduct was directed toward actual patent infringers.” Twenty-five states have passed or are considering legislation similar to Vermont’s, aimed at curbing bad-faith patent assertion through state law, either based in consumer protection or through laws directed at bad business practices. “As other states follow Vermont’s lead in passing and enforcing these protections, lawmakers are well-advised to draft carefully worded statutes that do not trespass on federal patent laws, while patent owners are best advised to craft careful patent enforcement strategies that account for applicable state consumer protection,” Gianna Cricco-Lizza with Gibbons says.