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Economy & Business

Acting Attorney General Tied To Company Accused Of Patent Scams


Critics of President Trump's acting attorney general, Matthew Whitaker, include a group of inventors. They question his role on the advisory board of a company called World Patent Marketing, which scammed its inventors. Here's Nick Fountain from NPR's Planet Money podcast.

NICK FOUNTAIN, BYLINE: Crystal Carlson was living in Arizona when she had her big idea. She'd been watching the news, and there were a lot of reports of kids being left in hot cars. And one day, she was coming home from the supermarket with her kids.

CRYSTAL CARLSON: As we were bringing groceries in, I've got two that have to go potty. And I'm trying to get them to the toilet. And then the dog made an accident. And then I'm like - where's the baby? (Laughter).

FOUNTAIN: So Carlson invented something, a sort of pressure sensor that detected when a kid was in a car and a parent was far away. And then she started looking around on the Internet for someone to help her patent it. There were a bunch of companies out there, but none of them had brought inventions to market, except one she found called World Patent Marketing. They even had videos of their successes.


STEVE HARRIS: Not again. Looking under the couch or bed for your pet's toys or the remote control?

CARLSON: I'd seen Teddy's Ballie Bumpers.


HARRIS: With Teddy's Ballie Bumpers, you've got nothing to lose.

CARLSON: And lo and behold, I came across his product for sale on a website, so that's promising.

FOUNTAIN: And then Carlson was looking around the World Patent Marketing website and found this page bragging about its advisory board.

CARLSON: And they had all these images of the people who were on the advisory board. And...

FOUNTAIN: Did they seem impressive?

CARLSON: You know what? It did seem impressive because a lot of those people had backgrounds to them that would make you feel that they were important - government officials, ex-military officials.

FOUNTAIN: One of the advisory board members was Matthew Whitaker, a former U.S. attorney and now the acting attorney general. He replaced Jeff Sessions. According to court documents, Whitaker was paid more than $9,000 for his work, which included showing up in promotional videos like this one for a razor blade cover.


MATTHEW WHITAKER: It's a simple design but a unique design that I think is going to really not only...

FOUNTAIN: Carlson, the inventor, signed up. She paid World Patent Marketing over a $1,000 to research her product, to see if it could be patented. And they told her that it was going to be a wild success - such a success, they said, she should patent it worldwide. And they said that they would do that and find her manufacturer and market the products for her all for only $36,000. But they also told her she would make the money back in six months. Carlson raised the money from friends and family. She sent it in.

CARLSON: And, well, there stopped all the phone calls.

FOUNTAIN: So Carlson started looking for other World Patent Marketing customers, starting with that guy from the video.


HARRIS: Not again. On your knees or straining your back looking...

FOUNTAIN: She called him. They compared notes, and they figured out that they were both being scammed. The guy from the video had paid World Patent Marketing, but they'd hardly done anything for him. They'd let his patent go abandoned. And it turned out, someone had already patented the idea years earlier. Carlson lost everything.

CARLSON: You know, I borrowed $36,000 from friends and family. And when you do that, it makes you feel horrible - when you're not able to get it back. I'm sorry.

FOUNTAIN: That's fine. It's fine.

CARLSON: I haven't talked about it, like, for a while.

FOUNTAIN: Did you ask them for your money back?

CARLSON: I did. I did.

FOUNTAIN: But they wouldn't give it back, so Carlson filed a complaint with the FTC. Her and the guy from the videos started a class action. And last year, the FTC raided the offices of World Patent Marketing and got it shut down. In court filings, they said the company scammed more than 1,500 people out of close to $26 million. A spokesperson for the acting attorney general says, quote, "he was not aware of any fraudulent activity at World Patent Marketing." The court-appointed receiver who's collecting funds for the victims told NPR that, while other advisory board members have returned funds, Whitaker has not.

Nick Fountain, NPR News.