Getting your awesome invention from scribble to prototype to store shelves is often no simple task, but one company that promised to help amateur inventors patent and market their creation has been shut down by a federal court after being accused of bilking millions of dollars from its clients.
The Federal Trade Commission announced today that a U.S. District Court judge in Florida granted the government’s request to halt the operations of World Patent Marketing. The FTC alleges that the company deceived customers and threatened them with lawsuits if they filed complaints about the business.
According to the FTC complaint [PDF], since Feb. 2014 Florida-Based World Patent Marketing and Desa Industries, Inc. — owned by Scott Cooper — marketed and sold research, patenting, and invention-promotion services to inventors who wanted to profit from their ideas for inventions.
The company allegedly used bogus “success stories” and testimonials in order to promote their ability to market prospective customers’ inventions.
However, the FTC claims that many of the inventors featured in the company’s success stories wrote the testimonials shortly after signing on with the company, before they actually had time to evaluate World Patent Marketing’s business.
Potential World Patent customers who saw these ads would contact the company, where a sales rep would ask for a description of the invention. The FTC claims that, regardless of what the customer said, the rep would invariably praise the idea before explaining that a “board” or “team” needed to give their approval to move forward.
At this point, the company would direct prospective customers to submit written descriptions and drawings of their inventions.
The salesperson would then call the customer back with the news that the company wanted to move forward with the product. But to do this, says the FTC, the customer would be required to spend up to $1,295 for a “Global Invention Royalty Analysis” or similar report.
Several weeks later, the report would materialize describing the product as patentable and marketable.
Salespeople would then sell customers “packages” ranging from $7,995 to $64,995 for varying levels of patent protection and invention-promotion services, including 3D renderings, website design, exhibiting inventions at trade shows, and on-going support from a personal licensing agent.
The sales process, the FTC claims, would drag on for months or even years, with the company never delivering what they promised.
When customers attempted to complain about World Patent Marketing’s business practices — such as posting complaints on the internet, with the Better Business Bureau or law enforcement — the company would respond by threatening to file a lawsuit for extortion, defamation, and other causes of action.
In one case, a customer who sought a refund and filed a complaint with the Better Business Bureau received a letter from the defendants’ lawyer.
The letter stated that seeking a refund was extortion under Florida law and, “since you used email to make your threats, you would be subject to a federal extortion charge, which carries a term of imprisonment of up to two years and potential criminal fines.”
The FTC is seeking to permanently halt World Patent Marketing’s operations and return funds to consumers.