Acacia Technologies adopts, acquires and permits patented technologies. Acacia’s Digital Media Transmission or “DMT” technology includes the transmittance and reception of digital audio and/or audio video substance. These include the internet, cable, satellite, and local area networks. Constituents of the DMT transmission process include a source material library, identification encoding process, format conversion, sequence encoding, compressed data storage, and transmission. Features of the DMT receiving process include a transceiver, format conversion, storage, decompression, and playback.

The online adult industry is covered by Acacia Technologies and it is now seeking approval of a class action lawsuit against the entire Adult Internet Industry. Acacia claims to have a patent on all information streamed or downloaded over the Internet. If allowed Acacia will have the power to process whether their patents are valid to a single company rather than against the entire industry. Meaning, if Acacia wins, they will be at your doorway asking for money.

The strong-arm strategy of Acacia, effectively wants to put a tax on every single person using the Internet for video-on-demand services, Internet radio, pay-per-view movies, video news clips from sites like CNN.com, and even songs from iTunes or Amazon.com.

Acacia is making an offensive attempt to target the adult industry in its effort to get unwarranted fees for alleged infringement of its patents. With this lawsuit everybody using the Internet is at risk. The adult industry will be greatly affected by this. Acacia wants a cut of everything that moves on the Internet. If they win, everyone will pay the price for Acacia's raiding practice, as Acacia's "tax" will be passed on to users.

How to win against Acacia

The Adult Industry gives different options on how to deal with Acacia’s lawsuit. First option, the License Agreement demands webmasters to pay Acacia a royalty fee amounting to a percentage of gross receipts realized from the Website containing the streaming content. This choice basically puts you into business with Acacia, with whom you will be sharing revenues. An accounting of revenues may be asked to know that Acacia is getting its "fair share." This option will decrease the webmasters' bottom line, but in a known percentage. For those webmasters who do not want to gamble, this option will eradicate all risk on a go-forward basis, and quantify any exposure to liability for past patent violation.

The second option is to join a defense group. A number of adult media firms have joined a group of industry players who have chosen to fight against the validity of Acacia's patent claims. Some members of the group have already been litigated, and are actively in litigation. Those who have not been litigated can ask for an opinion letter from defense counsel, regarding the validity of Acacia's patent claims in regard to the actual technology being used by any particular Website for streaming video.

Some Adult Webmasters affected by the Acacia issue always have the option to hire their own personal patent attorney. Webmasters looking for such representation should make sure that any candidate for legal counsel is a "registered patent attorney." The field of patent law is highly specialized. Attorneys should not paddle in a field like patent litigation. Webmasters are advised to only consider patent attorneys who have had years of experience processing patent claims in federal court.

Fourth option is you can negotiate with Acacia independently. Acacia has no obligation to pull off the terms of its License Agreement; but nothing prevents that from happening. There may actually be different settlement privileges that come into play, preventing the admissibility of such statements, however a webmaster treads on dangerous ground if he or she decides to get into a substantive discussion with a spokesperson of Acacia regarding the issues of video streaming, or any other relevant legal fact.

Attorneys can manage such issues without the fear of making binding admissions, or giving away sensitive information that could bear on potential defenses. Therefore it is always advisable to utilize the services of an attorney when embarking on such negotiations. Another point is the disadvantage that a webmaster is at, compared to a member of Acacia's legal staff. Acacia holds all the cards in the dialogue, and discussing patent claims with its spokespersons will be the same to negotiating with someone who speaks another language. It may be hard for the webmaster to know if any particular terms being proposed are fair or reasonable.

Acacia and null patent claims

Some webmasters are trusting that the "court case" involving Acacia will be decided soon, and that its patent claims will be nullified. This is an unrealistic expectation, since the litigation against the existing defendants is in its early stages. No substantive rulings have occurred to date with regards to the enforceability of Acacia's patents. It could be years before a final verdict is handed down, once a trial has occurred and all appeals have been consumed. Nothing significantly impacts the viability of the adult Internet industry, despite attacks from within. The industry will continue to exist, and it is in Acacia's best interests that it does, if this firm intends to base its future profits on royalties received from successful players.