These regulations are promulgated pursuant to Commercial Law Article, §13-205, Annotated Code of Maryland, Subtitle, “Division of Consumer Protection; Consumer Council”. They shall apply to Chapter 362 of the Acts of 1977, which defines as an unfair or deceptive trade practice and thus prohibits under the provisions of Commercial Law Article, §13-303. Annotated Code of Maryland, “deception, fraud, false pretense, misrepresentation, or knowing concealment, suppression, or omission of any material fact with the intent that a consumer rely on the same in connection with a contract or other agreement for the evaluation, perfection, marketing, brokering, or promotion of an invention”. The Consumer Protection Division of the office of the Attorney General and the Consumer Council find that Chapter 362 was enacted because of concern by the General Assembly regarding the practices of invention development services and, more particularly, because of concern as to whether those using these services were entitled to the benefits of the Consumer Protection Act. The Division and the Council further find that the General Assembly has delegated to them the responsibility to detail what practices of invention development services shall constitute violations of the Consumer Protection Act as unfair or deceptive trade practices, and to set certain requirements for the transaction of business by invention development services in Maryland. “Business day” means any calendar day except Sunday or the following business holidays: New Year's Day, Washington's Birthday, Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans' Day, Thanksgiving Day, and Christmas Day, all as celebrated by the State of Maryland. “Contract” or “contract for invention development services”, for the purposes of these regulations, means a contract by which an invention developer undertakes invention development services for a customer for a stated payment or consideration, whether or not the payment or consideration has yet been made. “Customer” means a person, firm, partnership, corporation, or other entity that is solicited by or enters into a contract for invention development services with an invention developer. “Invention” means any discovery, process, machine, design, formulation, composition of matter, product, concept, or idea, or any combination of these. “Invention developer” means any person, firm, partnership, corporation, or other entity and any agent, employee, officer, partner, or independent contractor who or which sells or offers for sale in Maryland invention development services. “Invention developer” does not include: Any department or agency of federal, state or local government; Any charitable, scientific, educational, religious, or other organization qualified under Section 501(c)(3) or described in Section 170(b)(1)(a) of the Internal Revenue Code of 1954 as amended; and Bona fide manufacturers' representatives who sell, broker or otherwise market goods. “Invention development services” means the evaluation, perfection, marketing, brokering, or promotion of an invention by an invention developer, including a patent search or the procurement thereof, procuring the preparation or prosecution of a patent application, and any other acts done by an invention developer for consideration for the purpose of procuring or attempting to procure a patent for an invention or finding a licensee or buyer for an invention. “Invention development services” does not include solely technical or industrial research and development services or the services of an attorney and of a patent agent duly registered by the United States Patent and Trademark Office in the performance of those tasks which they are permitted to perform by reason of their registration. Every contract for invention development services shall be in writing, and a completed copy shall be given to the customer in accordance with the provisions of these regulations. No contract for invention development services may require payment or any portion thereof to be made by the customer until after 3 business days following the date on which the customer receives a completed copy of it. Every contract for invention development services shall provide for a 3 business day period during which the customer may cancel the contract in accordance with the provisions of these regulations. Every contract for invention development services shall have a conspicuous and legible cover sheet with the following notice and required disclosures imprinted on it in boldface type of a minimum size of 10 points: The invention developer shall complete the cover sheet with the proper information to be provided in the required disclosures. Numbers to be inserted in Required Disclosure #1 may be rounded to the nearest 100 and need not include those who have contracted within the 2 immediately preceding calendar months or parts thereof. The cover sheet shall contain the items required by the provisions of Regulation .05A and B, of this chapter, the name, home office address, and local office address of the invention developer, and nothing more. Every contract for invention development services shall set forth, in conspicuous and legible type, all of the following information: The terms and conditions of payment, which shall be consistent with the requirements of these regulations. A full, clear, and concise description of the specific acts or services which the invention developer contracts to perform for the customer for the stated consideration. A statement as to whether the invention developer contracts to construct, sell, or distribute one or more prototypes, models, or devices embodying the customer's invention. The full name and principal place of business, both in Maryland and at its home office if different, of the invention developer, and the name and principal place of business of any parent, subsidiary, or affiliated company which regularly performs for the invention developer the kinds of services for which the customer has contracted. A statement of the fee being charged for all services to be provided under the contract, together with any terms and conditions applicable to the payment of the fee. A statement as to whether or not any representation of estimated or projected earnings is or has been given by the invention developer, its employees, or agents to the customer. If so, then such estimate or projection shall be stated in the contract, together with a description of the data on which it is based. A statement as to whether or not the invention developer's officers or employees, or any of them, are licensed to practice law in any jurisdiction or are patent agents or patent attorneys duly registered with the United States Patent and Trademark Office and if so, a