Document_and_Entity_Informatio
Document and Entity Information Document (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Feb. 25, 2014 | Jun. 30, 2013 | |
Entity Information [Line Items] | ' | ' | ' |
Entity Registrant Name | 'ACACIA RESEARCH CORP | ' | ' |
Entity Central Index Key | '0000934549 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Large Accelerated Filer | ' | ' |
Document Type | '10-K | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Amendment Flag | 'false | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 50,640,123 | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Public Float | ' | ' | $1,084,840,000 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $126,685 | $221,804 |
Short-term investments | 130,017 | 89,475 |
Accounts receivable | 6,341 | 9,843 |
Deferred income tax | 3,139 | 1,014 |
Prepaid expenses and other current assets | 7,546 | 2,427 |
Total current assets | 273,728 | 324,563 |
Property and equipment, net of accumulated depreciation and amortization | 766 | 339 |
Patents, net of accumulated amortization | 288,432 | 313,529 |
Goodwill | 30,149 | 30,149 |
Other assets | 318 | 137 |
Total assets | 593,393 | 668,717 |
Current liabilities: | ' | ' |
Accounts payable and accrued expenses | 11,555 | 9,235 |
Accrued patent acquisition costs | 4,000 | 250 |
Royalties and contingent legal fees payable | 10,447 | 12,508 |
Total current liabilities | 26,002 | 21,993 |
Deferred income taxes | 4,874 | 27,831 |
Other liabilities | 319 | 415 |
Total liabilities | 31,195 | 50,239 |
Commitments and contingencies (Note 12) | ' | ' |
Stockholders' equity: | ' | ' |
Preferred stock, par value $0.001 per share; 10,000,000 shares authorized; no shares issued or outstanding | 0 | 0 |
Common stock, par value $0.001 per share; 100,000,000 shares authorized; 49,385,057 shares issued and outstanding as of December 31, 2013 and 49,160,844 shares issued and outstanding as of December 31, 2012 | 49 | 49 |
Treasury stock, at cost, 1,729,408 shares as of December 31, 2013 and 1,129,408 shares as of December 31, 2012 | -34,640 | -26,731 |
Additional paid-in capital | 653,314 | 644,982 |
Accumulated comprehensive loss | -947 | -1,166 |
Accumulated deficit | -62,066 | -5,632 |
Total Acacia Research Corporation stockholders’ equity | 555,710 | 611,502 |
Noncontrolling interests in operating subsidiaries | 6,488 | 6,976 |
Total stockholders’ equity | 562,198 | 618,478 |
Total liabilities and stockholders' equity | $593,393 | $668,717 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets Parentheticals (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, par value per share | $0.00 | $0.00 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value per share | $0.00 | $0.00 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 49,385,057 | 49,160,844 |
Common stock, shares outstanding | 49,385,057 | 49,160,844 |
Treasury stock, shares | 1,729,408 | 1,129,408 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Statement [Abstract] | ' | ' | ' |
Revenues | $130,556 | $250,727 | $172,256 |
Cost of revenues: | ' | ' | ' |
Inventor royalties | 29,724 | 26,028 | 43,727 |
Contingent legal fees | 24,784 | 24,651 | 40,281 |
Litigation and licensing expenses - patents | 39,335 | 21,591 | 13,005 |
Amortization of patents | 53,658 | 39,019 | 9,745 |
Verdict insurance proceeds | 0 | 0 | -12,451 |
Verdict insurance proceeds related costs | 0 | 0 | 7,661 |
Marketing, general and administrative expenses (including non-cash stock compensation expense of $27,894 in 2013, $25,657 in 2012 and $13,579 in 2011) | 59,229 | 54,083 | 35,693 |
Research, consulting and other expenses - business development | 3,251 | 4,943 | 4,338 |
Other | 3,506 | 0 | 0 |
Total operating costs and expenses | 213,487 | 170,315 | 141,999 |
Operating income (loss) | -82,931 | 80,412 | 30,257 |
Other income | 0 | 500 | 0 |
Interest income | 1,938 | 825 | 81 |
Write off of investment | 0 | -45 | 0 |
Gain (loss) on investment | 193 | -343 | 15 |
Total other income (expense) | 2,131 | 937 | 96 |
Income (loss) from operations before benefit from (provision for) income taxes | -80,800 | 81,349 | 30,353 |
Benefit from (provision for) income taxes | 21,958 | -22,060 | -8,708 |
Net income (loss) including noncontrolling interests in operating subsidiaries | -58,842 | 59,289 | 21,645 |
Net loss (income) attributable to noncontrolling interests in operating subsidiaries | 2,408 | 164 | -539 |
Net income (loss) attributable to Acacia Research Corporation | -56,434 | 59,453 | 21,106 |
Net Income (Loss) Available to Common Stockholders, Basic | -56,945 | 57,564 | 20,265 |
Net Income (Loss) Available to Common Stockholders, Diluted | ($56,945) | $57,577 | $20,273 |
Basic income (loss) per common share | ($1.18) | $1.22 | $0.51 |
Diluted income (loss) per common share | ($1.18) | $1.21 | $0.50 |
Weighted-average number of shares outstanding, basic | 48,155,832 | 47,251,061 | 39,743,433 |
Weighted-average number of shares outstanding, diluted | 48,155,832 | 47,584,120 | 40,150,600 |
Common Stock, Dividends, Per Share, Cash Paid | $0.38 | $0 | $0 |
Consolidated_Statements_of_Ope1
Consolidated Statements of Operations Parentheticals (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Non-cash stock compensation | $27,894 | $25,657 | $13,579 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (Loss) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' |
Net income (loss) attributable to Acacia Research Corporation | ($56,434) | $59,453 | $21,106 |
Other comprehensive income (loss): | ' | ' | ' |
Unrealized loss on short-term investments | 26 | 657 | -1,830 |
Unrealized gain on foreign currency translation | 0 | 7 | 0 |
Add: reclassification adjustment for losses included in net income | 193 | 277 | 0 |
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest | -56,215 | 60,394 | 19,276 |
Comprehensive (Income) Loss, Net of Tax, Attributable to Noncontrolling Interest | 0 | 0 | 0 |
Comprehensive income | ($56,215) | $60,394 | $19,276 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Common Stock [Member] | Treasury Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Accumulated Deficit [Member] | Noncontrolling Interests [Member] |
In Thousands, except Share data, unless otherwise specified | |||||||
Balance at Dec. 31, 2010 | $113,853 | $36 | $0 | $197,026 | $0 | ($86,191) | $2,982 |
Common stock, shares outstanding at Dec. 31, 2010 | ' | 36,029,068 | ' | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) attributable to Acacia Research Corporation | 21,106 | ' | ' | ' | ' | 21,106 | ' |
Sale of common stock, shares | ' | 5,750,000 | ' | ' | ' | ' | ' |
Sale of common stock, value | ' | 6 | ' | 175,223 | ' | ' | ' |
Payments for Repurchase of Common Stock | 0 | ' | ' | ' | ' | ' | ' |
Stock options exercised, shares | ' | 87,068 | ' | ' | ' | ' | ' |
Stock options exercised, value | 411 | 0 | ' | 411 | ' | ' | ' |
Stock issued during period, shares, share-based compensation, net of forfeitures | ' | 1,061,865 | ' | ' | ' | ' | ' |
Compensation expense related to stock options and restricted stock awards | 13,579 | 1 | ' | 13,578 | ' | ' | ' |
Excess tax benefits from stock-based compensation | 583 | ' | ' | 583 | ' | ' | ' |
Net income (loss) attributable to noncontrolling interest | 539 | ' | ' | ' | ' | ' | 539 |
Contributions from noncontrolling interests in operating subsidiary, net | 1,539 | ' | ' | ' | ' | ' | 1,539 |
Distributions to noncontrolling interests in operating subsidiary | -2,897 | ' | ' | ' | ' | ' | -2,897 |
Adjustments to Additional Paid in Capital, Other | ' | ' | ' | 0 | ' | ' | ' |
Unrealized gain on foreign currency translation | 0 | ' | ' | ' | ' | ' | ' |
Unrealized gain (loss) on short-term investments | -1,830 | ' | ' | ' | ' | ' | ' |
Balance at Dec. 31, 2011 | 322,112 | 43 | 0 | 386,821 | -1,830 | -65,085 | 2,163 |
Common stock, shares outstanding at Dec. 31, 2011 | ' | 42,928,001 | ' | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) attributable to Acacia Research Corporation | 59,453 | ' | ' | ' | ' | 59,453 | ' |
Sale of common stock, value | ' | 6 | ' | 218,955 | ' | ' | ' |
Treasury stock, shares acquired | 1,129,408 | -1,129,408 | ' | ' | ' | ' | ' |
Stock Repurchased During Period, Shares | -1,000 | ' | ' | ' | ' | ' | ' |
Treasury stock, cost of shares acquired | -26,732 | ' | -26,731 | ' | ' | ' | ' |
Payments for Repurchase of Common Stock | 26,732 | ' | ' | ' | ' | ' | ' |
Stock options exercised, shares | ' | 71,272 | ' | ' | ' | ' | ' |
Stock options exercised, value | 340 | ' | ' | 340 | ' | ' | ' |
Stock issued during period, shares, share-based compensation, net of forfeitures | ' | 1,168,530 | ' | ' | ' | ' | ' |
Compensation expense related to stock options and restricted stock awards | 25,657 | 1 | ' | 25,656 | ' | ' | ' |
Excess tax benefits from stock-based compensation | 13,210 | ' | ' | 13,210 | ' | ' | ' |
Net income (loss) attributable to noncontrolling interest | -164 | ' | ' | ' | ' | ' | -164 |
Contributions from noncontrolling interests in operating subsidiary, net | 5,793 | ' | ' | ' | ' | ' | 5,793 |
Distributions to noncontrolling interests in operating subsidiary | -816 | ' | ' | ' | ' | ' | -816 |
Unrealized gain on foreign currency translation | 7 | ' | ' | ' | ' | ' | ' |
Unrealized gain (loss) on short-term investments | 657 | ' | ' | ' | ' | ' | ' |
Balance at Dec. 31, 2012 | 618,478 | 49 | -26,731 | 644,982 | -1,166 | -5,632 | 6,976 |
Common stock, shares outstanding at Dec. 31, 2012 | 49,160,844 | 49,160,844 | ' | ' | ' | ' | ' |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) attributable to Acacia Research Corporation | -56,434 | ' | ' | ' | ' | ' | ' |
Sale of common stock, value | -18,633 | 0 | ' | -18,633 | ' | ' | ' |
Treasury stock, shares acquired | 600,000 | -600,000 | ' | ' | ' | ' | ' |
Stock Repurchased During Period, Shares | -1,000 | -666 | ' | ' | ' | ' | ' |
Treasury stock, cost of shares acquired | -7,910 | ' | -7,909 | ' | ' | ' | ' |
Payments for Repurchase of Common Stock | 7,926 | ' | ' | -16 | ' | ' | ' |
Stock options exercised, shares | 115,000 | 115,346 | ' | ' | ' | ' | ' |
Stock options exercised, value | 486 | ' | ' | 486 | ' | ' | ' |
Stock issued during period, shares, share-based compensation, net of forfeitures | ' | 709,533 | ' | ' | ' | ' | ' |
Compensation expense related to stock options and restricted stock awards | 27,894 | 1 | ' | 27,893 | ' | ' | ' |
Excess tax benefits from stock-based compensation | -1,398 | ' | ' | ' | ' | ' | ' |
Net income (loss) attributable to noncontrolling interest | -2,408 | ' | ' | ' | ' | ' | -2,408 |
Contributions from noncontrolling interests in operating subsidiary, net | 1,920 | ' | ' | ' | ' | ' | 1,920 |
Unrealized Gain (Loss) on Investments | 219 | ' | ' | ' | 219 | ' | ' |
Unrealized gain on foreign currency translation | 0 | ' | ' | ' | ' | ' | ' |
Unrealized gain (loss) on short-term investments | 26 | ' | ' | ' | ' | ' | ' |
Balance at Dec. 31, 2013 | $562,198 | $49 | ($34,640) | $653,314 | ($947) | ($62,066) | $6,488 |
Common stock, shares outstanding at Dec. 31, 2013 | 49,385,057 | 49,385,057 | ' | ' | ' | ' | ' |
Consolidated_Statements_of_Sto1
Consolidated Statements of Stockholders' Equity Parentheticals (Additional Paid-in Capital [Member], USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Additional Paid-in Capital [Member] | ' | ' | ' |
Issuance costs | $0 | $6,039 | $5,896 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Cash flows from operating activities: | ' | ' | ' |
Net income including noncontrolling interests in operating subsidiaries | ($58,842) | $59,289 | $21,645 |
Adjustments to reconcile net income (loss) including noncontrolling interests in operating subsidiaries to net cash provided by (used in) operating activities: | ' | ' | ' |
Depreciation and amortization | 53,894 | 39,168 | 9,850 |
Non-cash stock compensation | 27,894 | 25,657 | 13,579 |
Excess tax benefits from stock-based compensation | 1,398 | -13,210 | -583 |
Change in valuation allowance | 2,189 | -10,651 | 0 |
Other | 12 | 777 | -15 |
Changes in assets and liabilities: | ' | ' | ' |
Accounts receivable | 3,502 | -6,928 | 5,072 |
Prepaid expenses and other assets | -5,300 | -1,294 | 1,075 |
Accounts payable and accrued expenses / costs | 1,076 | 16,249 | -781 |
Royalties and contingent legal fees payable | -2,061 | -11,000 | 10,748 |
Deferred income tax | -27,271 | 6,546 | 0 |
Net cash provided by (used in) operating activities | -3,509 | 104,603 | 60,590 |
Cash flows from investing activities: | ' | ' | ' |
Purchase of property and equipment | -675 | -268 | -190 |
Purchase of available-for-sale investments | -279,693 | -402,500 | -8,427 |
Sale of available-for-sale investments | 239,370 | 322,236 | 60 |
Purchase of ADAPTIX, Inc., net of cash acquired | 0 | -150,000 | 0 |
Patent acquisition costs | -25,061 | -178,260 | -14,680 |
Net cash used in investing activities | -66,059 | -408,792 | -23,237 |
Cash flows from financing activities: | ' | ' | ' |
Proceeds from sale of common stock, net of issuance costs | 0 | 218,961 | 175,229 |
Repurchases of common stock | -7,926 | -26,732 | 0 |
Dividends paid to shareholders | -18,633 | 0 | 0 |
Distributions to noncontrolling interests in operating subsidiary | 0 | -312 | -2,897 |
Contributions from noncontrolling interests in operating subsidiary, net of issuance costs | 1,920 | 5,793 | 1,539 |
Proceeds from the exercise of stock options | 486 | 340 | 411 |
Excess tax benefits from stock-based compensation | -1,398 | 13,210 | 583 |
Net cash provided by (used in) financing activities | -25,551 | 211,260 | 174,865 |
Increase in cash and cash equivalents | -95,119 | -92,929 | 212,218 |
Cash and cash equivalents, beginning | 221,804 | 314,733 | 102,515 |
Cash and cash equivalents, ending | 126,685 | 221,804 | 314,733 |
Patent acquisition costs included in accrued expenses | $4,000 | $0 | $900 |
Description_of_Business
Description of Business | 12 Months Ended |
Dec. 31, 2013 | |
DESCRIPTION OF BUSINESS [Abstract] | ' |
Description of Business | ' |
DESCRIPTION OF BUSINESS | |
Description of Business. As used herein, “Acacia” and the “Company” refer to Acacia Research Corporation and/or its wholly and majority-owned and controlled operating subsidiaries. All patent acquisition, prosecution, licensing and enforcement activities are conducted solely by certain of Acacia’s wholly and majority-owned and controlled operating subsidiaries. | |
Acacia’s operating subsidiaries acquire rights in, license and enforce patented technologies. Acacia’s operating subsidiaries partner with inventors and patent owners, applying their legal and technology expertise to patent assets to unlock the financial value in their patented inventions. Acacia is an intermediary in the patent marketplace, bridging the gap between invention and application, facilitating efficiency and delivering monetary rewards to patent owners. | |
Acacia’s operating subsidiaries generate revenues and related cash flows from the granting of intellectual property rights for the use of patented technologies that its operating subsidiaries control or own. Acacia’s operating subsidiaries assist patent owners with the prosecution and development of their patent portfolios, the protection of their patented inventions from unauthorized use, the generation of licensing revenue from users of their patented technologies and, where necessary, with the enforcement against unauthorized users of their patented technologies through the filing of patent infringement litigation. | |
Acacia’s operating subsidiaries are principals in the licensing and enforcement effort, obtaining control of the rights in the patent portfolio, or control of the patent portfolio outright. Acacia’s operating subsidiaries own or control the rights to multiple patent portfolios, which include U.S. patents and certain foreign counterparts, covering technologies used in a wide variety of industries. | |
In January 2012, a wholly owned operating subsidiary of Acacia acquired ADAPTIX, Inc. (“ADAPTIX”), a pioneer in the development of 4G technologies for wireless systems, for cash consideration of $150 million, net of cash acquired, as described at Note 8 to these consolidated financial statements. | |
Acacia was incorporated on January 25, 1993 under the laws of the State of California. In December 1999, it changed its state of incorporation from California to Delaware. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Summary of Significant Accounting Policies | ' | ||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||||||||
Accounting Principles and Fiscal Year End. The consolidated financial statements and accompanying notes are prepared on the accrual basis of accounting in accordance with generally accepted accounting principles in the United States of America. Acacia has a December 31 fiscal year end. | |||||||||||||
Principles of Consolidation. The accompanying consolidated financial statements include the accounts of Acacia and its wholly and majority-owned and controlled subsidiaries. Material intercompany transactions and balances have been eliminated in consolidation. | |||||||||||||
Noncontrolling interests in Acacia’s majority-owned and controlled operating subsidiaries (“noncontrolling interests”) are separately presented as a component of stockholders’ equity in the consolidated statements of stockholders’ equity for the applicable periods presented. Consolidated net income or (loss) is adjusted to include the net (income) or loss attributed to noncontrolling interests in the consolidated statements of operations for the applicable periods presented. Refer to the accompanying consolidated statements of stockholders’ equity for total noncontrolling interests for the applicable periods presented. | |||||||||||||
In August 2010, a wholly owned subsidiary of Acacia became the general partner of the Acacia Intellectual Property Fund, L.P. (the “Acacia IP Fund”), which was formed in August 2010. The Acacia IP Fund is included in the Company’s consolidated financial statements for the periods presented, as Acacia’s wholly owned subsidiary, as the general partner, has the ability to control the operations and activities of the Acacia IP Fund. Refer to Note 12 to these consolidated financial statements. | |||||||||||||
Revenue Recognition. Revenue is recognized when (i) persuasive evidence of an arrangement exists, (ii) all obligations have been substantially performed pursuant to the terms of the arrangement, (iii) amounts are fixed or determinable, and (iv) the collectibility of amounts is reasonably assured. | |||||||||||||
In general, revenue arrangements provide for the payment of contractually determined fees in consideration for the grant of certain intellectual property rights for patented technologies owned or controlled by Acacia’s operating subsidiaries. These rights typically include some combination of the following: (i) the grant of a non-exclusive, retroactive and future license to manufacture and/or sell products covered by patented technologies owned or controlled by Acacia’s operating subsidiaries, (ii) a covenant-not-to-sue, (iii) the release of the licensee from certain claims, and (iv) the dismissal of any pending litigation. The intellectual property rights granted may be perpetual in nature, extending until the expiration of the related patents, or can be granted for a defined, relatively short period of time, with the licensee possessing the right to renew the agreement at the end of each contractual term for an additional minimum upfront payment. Pursuant to the terms of these agreements, Acacia’s operating subsidiaries have no further obligation with respect to the grant of the non-exclusive retroactive and future licenses, covenants-not-to-sue, releases, and other deliverables, including no express or implied obligation on Acacia’s operating subsidiaries’ part to maintain or upgrade the technology, or provide future support or services. Generally, the agreements provide for the grant of the licenses, covenants-not-to-sue, releases, and other significant deliverables upon execution of the agreement, or upon receipt of the minimum upfront payment for term agreement renewals. As such, the earnings process is complete and revenue is recognized upon the execution of the agreement, when collectibility is reasonably assured, or upon receipt of the minimum upfront fee for term agreement renewals, and when all other revenue recognition criteria have been met. | |||||||||||||
Certain of the Company’s revenue arrangements provide for future royalties or additional required payments based on future licensee activities. Additional royalties are recognized in revenue upon resolution of the related contingency provided that all revenue recognition criteria, as described above, have been met. Amounts of additional royalties due under these license agreements, if any, cannot be reasonably estimated by management. | |||||||||||||
Certain of the Company’s revenue arrangements provide for the calculation of fees based on a licensee’s actual quarterly sales or actual per unit activity, applied to a contractual royalty rate. Licensees that pay fees on a quarterly basis generally report actual quarterly sales or actual per unit activity information and related quarterly fees due within 30 days to 45 days after the end of the quarter in which such sales or activity takes place. The amount of fees due under these revenue arrangements each quarter cannot be reasonably estimated by management. Consequently, Acacia’s operating subsidiaries recognize revenue from these revenue arrangements on a three-month lag basis, in the quarter following the quarter of sales or per unit activity, provided amounts are fixed or determinable and collectibility is reasonably assured. The lag method described above allows for the receipt of licensee royalty reports prior to the recognition of revenue. | |||||||||||||
Amounts related to revenue arrangements that do not meet the revenue recognition criteria described above are deferred until the revenue recognition criteria are met. | |||||||||||||
Acacia assesses the collectibility of fees receivable based on a number of factors, including past transaction history and credit-worthiness of licensees. If it is determined that collection is not reasonably assured, the fee is recognized when collectibility becomes reasonably assured, assuming all other revenue recognition criteria have been met, which is generally upon receipt of cash. | |||||||||||||
