Acacia
Research Group (ACTG) Q3 2014 in Review
Disclaimer: I have not been compensated to publish this
preview by any company discussed. All information is based on publicly
available information and all opinions/conclusions are my own. This preview is only
for informational purposes. Please contact a registered financial agent before
making any financial decisions.
Link to PDF version on Scribd.com for better formatting.
Commentary:
Acacia continued to be very active in Q3 2014, although I am of the opinion that it will be a “bridge” quarter moving into Q4 2014 and 1H 2015 where activity is sure to accelerate with a numerous amount of trial dates and Markman hearings. My opinion is the quarter will not be a blowout as it was in Q2 2014. There were a number of dismissals in Q3 although estimating revenue from these agreements continues to be very difficult. My gun to the head guess would be in the $25-$30M range. Key highlights:
- RPX
and Innovative Display agreement has led to a number of dismissals on the
docket, which included Apple, Acer, Canon, Verizon, T-Mobile, Nikon, and Best
Buy. A Markman opinion was also issued.
- Blackberry
and Microsoft were also able to reach agreements through mediation with
Innovative Display.
- Sharp
licensed with Acacia under three portfolios, which included Adaptix.
- Arthrex
licensed with Bonutti Skeletal.
- Progressive
Semiconductor licensed with Marvell and later was issued a Markman opinion in
their case against Qualcomm.
- Markman
opinion issued in LifeScreen v Cordis on August 12, 2014.
- Signal
Enhancement had their case stayed with Broadcomm pending the outcome of the
Inter Partes Review that was filed. The
case was settled per the PTAB docket. It
is not known if there was any revenue attached with the settlement.
- There
were a number of Inter Partes Reviews filed across a handful of portfolios in
the quarter. There were no final
decisions that I was able to locate on the database.
- Adaptix
Markman opinion was issued in case with Huawei and ZTE.
- Light
Transformation Technologies Markman opinion issued on the ‘959 patent ruling
all asserted claims invalid.
- Markman
hearing scheduled for 9/29/2014 was taken off the calendar because of
settlement agreements in the Online News Link portfolio.
List
of Q3 case dismissals, * = my estimate of a likely larger than average
agreement:
Auto-Dimensions – Autodesk
8/21/2014
Battle Toys – Lego
9/2/2014 – 8K
Brandywine Communications – Consolidated
Communications Holdings
Innovative Display – MiTac
Digital 7/9/2014, Acer
8/22/2014, Apple
8/26/2014, Canon
8/6/2014, Verizon
9/3/2014, T-Mobile
9/3/2014, Best
Buy 9/9/2014, Blackberry
9/16/2014, Microsoft
9/16/2014, Nikon
9/27/2014. Many of these
dismissals/settlements should be covered by the RPX
agreement dated 8/19/2014 *.
Online News Link – BodyBuilding.com
8/4/2014, Strongview
Systems 9/11/2014, Overstock.com
9/24/2014, Netflix
9/24/2014, Groupon
9/26/2014, QVC 9/26/2014, Backcountry.com 9/26/2014, Evite Inc 9/26/2014,
Provide Commerce 9/26/2014
Promethean Insulation Tech – Pregis
Corp 7/24/2014, Innovative Energy 7/24/2014, Energie Innovation 7/24/2014, Saving
Haven LLC D/B/A Radiantguard 9/16/2014
Saint Lawrence – Tecnotree
OYJ 7/22/2014
Signal Enhancement – Broadcomm 7/25/2014
Super Resolution Technologies – Nikon Corp 7/24/2014
Stayed pending Settlement – 9/23/2014
Agreement announced *
Wireless Mobile Devices – Sprint
7/11/2014 * , AT&T 7/17/2014 * (Only a docket entry, no filing
for AT&T
Q3
2014 Partnerships and New Litigation Filed
A new subsidiary named In-Depth Test LLC, filed
suit against five targets during the quarter. The patents cover semiconductor
testing and were acquired / partnered with a company called Test Advantage Inc,
located in Tempe Arizona.
Intersil Corp
Maxim Integrated Products
Vishay Intertechnology
Intersil Corp
Maxim Integrated Products
Vishay Intertechnology
Linear Technology Corp
Fairchild Semiconductor Corp
A new subsidiary
named Nexus Display Technologies filed suit on July 11th, 2014 against nine
targets. The patents originated from Silicon Image Inc.
Dell
Lenovo
Panasonic
Eizo
NEC
Sony
Viewsonic
BenQ
LG
Credit Card Fraud Control
Corporation filed two suits on July 21, 2014 and three more suits on September
10, 2014:
Chase Paymentech Solutions
First Data Corporation
Elavon Inc
TCSP Inc
MaxMind Inc
CeraMedic LLC filed suit
against three companies between July 23rd and August 1st. The patents
originated from Fraunhofer-Gesellschaft in the late 90s and were transferred to
Acacia in February 2014. The patents relate to ceramics used in hip
replacements.
Smith
& Nephew
DuPuy
Orthopaedics
CeramTec
GMBH
Data Engine Technologies filed suit against
Google on September 2, 2014.
Liefeport Sciences filed suit against C.R.
Bard on September 3, 2014.
Industrial Print Technologies filed suit
against two companies on September 12, 2014:
Hewlett-Packard
O’Neil
Data Systems
Cellular Communications Equipment filed suit
against six targets on September 15, 2014:
Samsung
AT&T
Boost
Mobile
Sprint
T-Mobile
Verizon
Parthenon Unified Memory Architecture filed
suit against Samsung on September 22, 2014. The patents originated from ST Microelectronics. Acacia announced a partnership with an unnamed leading semiconductor on April
15th, 2014.
Markman
Opinions issued in Q3 2014:
Patents 6,755,547, 7,300,194, 7,384,177,
7,404,660, 7,434,974, 7,537,370, and 8,215,816 asserted with 12 claim terms in
dispute.
Patents 6,473,349 and 6,862,208 asserted with 5 claim
terms in dispute.
Patents 6,947,748 and 7,454,212 asserted with 5 claim
terms in dispute. The opinion was issued on September 19, 2014.
Patent 8,220,959 asserted with 11 claim terms in dispute.
The opinion was issued on July 11, 2014.
Patents 5,709,704 and 6,214,025 asserted with 9 claim
terms in dispute. The opinion was issued
on August 12, 2014.
Q4
2014 Events:
Endotach v Cook was scheduled for trial on December 3,
2014. It
has been moved to March 30, 2015.
Markman Opinion should be issued in Body Science v
A&D Engineering, Lifewatch Services, and Polar Electro. Hearing was held on July 31, 2014.
Cellular Communications Equipment Markman hearing remains
on schedule for November 18, 2014 in EDTX.
Optimum Content Protection v Microsoft Markman hearing is
set for November 6, 2014 in EDTX.
Cell & Network Selection v Blackberry, Nokia, Sprint,
T-Mobile, and Verizon Markman hearing is set for November 13, 2014 in EDTX.
Questions
for the Q3 Conference Call:
- Impact
on monetization from the Innovative Display Markman opinion, which claim 1 of
the ‘547 patent was ruled indefinite?
- Plans
to appeal the claims construction order in Light Transformation Technologies?
- Were
there any final decisions at the PTAB with Inter Partes Reviews that have
reached final decisions or were not instituted in the quarter?
- Any
color on the pipeline and when to expect additional intake?
- Results
from the litigation with Adaptix in Japan?
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