statement whether he or she will handle the customer's case. The name and address of the custodian of all records and correspondence pertaining to the services being contracted, together with a statement that the invention developer shall maintain all records and correspondence related to the contract and the services being contracted for that customer for at least 3 years after the expiration of the contract. Identification of the custodian as the invention developer by company name and address shall be sufficient. The statement shall also recite that these records and correspondence will be made available to the customer or the customer's representative for review and copying at the customer's reasonable expense on the invention developer's premises during normal business hours upon 7 days' written notice. A statement setting forth the approximate time schedule for the performance of the invention development services, including the estimated date by which performance of the services contracted for is expected to be completed. If the invention developer or any of its officers, directors, or managing agents has or have, or if an affiliated, parent, or subsidiary of the invention developer or any of its officers, directors, or managing agents has or have, during the 5 years immediately preceding the receipt by the customer of the completed copy of the contract, been a defendant or respondent in any proceeding in which a finding of deception, fraud, false pretense, false premise, misrepresentation, or knowing concealment, suppression, or omission of a material fact with the intent that a consumer rely on the same, unfair competition, unauthorized practice of law, or violation of consumer protection laws or regulations of the United States, any state or the Federal Trade Commission, was a part of the basis of a final judgment of liability, a guilty verdict, or an injunction or consent decree by final order of court or administrative agency, then the contract shall set forth a statement describing the invention developer's final adjudicated status in that proceeding. Any such proceeding which is presently pending and in which the moving party was an agency or instrumentality of federal, state, or local government shall be similarly disclosed. In the case of a pending proceeding, the disclosure may include a statement of the status of the proceeding and an opinion, clearly identified as opinion, of the invention developer's legal counsel as to the merits of the allegations. If, in conjunction with any contract with a customer, the invention developer normally uses one or more subsequent contracts, then the invention developer shall include in the contract a statement summarizing the subsequent contracts normally used. The statement shall include the amount of any fees or other consideration that may be required from the customer for the subsequent contracts and an approximate schedule of the expected times at or occasions on which the subsequent contracts and fees or other consideration will be proposed by the invention developer. A statement as to whether or not the invention developer contracts to pursue or arrange for protection of the customer's invention by United States Letters Patent or United States Design Patent or any foreign patent. With respect to every contract for invention development services, the invention developer shall deliver written reports to the customer at the address specified in the contract, at quarterly intervals commencing not later than 3 months after the date of the contract and continuing throughout the term of the contract. These written reports shall identify the contract and shall include: A full, clear, and concise description of the services performed to the date of the report and of the services yet to be performed; and The name and address of the persons, firms, corporations or other entities to which the subject matter forming the basis of the contract has been disclosed, the reason for every disclosure and copies of all responses received as a result of these disclosures. Information previously furnished to the customer need not be repeated, provided the invention developer retains copies of these communications with the records of that customer's contract. As to disclosures made at trade shows or exhibitions, the requirements of this regulation shall be met so long as the trade show, its date and location are identified in the report. Attached to the contract as a part thereof, there shall be a Notice of Cancellation, provided in duplicate and in easily detachable form, in not less than 10-point boldface type, which reads as follows: The invention developer shall complete the notice of cancellation form with all proper information, leaving blank only the date on which the customer executes the cancellation notice and the customer's signature. The customer may cancel any contract for invention development services by mailing or delivering a signed and dated copy of the notice of cancellation, or any other notice to the same effect, to the invention developer at the address provided for the invention developer in the notice of cancellation or elsewhere in the contract, not later than midnight of the third business day following the date on which the customer receives the completed copy of the contract. Any contract for invention development services which does not substantially comply with the provisions of these regulations is voidable at the option of the customer. Any contract for invention development services entered into in reliance upon deception, fraud, false pretense, misrepresentation, or knowing concealment, suppression, or omission of a material fact is voidable at the option of the customer. If a customer makes a valid cancellation of the contract in accordance with these regulations, the invention developer shall, within 10 days following that act, return to the customer at the address furnished in the contract any payments made or other consideration given by the customer under that contract, as well as any property entrusted to the invention developer by the customer. In conjunction with this return, the invention developer may retain copies of the material for file records, which copies shall remain confidential. The provisions of these regulations may not restrict any right to bring an action to recover for injury or loss sustained as a result of the matters dealt with in these regulations. A customer may not waive nor may any contract contain a waiver of any of the provisions of these regulations. These regulations shall be effective 30 days after notice of final action is published in the Maryland Register. Commercial Law Article, §13-205, Annotated Code of Maryland Effective date: March 10, 1978 (5:3 Md. R. 134)