Intellectual property services company CPA Global has been accused of substantial overcharging in a class action complaint brought by a medical device company on behalf of itself and around 100 other CPA clients.
In the complaint, filed at the US District Court for the Eastern District of Virginia, New York-based Brainchild Surgical Devices claimed CPA overcharged for renewals and issued “opaque invoices” to conceal this.
The complaint further alleges that CPA uses similar contracts and pricing structures for all, or nearly all, of its clients in a “deliberate and systematic scheme”.
A spokesperson for Clarivate, which acquired CPA Global in 2020, said it “categorically and emphatically denies any wrongdoing”.
“The fees for our services are defined in our agreements with our customers, and we adhere to those agreements fully,” the spokesperson added.
According to the complaint, filed on May 2, Brainchild entered into an agreement with CPA for managing maintenance payments for its registered, and in some cases pending, patent and design rights around the world.
CPA, Brainchild alleges, agreed to charge a fixed fee of $200 per payment plus CPA’s costs on top.
However, according to the complaint, CPA’s invoices “made it difficult for Brainchild to determine the actual costs incurred in making payments, and thus difficult to tell if Brainchild was being overcharged”.
The complaint includes several examples of renewals work undertaken by CPA at various IP offices, including at the EPO and CIPO, Canada’s IP office. In each case, there were “undisclosed overcharges” of between $214 and $610, the complaint alleges.
It is not the first time CPA has been accused of overcharging – in 2016, the company was sued in a separate class action lawsuit in the US.
According to the latest complaint, in October 2017 the Eastern District of Virginia approved a $5.6 million settlement that went to then-class members.
Brainchild is seeking an order requiring CPA to reimburse any wrongfully obtained funds, damages and attorneys’ fees, as well as an order preventing it from continuing “unfair and deceptive” business practices.
In its complaint Brainchild states that if CPA were to change its billing practices, it might retain the company in the future to manage international patent registration payments.
The Clarivate spokesperson added: “We consider the allegations of overcharging in the new class action to be a deliberate attempt to tarnish our good business reputation and we vigorously defend ourselves against any such vexatious speculation.”
