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Patents

3 Months Ended

Mar. 31, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Identifiable Intangible Assets

Acacia’s only identifiable intangible assets at March 31, 2014 and December 31, 2013 are patents. Patent-related accumulated amortization totaled $126,795,000 and $112,323,000 as of March 31, 2014 and December 31, 2013, respectively.

Acacia’s patents have remaining estimated economic useful lives ranging from one to ten years. The weighted-

average remaining estimated economic useful life of Acacia’s patents is approximately seven years. The following table presents the scheduled annual aggregate amortization expense as of March 31, 2014 (in thousands):



Remainder of 2014	$	37,371
2015	48,586
2016	45,503
2017	44,293
2018	40,421
Thereafter	74,023
Total	$	290,197

For the three months ended March 31, 2014 and 2013, Acacia paid patent investment costs totaling $987,000 and $4,010,000, respectively. The underlying patents have estimated economic useful lives of approximately four to ten years. Included in net additions to capitalized patent costs during the three months ended March 31, 2014 are accrued patent investment costs totaling $15,250,000, which are amortized over the estimated economic useful life of the related patents.

During the three months ended March 31, 2014 and 2013, certain operating subsidiaries recovered up-front patent portfolio advances from applicable net licensing proceeds prior to the scheduled amortization of such up-front patent portfolio advances, resulting in the acceleration of amortization expense for the applicable patent related assets. Accelerated amortization expense related to the recovery of up-front patent portfolio advances totaled $48,000 and $483,000 for the three months ended March 31, 2014 and 2013, respectively. Included in amortization of patents for the three months ended March 31, 2014 was accelerated amortization related to the partial write-down of a patent portfolio, due to a reduction in expected estimated future net cash flows, totaling $2,565,000.

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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