Cost of Revenues. Cost of revenues include the costs and expenses incurred in connection with Acacia’s patent licensing and enforcement activities, including inventor royalties paid to original patent owners, contingent legal fees paid to external patent counsel, other patent-related legal expenses paid to external patent counsel, licensing and enforcement related research, consulting and other expenses paid to third-parties and the amortization of patent-related acquisition costs. These costs are included under the caption “Cost of revenues” in the accompanying consolidated statements of operations. | |||||||||||||
Inventor Royalties and Contingent Legal Expenses. Inventor royalties are expensed in the consolidated statements of operations in the period that the related revenues are recognized. In certain instances, pursuant to the terms of the underlying inventor agreements, costs paid by Acacia’s operating subsidiaries to acquire patents are recoverable from future net revenues. Patent acquisition costs that are recoverable from future net revenues are amortized over the estimated economic useful life of the related patents, or as the prepaid royalties are earned by the inventor, as appropriate, and the related expense is included in amortization expense in the consolidated statements of operations. Any unamortized patent acquisition costs recovered from net revenues are expensed in the period recovered, and included in amortization expense in the consolidated statements of operations. | |||||||||||||
Contingent legal fees are expensed in the consolidated statements of operations in the period that the related revenues are recognized. In instances where there are no recoveries from potential infringers, no contingent legal fees are paid; however, Acacia’s operating subsidiaries may be liable for certain out of pocket legal costs incurred pursuant to the underlying legal services agreement. Legal fees advanced by contingent law firms that are required to be paid in the event that no license recoveries are obtained are expensed as incurred and included in liabilities in the consolidated balance sheets. | |||||||||||||
Fair Value Measurements. U.S. generally accepted accounting principles define fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date, and also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The three-level hierarchy of valuation techniques established to measure fair value, is defined as follows: | |||||||||||||
● | Level 1 - | Observable Inputs: Quoted prices in active markets for identical investments; | |||||||||||
● | Level 2 - | Pricing Models with Significant Observable Inputs: Other significant observable inputs, including quoted prices for similar investments, interest rates, credit risk, etc.; and | |||||||||||
● | Level 3 - | Unobservable Inputs: Significant unobservable inputs, including the entity’s own assumptions in determining the fair value of investments. | |||||||||||
Whenever possible, the Company is required to use observable market inputs (Level 1 - quoted market prices) when measuring fair value. | |||||||||||||
Cash and Cash Equivalents. Acacia considers all highly liquid, short-term investments with original maturities of three months or less when purchased to be cash equivalents. For the periods presented, Acacia’s cash equivalents are comprised of investments in AAA rated money market funds that invest in first-tier only securities, which primarily includes: domestic commercial paper, securities issued or guaranteed by the U.S. government or its agencies, U.S. bank obligations, and fully collateralized repurchase agreements. Acacia’s cash equivalents are measured at fair value using quoted prices that represent Level 1 inputs. | |||||||||||||
Investments in Marketable Securities. Investments in securities with original maturities of greater than three months and less than one year and other investments representing amounts that are available for current operations are classified as short-term investments, unless there are indications that such investments may not be readily sold in the short term. The fair values of these investments approximate their carrying values. At December 31, 2013 and 2012, all of Acacia’s investments were classified as available-for-sale, which are reported at fair value on a recurring basis using significant observable inputs (Level 1) whenever possible, with related unrealized gains and losses in the value of such securities recorded as a separate component of other comprehensive income (loss) in stockholders’ equity until realized. Realized and unrealized gains and losses are recorded based on the specific identification method. Interest on all securities is included in interest income. | |||||||||||||
Impairment of Marketable Securities. Acacia evaluates its investments in marketable securities for potential impairment, employing a systematic methodology on a quarterly basis that considers available quantitative and qualitative evidence. If the cost or carrying value of an investment exceeds its estimated fair value, the Company evaluates, among other factors, general market conditions, credit quality of instrument issuers, the duration and extent to which the fair value is less than cost, and the Company’s intent and ability to hold, or plans or ability to sell. Fair value is estimated based on publicly available market information or other estimates determined by management. Investments are considered to be impaired when a decline in fair value is estimated to be other-than-temporary. Acacia reviews impairments associated with its investments in marketable securities and determines the classification of any impairment as temporary or other-than-temporary. An impairment is deemed other-than-temporary unless (a) Acacia has the ability and intent to hold an investment for a period of time sufficient for recovery of its carrying amount and (b) positive evidence indicating that the investment’s carrying amount is recoverable within a reasonable period of time outweighs any evidence to the contrary. All available evidence, both positive and negative, is considered to determine whether, based on the weight of such evidence, the carrying amount of the investment is recoverable within a reasonable period of time. For investments classified as available-for-sale, unrealized losses that are other-than-temporary are recognized in the consolidated statements of operations. | |||||||||||||
Concentration of Credit Risks. Financial instruments that potentially subject Acacia to concentrations of credit risk are cash equivalents, investments and accounts receivable. Acacia places its cash equivalents and investments primarily in highly rated money market funds and investment grade marketable securities. Cash equivalents are also invested in deposits with certain financial institutions and may, at times, exceed federally insured limits. Acacia has not experienced any significant losses on its deposits of cash and cash equivalents. | |||||||||||||
Two licensees individually accounted for 38% and 16%, respectively, of revenues recognized during the year ended December 31, 2013. Four licensees individually accounted for 21%, 14%, 10% and 10%, respectively, of revenues recognized during the year ended December 31, 2012. Three licensees individually accounted for 26%, 17% and 15%, respectively, of revenues recognized during the year ended December 31, 2011. Two licensees individually represented approximately 60% and 22%, respectively, of accounts receivable at December 31, 2013. Three licensees individually represented approximately 34%, 30% and 25% of accounts receivable at December 31, 2012. For 2013, 2012 and 2011, 24%, 43% and 49%, respectively, of revenues were attributable to licensees domiciled in foreign jurisdictions, based on the jurisdiction of the entity obligated to satisfy payment obligations pursuant to the applicable revenue arrangement. The Company does not have any material foreign operations. | |||||||||||||
Acacia performs credit evaluations of its licensees with significant receivable balances, if any, and has not experienced any significant credit losses. Accounts receivable are recorded at the executed contract amount and generally do not bear interest. Collateral is not required. An allowance for doubtful accounts may be established to reflect the Company’s best estimate of probable losses inherent in the accounts receivable balance, and is reflected as a contra-asset account on the balance sheet and a charge to operating expenses in the statement of operations for the applicable period. The allowance is determined based on known troubled accounts, historical experience, and other currently available evidence. There was no allowance for doubtful accounts established for the periods presented. | |||||||||||||
Property and Equipment. Property and equipment are recorded at cost. Major additions and improvements that materially extend useful lives of property and equipment are capitalized. Maintenance and repairs are charged against the results of operations as incurred. When these assets are sold or otherwise disposed of, the asset and related depreciation are relieved, and any gain or loss is included in the consolidated statements of operations for the period of sale or disposal. Depreciation and amortization is computed on a straight-line basis over the following estimated useful lives of the assets: | |||||||||||||
Furniture and fixtures | 3 to 5 years | ||||||||||||
Computer hardware and software | 3 to 5 years | ||||||||||||
Leasehold improvements | 2 to 5 years (Lesser of lease term or useful life of improvement) | ||||||||||||
Rental payments on operating leases are charged to expense in the consolidated statements of operations on a straight-line basis over the lease term. | |||||||||||||
Organization Costs. Costs of start-up activities, including organization costs, are expensed as incurred. | |||||||||||||
Patents. Patents includes the cost of patents or patent rights (hereinafter, collectively “patents”), acquired from third-parties or acquired in connection with business combinations. Patent acquisition costs are amortized utilizing the straight-line method over their remaining economic useful lives, ranging from one to ten years. Certain patent application and prosecution costs incurred to secure additional patent claims, that based on management’s estimates are deemed to be recoverable, are capitalized and amortized over the remaining estimated economic useful life of the related patent portfolio. | |||||||||||||
Goodwill. Goodwill is tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis (December 31 for Acacia) and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. Acacia considers its market capitalization and the carrying value of its assets and liabilities, including goodwill, when performing its goodwill impairment test. When conducting its annual goodwill impairment assessment, the Company initially performs a qualitative evaluation of whether it is more likely than not that goodwill is impaired. If it is determined by a qualitative evaluation that it is more likely than not that goodwill is impaired, the Company then applies a two-step impairment test. The two-step impairment test first compares the fair value of the Company’s reporting unit to its carrying or book value. If the fair value of the reporting unit exceeds its carrying value, goodwill is not impaired and the Company is not required to perform further testing. If the carrying value of the reporting unit exceeds its fair value, the Company determines the implied fair value of the reporting unit’s goodwill and if the carrying value of the reporting unit’s goodwill exceeds its implied fair value, then an impairment loss equal to the difference is recorded in the consolidated statement of operations. | |||||||||||||
Impairment of Long-lived Assets. Acacia reviews long-lived assets and intangible assets for potential impairment annually (quarterly for patents) and when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. In the event the sum of the expected undiscounted future cash flows resulting from the use of the asset is less than the carrying amount of the asset, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. If an asset is determined to be impaired, the loss is measured based on quoted market prices in active markets, if available. If quoted market prices are not available, the estimate of fair value is based on various valuation techniques, including a discounted value of estimated future cash flows. | |||||||||||||
Fair value is generally estimated using the “Income Approach,” focusing on the estimated future net income-producing capability of the patent portfolios over the estimated remaining economic useful life. Estimates of future after-tax cash flows are converted to present value through “discounting,” including an estimated rate of return that accounts for both the time value of money and investment risk factors. Estimated cash inflows are typically based on estimates of reasonable royalty rates for the applicable technology, applied to estimated market share data. Estimated cash outflows are based on existing contractual obligations, such as contingent legal fee and inventor royalty obligations, applied to estimated license fee revenues, in addition to other estimates of out-of-pocket expenses associated with a specific patent portfolio’s licensing and enforcement program. The analysis also contemplates consideration of current information about the patent portfolio including, status and stage of litigation, periodic results of the litigation process, strength of the patent portfolio, technology coverage and other pertinent information that could impact future net cash flows. | |||||||||||||
Fair Value of Financial Instruments. The carrying value of cash and cash equivalents, investments, accounts receivables, accounts payable and accrued expenses approximates their fair values due to their short-term maturities. | |||||||||||||
Contingent Liabilities. The Company, from time to time, is involved in certain legal proceedings. Based upon consultation with outside counsel handling its defense in these matters and the Company’s analysis of potential outcomes, if the Company determines that a loss arising from such matters is probable and can be reasonably estimated, an estimate of the contingent liability is recorded in its consolidated financial statements. If only a range of estimated loss can be determined, an amount within the range that, based on estimates, assumptions and judgments, reflects the most likely outcome, is recorded as a contingent liability in the consolidated financial statements. In situations where none of the estimates within the estimated range is a better estimate of probable loss than any other amount, the Company records the low end of the range. Any such accrual would be charged to expense in the appropriate period. Litigation expenses for these types of contingencies are recognized in the period in which the litigation services were provided. | |||||||||||||
Stock-Based Compensation. The compensation cost for all stock-based awards is measured at the grant date, based on the fair value of the award, and is recognized as an expense, on a straight-line basis, over the employee’s requisite service period (generally the vesting period of the equity award) which is generally two to four years. The fair value of restricted stock and restricted stock unit awards is determined by the product of the number of shares or units granted and the grant date market price of the underlying common stock. The fair value of each option award is estimated on the date of grant using a Black-Scholes option valuation model. Stock-based compensation expense is recorded only for those awards expected to vest using an estimated forfeiture rate. Refer to Note 11 to these notes to consolidated financial statements for information on stock-based awards granted for the periods presented. | |||||||||||||
Income Taxes. Income taxes are accounted for using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in Acacia’s consolidated financial statements or consolidated tax returns. A valuation allowance is established to reduce deferred tax assets if all, or some portion, of such assets will more than likely not be realized. | |||||||||||||
Under U.S. generally accepted accounting principles, a tax position is a position in a previously filed tax return or a position expected to be taken in a future tax filing that is reflected in measuring current or deferred income tax assets and liabilities. Tax positions are recognized only when it is more likely than not (likelihood of greater than 50%), based on technical merits, that the position will be sustained upon examination. Tax positions that meet the more likely than not threshold are measured using a probability weighted approach as the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement. | |||||||||||||
Acacia recognizes interest and penalties with respect to unrecognized tax benefits in income tax expense. Acacia has identified no uncertain tax position for which it is reasonably possible that the total amount of unrecognized tax benefits will significantly increase or decrease within 12 months. | |||||||||||||
If a deduction reported on a tax return for an equity-based incentive award exceeds the cumulative compensation cost for those instruments recognized for financial reporting purposes, any resulting realized tax benefit that exceeds the previously calculated deferred tax asset for those instruments is considered an excess tax benefit, and is recognized as additional paid-in capital. If the tax deduction is less than the cumulative book compensation cost, the tax effect of the resulting difference is charged first to APIC, to the extent of the available pool of windfall tax benefits, with any remainder recognized in income tax expense. | |||||||||||||
Comprehensive Income (Loss). Comprehensive income (loss) is the change in equity from transactions and other events and circumstances other than those resulting from investments by owners and distributions to owners. | |||||||||||||
Segment Reporting. Acacia uses the management approach, which designates the internal organization that is used by management for making operating decisions and assessing performance as the basis of Acacia’s reportable segments. Acacia’s patent licensing and enforcement business constitutes its single reportable segment. | |||||||||||||
Use of Estimates. The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Acacia believes that, of the significant accounting policies described herein, the accounting policies associated with revenue recognition, stock-based compensation expense, impairment of marketable securities and intangible assets, the determination of the economic useful life of amortizable intangible assets, income taxes and valuation allowances against net deferred tax assets and the application of the acquisition method of accounting for business combinations, require its most difficult, subjective or complex judgments. | |||||||||||||
Earnings (Loss) Per Share. The Company computes net income (loss) attributable to common stockholders using the two-class method required for capital structures that include participating securities. Under the two-class method, securities that participate in non-forfeitable dividends, such as the Company’s outstanding unvested restricted stock, are considered “participating securities.” | |||||||||||||
In applying the two-class method, (i) basic net income (loss) per share is computed by dividing net income (loss) (less any dividends paid on participating securities) by the weighted average number of shares of common stock and participating securities outstanding for the period and (ii) diluted earnings per share may include the additional effect of other securities, if dilutive, in which case the dilutive effect of such securities is calculated by applying the two-class method and the treasury stock method to the assumed exercise or vesting of potentially dilutive common shares. The method yielding the more dilutive result is ultimately reported for the applicable period. Potentially dilutive common stock equivalents primarily consist of employee stock options, and restricted stock units for calculations utilizing the two-class method, and also include unvested restricted stock, when utilizing the treasury method. | |||||||||||||
The following table presents the weighted-average number of common shares outstanding used in the calculation of basic and diluted income per share: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Numerator (in thousands): | |||||||||||||
Basic | |||||||||||||
Net income (loss) | $ | (56,434 | ) | $ | 59,453 | $ | 21,106 | ||||||
Undistributed earnings allocated to participating securities | — | (1,889 | ) | (841 | ) | ||||||||
Total dividends paid | (18,633 | ) | — | — | |||||||||
Dividends attributable to common stockholders | 18,122 | — | — | ||||||||||
Net income (loss) attributable to common stockholders – basic | $ | (56,945 | ) | $ | 57,564 | $ | 20,265 | ||||||
Diluted | |||||||||||||
Net income (loss) | $ | (56,434 | ) | $ | 59,453 | $ | 21,106 | ||||||
Undistributed earnings allocated to participating securities | — | (1,876 | ) | (833 | ) | ||||||||
Total dividends paid | (18,633 | ) | — | — | |||||||||
Dividends attributable to common stockholders | 18,122 | — | — | ||||||||||
Net income (loss) attributable to common stockholders – diluted | $ | (56,945 | ) | $ | 57,577 | $ | 20,273 | ||||||
Denominator: | |||||||||||||
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders – basic | 48,155,832 | 47,251,061 | 39,743,433 | ||||||||||
Effect of potentially dilutive securities: | |||||||||||||
Common stock options and restricted stock units | — | 333,059 | 407,167 | ||||||||||
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders – diluted | 48,155,832 | 47,584,120 | 40,150,600 | ||||||||||
Basic net income (loss) per common share | $ | (1.18 | ) | $ | 1.22 | $ | 0.51 | ||||||
Diluted net income (loss) per common share | $ | (1.18 | ) | $ | 1.21 | $ | 0.5 | ||||||
