The Davison invention class action lawsuit, Dungee v. Davison Design and Development, settled in December 2014 in the U.S. District Court for the District of Delaware, covering customers who signed agreements with the Pittsburgh-area invention promoter between January 2000 and March 2006. Timely claims totaled $564,735.50, paid out as a mix of cash and service vouchers. The case followed a 2006 federal judgment in which the Federal Trade Commission won $26 million in consumer redress against Davison, later settled for about $10 million in cash and property.
What the Dungee Class Action Covered
Deborah Dungee, a former Davison customer, filed the suit in 2010. It alleged breach of contract and violations of the American Inventors Protection Act of 1999, the federal statute that requires invention promoters to disclose their real track records — how many customers made money, how many got license agreements, how many inventions received positive evaluations.1U.S. District Court for the District of Delaware. Dungee v. Davison Design and Development, Memorandum Opinion
The class was defined by contract date: customers who entered agreements with Davison from January 2000 through March 2006. If you signed outside that window, the Dungee settlement did not cover you, and any claim you have would run through individual arbitration under Davison’s contract.
After mediation, the parties reached a claims-made settlement. Class members who filed on time shared the $564,735.50 in approved claims through cash payments and service vouchers.1U.S. District Court for the District of Delaware. Dungee v. Davison Design and Development, Memorandum Opinion
The Attorney Fee Fight That Delayed the Case
The substantive settlement was resolved in 2014, but the case did not truly end for another four years. The district court initially awarded class counsel $1,118,936.40 in fees, applying a 4.35 multiplier on top of a base lodestar of $257,226.76. Davison appealed. In January 2017 the Third Circuit vacated that award, holding the trial court had not made the detailed findings required to justify such a large enhancement under Perdue v. Kenny A.2Findlaw. Dungee v. Davison Design and Development
On remand in March 2018, the district court dropped the multiplier entirely. It recalculated the lodestar using 2017 billing rates to account for the delay, ending at $307,551.50 in fees plus $18,326.94 in costs.1U.S. District Court for the District of Delaware. Dungee v. Davison Design and Development, Memorandum Opinion
The FTC Judgment That Preceded the Class Action
The FTC sued Davison and its principals in July 1997 in the Western District of Pennsylvania under Section 5 of the FTC Act. After a three-week bench trial in June 2005, the court found Davison had told inventors they had a “reasonably good chance” of earning money, held out its patent and marketability research as objective when it was primarily a tool to sell more services, claimed a “vast network” of corporate licensing relationships, and used specific products as success stories even when some had no documented sales. Fewer than one percent of Davison’s customers ever received royalties exceeding what they had paid in fees.3FTC.gov. FTC v. Davison Associates, Findings of Fact and Conclusions of Law4FTC.gov. Court Halts Bogus Invention Promotion Claims
On March 17, 2006, the court entered $26 million in consumer redress and a permanent injunction. In July 2008, the parties reached a consent order under which the defendants paid roughly $10 million in cash and property, including residential real estate in Fox Chapel, Pennsylvania. The remaining balance of the $26 million judgment was suspended once those transfers were made.5FTC.gov. Invention Promoters Will Pay $10 Million to Settle FTC Charges Founder George M. Davison III was named individually as a defendant.
Arbitrations Since the Settlement
Davison’s contracts require disputes to go through the American Arbitration Association in Pittsburgh, not court. Several individual inventors have won those arbitrations, and Davison’s attempts to overturn the awards in federal court have largely failed.
Betty Frison prevailed in August 2017. The arbitrator found that even though Davison may have “technically complied” with the American Inventors Protection Act’s disclosure requirements, its communications still created a false net impression that customers had a “reasonably good chance of realizing financial gain.” Frison was awarded $13,290 in doubled damages, $10,000 in attorney fees, and $1,700 in costs. The Western District of Pennsylvania denied Davison’s motion to vacate.6Jus Mundi. Davison Design and Development v. Betty Frison, Award of Arbitrator7Jus Mundi. Davison Design and Development v. Betty Frison, Memorandum Opinion
Mario Scorza won an arbitration in March 2023 of $20,042.25 in damages and $199,024.05 in attorney fees, decided under the American Inventors Protection Act, the Texas Invention Development Services Act, and the Pennsylvania Unfair Trade Practices and Consumer Protection Law. The Western District of Pennsylvania denied Davison’s motion to vacate in November 2023, finding the award “rationally derived from the parties’ agreement and submissions.”8U.S. District Court for the Western District of Pennsylvania. Davison Design and Development v. Scorza, Opinion and Order
Heidi Morris, who paid $695 for a pre-development agreement and $14,222 for a “New Product Sample Agreement,” won an arbitration in which the arbitrator concluded the “virtual rendering” and mockup she received did not constitute the “fully operating prototype” Davison had represented it could produce. She was awarded double her money back plus attorney fees, and filed a complaint with the U.S. Patent and Trademark Office in March 2023.9USPTO. Heidi Morris Complaint Against Davison Design and Development
What the American Inventors Protection Act Lets You Recover
The American Inventors Protection Act of 1999 is the statute driving most of the successful claims against Davison. It requires invention promoters to give prospective customers written disclosures covering a five-year window: how many inventions the promoter evaluated (broken into positive and negative evaluations), how many customers earned a net financial profit, and how many received license agreements.10USPTO. American Inventors Protection Act of 1999
A customer harmed by a failure to disclose, or by material false representations, can sue for statutory damages of up to $5,000, actual damages, reasonable attorney fees, and up to triple damages where the conduct is found to be intentional and deceptive.11IPWatchdog. Invention Promoters and the American Inventors Protection Act The USPTO also maintains a public log of complaints against invention promoters. As of mid-2026, it lists four active complaints against Davison filed between 2022 and 2024.12USPTO. Published Complaints Against Invention Promoters
Is Davison Still Operating?
Yes. Davison remains fully operational as of 2026. The company continues to solicit new clients through its website and advertising, offering what it describes as a nine-step invention development process. It runs roughly 110,000 square feet of office and factory space near Pittsburgh, including a facility it calls “Inventionland,” and employs more than 130 people. Development fees typically run $8,000 to $14,000, on top of an initial pre-development fee of about $700.13Davison.com. Davison Fact Sheet
Consumer complaints continue as well. The Better Business Bureau, where Davison holds an A+ rating but is not accredited, lists 74 complaints against the company in the three years ending mid-2026, with 31 closed in the most recent 12 months. Consumers report high-pressure sales tactics, unclear total costs across a multi-stage process, and long silences after payment. Some describe being urged to use tax refunds to fund additional project stages. Davison consistently responds that it provides advance disclosures of all fees, that clients sign contracts acknowledging those disclosures, and that it performs its services according to its agreements.14BBB. Davison Design and Development Complaints
If you signed a Davison contract outside the January 2000 to March 2006 Dungee class window, the class settlement does not apply to your situation. Your route is individual arbitration under the contract, and the Frison, Scorza, and Morris results show that inventors have won those proceedings under the American Inventors Protection Act and related state consumer protection statutes.