Jessica M. Karmasek Aug. 14, 2014, 10:55am

WASHINGTON (Legal Newsline) - On Monday, the U.S. Court of Appeals for the Federal Circuit ruled that Vermont Attorney General Bill Sorrell’s case against an alleged patent troll should be tried in the state.

The so-called “scanner troll,” MPHJ Technology Investments LLC, was trying to avoid litigating its case in Vermont state court.

The company has been accused, in various lawsuits, of sending thousands of letters to businesses, demanding them to pay $1,000 per worker for using a process of scanning and emailing an electronic document.

Judge Pauline Newman explained in the Federal Circuit’s six-page order that the court lacks jurisdiction to grant the relief requested by MPHJ.

“Here the district court remanded on a ground provided in §1447(c); that is, in the district court’s view the complaint did not raise a claim or question of federal law to give rise to federal jurisdiction,” Newman wrote for the three-judge panel.

“Section 1447(d) precludes this court from second-guessing the district court’s jurisdiction determination regarding subject matter.”

In May 2013, Sorrell brought a lawsuit in state court against MPHJ.

The attorney general alleged that MPHJ sent unfair and deceptive demand letters to businesses and nonprofits throughout Vermont.

MPHJ removed the case to federal court, which remanded it back to state court in April due to lack of subject matter jurisdiction.

MPHJ appealed that decision and raised other issues, all of which were dismissed by the Federal Circuit.

“We’re pleased the Federal Circuit has rejected MPHJ’s appeal. Now we can turn in earnest to litigate the case in state court -- where it began and where it rightfully should be,” Sorrell said.

In a company statement, MPHJ said it believes the panel erred in its decision.

“We will be asking the full court to review the panel’s decision,” it said.

MPHJ added, “It is important to note that this ruling did not address substantive case issues. Those issues include MPHJ’s rights under the First and Fourteenth Amendments that have already been confirmed by other federal courts.”

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