Anti-dilutive equity-based incentive awards excluded from the computation of diluted income (loss) per share | 27,760 | 30,812 | 7,760 | ||||||||||
Revision of Prior Period Earnings (Loss) Per Share - Two-Class Method. In connection with the preparation of the Company’s Quarterly Report on Form 10-Q as of and for the three and nine months ended September 30, 2013, the Company determined that its basic and diluted net income (loss) per share calculations should have been prepared using the “two-class method.” Pursuant to guidance set forth in Staff Accounting Bulletin (“SAB”) No. 99, “Materiality,” the Company concluded that the errors were not material to any of its prior period financial statements. Although the errors were immaterial to prior periods, the prior period financial statements presented herein were revised, in accordance with SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements.” The impact of the revision for the comparable prior period earnings (loss) per share calculations using the two-class method were as follows: | |||||||||||||
2012 | 2011 | ||||||||||||
Numerator: | |||||||||||||
Net income attributable to common stockholders – basic and diluted - As Reported | $ | 59,453 | $ | 21,106 | |||||||||
Net income attributable to common stockholders – basic - As Adjusted | $ | 57,564 | $ | 20,265 | |||||||||
Net income attributable to common stockholders – diluted - As Adjusted | $ | 57,577 | $ | 20,273 | |||||||||
Denominator: | |||||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – basic - As Reported | 47,251,061 | 39,743,433 | |||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – basic - As Adjusted | 47,251,061 | 39,743,433 | |||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – diluted - As Reported | 48,060,647 | 41,258,297 | |||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – diluted - As Adjusted | 47,584,120 | 40,150,600 | |||||||||||
Basic net income per common share - As Reported | $ | 1.26 | $ | 0.53 | |||||||||
Basic net income per common share - As Adjusted | $ | 1.22 | $ | 0.51 | |||||||||
Diluted net income per common share - As Reported | $ | 1.24 | $ | 0.51 | |||||||||
Diluted net income per common share - As Adjusted | $ | 1.21 | $ | 0.5 | |||||||||
Treasury Stock. Repurchases of the Company’s outstanding common stock are accounted for using the cost method. The applicable par value is deducted from the appropriate capital stock account on the formal or constructive retirement of treasury stock. Any excess of the cost of treasury stock over its par value is charged to additional paid-in capital, and reflected as Treasury Stock on the consolidated balance sheets. | |||||||||||||
Recently Adopted Accounting Pronouncements - Adopted Effective January 1, 2013. In February 2013, the Financial Accounting Standards Board (“FASB”) issued a new accounting standard requiring an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required under U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) to be reclassified in its entirety to net income. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures required under U.S. GAAP that provide additional detail about those amounts. This pronouncement is effective prospectively for reporting periods beginning after December 15, 2012. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures. | |||||||||||||
In December 2012, the FASB issued a new accounting standard that will require the Company to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. The new guidance is effective for the Company’s interim period ending March 31, 2013. The disclosures required are to be applied retrospectively for all comparative periods presented. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures. | |||||||||||||
In July 2013, the FASB issued an accounting update which provides guidance on financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward or a tax credit carryforward exists in the same taxing jurisdiction. Per this guidance, an entity must present the unrecognized tax benefit as a reduction to a deferred tax asset, except when the carryforward is not available as of the reporting date under the governing tax law to settle taxes or the entity does not intend to use the deferred tax asset for this purpose. This amendment does not impact the recognition or measurement of uncertain tax positions or the disclosure reconciliation of gross unrecognized tax benefits. The new accounting standards update becomes effective for the Company on January 1, 2014 and it should be applied prospectively to unrecognized tax benefits that exist at the effective date with retrospective application permitted. Early adoption of the update is permitted and an entity may choose to apply this amendment retrospectively to each reporting period presented. The adoption of this accounting update did not have a material impact on the Company’s consolidated financial statements. |
Shortterm_Investments
Short-term Investments | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Short-term Investments [Abstract] | ' | |||||||||||||||
Short-Term Investments | ' | |||||||||||||||
SHORT-TERM INVESTMENTS | ||||||||||||||||
Short-term marketable securities for the periods presented were comprised of the following (in thousands): | ||||||||||||||||
December 31, 2013 | ||||||||||||||||
Security Type | Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
U.S. government fixed income securities | $ | 130,971 | $ | 21 | $ | (975 | ) | $ | 130,017 | |||||||
Total short-term investments | $ | 130,971 | $ | 21 | $ | (975 | ) | $ | 130,017 | |||||||
December 31, 2012 | ||||||||||||||||
Security Type | Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
U.S. government fixed income securities | $ | 87,394 | $ | 20 | $ | (411 | ) | $ | 87,003 | |||||||
Equity securities of certain technology companies | 3,254 | — | (782 | ) | 2,472 | |||||||||||
Total short-term investments | $ | 90,648 | $ | 20 | $ | (1,193 | ) | $ | 89,475 | |||||||
Short-term investments at December 31, 2013 and 2012 were comprised of investments in highly liquid, AAA, U.S. government fixed income securities with maturity dates ranging from 2014 to 2015, and 2013 to 2014, respectively. Short-term marketable securities in unrealized loss positions at December 31, 2013 and 2012 have been in continuous unrealized loss positions for less than one year. | ||||||||||||||||
U.S. government fixed income securities. The gross unrealized loss can be primarily attributed to a combination of market conditions as well as the demand for and duration of the U.S. government fixed income securities. The Company has the ability to hold these securities until maturity, currently has no intent to sell, there is no requirement to sell and the Company believes that it can recover the amortized cost of these investments. The Company has found no evidence of impairment due to credit losses in its portfolio. Therefore, these unrealized losses were recorded in other comprehensive income (loss). However, the Company cannot provide any assurance that its portfolio of short-term marketable securities will not be impacted by adverse conditions in the financial markets, which may require the Company in the future to record an impairment charge for credit losses which could adversely impact its financial results. | ||||||||||||||||
For the year ended December 31, 2013, proceeds from the sale of short-term marketable securities classified as available-for-sale were $239,370,000, gross realized gains were $1,174,000 and gross realized losses were $981,000. For the year ended December 31, 2012, proceeds from the sale of short-term marketable securities classified as available-for-sale were $319,811,000, gross realized gains were $31,000 and gross realized losses were $555,000. Proceeds from the sale of short-term marketable securities classified as available-for-sale and related gross realized gains and losses were not material for the year ended December 31, 2011. |
Property_and_Equipment
Property and Equipment | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Property and Equipment | ' | ||||||||
PROPERTY AND EQUIPMENT | |||||||||
Property and equipment consists of the following at December 31, 2013 and 2012 (in thousands): | |||||||||
2013 | 2012 | ||||||||
Furniture and fixtures | $ | 783 | $ | 472 | |||||
Computer hardware and software | 687 | 586 | |||||||
Leasehold improvements | 306 | 173 | |||||||
1,776 | 1,231 | ||||||||
Less: accumulated depreciation and amortization | (1,010 | ) | (892 | ) | |||||
$ | 766 | $ | 339 | ||||||
Depreciation expense was $236,000, $149,000 and $105,000 for the years ended December 31, 2013, 2012 and 2011, respectively. In 2013, we retired $130,000 of items held in property and equipment and recorded a $12,000 loss on disposal. |
Accounts_Payable_and_Accrued_E
Accounts Payable and Accrued Expenses | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Accounts Payable and Accrued Liabilities, Current [Abstract] | ' | ||||||||
Accounts Payable and Accrued Expenses / Costs | ' | ||||||||
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | |||||||||
Accounts payable and accrued expenses consist of the following at December 31, 2013 and 2012 (in thousands): | |||||||||
2013 | 2012 | ||||||||
Accounts payable | $ | 128 | $ | 642 | |||||
Payroll and other employee benefits | 1,039 | 1,815 | |||||||
Accrued vacation | 813 | 703 | |||||||
Accrued legal expenses - patent | 5,900 | 3,990 | |||||||
Accrued consulting and other professional fees | 2,948 | 1,510 | |||||||
Accrued distribution to noncontrolling interests | 504 | 504 | |||||||
Other accrued liabilities | 223 | 71 | |||||||
$ | 11,555 | $ | 9,235 | ||||||
Goodwill_and_Other_Identifiabl
Goodwill and Other Identifiable Intangible Assets | 12 Months Ended | ||||||||||||
Dec. 31, 2012 | |||||||||||||
Patents [Abstract] | ' | ||||||||||||
Patents | ' | ||||||||||||
GOODWILL AND OTHER IDENTIFIABLE INTANGIBLE ASSETS | |||||||||||||
Acacia’s only identifiable intangible assets are patents and patent rights, with estimated remaining economic useful lives ranging from one to ten years. For all periods presented, all of Acacia’s identifiable intangible assets were subject to amortization. The gross carrying amounts and accumulated amortization related to acquired intangible assets as of December 31, 2013 and 2012 are as follows (in thousands): | |||||||||||||
2013 | 2012 | ||||||||||||
Gross carrying amount - patents | $ | 400,755 | $ | 383,379 | |||||||||
Accumulated amortization - patents | (112,323 | ) | (69,850 | ) | |||||||||
Patents, net | $ | 288,432 | $ | 313,529 | |||||||||
The weighted-average remaining estimated economic useful life of Acacia’s patents and patent rights is 7 years. Scheduled annual aggregate amortization expense for each of the next five years through December 31, 2018 is estimated to be $47,654,000 in 2014, $46,554,000 in 2015, $44,051,000 in 2016, $43,268,000 in 2017, and $39,381,000 in 2018. | |||||||||||||
For the years ended December 31, 2013, 2012 and 2011, on a consolidated basis, Acacia’s operating subsidiaries incurred and capitalized patent and patent rights acquisition costs totaling $25,061,000, $178,260,000 (excluding the acquisition of ADAPTIX) and $14,680,000, respectively. The patents have estimated economic useful lives ranging from three to ten years. Included in capitalized patent costs as of December 31, 2013 are $4,000,000 of accrued future patent-related acquisition costs that management expects to incur pursuant to the terms of the underlying patent acquisition agreements, which are being amortized over the estimated economic useful life of the patents acquired. | |||||||||||||
Refer to Note 8 to these consolidated financial statements for additions to patents and goodwill in connection with Acacia’s acquisition of ADAPTIX and the related application of the acquisition method of accounting. | |||||||||||||
During the periods presented, certain operating subsidiaries recovered up-front patent portfolio acquisition costs from applicable net licensing proceeds prior to the scheduled amortization of such up-front patent portfolio acquisition costs, resulting in the acceleration of amortization expense for the applicable patent-related assets. For the years ended December 31, 2013, 2012 and 2011, accelerated amortization expense related to the recovery of up-front patent acquisition costs totaled $592,000, $10,574,000 and $3,111,000, respectively. | |||||||||||||
For the years ended December 31, 2013, 2012 and 2011, pursuant to the terms of the respective inventor agreements, certain Acacia operating subsidiaries elected to terminate or sell their rights to patent portfolios, resulting in the acceleration of amortization expense for the patent-related assets totaling $1,747,000, $3,034,000 and $1,103,000, respectively. Included in amortization of patents for the year ended December 31, 2013 are patent impairment charges totaling $4,619,000. The impairment charges, related to certain patent portfolios that management, in the fourth quarter of 2013, determined it would no longer allocate future resources to in connection with the licensing and enforcement of such portfolios, due primarily to potential prior art related complexities in two of the programs and/or the overall determination that future resources would be allocated to other licensing and enforcement programs with higher potential return profiles. The impairment charges consisted of the remaining net carrying value of the related portfolios as of December 31, 2013. | |||||||||||||
For the years ended December 31, 2013, 2012 and 2011, capitalized patent costs and accumulated amortization, and sales proceeds and other costs, related to patent-related sales and disposals are as follows (in thousands): | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Capitalized patent costs | $ | 3,500 | $ | 5,500 | $ | 4,612 | |||||||
Accumulated amortization | 1,753 | 2,466 | 3,509 | ||||||||||
Sales proceeds | 1,000 | 2,792 | 11,000 | ||||||||||
Other costs | — | — | 4,717 | ||||||||||
Fair_Value_Measurements_and_Au
Fair Value Measurements and Auction Rate Securities | 12 Months Ended |
Dec. 31, 2013 | |
Fair Value Measurements and Auction Rate Securities [Abstract] | ' |
Fair Value Measurements and Auction Rate Securities | ' |
FAIR VALUE MEASUREMENTS AND AUCTION RATE SECURITIES | |
As of December 31, 2011, Acacia held investment grade auction rate securities with a par value totaling $2,425,000, consisting of auction rate investments backed by student loans, which were classified as noncurrent, available-for-sale and reflected at fair value. The fair values of these securities were estimated utilizing an analysis of certain unobservable inputs (Level 3) and by reference to periodic discounted cash flow analyses. | |
All outstanding auction rate securities as of December 31, 2011, were sold during the year ended December 31, 2012. For the year ended December 31, 2012 auction rate securities related recognized gains included in earnings totaled $118,000, and total settlements of auction rate securities totaled $2,074,000. |
Acquisition
Acquisition | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Business Combinations [Abstract] | ' | ||||||||||||
Business Combination Disclosure [Text Block] | ' | ||||||||||||
ACQUISITION | |||||||||||||
On January 12, 2012 (the “Acquisition Date”), pursuant to the terms and conditions of the Agreement and Plan of Merger dated as of November 22, 2011 (the “Merger Agreement”) among Acacia Research Group LLC (“ARG”), a wholly-owned subsidiary of Acacia, Apollo Patent Corp., a newly-formed, wholly-owned subsidiary of ARG (“Merger Sub”), ADAPTIX, a Delaware corporation, and Baker Communications Fund II (QP), L.P. solely in its capacity as shareholder representative, ARG completed its acquisition of ADAPTIX, which held no material assets other than its portfolio of patents and $10 million in cash, through a merger of Merger Sub with and into ADAPTIX, with ADAPTIX as the surviving corporation (the “Merger”). Upon completion of the Merger, the separate corporate existence of Merger Sub ceased and ADAPTIX became a wholly-owned subsidiary of ARG. | |||||||||||||
ADAPTIX, a pioneer in the development of 4G technologies for wireless systems, is a technology company recognized in the industry as one of the first developers of 4G wireless systems. With patents filed as early as 2000, ADAPTIX’s research and development efforts have resulted in a significant intellectual property portfolio focused on 4G technologies. With its growing portfolio of 230 issued and pending patents in 13 countries, ADAPTIX’s innovations extend across a broad range of 4G technologies including OFDMA and MIMO. | |||||||||||||
The Merger was being accounted for in accordance with the acquisition method of accounting under FASB ASC Topic 805, “Business Combinations” (“Topic 805”). Topic 805 requires, among other things, that identifiable assets acquired and liabilities assumed be recognized at their fair values as of the Acquisition Date. Under the acquisition method of accounting, the purchase consideration is allocated to the assets acquired, including tangible assets, patents and other identifiable intangible assets and liabilities assumed, based on their estimated fair market values on the date of acquisition. Any excess purchase price after the initial allocation to identifiable net tangible and identifiable intangible assets is assigned to goodwill. Amounts attributable to patents are amortized using the straight-line method over the estimated economic useful life of the underlying patents. | |||||||||||||
The total consideration paid by ARG in connection with the Merger was approximately $160 million, in cash. Based on the total purchase consideration and the estimate of the assets acquired and the liabilities assumed by ARG as of the Acquisition Date, the purchase price allocation was as follows ($ amounts in thousands): | |||||||||||||
Amortization Period | Annual Amortization | ||||||||||||
Assets Acquired and Liabilities Assumed: | |||||||||||||
Fair value of net tangible assets acquired | $ | 10,000 | |||||||||||
Intangible assets acquired - patents | 150,000 | 10 years | $ | 15,000 | |||||||||
Goodwill | 30,149 | ||||||||||||
Net deferred income tax liability | (30,149 | ) | |||||||||||
Total | $ | 160,000 | |||||||||||
Amounts attributable to the patents acquired are being amortized using the straight-line method over an estimated weighted average economic useful life of the underlying patents, which was estimated to be approximately 10 years. Goodwill is calculated as the residual after recording the identifiable net assets acquired and associated net deferred tax assets and liabilities. | |||||||||||||
Management is responsible for determining the fair value of the tangible and identifiable intangible assets acquired and liabilities assumed as of the Acquisition Date. Management considered a number of factors, including reference to an analysis under Topic 805 solely for the purpose of allocating the purchase price to the assets acquired and liabilities assumed. The analysis included a discounted cash flow which estimated future net cash flows resulting from the licensing and enforcement of the patent portfolio based on information as of the date of acquisition, considering assumptions and estimates related to potential infringers of the patents, applicable industries, usage of the underlying patented technologies, estimated license fee revenues, contingent legal fee arrangements, other estimated costs, tax implications and other factors. A discount rate consistent with the risks associated with achieving the estimated net cash flows was used to estimate the present value of estimated net cash flows. | |||||||||||||
The Merger was treated for tax purposes as a nontaxable transaction and as such, the historical tax bases of the acquired assets and assumed liabilities, net operating losses, and other tax attributes of ADAPTIX will carryover. As a result, no new tax goodwill will be created in connection with the Merger as there is no step-up to fair value of the underlying tax bases of the acquired net assets. Acquisition accounting includes the establishment of a net deferred tax asset or liability resulting from book tax basis differences related to assets acquired and liabilities assumed on the date of acquisition. Acquisition date deferred tax assets primarily relate to certain net operating loss carryforwards of ADAPTIX. Acquisition date deferred tax liabilities relate to specifically identified non-goodwill intangibles acquired. The estimated net deferred tax liability was determined as follows ($ amounts in thousands): | |||||||||||||
Book Basis | Tax Basis | Difference | |||||||||||
Intangible assets acquired - patents | $ | 150,000 | $ | — | $ | (150,000 | ) | ||||||
Estimated acquired deferred tax assets (including net operating loss carryforwards) - ADAPTIX | — | 63,860 | 63,860 | ||||||||||
Net deferred tax liability - pretax | (86,140 | ) | |||||||||||
Estimated tax rate | 35 | % | |||||||||||
Estimated net deferred tax liability | $ | (30,149 | ) | ||||||||||
The following unaudited pro forma combined results of operations for periods presented are provided for illustrative purposes only and assume the acquisition occurred as of January 1, 2012. The unaudited pro forma combined financial results do not purport to be indicative of the results of operations for future periods or the results that actually would have been realized had the entities been a single entity during these periods. The unaudited pro forma combined results are presented in thousands, except share and per share information. | |||||||||||||
2012 | 2011 | ||||||||||||
Revenues | $ | 250,727 | $ | 172,256 | |||||||||
Total operating costs and expenses | 170,953 | 159,674 | |||||||||||
Operating income | 79,774 | 12,582 | |||||||||||
Interest and investment income | 937 | 96 | |||||||||||
Income from operations before provision for income taxes | 80,711 | 12,678 | |||||||||||
Provision for income taxes | (22,060 | ) | (8,708 | ) | |||||||||
Net income including noncontrolling interests in operating subsidiaries | 58,651 | 3,970 | |||||||||||
Net loss (income) attributable to noncontrolling interests in operating subsidiaries | 164 | (539 | ) | ||||||||||
Net income attributable to Acacia Research Corporation | $ | 58,815 | $ | 3,431 | |||||||||
