A registered nurse and a full-time grocery store manager allege in a proposed class action that the entities and individuals behind InventHelp have engaged in “rampant and blatant fraud” by which they’ve bilked aspiring inventors out of millions.
According to the 57-page complaint, the defendants’ entire business model and enterprise is fraudulent “from start to finish.” The multi-tiered conspiracy perpetrated by InventHelp and its co-defendants—Technosystems Consolidated Corp., Technosystems Service Corp., Western InventHelp, Universal Payment Corporation, Intromark Incorporated, the companies’ president and a Florida-licensed patent attorney—utilizes a web of invention promotion companies, licensing agents, private money lenders, attorneys, agents and licensing and distribution companies to prey upon consumers’ “high hopes and dreams” while avoiding liability and monetary judgment, the lawsuit alleges.
While the aforementioned companies hold themselves out as independent of one another, they are all components of an integrated enterprise set on defrauding those who fall victim to their scheme, the plaintiffs claim. According to the case, the defendants’ carefully crafted marketing materials, in which the companies purport to have successfully helped consumers monetize their inventions while perpetuating their apparent reliability and repute, serve to create the impression that they’re a legitimate operation.
With regard to one layer of the conspiracy, defendant Universal Payment Corporation, which holds itself out to be an independent private money lender, is a façade that operates “under the identical ownership and control as InventHelp,” and lacks even a business address other than a P.O. box, the plaintiffs say. According to the case, consumers without thousands of dollars on hand to dump into their inventions are offered generous loans by the supposedly independent Universal Payment Corporation only to have the defendants make off with their steep initial fees.
While the defendants pocket consumers’ money, the companies string inventors along with “false promises and boilerplate ‘analyses’” in order to collect even more money before “disappearing and dodging calls as soon as Defendants have the money in hand,” the complaint alleges.
Those who sign agreements with InventHelp are inundated for years with a barrage of paperwork, which lends the impression that the defendants are continuing to work on their behalf, the lawsuit continues. In truth, the suit alleges, the avalanche of paperwork is designed to create the impression that the defendants have consumers’ best interests in mind though no expectation exists that an individual’s proposed invention will be licensed. Even in the “rare occasion” that a company expressed interest in an InventHelp client’s idea, they would have no means of contacting InventHelp other than the 1-800 number advertised on late-night television commercials, per the suit.
“These calls go unreturned,” the case says.
In other instances, InventHelp may reach out to existing clients claiming an outside company has discovered their invention and they may want to license the product pursuant to a 60-day license agreement, the suit goes on. Though the defendants claim these 60-day licensing agreements are a standard industry practice, the purported “outside” companies inevitably decide against renewing the licenses, the complaint reads.
“Fraud permeates all of the dealings and contracts between Class Plaintiffs and all Defendants herein, from start to finish,” the lawsuit says. “Defendants’ enterprise as a whole is fraudulent, and Defendants fraudulently induce Class Plaintiffs to sign various contracts.”
Among the “sophisticated and crafty” mechanisms used by the defendants to sidestep liability, the companies insert fraudulent clauses into their contracts that aim to erase the rights of anyone who may look to pursue litigation, the complaint says. Further, the defendants misrepresent the actual content of their contracts with consumers, who the lawsuit claims are tricked into signing documents that outline terms and conditions far different than those represented by InventHelp.
Before consumers can meaningfully review the “lengthy, complicated” contracts forwarded by the defendants, the companies allegedly utilize high-pressure tactics in order to get inventors to sign the paperwork immediately. Though consumers are told about so-called special promotions and advised they can stop making payments to InventHelp without penalty, the former does not exist and the latter is not true, the complaint says.
InventHelp and its co-defendants also engaged in “nefarious means” in order to censor or block negative reviews of the company and thereby prevent consumers from seeing what they’re really signing up for, the case says. Per the suit, the defendants have obstructed hundreds of poor reviews on consumer watchdog websites by employing “sophisticated mechanisms” to redirect unhappy consumers to InventHelp’s website or reroute individuals to “false and fraudulent glowing reviews.”
Similarly, the defendants utilize “deceptive and fraudulent tactics,” including threats, intimidation and harassment, to collect debts from those who can no longer make payments pursuant to the contracts they signed, according to the case.
The case alleges wholesale violations of the American Inventors Protection Act of 1999 in that the defendants omitted statutorily mandated information in their disclosures to consumers.