Acacia Now a Defendant Over Alleged Patent Badgering

Rhett Pardon
NEWPORT BEACH, Calif. — The online adult site owners fighting Acacia Technologies Group over alleged patent claims and resulting legal badgering have a new bedfellow.

Publicly traded Lone Star Steakhouse & Saloon, with nearly 300 restaurants in 40 states, has filed suit against Acacia Technologies, claiming the intellectual property licensing firm has repeatedly attempted to enforce a patent described as overly broad in “bad faith.”

The complaint seeks a declaratory judgment of noninfringement and invalidity and says that Acacia violated the Sherman Act over antitrust violations. The suit, which was filed earlier this month, also names another company, Illinois-based Financial Systems Innovation, which was purchased by Acacia Technologies.

After several years of litigation against more than a dozen adult companies, Acacia Technologies, a division of Newport Beach, Calif.-based Acacia Research Corp., is continuing its suit over its patented technology, called Digital Media Transmission.

The intellectual property licensing firm, which owns 120 U.S. patents, has five U.S. patents that cover the transmission and receipt of digital audio and video content.

The consolidated case against the adult companies, as well as several mainstream media firms, hasn’t yet been decided, although another hearing is scheduled Sept. 8-9.

In the Lone Star case filed in U.S. District Court in Kansas, Acacia Technologies has been sued for making “threats, demands, claims and other assertions” to the restaurant chain over its contention that it is making use of technology the company says it owns.

In court documents, Acacia Technologies asserts it owns U.S. Patent No. 4,707,592, once owned by Financial Systems. The technology is designed for use in electronic sales transactions.

Acacia Technologies alleges that the patent covers a system that can protect credit card transactions against fraud by creating printed receipts at the point of sale that include only minimal information and exclude the credit card account number but can be related to detailed information by a unique transaction number.

Witchita, Kan.-based Lone Star said its systems don’t infringe on Acacia Technologies’ claim and that the licensing firm was incorrigible in its written responses. Further, Lone Star said that the patent is overly broad.

In the suit, Lone Star said that Acacia Technologies wasn’t willing to take a “wait and see” approach in another patent infringement case relative to electronic sales transactions and that it demanded a one-time royalty payment of $65,000.

“As a direct result of defendant Acacia’s threat of pending litigation, plaintiff Lone Star must face labors daily with the uncertainty and insecurity of a looming threat of costly litigation,” the suit says.

Acacia Technologies on Tuesday did not respond to XBiz inquiries on the lawsuit.