Dos Towers: ACTG Q1 Conference Call
Much like the
epic book and the movie of the L-rd of the R-ngs (I don't want to
attract fans of the movie and the book to my website when they do
a google search), there is a battle going on for the licensing of
patents in Middle Internet.
has clearly demonstrated their business model in acquiring or partnering
with patent holders to attempt to "solicit" and "market"
companies to pay-up on patent infringements.
For those following
this saga, Acacia's interpretations of the DMT patent is just as
imaginative as T-lkien's writings.
the Internet Tower first, more specifically Adult Entertainment
websites, as being the "low hanging fruit"**
to be able to "dip their beaks"**.
Out of the
120 licenses that they are proud about, 100 are from Adult Entertainment
websites. The following non-porn companies have been revealed in
press releases (CinemaNow, Disney, General Dynamics Interactive,
Grupo Pegaso, LodgeNet, NXTV, Oral Roberts University, T. Rowe Price,
24/7 University and Virgin Radio) which leaves ten others not released.
Out of 47 Adult
Entertainment companies targeted, eleven are in court, defending
their companies and the Internet from the M-rdor of Patent licensing
Markman Hearing brought more debate and discussion over the words
and definitions that Acacia is using from the patent. Several more
Markman Hearings are scheduled with some outcome by late summer.
It is believed
by the current defendants and myself that the judge will rule that
the DMT patent does not apply to the Internet. This would mean an
eventual non-infringing verdict for the defendants, but not invalidating
This now means
that cable and satellite companies would be the only areas to go
after, and admittedly, are really the "low hanging fruit"
because they are so heavy and plump in financial sweetness.
this push towards cable is observec by three attorney firms who
had contacted me for information concerning prior art and the Acacia
Saga as they are being "solicited" and "marketed"
to license the DMT patent.
on the conference call asked about the possibilities of litigation
with cable companies. Paul Ryan responded that there is the possibility
of litigation and that they would hope to have some licensees in
the cable industry that might impact other cable companies decision
to just settle. While laymen like me call that "Sweetheart
deals", in the patent licensing world, it's called "most
favored nations clause/status".
While the good
guys had defeated the first Tower and marched onward to the Second
tower in the movie, in this modern day saga, it is the story of
a band of lawyers with patent infringement weapons that now target
the Cable Tower.
Will the cable
industry band together and fight against what an EFF attorney said
was an "absurd patent", or will a large cable company
be offered the sweetheart deal that helps to deliver the rest of
the cable industry?
Who will be
the first to sell-out or settle, finding it cheaper to license than
to fight? Who will make it a business decision to rollover, rather
than band with other targeted companies?
In the conference
call, the V-Chip patent was brought up. Acacia had derived over
$25M in licensing before Sony went to court and proved that TV manufacturers
were not infringing on the patent. In seeing history repeat itself,
it's easy to see how smaller cable companies can be picked apart
to license, until the Sony of the cable industry steps in to squash
it. By then, Acacia will have filled up its coffers with money extracted
was round one. DMT Patent is round two. There will be additional
rounds that could make this Saga run longer than the six episodes
of St-r W-rs (that is unless the FTC or SEC has something to say
While the Farce
lies within this website and in these articles, it illuminates the
growing problems that business and innovators face and will face
when confronted with broad patent interprations that seek to add
a patent tax onto the cost of doing business.
The two paradoxes
in this particular case is this:
1) How can a
patent that has 160 other patents that referenced the DMT patent,
be able to broadly apply itself? Case in point: InterVu has patents
on client-server streaming technology that references the DMT patent.
A company that uses InterVu's patented technology could find themselves
infringing on a broader patent (DMT patent).
2) How can USA
Video's inventor have a patent that has overlaping claims as the
DMT patent? Both patents were granted within a year of each other,
which leads one to wonder about the obviousness issue.
If only the
whole season were but a dream.
phrases attributed to Robert Berman, General Counsel of Acacia Research