Adding more charges against the defendants, the Federal Trade Commission (FTC) has amended its complaint against the operators of an invention promotion scheme.
In March, the agency filed suit against Scott Cooper and his companies, World Patent Marketing and Desa Industries Inc., accusing the defendants of violating Section 5 of the Federal Trade Commission Act by claiming they would analyze, file and promote inventions and then failing to follow through on their promises.
According to the agency, the defendants tricked consumers with fake “success stories” and testimonials to induce them to pay thousands of dollars to patent and market their inventions, with a price tag of up to $1,295 for a report from an “expert” about the viability of a patent. Once the analysis arrived, consumers faced another bill, the FTC alleged: this time for packages, ranging in price from $7,995 to almost $65,000, of various services that would help the consumer earn money from their inventions and see the product sold at big-name retailers. However, consumers were then strung along for months and received, at best, “low-effort, low-value” marketing help, the FTC said.
In the amended complaint, the Commission added new false advertising allegations based on the defendants’ claims that its clients’ products were sold in multiple “big box” stores, including Best Buy, Lowes, Petco, Sears, Target, The Home Depot, Walgreens and Walmart. None of the defendants’ customers’ inventions were sold in any brick-and-mortar stores, the FTC said.
The defendants also claimed to have brokered licensing deals between its clients and a manufacturing plant of the Chinese arm of its business, “WPM China.” But the FTC alleged the defendants do not own a manufacturing plant in China and that “WPM China” does not exist.
A Florida federal court granted the agency’s motion for a temporary restraining order and froze the defendants’ assets pending litigation.
To read the amended complaint in FTC v. World Patent Marketing, click here.
Why it matters: The FTC characterized the action as one “about protecting innovators, the engine of a thriving economy,” as FTC Acting Chair Maureen K. Ohlhausen described the original complaint.