2012 | 2011 | ||||||||||||
Pro forma income per common share attributable to Acacia Research Corporation: | |||||||||||||
Basic earnings per share | $ | 1.24 | $ | 0.09 | |||||||||
Diluted earnings per share | $ | 1.22 | $ | 0.08 | |||||||||
Weighted average number of shares outstanding, basic | 47,251,061 | 39,743,433 | |||||||||||
Weighted average number of shares outstanding, diluted | 48,060,647 | 41,258,297 | |||||||||||
Pro forma adjustments primarily relate to the amortization of identifiable intangible assets acquired over an estimated economic useful life of ten years, historical operating expenses of ADAPTIX for 2012, and the expensing of acquisition costs incurred by ARG in connection with the Merger. | |||||||||||||
The unaudited pro forma combined statements of income for the periods presented herein have been adjusted to give effect to pro forma events that are expected to have a continuing impact on the combined results. As such, the income tax benefit related to the release of valuation allowance reflected in the statement of operations for 2012, as described at Note 10, is not reflected in the accompanying unaudited pro forma combined statements of operations for the periods presented. |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Stockholders' Equity Note [Abstract] | ' | |||||||||
Stockholders' Equity | ' | |||||||||
STOCKHOLDERS’ EQUITY | ||||||||||
Equity Offerings. In February 2012, Acacia raised gross proceeds of $225,000,000 through the sale of 6,122,449 shares of Acacia’s common stock at a price of $36.75 per share in a private placement offering with certain institutional accredited investors. Net proceeds, net of placement agent fees and estimated offering expenses, totaled approximately$218,961,000. The use of proceeds included the finance of pending and future acquisitions of patents and patent royalties and other patent licensing vehicles and companies with patent assets, and for working capital and general corporate purposes. | ||||||||||
In March 2011, Acacia completed a public offering of 5,750,000 shares of common stock. The public offering price was $31.50 per share, and the net proceeds to the Company totaled approximately $175,229,000 after deducting underwriting discounts and related offering expenses. Acacia retained broad discretion over the use of the net proceeds from the sale of common stock including use for operations and for other general corporate purposes, including, but not limited to, working capital, strategic acquisitions and other transactions. | ||||||||||
Repurchases of Common Stock. On November 16, 2012, Acacia’s Board of Directors authorized a program for repurchases of shares of Acacia’s outstanding common stock. Under the stock repurchase program, effective November 16, 2012, Acacia was authorized to purchase in the aggregate up to $100,000,000 of its outstanding common stock through the period ended May 15, 2013. On April 23, 2013, Acacia’s Board of Directors approved an extension of the stock repurchase program from May 15, 2013 until August 15, 2013. The November 16, 2012 program expired on August 15, 2013. | ||||||||||
On November 15, 2013, Acacia’s Board of Directors authorized a program for repurchases of shares of Acacia’s outstanding common stock. Under the stock repurchase program, effective November 15, 2013, Acacia was authorized to purchase in the aggregate up to $70,000,000 of its of its outstanding common stock through the period ending May 14, 2014. | ||||||||||
Repurchases may be made from time to time by Acacia in the open market or in block purchases in compliance with applicable Securities and Exchange Commission rules. Repurchases to date were made using existing cash resources and occurred in the open market. The authorization to repurchase shares presented an opportunity to reduce the outstanding share count and enhance stockholder value. Following are our monthly stock repurchases for the periods presented, all of which were purchased as part of publicly announced plans or programs: | ||||||||||
Total Number of Shares Purchased | Average Price paid per Share | Approximate Dollar Value of | Plan Expiration | |||||||
Shares that May Yet be | ||||||||||
Purchased under the Program | ||||||||||
November 16, 2012 - November 30, 2012 | 256,262 | $ | 21.58 | $ | — | 15-Aug-13 | ||||
December 1, 2012 - December 31, 2012 | 873,146 | $ | 24.26 | $ | — | 15-Aug-13 | ||||
Totals for 2012 | 1,129,408 | $ | 23.65 | |||||||
December 4, 2013 - December 11, 2013 | 600,000 | $ | 13.18 | $ | 62,074,000 | 14-May-14 | ||||
Totals for 2013 | 600,000 | |||||||||
Cash Dividends. On April 23, 2013, Acacia announced that its Board of Directors approved the adoption of a cash dividend policy that calls for the payment of an expected total annual cash dividend of $0.50 per common share, payable in the amount of $0.125 per share per quarter. Under the policy, the Company paid three quarterly cash dividends totaling $18,633,000 in 2013. While the Company paid dividends to holders of our common stock on a quarterly basis during fiscal year 2013, the declaration and payment of future dividends will depend on many factors, including, but not limited to, our earnings and financial condition, and any future dividends will be made solely at the discretion of our Board of Directors. | ||||||||||
On February 20, 2014, Acacia announced that its Board of Directors approved a fourth quarterly cash dividend payable in the amount of $0.125 per share. The quarterly cash dividend will be paid on March 31, 2014 to shareholders of record at close of business on March 3, 2014. |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
Income Taxes | ' | ||||||||||||
INCOME TAXES | |||||||||||||
Acacia’s provision for income taxes consists of the following (in thousands): | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Current: | |||||||||||||
Federal | $ | — | $ | — | $ | 179 | |||||||
State taxes | 113 | 281 | 943 | ||||||||||
Foreign taxes | 4,405 | 11,890 | 7,586 | ||||||||||
Total current | 4,518 | 12,171 | 8,708 | ||||||||||
Deferred: | |||||||||||||
Federal | (26,151 | ) | 10,085 | — | |||||||||
State taxes | (325 | ) | (196 | ) | — | ||||||||
Total deferred | (26,476 | ) | 9,889 | — | |||||||||
Provision for income taxes | $ | (21,958 | ) | $ | 22,060 | $ | 8,708 | ||||||
The tax effects of temporary differences and carryforwards that give rise to significant portions of deferred tax assets and liabilities consist of the following at December 31, 2013 and 2012 (in thousands): | |||||||||||||
2013 | 2012 | ||||||||||||
Deferred tax assets: | |||||||||||||
Net operating loss and capital loss carryforwards and credits | $ | 34,679 | $ | 15,668 | |||||||||
Stock compensation | 3,052 | 1,140 | |||||||||||
Basis of investments in affiliates | 867 | 415 | |||||||||||
Accrued liabilities and other | 387 | 250 | |||||||||||
Unrealized loss on short-term investments | 337 | 415 | |||||||||||
State taxes | 18 | 212 | |||||||||||
Total deferred tax assets | 39,340 | 18,100 | |||||||||||
Deferred tax liabilities: | |||||||||||||
Fixed assets and intangibles | (33,378 | ) | (39,457 | ) | |||||||||
Other | (112 | ) | (60 | ) | |||||||||
Net deferred tax liabilities | 5,850 | (21,417 | ) | ||||||||||
Less: valuation allowance | (7,585 | ) | (5,396 | ) | |||||||||
Net deferred taxes | $ | (1,735 | ) | $ | (26,813 | ) | |||||||
A reconciliation of the federal statutory income tax rate and the effective income tax rate is as follows: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Statutory federal tax rate - (benefit) expense | (35 | )% | 35 | % | 35 | % | |||||||
State income and foreign taxes, net of federal tax effect | 5 | % | 15 | % | 27 | % | |||||||
Foreign tax credit | (6 | )% | (15 | )% | (25 | )% | |||||||
Noncontrolling interests in operating subsidiaries | 1 | % | — | % | (1 | )% | |||||||
Nondeductible permanent items | 2 | % | 5 | % | 4 | % | |||||||
Expired net operating loss carryforwards | 2 | % | — | % | 1 | % | |||||||
Valuation allowance | 4 | % | (13 | )% | (12 | )% | |||||||
(27 | )% | 27 | % | 29 | % | ||||||||
At December 31, 2013 and 2012, the Company has recorded valuation allowances for certain tax attribute carryforwards and other deferred tax assets due to uncertainty regarding future realizability, as follows: | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Capital loss carryforwards | $ | 1,562 | $ | 2,935 | |||||||||
Net operating loss carryforwards | 1,281 | 2,046 | |||||||||||
Foreign tax credits | 4,405 | — | |||||||||||
Unrealized losses on short-term investments and other deferred tax assets | 337 | 415 | |||||||||||
Total valuation allowance | $ | 7,585 | $ | 5,396 | |||||||||
Capital loss carryforwards and certain net operating loss carryforwards included in the valuation allowances for the periods presented, expire in varying amounts from 2014 through 2033. Foreign tax credits included in the valuation allowance were generated during the year ended December 31, 2013, and expire in 2023. In future periods, if the Company determines it will more likely than not be able to realize certain of these amounts, the applicable portion of the benefit from the release of the valuation allowance will generally be recognized in the statement of income in the period the determination is made. | |||||||||||||
Release of Valuation Allowance. As of December 31, 2011, Acacia maintained a full valuation allowance against its net deferred tax assets. The net deferred tax liability resulting from the acquisition of ADAPTIX in January 2012 created an additional source of income to utilize against the majority of Acacia’s existing consolidated net deferred tax assets. In addition, Acacia estimated that certain other deferred tax assets related to foreign tax credits and other state related deferreds were more likely than not realizable in future periods. Accordingly, the valuation allowance on the majority of the Company’s net deferred tax assets was released, resulting in a financial statement income tax benefit of $10,651,000 for the year ended December 31, 2012. | |||||||||||||
At December 31, 2013, Acacia had U.S. federal and state income tax NOLs totaling approximately $83,372,000 and $56,400,000, expiring between 2025 and 2033, and 2014 and 2033, respectively, for which $0 and $441,000 of federal and state net operating losses are included as a deferred tax asset which will be credited to additional paid-in capital when realized as a reduction of taxes payable on Acacia’s tax return. In addition, $1,928,000 and $37,725,000 of federal and state net operating losses are not included as a deferred tax asset and will be credited to additional paid-in capital when realized as a reduction of taxes payable on Acacia’s tax return as they relate to unrecognized excess tax benefits (see additional information regarding the ordering of windfall tax benefits and use of the “with-and-without” approach below). As of December 31, 2013, $0 and $441,000 of the valuation allowance related to the tax benefits of stock option deductions included in Acacia’s federal and state NOLs deferred tax asset, respectively. | |||||||||||||
At December 31, 2013, approximately $29,318,000 of the U.S. federal NOLs, acquired in connection with the acquisition of ADAPTIX, are subject to an annual utilization limitation of approximately $14,100,000, pursuant to the “change in ownership” provisions under Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”). | |||||||||||||
As of December 31, 2013 Acacia has approximately $24,718,000 of foreign tax credits, expiring between 2015 and 2023, of which $20,313,000 has been utilized for financial statement purposes. Future realization of the credits as a reduction of taxes payable on Acacia’s tax return will result in an income tax benefit recognizable through additional paid in capital since the entire amount of the credits have been utilized for financial statement purposes under the “with-and-without approach.” In general, foreign taxes withheld may be claimed as a deduction on future U.S. corporate income tax returns, or as a credit against future U.S. income tax liabilities, subject to certain limitations. | |||||||||||||
Excluding the impact of the change in valuation allowance in fiscal years 2013, 2012 and 2011, our annual effective tax rates were (31%), 40% and 41%, respectively. In 2013, the rate at which we recorded the tax benefit associated with the pre-tax loss for the period was reduced from the statutory rate primarily due to certain nondeductible permanent items and expired capital loss carryforwards. The Company recorded a valuation allowance on foreign tax credits generated in fiscal year 2013 totaling $4,605,000, as discussed above, and therefore, did not recognize the related tax benefit in fiscal year 2013. The Company generated pretax income in 2012 and had significant nondeductible permanent items which increased our effective tax rate as shown above. The Company generated pretax income in fiscal year 2012, resulting in tax expense for the period. The fiscal year 2012 effective tax rate was lower than the U.S. federal statutory rate primarily due to $10.2 million of tax benefits recognized resulting from the release of valuation allowance on the majority of our net deferred tax assets in the first quarter of 2012, as discussed above. | |||||||||||||
The Company has elected to utilize the “with-and-without approach” regarding ordering of windfall tax benefits to determine whether the windfall tax benefit has reduced taxes payable. Under this approach, the windfall tax benefits would be recognized in additional paid in capital only if an incremental tax benefit is realized after considering all other tax benefits presently available to the Company. The deductions related to the exercise and vesting of equity-based incentive awards during the periods presented are, in general, available to offset taxable income on Acacia’s consolidated tax returns. Accordingly, the excess tax benefit related to the exercise and vesting of equity-based incentive awards for the periods presented, was credited to additional paid-in capital, not taxes payable. The actual tax benefit realized for excess tax deductions resulting from the exercise and vesting of equity-based incentive awards (noncash tax expense) totaled $13,210,000 and $583,000 for the years ended December 31, 2012 and 2011, respectively. For the year ended December 31, 2013, the Company incurred approximately $1,398,000 of net short falls from the exercise and vesting of equity-based incentive awards, of which $1,398,000 was recorded against its additional paid-in capital pool with no impact to the income statement. | |||||||||||||
Acacia is subject to taxation in the U.S. and various state jurisdictions. With no material exceptions, Acacia is no longer subject to U.S. federal or state examinations by tax authorities for years before 1997. | |||||||||||||
At December 31, 2013, the Company had total unrecognized tax benefits of approximately $2,127,000, including a recorded noncurrent liability of $85,000, related to unrecognized tax benefits primarily associated with state taxes. No interest and penalties have been recorded for the unrecognized tax benefits as of December 31, 2013. If recognized, approximately $2,127,000 would impact the Company’s effective tax rate. The Company does not expect that the liability for unrecognized tax benefits will change significantly within the next 12 months. Activity related to the gross unrecognized tax benefits for the year ended December 31, 2013 was as follows (in thousands): | |||||||||||||
Balance at January 1, 2012 | $ | 85 | |||||||||||
Additions based on tax positions related to the current year | — | ||||||||||||
Additions for tax positions related to prior years | 772 | ||||||||||||
Additions resulting from the acquisition of ADAPTIX | 1,270 | ||||||||||||
Reductions | — | ||||||||||||
Balance at December 31, 2012 | 2,127 | ||||||||||||
Reductions | — | ||||||||||||
Balance at December 31, 2013 | $ | 2,127 | |||||||||||
StockBased_Incentive_Plans
Stock-Based Incentive Plans | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Share-based Compensation [Abstract] | ' | |||||||||||||
Stock-based Incentive Plans | ' | |||||||||||||
STOCK-BASED INCENTIVE PLANS | ||||||||||||||
The 2002 Acacia Technologies Stock Incentive Plan (“2002 Plan”), the 2007 Acacia Technologies Stock Incentive Plan (“2007 Plan”) and the 2013 Acacia Research Corporation Stock Incentive Plan (“2013 Plan”) (collectively, the “Plans”) were approved by the stockholders of Acacia in December 2002, May 2007 and May 2013, respectively. All Plans allow grants of stock options, stock awards and performance shares with respect to Acacia common stock to eligible individuals, which generally includes directors, officers, employees and consultants. Except as noted below, the terms and provisions of the Plans are identical in all material respects. The term of the 2002 Plan expired in December 2012. | ||||||||||||||
Acacia’s compensation committee administers the discretionary option grant and stock issuance programs. The compensation committee determines which eligible individuals are to receive option grants or stock issuances under those programs, the time or times when the grants or issuances are to be made, the number of shares subject to each grant or issuance, the status of any granted option as either an incentive stock option or a non-statutory stock option under the federal tax laws, the vesting schedule to be in effect for the option grant or stock issuance and the maximum term for which any granted option is to remain outstanding. The exercise price of options is generally equal to the fair market value of Acacia’s common stock on the date of grant. Options generally begin to be exercisable six months to one year after grant and generally expire ten years after grant. Stock options generally vest over two to three years and restricted shares generally vest in full after two to three years (generally representing the requisite service period). The Plans terminate no later than the tenth anniversary of the approval of the incentive plans by Acacia’s stockholders. | ||||||||||||||
The Plans provide for the following separate programs: | ||||||||||||||
• | Discretionary Option Grant Program. Under the discretionary option grant program, Acacia’s compensation committee may grant (1) non-statutory options to purchase shares of common stock to eligible individuals in the employ or service of Acacia or its subsidiaries (including employees, non-employee board members and consultants) at an exercise price not less than 85% of the fair market value of those shares on the grant date, and (2) incentive stock options to purchase shares of common stock to eligible employees at an exercise price not less than 100% of the fair market value of those shares on the grant date (not less than 110% of fair market value if such employee actually or constructively owns more than 10% of Acacia’s voting stock or the voting stock of any of its subsidiaries). | |||||||||||||
• | Stock Issuance Program. Under the stock issuance program, eligible individuals may be issued shares of common stock directly, upon the attainment of performance milestones or the completion of a specified period of service or as a bonus for past services. Under this program, the purchase price for the shares shall not be less than 100% of the fair market value of the shares on the date of issuance, and payment may be in the form of cash or past services rendered. | |||||||||||||
• | Automatic Option Grant Program (2002 and 2013Plans only). Commencing in fiscal 2008, each non-employee director will receive restricted stock units for the number of shares determined by dividing the annual retainer by the closing price of Acacia’s common stock on the grant date, provided that such individual has served as a non-employee director for at least 6 months. In addition, as of May 2007, each new non-employee director will receive restricted stock units for the number of shares determined by dividing the annual board of directors retainer by the closing price of Acacia’s common stock on the commencement date. Restricted stock units vest in a series of twelve quarterly installments over the three year period following the grant date, subject to immediate acceleration upon a change in control. Acacia will deliver shares corresponding to the vested restricted stock units within thirty (30) days after the first to occur of the following events: (i) the fifth (5th) anniversary of the grant date; or (ii) termination of the non-employee director’s service as a member of the Company’s Board of Directors. The non-employee directors do not have any rights, benefits or entitlements with respect to any shares unless and until the shares have been delivered. | |||||||||||||
The number of shares of common stock available for issuance under the 2002 Plan automatically increased on the first trading day of January each calendar year during the term of the Plan by an amount equal to three percent (3%) of the total number of shares of common stock outstanding on the last trading day in December of the immediately preceding calendar year, not to exceed 500,000 shares. The aggregate number of shares of common stock available for issuance under the 2002 Plan could not exceed 20,000,000 shares. At December 31, 2013, there were no shares available for grant under the expired 2002 Plan. | ||||||||||||||
The initial share reserve under the 2007 Plan was 560,000 shares. The number of shares of common stock available for issuance under the 2007 Plan automatically increased on January 1, 2008 and 2009, by an amount equal to two percent (2%) of the total number of shares of common stock outstanding on the last trading day of December in the prior calendar year. After January 1, 2009, no new additional shares will be added to the 2007 Plan without stockholder approval (except for shares subject to outstanding awards that are forfeited or otherwise returned to the 2007 Plan). At December 31, 2013, there were no shares available for grant under the 2007 Plan. | ||||||||||||||
