“After AIA was enacted, a lot of the smaller portfolios that we had helped individuals and small companies license just weren’t strong enough to withstand PTAB. The IPR process was just too costly and deadly.”
Chief IP Officer
Acacia Research

Time and Money
“When it comes right down to it, we would much prefer to do all of our licensing without litigation,” Booth says.
That’s easier said than done, but having a prior relationship with the infringing company helps. It may not bring the parties to the table right away, but it does facilitate a conversation.
“There are companies we’ve built relationships with throughout the years, even some that we’ve litigated against, who understand that it’s a business at the heart of it all,” Booth says.
A degree of familiarity and trust helps set the stage in a way that’s not usually possible when dealing with a new party. In any case, it’s essential to demonstrate the strength of the patents in question and the scale of the portfolio being asserted — and to highlight the value of a timely deal.
Acacia will typically allow the negotiation to last from three to 12 months before it opts to file an infringement suit. The faster the process goes, the better the deal.
“If we can engage in a negotiated license agreement, we can provide much more favorable rates and neither side will have to pay for attorneys, except for the transaction itself,” Booth says. “It depends on the portfolio and other factors, but we’re talking about a very steep discount compared to what we would have to ask for in litigation.”
Those other factors include prelitigation licensing, a lump-sum upfront payment, or an early-adopter discount for the first party to take a license in a specific industry — all incentives to take a license with as little conflict as possible. This approach, he says, has been reasonably successful, including in reaching a recent license agreement with one of the biggest handset manufacturers in the world.
“They realized that negotiating with us made more sense than fighting all the way,” Booth says.
Arms Race
IPR often stalls the process and makes it more expensive.
The Road Ahead
As to the outlook for changes at PTAB, Booth is circumspect, but hopes that any tweaks work to level the playing field. One of the topics in the legislation that Leahy and Tillis are considering is the transparency of parties of interest. Booth says that would be a welcome change, so long as it goes in both directions.
“Certainly there’s a big push for the plaintiffs to be transparent with regard to the parties of interest,” he says. “There ought to be a balance. If one party is going to reveal all their backers and funders and everybody who has a financial interest, well, then so should the other side.”
Regardless of how reform efforts play out, the patent licensing landscape will continue to evolve, and all parties must adapt.
“Licensing has certainly become more difficult post-AIA, and enforcement more costly,” Booth says, “but I hope the system will eventually end up providing a less litigious environment which will facilitate more frictionless transactions.”