Ops Battle Patent Claims

It’s been a busy month for cable patent attorneys, as two little-known firms, Acacia Research Corp. and Broadcast Innovation LLC, have been pushing operators to pay them license fees for technology used for products such as digital cable and Internet-delivered streaming video.

While Charter Communications Inc. won a small victory over Northbrook, Ill.-based Broadcast Innovation and Australian firm IO Research last week, when a judge invalidated a patent claim from the two companies related to the transmission of data over digital-cable networks, Acacia managed to settle its claims against some smaller cable firms.

Acacia vice president of business development and general counsel Rob Berman said the Newport Beach, Calif.-based company cut license deals with B&C Cablevision in Florida, BoulderRidge Cable TV in Colorado, Seren Innovations Inc. in Minneapolis and Central Valley in California. Berman said the cable firms agreed to license a patent for video-on-demand programming and a separate patent related to technology Acacia owns for transmitting analog channels over a digital network.

But Acacia still has a suit pending against Comcast Corp., Charter Communications Inc., Cox Communications Inc., EchoStar Communications Corp. and DirecTV Inc.

Comcast officials declined to comment on the Acacia suit, while DirecTV representatives said they believed the Acacia suit had no merit.

“We are preparing our defense and we will vigorously defend ourselves against this claim,” DirecTV said in a prepared statement.

EchoStar spokesman Steve Caulk said the company doesn’t believe that it has infringed Acacia’s patents, but he declined further comment.

Berman said Acacia’s team of patent attorneys (the company doesn’t employ traditional sales executives) has been pitching cable operators a rate card for its intellectual property, which would force operators to pay Acacia 50 cents per home annually for analog subscribers; $1 annually for digital subscribers; and $1.25 annually for each VOD subscriber.

If a home receives both digital cable and VOD, Acacia wants $1.25 per customer, Berman said.

While Acacia’s rate card might seem demanding to some operators, Berman said the rates would increase if the major MSOs don’t agree to pay up soon. “We will continue to increase those rates over time. If companies decide to wait … they will be paying higher rates,” he said.

Berman said Acacia believes other firms, including video-on-demand technology providers, vendors of middleware software and programmers have infringed its patents, but Acacia is only looking to sue cable distributors.

“Our business model is to pursue the cable companies, the companies that are collecting money from the end customer,” Berman said. “We’re not going to license a cable company and then cut off their supply by going after a middleware provider or an HBO.”

While Acacia has seen some recent wins in licensing its technology to small cable firms, Broadcast Innovation hasn’t been as successful.

A U.S. District Court judge in Colorado last week granted Charter’s motion for summary judgment, invalidating a patent claim from the company that relates to the transmission and reception of data over digital networks.

Broadcast Innovation had alleged that Charter had violated its patents through rollouts of ITV technology.

Comcast officials settled a lawsuit brought by Broadcast Innovation earlier this year, but MSO officials declined to discuss the settlement last week, citing a confidentiality agreement.

Jonathan Suder, an attorney for Broadcast Innovation, downplayed the court ruling last week, maintaining that the company’s patent “was, at worst, temporarily invalidated.”

Suder said Judge Alan Johnson has scheduled a hearing in October where he will entertain arguments to reconsider the ruling.

“This case is far from over,” Suder said.