The number of shares of Common Stock initially reserved for issuance under the 2013 Plan was 4,750,000 shares. No new additional shares will be added to the 2013 Plan without security holder approval (except for shares subject to outstanding awards that are forfeited or otherwise returned to the 2013 Plan). The stock issuable under the 2013 Plan shall be shares of authorized but unissued or reacquired Common Stock, including shares repurchased by the Company on the open market. At December 31, 2013, there were 4,280,000 shares available for grant under the 2013 Plan. | ||||||||||||||
Upon the exercise of stock options, the granting of restricted stock, or the delivery of shares pursuant to vested restricted stock units, it is Acacia’s policy to issue new shares of common stock. Acacia’s board of directors may amend or modify the Plans at any time, subject to any required stockholder approval. | ||||||||||||||
The following table summarizes stock option activity for the Plans for the year ended December 31, 2013: | ||||||||||||||
Weighted-Average | ||||||||||||||
Options | Exercise | Remaining | Aggregate | |||||||||||
Price | Contractual Term | Intrinsic Value | ||||||||||||
Outstanding at December 31, 2012 | 313,000 | $ | 5.87 | |||||||||||
Exercised | (115,000 | ) | $ | 4.22 | ||||||||||
Expired/forfeited | (3,000 | ) | $ | 1.85 | ||||||||||
Outstanding at December 31, 2013 | 195,000 | $ | 6.91 | 1.6 years | $ | 1,485,000 | ||||||||
Vested | 195,000 | $ | 6.91 | 1.6 years | $ | 1,485,000 | ||||||||
Exercisable at December 31, 2013 | 195,000 | $ | 6.91 | 1.6 years | $ | 1,485,000 | ||||||||
The aggregate intrinsic value of options exercised during the years ended December 31, 2013, 2012 and 2011 was $2,024,000, $1,796,000, and $2,822,000, respectively. No options vested during the years ended December 31, 2013, 2012 and 2011. | ||||||||||||||
The following table summarizes nonvested restricted share activity for the year ended December 31, 2013: | ||||||||||||||
Nonvested | Weighted | |||||||||||||
Restricted Shares | Average Grant Date Fair Value | |||||||||||||
Nonvested restricted stock at December 31, 2012 | 1,353,000 | $ | 30.17 | |||||||||||
Granted | 823,000 | $ | 24.31 | |||||||||||
Vested | (813,000 | ) | $ | 27.45 | ||||||||||
Canceled | (126,000 | ) | $ | 28.48 | ||||||||||
Nonvested restricted stock at December 31, 2013 | 1,237,000 | $ | 28.23 | |||||||||||
The weighted-average grant date fair value of nonvested restricted stock granted during the years ended December 31, 2013, 2012 and 2011 was $24.31, $32.17, and $29.24, respectively. The aggregate fair value of restricted stock that vested during the years ended December 31, 2013, 2012 and 2011 was $22,317,000, $28,865,000, $11,043,000, respectively. As of December 31, 2013, the total unrecognized compensation expense related to nonvested restricted stock awards was $25,915,000, which is expected to be recognized over a weighted-average period of approximately 1.8 years. | ||||||||||||||
The following table summarizes restricted stock unit activity for the year ended December 31, 2013: | ||||||||||||||
Restricted | Weighted | |||||||||||||
Stock Units | Average Grant Date Fair Value | |||||||||||||
Nonvested restricted stock units outstanding at December 31, 2012 | 38,000 | $ | 26.98 | |||||||||||
Granted | — | $ | — | |||||||||||
Vested | (18,000 | ) | $ | 26.05 | ||||||||||
Nonvested restricted stock units outstanding at December 31, 2013 | 20,000 | $ | 27.83 | |||||||||||
Vested restricted stock units outstanding at December 31, 2013 | 94,000 | $ | 13.05 | |||||||||||
The weighted-average grant date fair value of restricted stock units granted during the years ended December 31, 2012 and 2011 was $29.39 and $24.87, respectively. There were $0 shares granted during the year ended December 31, 2013. The aggregate fair value of restricted stock units that vested during the years ended December 31, 2013, 2012 and 2011 was $469,000, $363,000 and $257,000, respectively. As of December 31, 2013, the total unrecognized compensation expense related to restricted stock unit awards was $480,000, which is expected to be recognized over a weighted-average period of approximately 1.6 years. | ||||||||||||||
As of December 31, 2013, 4,280,000 shares of common stock are reserved for issuance under the Plans. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||||
Commitments and Contingencies | ' | ||||||||
COMMITMENTS AND CONTINGENCIES | |||||||||
Operating Leases | |||||||||
Acacia leases certain office space under various operating lease agreements expiring at various dates from 2014 through 2020. Minimum annual rental commitments for operating leases of continuing operations having initial or remaining noncancellable lease terms in excess of one year are as follows (in thousands): | |||||||||
Year | |||||||||
2014 | $ | 1,442 | |||||||
2015 | 1,553 | ||||||||
2016 | 918 | ||||||||
2017 | 318 | ||||||||
2018 | 324 | ||||||||
Thereafter | 498 | ||||||||
Total minimum lease payments | $ | 5,053 | |||||||
Rent expense for the years ended December 31, 2013, 2012 and 2011 approximated $1,312,000, $898,000 and $915,000, respectively. Rental payments are expensed in the statements of operations in the period to which they relate. Scheduled rent increases are amortized on a straight-line basis over the lease term. | |||||||||
Inventor Royalties and Contingent Legal Expenses | |||||||||
In connection with the acquisition of certain patents and patent rights, certain of Acacia’s operating subsidiaries executed related agreements which grant to the former owners of the respective patents or patent rights, the right to receive inventor royalties based on future net revenues (as defined in the respective agreements) generated as a result of licensing and otherwise enforcing the respective patents or patent portfolios. | |||||||||
Acacia’s operating subsidiaries may retain the services of law firms that specialize in patent licensing and enforcement and patent law in connection with their licensing and enforcement activities. These law firms may be retained on a contingent fee basis whereby such law firms are paid on a scaled percentage of any negotiated fees, settlements or judgments awarded based on how and when the fees, settlements or judgments are obtained. | |||||||||
The economic terms of the inventor agreements, operating agreements and contingent legal fee arrangements associated with the patent portfolios owned or controlled by Acacia’s operating subsidiaries, if any, including royalty rates, contingent fee rates and other terms, vary across the patent portfolios owned or controlled by such operating subsidiaries. Inventor royalties, payments to noncontrolling interests and contingent legal fees expenses fluctuate period to period, based on the amount of revenues recognized each period, the terms and conditions of revenue agreements executed each period and the mix of specific patent portfolios with varying economic terms and obligations generating revenues each period. Inventor royalties and contingent legal fees expenses will continue to fluctuate and may continue to vary significantly period to period, based primarily on these factors. | |||||||||
During the years ended December 31, 2013 and 2012, Acacia entered into significant agreements with unrelated third-parties resolving pending patent matters that resulted in the grant of certain intellectual property rights and recognition of revenues, portions of which were not subject to inventor royalty and contingent legal fee arrangements, as well as the grant of licenses from certain of Acacia’s operating subsidiaries and recognition of revenues that were subject to inventor royalties and contingent legal fee arrangements. Certain revenues recognized subject to inventor royalties and contingent legal fees are based on a determination by the respective operating subsidiaries. | |||||||||
Patent Enforcement and Other Litigation | |||||||||
Acacia is subject to claims, counterclaims and legal actions that arise in the ordinary course of business. Management believes that the ultimate liability with respect to these claims and legal actions, if any, will not have a material effect on Acacia’s consolidated financial position, results of operations or cash flows. Certain of Acacia’s operating subsidiaries are often required to engage in litigation to enforce their patents and patent rights. In connection with any of Acacia’s operating subsidiaries’ patent enforcement actions, it is possible that a defendant may request and/or a court may rule that an operating subsidiary has violated statutory authority, regulatory authority, federal rules, local court rules, or governing standards relating to the substantive or procedural aspects of such enforcement actions. In such event, a court may issue monetary sanctions against Acacia or its operating subsidiaries or award attorney’s fees and/or expenses to a defendant(s), which could be material, and if required to be paid by Acacia or its operating subsidiaries, could materially harm the Company’s operating results and financial position. | |||||||||
Guarantees and Indemnifications | |||||||||
Certain of Acacia’s operating subsidiaries have made guarantees and indemnities under which they may be required to make payments to a guaranteed or indemnified party, in relation to certain transactions, including revenue transactions in the ordinary course of business. In connection with certain facility leases, Acacia and certain of its operating subsidiaries have indemnified lessors for certain claims arising from the facilities or the leases. Acacia indemnifies its directors and officers to the maximum extent permitted under the laws of the State of Delaware. However, Acacia has a directors and officers insurance policy that may reduce its exposure in certain circumstances and may enable it to recover a portion of future amounts that may be payable, if any. The duration of the guarantees and indemnities varies and, in many cases is indefinite but subject to statute of limitations. The majority of guarantees and indemnities do not provide any limitations of the maximum potential future payments that Acacia could be obligated to make. To date, Acacia has made no payments related to these guarantees and indemnities. Acacia estimates the fair value of its indemnification obligations to be insignificant based on this history and therefore, have not recorded any liability for these guarantees and indemnities in the accompanying consolidated balance sheets. | |||||||||
Other | |||||||||
In August 2010, a wholly owned subsidiary of Acacia became the general partner of the Acacia IP Fund, which was formed in August 2010. The Acacia IP Fund is authorized to raise up to $250 million. The Acacia IP Fund acquires, licenses and enforces intellectual property consisting primarily of patents, patent rights, and patented technologies. Refer to Note 2 to these notes to consolidated financial statements for information regarding the consolidation of majority-owned subsidiaries and the presentation of related noncontrolling interests. At December 31, 2013 and 2012, the Acacia IP Fund net assets were primarily comprised of the following (in thousands): | |||||||||
31-Dec-13 | 31-Dec-12 | ||||||||
Cash and other assets | $ | 2,927 | $ | 2,542 | |||||
Patents, net of accumulated amortization | 1,373 | 7,144 | |||||||
Investments - noncurrent | 11,120 | 11,617 | |||||||
Total assets | $ | 15,420 | $ | 21,303 | |||||
Accrued expenses and contributions | $ | 2,437 | $ | 5,016 | |||||
Accrued patent acquisition costs | — | 500 | |||||||
Total liabilities | 2,437 | 5,516 | |||||||
Net assets | $ | 12,983 | $ | 15,787 | |||||
Retirement_Savings_Plan_and_Ex
Retirement Savings Plan and Executive Severance Policy | 12 Months Ended |
Dec. 31, 2013 | |
RETIREMENT SAVINGS PLAN AND EXECUTIVE SEVERANCE POLICY [Abstract] | ' |
Retirement Savings Plan and Executive Severance Policy | ' |
RETIREMENT SAVINGS PLAN AND EXECUTIVE SEVERANCE POLICY | |
Retirement Savings Plan. Acacia has an employee savings and retirement plan under section 401(k) of the Code (the “Plan”). The Plan is a defined contribution plan in which eligible employees may elect to have a percentage of their compensation contributed to the Plan, subject to certain guidelines issued by the Internal Revenue Service. Acacia may contribute to the Plan at the discretion of the board of directors. There were no contributions made by Acacia during the periods presented. | |
Executive Severance Policy. Under Acacia’s Amended Executive Severance Policy, full-time employees with the title of Senior Vice President and higher (“Officer”) are entitled to receive certain benefits upon termination of employment. If employment of an Officer is terminated for other than cause or other than on account of death or disability, Acacia will (i) promptly pay to the Officer a lump sum amount equal to the aggregate of (a) accrued obligations (i.e., the Officer’s annual base salary through the date of termination to the extent not theretofore paid and any compensation previously deferred by the Officer (together with any accrued interest or earnings thereon) and any accrued vacation pay, and reimbursable expenses, in each case to the extent not theretofore paid) and (b) three (3) months of the Officer’s base salary for each full year that the Officer was employed by the Company (the “Severance Period”), up to a maximum of twelve (12) months of the Officer’s base salary, and (ii) provide to the Officer, Acacia paid COBRA coverage for the medical and dental benefits selected by the Officer in the year in which the termination occurs, for the duration of the Severance Period. |
Supplemental_Cash_Flow_Informa
Supplemental Cash Flow Information | 12 Months Ended |
Dec. 31, 2012 | |
Supplemental Cash Flow Information [Abstract] | ' |
Supplemental Cash Flow Information | ' |
SUPPLEMENTAL CASH FLOW INFORMATION | |
Estimated federal taxes paid totaled $3,000,000, $0 and $0 for the years ended December 31, 2013, 2012 and 2011, respectively. At December 31, 2013, prepaid expenses and other current assets included federal and state income taxes receivable totaling $3,251,000. Cash paid for state income taxes totaled $516,000, $771,000 and $185,000 for the years ended December 31, 2013, 2012 and 2011, respectively. Foreign taxes withheld totaled $4,605,000, $11,890,000 and $7,586,000 for the years ended December 31, 2013, 2012 and 2011. | |
Refer to Note 6 to these notes to consolidated financial statements for information regarding noncash investing activity related to the acquisition of patents for the periods presented. Cash flows from financing activities for the year ended December 31, 2012 exclude $504,000 of accrued distributions payable to noncontrolling interests. |
Quarterly_Financial_Data
Quarterly Financial Data | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||||||||||||||
Quarterly Financial Data [Abstract] | ' | ||||||||||||||||||||||||||||||||
Quarterly Financial Data | ' | ||||||||||||||||||||||||||||||||
QUARTERLY FINANCIAL DATA (unaudited) | |||||||||||||||||||||||||||||||||
The following table sets forth unaudited consolidated statements of operations data for the eight quarters in the period ended December 31, 2013. This information has been derived from Acacia’s unaudited condensed consolidated financial statements that have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the information when read in conjunction with the audited consolidated financial statements and related notes thereto. Acacia’s quarterly results have been, and may in the future be, subject to significant fluctuations. As a result, Acacia believes that results of operations for interim periods should not be relied upon as any indication of the results to be expected in any future periods. | |||||||||||||||||||||||||||||||||
Quarter Ended | |||||||||||||||||||||||||||||||||
Mar. 31, | Jun. 30, | Sept. 30, | Dec. 31, | Mar. 31, | Jun. 30, | Sept. 30, | Dec. 31, | ||||||||||||||||||||||||||
2013 | 2013 | 2013 | 2013 | 2012 | 2012 | 2012 | 2012 | ||||||||||||||||||||||||||
(Unaudited, in thousands, except share and per share information) | |||||||||||||||||||||||||||||||||
Revenues | $ | 76,861 | $ | 23,110 | $ | 15,520 | $ | 15,065 | $ | 99,040 | $ | 50,484 | $ | 34,939 | $ | 66,264 | |||||||||||||||||
Operating costs and expenses: | |||||||||||||||||||||||||||||||||
Cost of revenues: | |||||||||||||||||||||||||||||||||
Inventor royalties | 18,481 | 5,610 | 2,353 | 3,280 | 7,594 | 9,573 | 5,032 | 3,829 | |||||||||||||||||||||||||
Contingent legal fees | 15,032 | 4,024 | 2,547 | 3,181 | 3,748 | 6,607 | 8,833 | 5,463 | |||||||||||||||||||||||||
Litigation and licensing expenses - patents | 9,648 | 9,918 | 10,870 | 8,899 | 3,381 | 5,268 | 5,973 | 6,969 | |||||||||||||||||||||||||
Amortization of patents | 11,730 | 12,578 | 12,615 | 16,735 | 5,126 | 5,393 | 10,412 | 18,088 | |||||||||||||||||||||||||
Marketing, general and administrative expenses (including non-cash stock compensation expense) | 13,844 | 13,175 | 18,222 | 13,988 | 13,731 | 11,903 | 11,914 | 16,535 | |||||||||||||||||||||||||
Research, consulting and other expenses - business development | 1,031 | 735 | 743 | 742 | 1,116 | 1,967 | 1,139 | 721 | |||||||||||||||||||||||||
Other | — | — | 3,506 | — | — | — | — | — | |||||||||||||||||||||||||
Total operating costs and expenses | 69,766 | 46,040 | 50,856 | 46,825 | 34,696 | 40,711 | 43,303 | 51,605 | |||||||||||||||||||||||||
Operating income (loss) | 7,095 | (22,930 | ) | (35,336 | ) | (31,760 | ) | 64,344 | 9,773 | (8,364 | ) | 14,659 | |||||||||||||||||||||
Total other income (expense) | 1,290 | 400 | 280 | 161 | 56 | 102 | (41 | ) | 820 | ||||||||||||||||||||||||
Income (loss) before (provision for) benefit from income taxes | 8,385 | (22,530 | ) | (35,056 | ) | (31,599 | ) | 64,400 | 9,875 | (8,405 | ) | 15,479 | |||||||||||||||||||||
Benefit from (provision for) income taxes | (3,272 | ) | 9,050 | 19,570 | (3,390 | ) | (14,747 | ) | (3,494 | ) | 1,938 | (5,757 | ) | ||||||||||||||||||||
Net income (loss) including noncontrolling interests | 5,113 | (13,480 | ) | (15,486 | ) | (34,989 | ) | 49,653 | 6,381 | (6,467 | ) | 9,722 | |||||||||||||||||||||
Net (income) loss attributable to noncontrolling interests | — | 977 | (225 | ) | 1,656 | 275 | (60 | ) | (152 | ) | 101 | ||||||||||||||||||||||
Net income (loss) attributable to Acacia Research Corporation | $ | 5,113 | $ | (12,503 | ) | $ | (15,711 | ) | $ | (33,333 | ) | $ | 49,928 | $ | 6,321 | $ | (6,619 | ) | $ | 9,823 | |||||||||||||
Net income (loss) per common share attributable to Acacia Research Corporation: | |||||||||||||||||||||||||||||||||
Basic income (loss) per share - As Adjusted(1) | $ | 0.1 | $ | (0.26 | ) | $ | (0.33 | ) | $ | (0.69 | ) | $ | 1.08 | $ | 0.13 | $ | (0.14 | ) | $ | 0.2 | |||||||||||||
Diluted income (loss) per share - As Adjusted(1) | $ | 0.1 | $ | (0.26 | ) | $ | (0.33 | ) | $ | (0.69 | ) | $ | 1.08 | $ | 0.13 | $ | (0.14 | ) | $ | 0.2 | |||||||||||||
Weighted-average number of shares outstanding, basic - As Adjusted(1) | 47,859,774 | 48,008,998 | 48,330,149 | 48,415,684 | 44,367,499 | 47,944,193 | 48,332,878 | 48,335,865 | |||||||||||||||||||||||||
Weighted-average number of shares outstanding, diluted - As Adjusted(1) | 48,104,242 | 48,008,998 | 48,330,149 | 48,415,684 | 44,764,064 | 48,294,782 | 48,332,878 | 48,607,141 | |||||||||||||||||||||||||
Quarter Ended | |||||||||||||||||||||||||||||||||
Mar. 31, | Jun. 30, | Sept. 30, | Dec. 31, | Mar. 31, | Jun. 30, | Sept. 30, | Dec. 31, | ||||||||||||||||||||||||||
2013 | 2013 | 2013 | 2013 | 2012 | 2012 | 2012 | 2012 | ||||||||||||||||||||||||||
(Unaudited, In thousands, except share and per share information) | |||||||||||||||||||||||||||||||||
Basic income (loss) per share - As Reported(1) | $ | 0.11 | $ | (0.26 | ) | N/A | N/A | $ | 1.13 | $ | 0.13 | $ | (0.14 | ) | $ | 0.2 | |||||||||||||||||
Diluted income (loss) per share - As Reported(1) | $ | 0.11 | $ | (0.26 | ) | N/A | N/A | $ | 1.09 | $ | 0.13 | $ | (0.14 | ) | $ | 0.2 | |||||||||||||||||
Weighted-average number of shares outstanding, basic - As Reported(1) | 47,859,774 | 48,008,998 | N/A | N/A | 44,367,499 | 47,944,193 | 48,332,878 | 48,335,865 | |||||||||||||||||||||||||
Weighted-average number of shares outstanding, diluted - As Reported(1) | 48,354,444 | 48,008,998 | N/A | N/A | 45,771,228 | 48,938,766 | 48,332,878 | 48,797,304 | |||||||||||||||||||||||||
_______________________ | |||||||||||||||||||||||||||||||||
(1) - Revision of Prior Period Earnings (Loss) Per Share - Two-Class Method. In connection with the preparation of the Company’s Quarterly Report on Form 10-Q as of and for the three months ended September 30, 2013, the Company determined that its basic and diluted net income (loss) per share calculations should have been prepared using the “two-class method.” Under the two-class method, securities that participate in dividends are considered “participating securities.” The Company’s unvested restricted shares outstanding are considered “participating securities” because they include non-forfeitable rights to dividends. | |||||||||||||||||||||||||||||||||
Pursuant to guidance set forth in Staff Accounting Bulletin (“SAB”) No. 99, “Materiality,” the Company concluded that the errors were not material to any of its prior period financial statements. Although the errors were immaterial to prior periods, the prior period financial statements presented herein were revised, in accordance with SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements.” |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Treasury Stock [Policy Text Block] | ' | ||||||||||||
Treasury Stock. Repurchases of the Company’s outstanding common stock are accounted for using the cost method. The applicable par value is deducted from the appropriate capital stock account on the formal or constructive retirement of treasury stock. Any excess of the cost of treasury stock over its par value is charged to additional paid-in capital, and reflected as Treasury Stock on the consolidated balance sheets. | |||||||||||||
Fiscal Period | ' | ||||||||||||
Accounting Principles and Fiscal Year End. The consolidated financial statements and accompanying notes are prepared on the accrual basis of accounting in accordance with generally accepted accounting principles in the United States of America. Acacia has a December 31 fiscal year end. | |||||||||||||
Consolidation, Subsidiaries or Other Investments, Consolidated Entities | ' | ||||||||||||
