Patent trolls have a new enemy—the State of Vermont. On Wednesday, the state sued MPHJ Technology Investments, a non-practicing entity or patent troll, accusing it of violating state laws by threatening infringement lawsuits to small businesses that did not pay licensing fees.

Patent trolls are a known nuisance in the legal world—businesses that hold patents but don’t produce products, and rely on patent infringement lawsuits and licensing fees for their income.

According to the lawsuit, MPHJ sent letters to companies saying they had potentially infringed on MPHJ’s scanner technology, and requested licensing fees or confirmation that the companies weren’t infringing the patents. The letters suggested that $900-$1200 per employee was a fair price for the licensing fees. The lawsuit claims that licensing fees are typically much lower and the letters are attempting to deceive businesses.

Vermont is seeking an injunction to bar MPHJ from sending any more letters to businesses in the state, and up to $10,000 in penalties for each of the troll’s violations of Vermont’s consumer protection act.

Read more at Thomson Reuters.


For more InsideCounsel coverage of patent trolls, see below:

Microsoft launches patent tracking system that could foil trolls

In-house counsel urge lawmakers to quell patent trolls with antitrust laws

IP: Federal Circuit weakens Internet patent troll model

Technology: Can you learn to love a troll?