Scott Cooper and his companies, World Patent Marketing Inc. and Desa Industries Inc., have agreed to a settlement with the Federal Trade Commission that bans them from the invention promotion business.
The proposed settlement order resolves charges the FTC brought last year, alleging that Cooper and his companies deceived consumers and suppressed complaints about them using threats, intimidation, and gag clauses. A federal court subsequently halted the Florida-based scheme and froze its assets pending litigation.
According to the FTC, consumers paid the defendants thousands of dollars to patent and market their inventions based on bogus “success stories” and testimonials. After stringing consumers along for months or even years, the defendants did not deliver what they promised, and many people ended up in debt or lost their life savings with nothing to show for it.
Under the proposed settlement order, the defendants are banned from invention promotion activities, misrepresenting any good or service, and suppressing the availability of truthful negative comments or reviews by consumers. They are also prohibited from profiting from consumers’ personal information collected as part of the challenged practices, and failing to dispose of it properly.
The order imposes a $25,987,192 judgment that will be partially suspended when $78,670 in frozen funds are transferred to the Commission and Cooper has paid $976,330. The full judgment will become due immediately if the defendants are found to have misrepresented their financial condition.
The Commission vote approving the proposed stipulated final order was 2-0. The FTC filed the proposed order in the U.S. District Court for the Southern District of Florida.
NOTE: Stipulated final orders or injunctions have the force of law when approved and signed by the District Court judge.
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