Principles of Consolidation. The accompanying consolidated financial statements include the accounts of Acacia and its wholly and majority-owned and controlled subsidiaries. Material intercompany transactions and balances have been eliminated in consolidation. | |||||||||||||
Net income (loss) attributable to noncontrolling interest | ' | ||||||||||||
Noncontrolling interests in Acacia’s majority-owned and controlled operating subsidiaries (“noncontrolling interests”) are separately presented as a component of stockholders’ equity in the consolidated statements of stockholders’ equity for the applicable periods presented. Consolidated net income or (loss) is adjusted to include the net (income) or loss attributed to noncontrolling interests in the consolidated statements of operations for the applicable periods presented. Refer to the accompanying consolidated statements of stockholders’ equity for total noncontrolling interests for the applicable periods presented. | |||||||||||||
In August 2010, a wholly owned subsidiary of Acacia became the general partner of the Acacia Intellectual Property Fund, L.P. (the “Acacia IP Fund”), which was formed in August 2010. The Acacia IP Fund is included in the Company’s consolidated financial statements for the periods presented, as Acacia’s wholly owned subsidiary, as the general partner, has the ability to control the operations and activities of the Acacia IP Fund. Refer to Note 12 to these consolidated financial statements. | |||||||||||||
Revenue Recognition | ' | ||||||||||||
Revenue Recognition. Revenue is recognized when (i) persuasive evidence of an arrangement exists, (ii) all obligations have been substantially performed pursuant to the terms of the arrangement, (iii) amounts are fixed or determinable, and (iv) the collectibility of amounts is reasonably assured. | |||||||||||||
In general, revenue arrangements provide for the payment of contractually determined fees in consideration for the grant of certain intellectual property rights for patented technologies owned or controlled by Acacia’s operating subsidiaries. These rights typically include some combination of the following: (i) the grant of a non-exclusive, retroactive and future license to manufacture and/or sell products covered by patented technologies owned or controlled by Acacia’s operating subsidiaries, (ii) a covenant-not-to-sue, (iii) the release of the licensee from certain claims, and (iv) the dismissal of any pending litigation. The intellectual property rights granted may be perpetual in nature, extending until the expiration of the related patents, or can be granted for a defined, relatively short period of time, with the licensee possessing the right to renew the agreement at the end of each contractual term for an additional minimum upfront payment. Pursuant to the terms of these agreements, Acacia’s operating subsidiaries have no further obligation with respect to the grant of the non-exclusive retroactive and future licenses, covenants-not-to-sue, releases, and other deliverables, including no express or implied obligation on Acacia’s operating subsidiaries’ part to maintain or upgrade the technology, or provide future support or services. Generally, the agreements provide for the grant of the licenses, covenants-not-to-sue, releases, and other significant deliverables upon execution of the agreement, or upon receipt of the minimum upfront payment for term agreement renewals. As such, the earnings process is complete and revenue is recognized upon the execution of the agreement, when collectibility is reasonably assured, or upon receipt of the minimum upfront fee for term agreement renewals, and when all other revenue recognition criteria have been met. | |||||||||||||
Certain of the Company’s revenue arrangements provide for future royalties or additional required payments based on future licensee activities. Additional royalties are recognized in revenue upon resolution of the related contingency provided that all revenue recognition criteria, as described above, have been met. Amounts of additional royalties due under these license agreements, if any, cannot be reasonably estimated by management. | |||||||||||||
Certain of the Company’s revenue arrangements provide for the calculation of fees based on a licensee’s actual quarterly sales or actual per unit activity, applied to a contractual royalty rate. Licensees that pay fees on a quarterly basis generally report actual quarterly sales or actual per unit activity information and related quarterly fees due within 30 days to 45 days after the end of the quarter in which such sales or activity takes place. The amount of fees due under these revenue arrangements each quarter cannot be reasonably estimated by management. Consequently, Acacia’s operating subsidiaries recognize revenue from these revenue arrangements on a three-month lag basis, in the quarter following the quarter of sales or per unit activity, provided amounts are fixed or determinable and collectibility is reasonably assured. The lag method described above allows for the receipt of licensee royalty reports prior to the recognition of revenue. | |||||||||||||
Amounts related to revenue arrangements that do not meet the revenue recognition criteria described above are deferred until the revenue recognition criteria are met. | |||||||||||||
Acacia assesses the collectibility of fees receivable based on a number of factors, including past transaction history and credit-worthiness of licensees. If it is determined that collection is not reasonably assured, the fee is recognized when collectibility becomes reasonably assured, assuming all other revenue recognition criteria have been met, which is generally upon receipt of cash. | |||||||||||||
Cost of Revenues | ' | ||||||||||||
Cost of Revenues. Cost of revenues include the costs and expenses incurred in connection with Acacia’s patent licensing and enforcement activities, including inventor royalties paid to original patent owners, contingent legal fees paid to external patent counsel, other patent-related legal expenses paid to external patent counsel, licensing and enforcement related research, consulting and other expenses paid to third-parties and the amortization of patent-related acquisition costs. These costs are included under the caption “Cost of revenues” in the accompanying consolidated statements of operations. | |||||||||||||
Inventor Royalties and Contingent Legal Expenses | ' | ||||||||||||
Inventor Royalties and Contingent Legal Expenses. Inventor royalties are expensed in the consolidated statements of operations in the period that the related revenues are recognized. In certain instances, pursuant to the terms of the underlying inventor agreements, costs paid by Acacia’s operating subsidiaries to acquire patents are recoverable from future net revenues. Patent acquisition costs that are recoverable from future net revenues are amortized over the estimated economic useful life of the related patents, or as the prepaid royalties are earned by the inventor, as appropriate, and the related expense is included in amortization expense in the consolidated statements of operations. Any unamortized patent acquisition costs recovered from net revenues are expensed in the period recovered, and included in amortization expense in the consolidated statements of operations. | |||||||||||||
Contingent legal fees are expensed in the consolidated statements of operations in the period that the related revenues are recognized. In instances where there are no recoveries from potential infringers, no contingent legal fees are paid; however, Acacia’s operating subsidiaries may be liable for certain out of pocket legal costs incurred pursuant to the underlying legal services agreement. Legal fees advanced by contingent law firms that are required to be paid in the event that no license recoveries are obtained are expensed as incurred and included in liabilities in the consolidated balance sheets. | |||||||||||||
Fair Value Measurements | ' | ||||||||||||
Fair Value Measurements. U.S. generally accepted accounting principles define fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date, and also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available. The three-level hierarchy of valuation techniques established to measure fair value, is defined as follows: | |||||||||||||
● | Level 1 - | Observable Inputs: Quoted prices in active markets for identical investments; | |||||||||||
● | Level 2 - | Pricing Models with Significant Observable Inputs: Other significant observable inputs, including quoted prices for similar investments, interest rates, credit risk, etc.; and | |||||||||||
● | Level 3 - | Unobservable Inputs: Significant unobservable inputs, including the entity’s own assumptions in determining the fair value of investments. | |||||||||||
Whenever possible, the Company is required to use observable market inputs (Level 1 - quoted market prices) when measuring fair value. | |||||||||||||
Cash and Cash Equivalents | ' | ||||||||||||
Cash and Cash Equivalents. Acacia considers all highly liquid, short-term investments with original maturities of three months or less when purchased to be cash equivalents. For the periods presented, Acacia’s cash equivalents are comprised of investments in AAA rated money market funds that invest in first-tier only securities, which primarily includes: domestic commercial paper, securities issued or guaranteed by the U.S. government or its agencies, U.S. bank obligations, and fully collateralized repurchase agreements. Acacia’s cash equivalents are measured at fair value using quoted prices that represent Level 1 inputs. | |||||||||||||
Marketable Securities | ' | ||||||||||||
Investments in Marketable Securities. Investments in securities with original maturities of greater than three months and less than one year and other investments representing amounts that are available for current operations are classified as short-term investments, unless there are indications that such investments may not be readily sold in the short term. The fair values of these investments approximate their carrying values. At December 31, 2013 and 2012, all of Acacia’s investments were classified as available-for-sale, which are reported at fair value on a recurring basis using significant observable inputs (Level 1) whenever possible, with related unrealized gains and losses in the value of such securities recorded as a separate component of other comprehensive income (loss) in stockholders’ equity until realized. Realized and unrealized gains and losses are recorded based on the specific identification method. Interest on all securities is included in interest income. | |||||||||||||
Impairment of Marketable Securities. Acacia evaluates its investments in marketable securities for potential impairment, employing a systematic methodology on a quarterly basis that considers available quantitative and qualitative evidence. If the cost or carrying value of an investment exceeds its estimated fair value, the Company evaluates, among other factors, general market conditions, credit quality of instrument issuers, the duration and extent to which the fair value is less than cost, and the Company’s intent and ability to hold, or plans or ability to sell. Fair value is estimated based on publicly available market information or other estimates determined by management. Investments are considered to be impaired when a decline in fair value is estimated to be other-than-temporary. Acacia reviews impairments associated with its investments in marketable securities and determines the classification of any impairment as temporary or other-than-temporary. An impairment is deemed other-than-temporary unless (a) Acacia has the ability and intent to hold an investment for a period of time sufficient for recovery of its carrying amount and (b) positive evidence indicating that the investment’s carrying amount is recoverable within a reasonable period of time outweighs any evidence to the contrary. All available evidence, both positive and negative, is considered to determine whether, based on the weight of such evidence, the carrying amount of the investment is recoverable within a reasonable period of time. For investments classified as available-for-sale, unrealized losses that are other-than-temporary are recognized in the consolidated statements of operations. | |||||||||||||
Concentrations of Credit Risk | ' | ||||||||||||
Concentration of Credit Risks. Financial instruments that potentially subject Acacia to concentrations of credit risk are cash equivalents, investments and accounts receivable. Acacia places its cash equivalents and investments primarily in highly rated money market funds and investment grade marketable securities. Cash equivalents are also invested in deposits with certain financial institutions and may, at times, exceed federally insured limits. Acacia has not experienced any significant losses on its deposits of cash and cash equivalents. | |||||||||||||
Two licensees individually accounted for 38% and 16%, respectively, of revenues recognized during the year ended December 31, 2013. Four licensees individually accounted for 21%, 14%, 10% and 10%, respectively, of revenues recognized during the year ended December 31, 2012. Three licensees individually accounted for 26%, 17% and 15%, respectively, of revenues recognized during the year ended December 31, 2011. Two licensees individually represented approximately 60% and 22%, respectively, of accounts receivable at December 31, 2013. Three licensees individually represented approximately 34%, 30% and 25% of accounts receivable at December 31, 2012. For 2013, 2012 and 2011, 24%, 43% and 49%, respectively, of revenues were attributable to licensees domiciled in foreign jurisdictions, based on the jurisdiction of the entity obligated to satisfy payment obligations pursuant to the applicable revenue arrangement. The Company does not have any material foreign operations. | |||||||||||||
Acacia performs credit evaluations of its licensees with significant receivable balances, if any, and has not experienced any significant credit losses. Accounts receivable are recorded at the executed contract amount and generally do not bear interest. Collateral is not required. An allowance for doubtful accounts may be established to reflect the Company’s best estimate of probable losses inherent in the accounts receivable balance, and is reflected as a contra-asset account on the balance sheet and a charge to operating expenses in the statement of operations for the applicable period. The allowance is determined based on known troubled accounts, historical experience, and other currently available evidence. There was no allowance for doubtful accounts established for the periods presented. | |||||||||||||
Property and Equipment | ' | ||||||||||||
Property and Equipment. Property and equipment are recorded at cost. Major additions and improvements that materially extend useful lives of property and equipment are capitalized. Maintenance and repairs are charged against the results of operations as incurred. When these assets are sold or otherwise disposed of, the asset and related depreciation are relieved, and any gain or loss is included in the consolidated statements of operations for the period of sale or disposal. Depreciation and amortization is computed on a straight-line basis over the following estimated useful lives of the assets: | |||||||||||||
Furniture and fixtures | 3 to 5 years | ||||||||||||
Computer hardware and software | 3 to 5 years | ||||||||||||
Leasehold improvements | 2 to 5 years (Lesser of lease term or useful life of improvement) | ||||||||||||
Rental payments on operating leases are charged to expense in the consolidated statements of operations on a straight-line basis over the lease term. | |||||||||||||
Organization Costs | ' | ||||||||||||
Organization Costs. Costs of start-up activities, including organization costs, are expensed as incurred. | |||||||||||||
Patents | ' | ||||||||||||
Patents. Patents includes the cost of patents or patent rights (hereinafter, collectively “patents”), acquired from third-parties or acquired in connection with business combinations. Patent acquisition costs are amortized utilizing the straight-line method over their remaining economic useful lives, ranging from one to ten years. Certain patent application and prosecution costs incurred to secure additional patent claims, that based on management’s estimates are deemed to be recoverable, are capitalized and amortized over the remaining estimated economic useful life of the related patent portfolio. | |||||||||||||
Goodwill | ' | ||||||||||||
Goodwill. Goodwill is tested for impairment at the reporting unit level (operating segment or one level below an operating segment) on an annual basis (December 31 for Acacia) and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. Acacia considers its market capitalization and the carrying value of its assets and liabilities, including goodwill, when performing its goodwill impairment test. When conducting its annual goodwill impairment assessment, the Company initially performs a qualitative evaluation of whether it is more likely than not that goodwill is impaired. If it is determined by a qualitative evaluation that it is more likely than not that goodwill is impaired, the Company then applies a two-step impairment test. The two-step impairment test first compares the fair value of the Company’s reporting unit to its carrying or book value. If the fair value of the reporting unit exceeds its carrying value, goodwill is not impaired and the Company is not required to perform further testing. If the carrying value of the reporting unit exceeds its fair value, the Company determines the implied fair value of the reporting unit’s goodwill and if the carrying value of the reporting unit’s goodwill exceeds its implied fair value, then an impairment loss equal to the difference is recorded in the consolidated statement of operations. | |||||||||||||
Impairment of Long-Lived Assets | ' | ||||||||||||
Impairment of Long-lived Assets. Acacia reviews long-lived assets and intangible assets for potential impairment annually (quarterly for patents) and when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. In the event the sum of the expected undiscounted future cash flows resulting from the use of the asset is less than the carrying amount of the asset, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. If an asset is determined to be impaired, the loss is measured based on quoted market prices in active markets, if available. If quoted market prices are not available, the estimate of fair value is based on various valuation techniques, including a discounted value of estimated future cash flows. | |||||||||||||
Fair value is generally estimated using the “Income Approach,” focusing on the estimated future net income-producing capability of the patent portfolios over the estimated remaining economic useful life. Estimates of future after-tax cash flows are converted to present value through “discounting,” including an estimated rate of return that accounts for both the time value of money and investment risk factors. Estimated cash inflows are typically based on estimates of reasonable royalty rates for the applicable technology, applied to estimated market share data. Estimated cash outflows are based on existing contractual obligations, such as contingent legal fee and inventor royalty obligations, applied to estimated license fee revenues, in addition to other estimates of out-of-pocket expenses associated with a specific patent portfolio’s licensing and enforcement program. The analysis also contemplates consideration of current information about the patent portfolio including, status and stage of litigation, periodic results of the litigation process, strength of the patent portfolio, technology coverage and other pertinent information that could impact future net cash flows. | |||||||||||||
Fair Value of Financial Instruments | ' | ||||||||||||
Fair Value of Financial Instruments. The carrying value of cash and cash equivalents, investments, accounts receivables, accounts payable and accrued expenses approximates their fair values due to their short-term maturities. | |||||||||||||
Contingent liabilities [Policy Text Block] | ' | ||||||||||||
Contingent Liabilities. The Company, from time to time, is involved in certain legal proceedings. Based upon consultation with outside counsel handling its defense in these matters and the Company’s analysis of potential outcomes, if the Company determines that a loss arising from such matters is probable and can be reasonably estimated, an estimate of the contingent liability is recorded in its consolidated financial statements. If only a range of estimated loss can be determined, an amount within the range that, based on estimates, assumptions and judgments, reflects the most likely outcome, is recorded as a contingent liability in the consolidated financial statements. In situations where none of the estimates within the estimated range is a better estimate of probable loss than any other amount, the Company records the low end of the range. Any such accrual would be charged to expense in the appropriate period. Litigation expenses for these types of contingencies are recognized in the period in which the litigation services were provided. | |||||||||||||
Stock-based Compensation | ' | ||||||||||||
Stock-Based Compensation. The compensation cost for all stock-based awards is measured at the grant date, based on the fair value of the award, and is recognized as an expense, on a straight-line basis, over the employee’s requisite service period (generally the vesting period of the equity award) which is generally two to four years. The fair value of restricted stock and restricted stock unit awards is determined by the product of the number of shares or units granted and the grant date market price of the underlying common stock. The fair value of each option award is estimated on the date of grant using a Black-Scholes option valuation model. Stock-based compensation expense is recorded only for those awards expected to vest using an estimated forfeiture rate. Refer to Note 11 to these notes to consolidated financial statements for information on stock-based awards granted for the periods presented. | |||||||||||||
