AIPLA Comments Regarding Proposed Consent Agreement in MPHJ Technology Investments, LLC, et al.

AIPLA and its membership have been engaged for some time in the vigorous debate regarding PAEs and patent licensing companies. While AIPLA in general supports economically efficient licensing of patents and intellectual property assets in general, and has cautioned against overbroad reactions to new market entrants and licensing models, we have expressed appropriate concerns about indiscriminate demand letters sent in bad faith.

In this case, AIPLA supports the FTC consent agreement, especially considering the allegations that the Respondents had no intent to go forward with any threatened litigation, but instead relied upon an expectation that the recipients of their letters would take a license to avoid the cost of appraising such threats. Here, the Respondents apparently asserted that “litigation will ensue” if the recipients of the letter did not respond. In fact, Respondents did not initiate a single legal action for infringement against any of the small businesses to whom draft complaints were sent.