Tech Firms Keep Eye On Acacia.(INTERNET & TECHNOLOGY)

Byline: PETE BARLAS

Could there be a troll under the bridge of the Internet?

That's the question surrounding Acacia Technologies Group, a unit of the holding company Acacia Research. The little-known firm says it owns the patent rights for sending video signals of prerecorded programs over the Net and cable TV systems. And like a toll collector, the company wants Internet, cable TV and other companies to pay up.

In the last year, Acacia has filed patent infringement suits against several companies to get them to pay for licenses to send video to consumers. Some companies -- including Walt Disney and CinemaNow, an online movie service -- have avoided the courtroom by signing license agreements with Acacia.

But Acacia's also faced setbacks. A judge last month ruled he needed to hear expert testimony to verify some of Acacia's patent claims in a case involving sending video over the Net. That ruling sent the stock into a tailspin, falling nearly 40% in one day.

And Acacia's critics, who feel the patents are too basic to be valid, are rallying against the company. They say Acacia is just trying to shake down other businesses.

"They are going around trying to extract a tax on anyone who transmits audio or video on the Web," said Jason Schultz, staff attorney for the Electronic Frontier Foundation, an online civil liberties group. "They think they own it all."