Income Taxes | ' | ||||||||||||
Income Taxes. Income taxes are accounted for using an asset and liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in Acacia’s consolidated financial statements or consolidated tax returns. A valuation allowance is established to reduce deferred tax assets if all, or some portion, of such assets will more than likely not be realized. | |||||||||||||
Under U.S. generally accepted accounting principles, a tax position is a position in a previously filed tax return or a position expected to be taken in a future tax filing that is reflected in measuring current or deferred income tax assets and liabilities. Tax positions are recognized only when it is more likely than not (likelihood of greater than 50%), based on technical merits, that the position will be sustained upon examination. Tax positions that meet the more likely than not threshold are measured using a probability weighted approach as the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement. | |||||||||||||
Acacia recognizes interest and penalties with respect to unrecognized tax benefits in income tax expense. Acacia has identified no uncertain tax position for which it is reasonably possible that the total amount of unrecognized tax benefits will significantly increase or decrease within 12 months. | |||||||||||||
If a deduction reported on a tax return for an equity-based incentive award exceeds the cumulative compensation cost for those instruments recognized for financial reporting purposes, any resulting realized tax benefit that exceeds the previously calculated deferred tax asset for those instruments is considered an excess tax benefit, and is recognized as additional paid-in capital. If the tax deduction is less than the cumulative book compensation cost, the tax effect of the resulting difference is charged first to APIC, to the extent of the available pool of windfall tax benefits, with any remainder recognized in income tax expense. | |||||||||||||
Comprehensive Income, Policy [Policy Text Block] | ' | ||||||||||||
Comprehensive Income (Loss). Comprehensive income (loss) is the change in equity from transactions and other events and circumstances other than those resulting from investments by owners and distributions to owners. | |||||||||||||
Segment Reporting | ' | ||||||||||||
Segment Reporting. Acacia uses the management approach, which designates the internal organization that is used by management for making operating decisions and assessing performance as the basis of Acacia’s reportable segments. Acacia’s patent licensing and enforcement business constitutes its single reportable segment. | |||||||||||||
Use of Estimates | ' | ||||||||||||
Use of Estimates. The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Acacia believes that, of the significant accounting policies described herein, the accounting policies associated with revenue recognition, stock-based compensation expense, impairment of marketable securities and intangible assets, the determination of the economic useful life of amortizable intangible assets, income taxes and valuation allowances against net deferred tax assets and the application of the acquisition method of accounting for business combinations, require its most difficult, subjective or complex judgments. | |||||||||||||
Earnings Per Share | ' | ||||||||||||
Earnings (Loss) Per Share. The Company computes net income (loss) attributable to common stockholders using the two-class method required for capital structures that include participating securities. Under the two-class method, securities that participate in non-forfeitable dividends, such as the Company’s outstanding unvested restricted stock, are considered “participating securities.” | |||||||||||||
In applying the two-class method, (i) basic net income (loss) per share is computed by dividing net income (loss) (less any dividends paid on participating securities) by the weighted average number of shares of common stock and participating securities outstanding for the period and (ii) diluted earnings per share may include the additional effect of other securities, if dilutive, in which case the dilutive effect of such securities is calculated by applying the two-class method and the treasury stock method to the assumed exercise or vesting of potentially dilutive common shares. The method yielding the more dilutive result is ultimately reported for the applicable period. Potentially dilutive common stock equivalents primarily consist of employee stock options, and restricted stock units for calculations utilizing the two-class method, and also include unvested restricted stock, when utilizing the treasury method. | |||||||||||||
The following table presents the weighted-average number of common shares outstanding used in the calculation of basic and diluted income per share: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Numerator (in thousands): | |||||||||||||
Basic | |||||||||||||
Net income (loss) | $ | (56,434 | ) | $ | 59,453 | $ | 21,106 | ||||||
Undistributed earnings allocated to participating securities | — | (1,889 | ) | (841 | ) | ||||||||
Total dividends paid | (18,633 | ) | — | — | |||||||||
Dividends attributable to common stockholders | 18,122 | — | — | ||||||||||
Net income (loss) attributable to common stockholders – basic | $ | (56,945 | ) | $ | 57,564 | $ | 20,265 | ||||||
Diluted | |||||||||||||
Net income (loss) | $ | (56,434 | ) | $ | 59,453 | $ | 21,106 | ||||||
Undistributed earnings allocated to participating securities | — | (1,876 | ) | (833 | ) | ||||||||
Total dividends paid | (18,633 | ) | — | — | |||||||||
Dividends attributable to common stockholders | 18,122 | — | — | ||||||||||
Net income (loss) attributable to common stockholders – diluted | $ | (56,945 | ) | $ | 57,577 | $ | 20,273 | ||||||
Denominator: | |||||||||||||
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders – basic | 48,155,832 | 47,251,061 | 39,743,433 | ||||||||||
Effect of potentially dilutive securities: | |||||||||||||
Common stock options and restricted stock units | — | 333,059 | 407,167 | ||||||||||
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders – diluted | 48,155,832 | 47,584,120 | 40,150,600 | ||||||||||
Basic net income (loss) per common share | $ | (1.18 | ) | $ | 1.22 | $ | 0.51 | ||||||
Diluted net income (loss) per common share | $ | (1.18 | ) | $ | 1.21 | $ | 0.5 | ||||||
Anti-dilutive equity-based incentive awards excluded from the computation of diluted income (loss) per share | 27,760 | 30,812 | 7,760 | ||||||||||
Revision of Prior Period Earnings (Loss) Per Share - Two-Class Method. In connection with the preparation of the Company’s Quarterly Report on Form 10-Q as of and for the three and nine months ended September 30, 2013, the Company determined that its basic and diluted net income (loss) per share calculations should have been prepared using the “two-class method.” Pursuant to guidance set forth in Staff Accounting Bulletin (“SAB”) No. 99, “Materiality,” the Company concluded that the errors were not material to any of its prior period financial statements. Although the errors were immaterial to prior periods, the prior period financial statements presented herein were revised, in accordance with SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements.” The impact of the revision for the comparable prior period earnings (loss) per share calculations using the two-class method were as follows: | |||||||||||||
2012 | 2011 | ||||||||||||
Numerator: | |||||||||||||
Net income attributable to common stockholders – basic and diluted - As Reported | $ | 59,453 | $ | 21,106 | |||||||||
Net income attributable to common stockholders – basic - As Adjusted | $ | 57,564 | $ | 20,265 | |||||||||
Net income attributable to common stockholders – diluted - As Adjusted | $ | 57,577 | $ | 20,273 | |||||||||
Denominator: | |||||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – basic - As Reported | 47,251,061 | 39,743,433 | |||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – basic - As Adjusted | 47,251,061 | 39,743,433 | |||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – diluted - As Reported | 48,060,647 | 41,258,297 | |||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – diluted - As Adjusted | 47,584,120 | 40,150,600 | |||||||||||
Basic net income per common share - As Reported | $ | 1.26 | $ | 0.53 | |||||||||
Basic net income per common share - As Adjusted | $ | 1.22 | $ | 0.51 | |||||||||
Diluted net income per common share - As Reported | $ | 1.24 | $ | 0.51 | |||||||||
Diluted net income per common share - As Adjusted | $ | 1.21 | $ | 0.5 | |||||||||
Recently Adopted Accounting Policies | ' | ||||||||||||
Recently Adopted Accounting Pronouncements - Adopted Effective January 1, 2013. In February 2013, the Financial Accounting Standards Board (“FASB”) issued a new accounting standard requiring an entity to report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required under U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) to be reclassified in its entirety to net income. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures required under U.S. GAAP that provide additional detail about those amounts. This pronouncement is effective prospectively for reporting periods beginning after December 15, 2012. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures. | |||||||||||||
In December 2012, the FASB issued a new accounting standard that will require the Company to disclose information about offsetting and related arrangements to enable users of its financial statements to understand the effect of those arrangements on its financial position. The new guidance is effective for the Company’s interim period ending March 31, 2013. The disclosures required are to be applied retrospectively for all comparative periods presented. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures. | |||||||||||||
In July 2013, the FASB issued an accounting update which provides guidance on financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward or a tax credit carryforward exists in the same taxing jurisdiction. Per this guidance, an entity must present the unrecognized tax benefit as a reduction to a deferred tax asset, except when the carryforward is not available as of the reporting date under the governing tax law to settle taxes or the entity does not intend to use the deferred tax asset for this purpose. This amendment does not impact the recognition or measurement of uncertain tax positions or the disclosure reconciliation of gross unrecognized tax benefits. The new accounting standards update becomes effective for the Company on January 1, 2014 and it should be applied prospectively to unrecognized tax benefits that exist at the effective date with retrospective application permitted. Early adoption of the update is permitted and an entity may choose to apply this amendment retrospectively to each reporting period presented. The adoption of this accounting update did not have a material impact on the Company’s consolidated financial statements. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Property and Equipment, Useful Lives | ' | ||||||||||||
Depreciation and amortization is computed on a straight-line basis over the following estimated useful lives of the assets: | |||||||||||||
Furniture and fixtures | 3 to 5 years | ||||||||||||
Computer hardware and software | 3 to 5 years | ||||||||||||
Leasehold improvements | 2 to 5 years (Lesser of lease term or useful life of improvement) | ||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | ' | ||||||||||||
The following table presents the weighted-average number of common shares outstanding used in the calculation of basic and diluted income per share: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Numerator (in thousands): | |||||||||||||
Basic | |||||||||||||
Net income (loss) | $ | (56,434 | ) | $ | 59,453 | $ | 21,106 | ||||||
Undistributed earnings allocated to participating securities | — | (1,889 | ) | (841 | ) | ||||||||
Total dividends paid | (18,633 | ) | — | — | |||||||||
Dividends attributable to common stockholders | 18,122 | — | — | ||||||||||
Net income (loss) attributable to common stockholders – basic | $ | (56,945 | ) | $ | 57,564 | $ | 20,265 | ||||||
Diluted | |||||||||||||
Net income (loss) | $ | (56,434 | ) | $ | 59,453 | $ | 21,106 | ||||||
Undistributed earnings allocated to participating securities | — | (1,876 | ) | (833 | ) | ||||||||
Total dividends paid | (18,633 | ) | — | — | |||||||||
Dividends attributable to common stockholders | 18,122 | — | — | ||||||||||
Net income (loss) attributable to common stockholders – diluted | $ | (56,945 | ) | $ | 57,577 | $ | 20,273 | ||||||
Denominator: | |||||||||||||
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders – basic | 48,155,832 | 47,251,061 | 39,743,433 | ||||||||||
Effect of potentially dilutive securities: | |||||||||||||
Common stock options and restricted stock units | — | 333,059 | 407,167 | ||||||||||
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders – diluted | 48,155,832 | 47,584,120 | 40,150,600 | ||||||||||
Basic net income (loss) per common share | $ | (1.18 | ) | $ | 1.22 | $ | 0.51 | ||||||
Diluted net income (loss) per common share | $ | (1.18 | ) | $ | 1.21 | $ | 0.5 | ||||||
Anti-dilutive equity-based incentive awards excluded from the computation of diluted income (loss) per share | 27,760 | 30,812 | 7,760 | ||||||||||
Impact of the Revision to the Comparable Prior Period Earnings (Loss) Per Share Calculations Using the Two-Class Method [Table Text Block] | ' | ||||||||||||
The impact of the revision for the comparable prior period earnings (loss) per share calculations using the two-class method were as follows: | |||||||||||||
2012 | 2011 | ||||||||||||
Numerator: | |||||||||||||
Net income attributable to common stockholders – basic and diluted - As Reported | $ | 59,453 | $ | 21,106 | |||||||||
Net income attributable to common stockholders – basic - As Adjusted | $ | 57,564 | $ | 20,265 | |||||||||
Net income attributable to common stockholders – diluted - As Adjusted | $ | 57,577 | $ | 20,273 | |||||||||
Denominator: | |||||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – basic - As Reported | 47,251,061 | 39,743,433 | |||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – basic - As Adjusted | 47,251,061 | 39,743,433 | |||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – diluted - As Reported | 48,060,647 | 41,258,297 | |||||||||||
Weighted-average shares used in computing net income per share attributable to common stockholders – diluted - As Adjusted | 47,584,120 | 40,150,600 | |||||||||||
Basic net income per common share - As Reported | $ | 1.26 | $ | 0.53 | |||||||||
Basic net income per common share - As Adjusted | $ | 1.22 | $ | 0.51 | |||||||||
Diluted net income per common share - As Reported | $ | 1.24 | $ | 0.51 | |||||||||
Diluted net income per common share - As Adjusted | $ | 1.21 | $ | 0.5 | |||||||||
Shortterm_Investments_Tables
Short-term Investments (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Short-term Investments [Abstract] | ' | |||||||||||||||
Short-term Investments | ' | |||||||||||||||
Short-term marketable securities for the periods presented were comprised of the following (in thousands): | ||||||||||||||||
December 31, 2013 | ||||||||||||||||
Security Type | Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
U.S. government fixed income securities | $ | 130,971 | $ | 21 | $ | (975 | ) | $ | 130,017 | |||||||
Total short-term investments | $ | 130,971 | $ | 21 | $ | (975 | ) | $ | 130,017 | |||||||
December 31, 2012 | ||||||||||||||||
Security Type | Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||
U.S. government fixed income securities | $ | 87,394 | $ | 20 | $ | (411 | ) | $ | 87,003 | |||||||
Equity securities of certain technology companies | 3,254 | — | (782 | ) | 2,472 | |||||||||||
Total short-term investments | $ | 90,648 | $ | 20 | $ | (1,193 | ) | $ | 89,475 | |||||||
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | ' | ||||||||
Property and Equipment | ' | ||||||||
Property and equipment consists of the following at December 31, 2013 and 2012 (in thousands): | |||||||||
2013 | 2012 | ||||||||
Furniture and fixtures | $ | 783 | $ | 472 | |||||
Computer hardware and software | 687 | 586 | |||||||
Leasehold improvements | 306 | 173 | |||||||
1,776 | 1,231 | ||||||||
Less: accumulated depreciation and amortization | (1,010 | ) | (892 | ) | |||||
$ | 766 | $ | 339 | ||||||
Accounts_Payable_and_Accrued_E1
Accounts Payable and Accrued Expenses (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Accounts Payable and Accrued Liabilities, Current [Abstract] | ' | ||||||||
Accounts Payable and Accrued Expenses / Costs | ' | ||||||||
Accounts payable and accrued expenses consist of the following at December 31, 2013 and 2012 (in thousands): | |||||||||
2013 | 2012 | ||||||||
Accounts payable | $ | 128 | $ | 642 | |||||
Payroll and other employee benefits | 1,039 | 1,815 | |||||||
Accrued vacation | 813 | 703 | |||||||
Accrued legal expenses - patent | 5,900 | 3,990 | |||||||
Accrued consulting and other professional fees | 2,948 | 1,510 | |||||||
Accrued distribution to noncontrolling interests | 504 | 504 | |||||||
Other accrued liabilities | 223 | 71 | |||||||
$ | 11,555 | $ | 9,235 | ||||||
Goodwill_and_Other_Identifiabl1
Goodwill and Other Identifiable Intangible Assets (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Patents [Abstract] | ' | ||||||||||||
Patent costs and accumulated amortization related to patent sales and disposals [Table Text Block] | ' | ||||||||||||
For the years ended December 31, 2013, 2012 and 2011, capitalized patent costs and accumulated amortization, and sales proceeds and other costs, related to patent-related sales and disposals are as follows (in thousands): | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Capitalized patent costs | $ | 3,500 | $ | 5,500 | $ | 4,612 | |||||||
Accumulated amortization | 1,753 | 2,466 | 3,509 | ||||||||||
Sales proceeds | 1,000 | 2,792 | 11,000 | ||||||||||
Other costs | — | — | 4,717 | ||||||||||
Patents | ' | ||||||||||||
The gross carrying amounts and accumulated amortization related to acquired intangible assets as of December 31, 2013 and 2012 are as follows (in thousands): | |||||||||||||
2013 | 2012 | ||||||||||||
Gross carrying amount - patents | $ | 400,755 | $ | 383,379 | |||||||||
Accumulated amortization - patents | (112,323 | ) | (69,850 | ) | |||||||||
Patents, net | $ | 288,432 | $ | 313,529 | |||||||||
Acquisition_Tables
Acquisition (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Business Combinations [Abstract] | ' | ||||||||||||
Schedule of Purchase Price Allocation | ' | ||||||||||||
The total consideration paid by ARG in connection with the Merger was approximately $160 million, in cash. Based on the total purchase consideration and the estimate of the assets acquired and the liabilities assumed by ARG as of the Acquisition Date, the purchase price allocation was as follows ($ amounts in thousands): | |||||||||||||
Amortization Period | Annual Amortization | ||||||||||||
Assets Acquired and Liabilities Assumed: | |||||||||||||
Fair value of net tangible assets acquired | $ | 10,000 | |||||||||||
Intangible assets acquired - patents | 150,000 | 10 years | $ | 15,000 | |||||||||
Goodwill | 30,149 | ||||||||||||
Net deferred income tax liability | (30,149 | ) | |||||||||||
Total | $ | 160,000 | |||||||||||
Deferred Tax Liability, Acquisition | ' | ||||||||||||
The estimated net deferred tax liability was determined as follows ($ amounts in thousands): | |||||||||||||
Book Basis | Tax Basis | Difference | |||||||||||
Intangible assets acquired - patents | $ | 150,000 | $ | — | $ | (150,000 | ) | ||||||
Estimated acquired deferred tax assets (including net operating loss carryforwards) - ADAPTIX | — | 63,860 | 63,860 | ||||||||||
Net deferred tax liability - pretax | (86,140 | ) | |||||||||||
Estimated tax rate | 35 | % | |||||||||||
Estimated net deferred tax liability | $ | (30,149 | ) | ||||||||||
Business Acquisition, Pro Forma Information | ' | ||||||||||||
The unaudited pro forma combined results are presented in thousands, except share and per share information. | |||||||||||||
2012 | 2011 | ||||||||||||
Revenues | $ | 250,727 | $ | 172,256 | |||||||||
Total operating costs and expenses | 170,953 | 159,674 | |||||||||||
Operating income | 79,774 | 12,582 | |||||||||||
Interest and investment income | 937 | 96 | |||||||||||
Income from operations before provision for income taxes | 80,711 | 12,678 | |||||||||||
Provision for income taxes | (22,060 | ) | (8,708 | ) | |||||||||
Net income including noncontrolling interests in operating subsidiaries | 58,651 | 3,970 | |||||||||||
Net loss (income) attributable to noncontrolling interests in operating subsidiaries | 164 | (539 | ) | ||||||||||
Net income attributable to Acacia Research Corporation | $ | 58,815 | $ | 3,431 | |||||||||
2012 | 2011 | ||||||||||||
Pro forma income per common share attributable to Acacia Research Corporation: | |||||||||||||
Basic earnings per share | $ | 1.24 | $ | 0.09 | |||||||||
Diluted earnings per share | $ | 1.22 | $ | 0.08 | |||||||||
Weighted average number of shares outstanding, basic | 47,251,061 | 39,743,433 | |||||||||||
Weighted average number of shares outstanding, diluted | 48,060,647 | 41,258,297 | |||||||||||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Stockholders' Equity Note [Abstract] | ' | |||||||||
Schedule of Treasury Stock by Class | ' | |||||||||
Following are our monthly stock repurchases for the periods presented, all of which were purchased as part of publicly announced plans or programs: | ||||||||||
Total Number of Shares Purchased | Average Price paid per Share | Approximate Dollar Value of | Plan Expiration | |||||||
Shares that May Yet be | ||||||||||
Purchased under the Program | ||||||||||
November 16, 2012 - November 30, 2012 | 256,262 | $ | 21.58 | $ | — | 15-Aug-13 | ||||
December 1, 2012 - December 31, 2012 | 873,146 | $ | 24.26 | $ | — | 15-Aug-13 | ||||
Totals for 2012 | 1,129,408 | $ | 23.65 | |||||||
December 4, 2013 - December 11, 2013 | 600,000 | $ | 13.18 | $ | 62,074,000 | 14-May-14 | ||||
