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Acacia Update: Busy Little Bees

It’s been a month since our last Acacia update, and Acacia has been anything but idle over that span of time. After the public outcry over their second wave of licensing-offer letters mailed to colleges and universities, Acacia has sent out a revised licensing offer. According to an eSchool News Online news piece entitled "Acacia revises royalty demands", Acacia’s original agreement demands a minimum payment of $5,000 from any school that uses streaming video and audio. The new offer reduces that annual minimum fee to $1,000, with two choices of fee structure: Schools can either pay $2 for each distance-education enrollment or seven cents per audio or video download/stream.

On September 13th, Acacia announced "that its Acacia Media Technologies Corporation subsidiary has initiated patent infringement litigation against cable companies located in Arizona, Minnesota, and Ohio." Acacia has had some success in leveraging litigation to convince cable companies to sign licensing agreements. In June of this year, Acacia filed a patent infringement litigation suit against six cable companies in the Northern District of California. Three have already settled and signed licensing agreements.

About a week earlier, on September 7th, Acacia announced that it had entered into a license agreement with Bloomberg LP, one of the world’s largest media organizations. The agreement covers all non-live streaming audio and video content accessed via The Bloomberg Professional service. Details of the agreement have not been released, but history has demonstrated Acacia’s willingness to offer "sweetheart" deals to larger companies, like the Disney Enterprises Inc. and Radio Free Virgin, the online music division of the Virgin Corporation. According to an article earlier this year at a ExtremeTech.com, "Licensees making over $10 million per year, however, have been asked to contact Acacia for ‘special terms’." Bloomberg’s license is the 175th that Acacia has entered into for its DMT technology.

Two weeks earlier, Acacia signed iFilm Corp. to license number 170. iFilm has a distribution partnership with RealNetworks, Movie.com, WindowsMedia.com, and RottenTomatoes.com, and delivers streaming movies, film and television clips, and music videos to more than 20 million visitors monthly. StreamingMedia.com asked iFilm to comment on their decision, but they declined to submit an on-the-record statement. Interestingly, Acacia isn’t the only company going after online movie sites while laying claim to a Video-on-Demand patent. On April 10, 2003, USA Video Technology Corporation filed a patent infringement lawsuit against Movielink, a Hollywood studio-backed IP VoD provider. The Interactive TV Today newsletter quoted USA Video patent counsel Andrew Huffman as saying that the primary difference between their claims and Acacia’s is that "Acacia’s patents also describe an audio transmission implementation," while USA Video’s patent is "directly for video content." Huffman goes on to claim that while USA Video doesn’t consider Acacia an adversary, his company actually developed the technology that it patented—unlike Acacia—and that their patents predate Acacia’s. How this might play out in the future has yet to be seen, especially since USA Video is still in litigation with Movielink.

Acacia’s ongoing trial against a feisty group of adult entertainment companies will stay on hold until October 13th. That’s when the court will begin hearings to determine whether or not to heed Acacia’s class action proposal against all adult entertainment Web sites. If Acacia wins this hearing, they’ll be allowed to bring patent infringement claims against all adult entertainment companies in a single lawsuit. On December 2nd, the judge will begin hearing a motion for summary judgement made by the defendants. This summary judgement comes as a result of an earlier ruling during the trial’s Markman Hearings. You can read more about these results in this StreamingMedia.com article.

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