Totals for 2013 | 600,000 | |||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||||||
Schedule of Components of Income Tax Expense (Benefit) | ' | ||||||||||||
Acacia’s provision for income taxes consists of the following (in thousands): | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Current: | |||||||||||||
Federal | $ | — | $ | — | $ | 179 | |||||||
State taxes | 113 | 281 | 943 | ||||||||||
Foreign taxes | 4,405 | 11,890 | 7,586 | ||||||||||
Total current | 4,518 | 12,171 | 8,708 | ||||||||||
Deferred: | |||||||||||||
Federal | (26,151 | ) | 10,085 | — | |||||||||
State taxes | (325 | ) | (196 | ) | — | ||||||||
Total deferred | (26,476 | ) | 9,889 | — | |||||||||
Provision for income taxes | $ | (21,958 | ) | $ | 22,060 | $ | 8,708 | ||||||
Schedule of Deferred Tax Assets and Liabilities | ' | ||||||||||||
The tax effects of temporary differences and carryforwards that give rise to significant portions of deferred tax assets and liabilities consist of the following at December 31, 2013 and 2012 (in thousands): | |||||||||||||
2013 | 2012 | ||||||||||||
Deferred tax assets: | |||||||||||||
Net operating loss and capital loss carryforwards and credits | $ | 34,679 | $ | 15,668 | |||||||||
Stock compensation | 3,052 | 1,140 | |||||||||||
Basis of investments in affiliates | 867 | 415 | |||||||||||
Accrued liabilities and other | 387 | 250 | |||||||||||
Unrealized loss on short-term investments | 337 | 415 | |||||||||||
State taxes | 18 | 212 | |||||||||||
Total deferred tax assets | 39,340 | 18,100 | |||||||||||
Deferred tax liabilities: | |||||||||||||
Fixed assets and intangibles | (33,378 | ) | (39,457 | ) | |||||||||
Other | (112 | ) | (60 | ) | |||||||||
Net deferred tax liabilities | 5,850 | (21,417 | ) | ||||||||||
Less: valuation allowance | (7,585 | ) | (5,396 | ) | |||||||||
Net deferred taxes | $ | (1,735 | ) | $ | (26,813 | ) | |||||||
Schedule of Effective Income Tax Rate Reconciliation | ' | ||||||||||||
A reconciliation of the federal statutory income tax rate and the effective income tax rate is as follows: | |||||||||||||
2013 | 2012 | 2011 | |||||||||||
Statutory federal tax rate - (benefit) expense | (35 | )% | 35 | % | 35 | % | |||||||
State income and foreign taxes, net of federal tax effect | 5 | % | 15 | % | 27 | % | |||||||
Foreign tax credit | (6 | )% | (15 | )% | (25 | )% | |||||||
Noncontrolling interests in operating subsidiaries | 1 | % | — | % | (1 | )% | |||||||
Nondeductible permanent items | 2 | % | 5 | % | 4 | % | |||||||
Expired net operating loss carryforwards | 2 | % | — | % | 1 | % | |||||||
Valuation allowance | 4 | % | (13 | )% | (12 | )% | |||||||
(27 | )% | 27 | % | 29 | % | ||||||||
Summary of Positions for which Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Table Text Block] | ' | ||||||||||||
ctivity related to the gross unrecognized tax benefits for the year ended December 31, 2013 was as follows (in thousands): | |||||||||||||
Balance at January 1, 2012 | $ | 85 | |||||||||||
Additions based on tax positions related to the current year | — | ||||||||||||
Additions for tax positions related to prior years | 772 | ||||||||||||
Additions resulting from the acquisition of ADAPTIX | 1,270 | ||||||||||||
Reductions | — | ||||||||||||
Balance at December 31, 2012 | 2,127 | ||||||||||||
Reductions | — | ||||||||||||
Balance at December 31, 2013 | $ | 2,127 | |||||||||||
Summary of Valuation Allowance [Table Text Block] | ' | ||||||||||||
At December 31, 2013 and 2012, the Company has recorded valuation allowances for certain tax attribute carryforwards and other deferred tax assets due to uncertainty regarding future realizability, as follows: | |||||||||||||
December 31, | |||||||||||||
2013 | 2012 | ||||||||||||
Capital loss carryforwards | $ | 1,562 | $ | 2,935 | |||||||||
Net operating loss carryforwards | 1,281 | 2,046 | |||||||||||
Foreign tax credits | 4,405 | — | |||||||||||
Unrealized losses on short-term investments and other deferred tax assets | 337 | 415 | |||||||||||
Total valuation allowance | $ | 7,585 | $ | 5,396 | |||||||||
StockBased_Incentive_Plans_Tab
Stock-Based Incentive Plans (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Share-based Compensation [Abstract] | ' | |||||||||||||
Stock Options Activity | ' | |||||||||||||
The following table summarizes stock option activity for the Plans for the year ended December 31, 2013: | ||||||||||||||
Weighted-Average | ||||||||||||||
Options | Exercise | Remaining | Aggregate | |||||||||||
Price | Contractual Term | Intrinsic Value | ||||||||||||
Outstanding at December 31, 2012 | 313,000 | $ | 5.87 | |||||||||||
Exercised | (115,000 | ) | $ | 4.22 | ||||||||||
Expired/forfeited | (3,000 | ) | $ | 1.85 | ||||||||||
Outstanding at December 31, 2013 | 195,000 | $ | 6.91 | 1.6 years | $ | 1,485,000 | ||||||||
Vested | 195,000 | $ | 6.91 | 1.6 years | $ | 1,485,000 | ||||||||
Exercisable at December 31, 2013 | 195,000 | $ | 6.91 | 1.6 years | $ | 1,485,000 | ||||||||
Nonvested Restricted Stock Activity | ' | |||||||||||||
The following table summarizes nonvested restricted share activity for the year ended December 31, 2013: | ||||||||||||||
Nonvested | Weighted | |||||||||||||
Restricted Shares | Average Grant Date Fair Value | |||||||||||||
Nonvested restricted stock at December 31, 2012 | 1,353,000 | $ | 30.17 | |||||||||||
Granted | 823,000 | $ | 24.31 | |||||||||||
Vested | (813,000 | ) | $ | 27.45 | ||||||||||
Canceled | (126,000 | ) | $ | 28.48 | ||||||||||
Nonvested restricted stock at December 31, 2013 | 1,237,000 | $ | 28.23 | |||||||||||
Restricted Stock Units Activity | ' | |||||||||||||
The following table summarizes restricted stock unit activity for the year ended December 31, 2013: | ||||||||||||||
Restricted | Weighted | |||||||||||||
Stock Units | Average Grant Date Fair Value | |||||||||||||
Nonvested restricted stock units outstanding at December 31, 2012 | 38,000 | $ | 26.98 | |||||||||||
Granted | — | $ | — | |||||||||||
Vested | (18,000 | ) | $ | 26.05 | ||||||||||
Nonvested restricted stock units outstanding at December 31, 2013 | 20,000 | $ | 27.83 | |||||||||||
Vested restricted stock units outstanding at December 31, 2013 | 94,000 | $ | 13.05 | |||||||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Commitments and Contingencies Disclosure [Abstract] | ' | ||||||||
Net assets of IP Fund [Table Text Block] | ' | ||||||||
At December 31, 2013 and 2012, the Acacia IP Fund net assets were primarily comprised of the following (in thousands): | |||||||||
31-Dec-13 | 31-Dec-12 | ||||||||
Cash and other assets | $ | 2,927 | $ | 2,542 | |||||
Patents, net of accumulated amortization | 1,373 | 7,144 | |||||||
Investments - noncurrent | 11,120 | 11,617 | |||||||
Total assets | $ | 15,420 | $ | 21,303 | |||||
Accrued expenses and contributions | $ | 2,437 | $ | 5,016 | |||||
Accrued patent acquisition costs | — | 500 | |||||||
Total liabilities | 2,437 | 5,516 | |||||||
Net assets | $ | 12,983 | $ | 15,787 | |||||
Schedule of Future Minimum Rental Payments for Operating Leases | ' | ||||||||
Minimum annual rental commitments for operating leases of continuing operations having initial or remaining noncancellable lease terms in excess of one year are as follows (in thousands): | |||||||||
Year | |||||||||
2014 | $ | 1,442 | |||||||
2015 | 1,553 | ||||||||
2016 | 918 | ||||||||
2017 | 318 | ||||||||
2018 | 324 | ||||||||
Thereafter | 498 | ||||||||
Total minimum lease payments | $ | 5,053 | |||||||
Quarterly_Financial_Data_Table
Quarterly Financial Data (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||
Dec. 31, 2012 | |||||||||||||||||||||||||||||||||
QUARTERLY FINANCIAL DATA (unaudited) [Abstract] | ' | ||||||||||||||||||||||||||||||||
Quarterly Financial Data | ' | ||||||||||||||||||||||||||||||||
The following table sets forth unaudited consolidated statements of operations data for the eight quarters in the period ended December 31, 2013. This information has been derived from Acacia’s unaudited condensed consolidated financial statements that have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the information when read in conjunction with the audited consolidated financial statements and related notes thereto. Acacia’s quarterly results have been, and may in the future be, subject to significant fluctuations. As a result, Acacia believes that results of operations for interim periods should not be relied upon as any indication of the results to be expected in any future periods. | |||||||||||||||||||||||||||||||||
Quarter Ended | |||||||||||||||||||||||||||||||||
Mar. 31, | Jun. 30, | Sept. 30, | Dec. 31, | Mar. 31, | Jun. 30, | Sept. 30, | Dec. 31, | ||||||||||||||||||||||||||
2013 | 2013 | 2013 | 2013 | 2012 | 2012 | 2012 | 2012 | ||||||||||||||||||||||||||
(Unaudited, in thousands, except share and per share information) | |||||||||||||||||||||||||||||||||
Revenues | $ | 76,861 | $ | 23,110 | $ | 15,520 | $ | 15,065 | $ | 99,040 | $ | 50,484 | $ | 34,939 | $ | 66,264 | |||||||||||||||||
Operating costs and expenses: | |||||||||||||||||||||||||||||||||
Cost of revenues: | |||||||||||||||||||||||||||||||||
Inventor royalties | 18,481 | 5,610 | 2,353 | 3,280 | 7,594 | 9,573 | 5,032 | 3,829 | |||||||||||||||||||||||||
Contingent legal fees | 15,032 | 4,024 | 2,547 | 3,181 | 3,748 | 6,607 | 8,833 | 5,463 | |||||||||||||||||||||||||
Litigation and licensing expenses - patents | 9,648 | 9,918 | 10,870 | 8,899 | 3,381 | 5,268 | 5,973 | 6,969 | |||||||||||||||||||||||||
Amortization of patents | 11,730 | 12,578 | 12,615 | 16,735 | 5,126 | 5,393 | 10,412 | 18,088 | |||||||||||||||||||||||||
Marketing, general and administrative expenses (including non-cash stock compensation expense) | 13,844 | 13,175 | 18,222 | 13,988 | 13,731 | 11,903 | 11,914 | 16,535 | |||||||||||||||||||||||||
Research, consulting and other expenses - business development | 1,031 | 735 | 743 | 742 | 1,116 | 1,967 | 1,139 | 721 | |||||||||||||||||||||||||
Other | — | — | 3,506 | — | — | — | — | — | |||||||||||||||||||||||||
Total operating costs and expenses | 69,766 | 46,040 | 50,856 | 46,825 | 34,696 | 40,711 | 43,303 | 51,605 | |||||||||||||||||||||||||
Operating income (loss) | 7,095 | (22,930 | ) | (35,336 | ) | (31,760 | ) | 64,344 | 9,773 | (8,364 | ) | 14,659 | |||||||||||||||||||||
Total other income (expense) | 1,290 | 400 | 280 | 161 | 56 | 102 | (41 | ) | 820 | ||||||||||||||||||||||||
Income (loss) before (provision for) benefit from income taxes | 8,385 | (22,530 | ) | (35,056 | ) | (31,599 | ) | 64,400 | 9,875 | (8,405 | ) | 15,479 | |||||||||||||||||||||
Benefit from (provision for) income taxes | (3,272 | ) | 9,050 | 19,570 | (3,390 | ) | (14,747 | ) | (3,494 | ) | 1,938 | (5,757 | ) | ||||||||||||||||||||
Net income (loss) including noncontrolling interests | 5,113 | (13,480 | ) | (15,486 | ) | (34,989 | ) | 49,653 | 6,381 | (6,467 | ) | 9,722 | |||||||||||||||||||||
Net (income) loss attributable to noncontrolling interests | — | 977 | (225 | ) | 1,656 | 275 | (60 | ) | (152 | ) | 101 | ||||||||||||||||||||||
Net income (loss) attributable to Acacia Research Corporation | $ | 5,113 | $ | (12,503 | ) | $ | (15,711 | ) | $ | (33,333 | ) | $ | 49,928 | $ | 6,321 | $ | (6,619 | ) | $ | 9,823 | |||||||||||||
Net income (loss) per common share attributable to Acacia Research Corporation: | |||||||||||||||||||||||||||||||||
Basic income (loss) per share - As Adjusted(1) | $ | 0.1 | $ | (0.26 | ) | $ | (0.33 | ) | $ | (0.69 | ) | $ | 1.08 | $ | 0.13 | $ | (0.14 | ) | $ | 0.2 | |||||||||||||
Diluted income (loss) per share - As Adjusted(1) | $ | 0.1 | $ | (0.26 | ) | $ | (0.33 | ) | $ | (0.69 | ) | $ | 1.08 | $ | 0.13 | $ | (0.14 | ) | $ | 0.2 | |||||||||||||
Weighted-average number of shares outstanding, basic - As Adjusted(1) | 47,859,774 | 48,008,998 | 48,330,149 | 48,415,684 | 44,367,499 | 47,944,193 | 48,332,878 | 48,335,865 | |||||||||||||||||||||||||
Weighted-average number of shares outstanding, diluted - As Adjusted(1) | 48,104,242 | 48,008,998 | 48,330,149 | 48,415,684 | 44,764,064 | 48,294,782 | 48,332,878 | 48,607,141 | |||||||||||||||||||||||||
Quarter Ended | |||||||||||||||||||||||||||||||||
Mar. 31, | Jun. 30, | Sept. 30, | Dec. 31, | Mar. 31, | Jun. 30, | Sept. 30, | Dec. 31, | ||||||||||||||||||||||||||
2013 | 2013 | 2013 | 2013 | 2012 | 2012 | 2012 | 2012 | ||||||||||||||||||||||||||
(Unaudited, In thousands, except share and per share information) | |||||||||||||||||||||||||||||||||
Basic income (loss) per share - As Reported(1) | $ | 0.11 | $ | (0.26 | ) | N/A | N/A | $ | 1.13 | $ | 0.13 | $ | (0.14 | ) | $ | 0.2 | |||||||||||||||||
Diluted income (loss) per share - As Reported(1) | $ | 0.11 | $ | (0.26 | ) | N/A | N/A | $ | 1.09 | $ | 0.13 | $ | (0.14 | ) | $ | 0.2 | |||||||||||||||||
Weighted-average number of shares outstanding, basic - As Reported(1) | 47,859,774 | 48,008,998 | N/A | N/A | 44,367,499 | 47,944,193 | 48,332,878 | 48,335,865 | |||||||||||||||||||||||||
Weighted-average number of shares outstanding, diluted - As Reported(1) | 48,354,444 | 48,008,998 | N/A | N/A | 45,771,228 | 48,938,766 | 48,332,878 | 48,797,304 | |||||||||||||||||||||||||
_______________________ | |||||||||||||||||||||||||||||||||
(1) - Revision of Prior Period Earnings (Loss) Per Share - Two-Class Method. In connection with the preparation of the Company’s Quarterly Report on Form 10-Q as of and for the three months ended September 30, 2013, the Company determined that its basic and diluted net income (loss) per share calculations should have been prepared using the “two-class method.” Under the two-class method, securities that participate in dividends are considered “participating securities.” The Company’s unvested restricted shares outstanding are considered “participating securities” because they include non-forfeitable rights to dividends. | |||||||||||||||||||||||||||||||||
Pursuant to guidance set forth in Staff Accounting Bulletin (“SAB”) No. 99, “Materiality,” the Company concluded that the errors were not material to any of its prior period financial statements. Although the errors were immaterial to prior periods, the prior period financial statements presented herein were revised, in accordance with SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements.” |
Description_of_Business_Detail
Description of Business (Details) (USD $) | 12 Months Ended | 0 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jan. 12, 2012 |
ADAPTIX, Inc. [Member] | ||||
Description of Business [Line Items] | ' | ' | ' | ' |
Payments to acquire businesses, gross | $0 | $150,000 | $0 | $150,000 |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Details) | 12 Months Ended |
Dec. 31, 2013 | |
Lag time in recognizing revenues from licensee's quarter | '3 months |
Minimum [Member] | ' |
Period after quarter end licensees report activity | '30 days |
Patents, useful life | '1 year |
Maximum [Member] | ' |
Period after quarter end licensees report activity | '45 days |
Patents, useful life | '10 years |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies Concentrations (Details) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Licensee 1 [Member] | Revenue, Rights Granted [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage | 38.00% | 21.00% | 26.00% |
Licensee 1 [Member] | Accounts Receivable [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage | 60.00% | 34.00% | ' |
Licensee 2 [Member] | Revenue, Rights Granted [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage | 16.00% | 14.00% | 17.00% |
Licensee 2 [Member] | Accounts Receivable [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage | 22.00% | 30.00% | ' |
Licensee 3 [Member] | Revenue, Rights Granted [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage | ' | 10.00% | 15.00% |
Licensee 3 [Member] | Accounts Receivable [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage | ' | 25.00% | ' |
Licensee 4 [Member] | Revenue, Rights Granted [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage | ' | 10.00% | ' |
Licensees in foreign jurisdictions [Member] | Revenue, Rights Granted [Member] | ' | ' | ' |
Concentration Risk [Line Items] | ' | ' | ' |
Concentration risk, percentage | 24.00% | 43.00% | 49.00% |
Summary_of_Significant_Account5
Summary of Significant Accounting Policies Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2013 | |
Furniture and Fixtures [Member] | Minimum [Member] | ' |
Property and Equipment [Line Items] | ' |
Estimated useful lives, years | '3 |
Furniture and Fixtures [Member] | Maximum [Member] | ' |
Property and Equipment [Line Items] | ' |
Estimated useful lives, years | '5 |
Computer Hardware and Software [Member] | Minimum [Member] | ' |
Property and Equipment [Line Items] | ' |
Estimated useful lives, years | '3 |
Computer Hardware and Software [Member] | Maximum [Member] | ' |
Property and Equipment [Line Items] | ' |
Estimated useful lives, years | '5 |
Leasehold Improvements [Member] | Minimum [Member] | ' |
Property and Equipment [Line Items] | ' |
Estimated useful lives, years | '2 |
Leasehold Improvements [Member] | Maximum [Member] | ' |
Property and Equipment [Line Items] | ' |
Estimated useful lives, years | '5 |
Summary_of_Significant_Account6
Summary of Significant Accounting Policies Earnings per share (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Accounting Policies [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Income (Loss) Attributable to Acacia Research Corporation | ($33,333) | ($15,711) | ($12,503) | $5,113 | $9,823 | ($6,619) | $6,321 | $49,928 | ($56,434) | $59,453 | $21,106 |
Undistributed Earnings (Loss) Allocated to Participating Securities, Diluted | ' | ' | ' | ' | ' | ' | ' | ' | 0 | -1,876 | -833 |
Undistributed Earnings (Loss) Allocated to Participating Securities, Basic | ' | ' | ' | ' | ' | ' | ' | ' | 0 | -1,889 | -841 |
Payments of Dividends | ' | ' | ' | ' | ' | ' | ' | ' | 18,633 | 0 | 0 |
Dividends attributable to common stockholders under the two class method | ' | ' | ' | ' | ' | ' | ' | ' | 18,122 | 0 | 0 |
Net Income (Loss) Available to Common Stockholders, Basic | ' | ' | ' | ' | ' | ' | ' | ' | -56,945 | 57,564 | 20,265 |
Net Income (Loss) Available to Common Stockholders, Diluted | ' | ' | ' | ' | ' | ' | ' | ' | ($56,945) | $57,577 | $20,273 |
Weighted-average number of shares outstanding, basic - As Adjusted(1) | 48,415,684 | 48,330,149 | 48,008,998 | 47,859,774 | 48,335,865 | 48,332,878 | 47,944,193 | 44,367,499 | 48,155,832 | 47,251,061 | 39,743,433 |
Weighted Average Number Diluted Shares Outstanding Adjustment | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 333,059 | 407,167 |
Weighted-average number of shares outstanding, diluted - As Adjusted(1) | 48,415,684 | 48,330,149 | 48,008,998 | 48,104,242 | 48,607,141 | 48,332,878 | 48,294,782 | 44,764,064 | 48,155,832 | 47,584,120 | 40,150,600 |
Basic income (loss) per common share | ($0.69) | ($0.33) | ($0.26) | $0.10 | $0.20 | ($0.14) | $0.13 | $1.08 | ($1.18) | $1.22 | $0.51 |
Diluted income (loss) per common share | ($0.69) | ($0.33) | ($0.26) | $0.10 | $0.20 | ($0.14) | $0.13 | $1.08 | ($1.18) | $1.21 | $0.50 |
Anti-dilutive equity-based incentive awards excluded from the computation of diluted income (loss) per share | ' | ' | ' | ' | ' | ' | ' | ' | 27,760 | 30,812 | 7,760 |
Summary_of_Significant_Account7
Summary of Significant Accounting Policies Impact of revision (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Accounting Policies [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net Income (Loss) Attributable to Acacia Research Corporation | ($33,333,000) | ($15,711,000) | ($12,503,000) | $5,113,000 | $9,823,000 | ($6,619,000) | $6,321,000 | $49,928,000 | ($56,434,000) | $59,453,000 | $21,106,000 |
Net Income (Loss) Available to Common Stockholders, Basic | ' | ' | ' | ' | ' | ' | ' | ' | -56,945,000 | 57,564,000 | 20,265,000 |
Net Income (Loss) Available to Common Stockholders, Diluted | ' | ' | ' | ' | ' | ' | ' | ' | -56,945,000 | 57,577,000 | 20,273,000 |
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders – basic - As Reported | ' | ' | ' | ' | ' | ' | ' | ' | ' | 47,251,061 | 39,743,433 |
Weighted-average number of shares outstanding, basic - As Adjusted(1) | 48,415,684 | 48,330,149 | 48,008,998 | 47,859,774 | 48,335,865 | 48,332,878 | 47,944,193 | 44,367,499 | 48,155,832 | 47,251,061 | 39,743,433 |
Weighted-average shares used in computing net income (loss) per share attributable to common stockholders – diluted - As Reported | ' | ' | ' | ' | ' | ' | ' | ' | ' | 48,060,647 | 41,258,297 |
Weighted-average number of shares outstanding, diluted - As Adjusted(1) | 48,415,684 | 48,330,149 | 48,008,998 | 48,104,242 | 48,607,141 | 48,332,878 | 48,294,782 | 44,764,064 | 48,155,832 | 47,584,120 | 40,150,600 |
Basic net income (loss) per common share, As Reported | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1.26 | 0.53 |
Basic income (loss) per common share | ($0.69) | ($0.33) | ($0.26) | $0.10 | $0.20 | ($0.14) | $0.13 | $1.08 | ($1.18) | $1.22 | $0.51 |
Diluted net income (loss) per common share - As Reported | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1.24 | $0.51 |
Diluted income (loss) per common share | ($0.69) | ($0.33) | ($0.26) | $0.10 | $0.20 | ($0.14) | $0.13 | $1.08 | ($1.18) | $1.21 | $0.50 |
Shortterm_Investments_Details
Short-term Investments (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Proceeds from Sale of Available-for-sale Securities | $239,370,000 | $322,236,000 | $60,000 |
Available-for-sale securities, amortized cost | 130,971,000 | 90,648,000 | ' |
Available-for-sale securities, gross unrealized gains | 21,000 | 20,000 | ' |
Available-for-sale securities, gross unrealized losses | -975,000 | -1,193,000 | ' |
Available-for-sale securities, fair value | 130,017,000 | 89,475,000 | ' |
Available-for-sale Securities, Gross Realized Gains | 1,174,000 | 31,000 | ' |
Available-for-sale Securities, Gross Realized Losses | 981,000 | 555,000 | ' |
Proceeds from Sale and Maturity of Marketable Securities | ' | 319,811,000 | 0 |
US Treasury Securities [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Available-for-sale securities, amortized cost | 130,971,000 | 87,394,000 | ' |
Available-for-sale securities, gross unrealized gains | 21,000 | 20,000 | ' |
Available-for-sale securities, gross unrealized losses | -975,000 | -411,000 | ' |
Available-for-sale securities, fair value | 130,017,000 | 87,003,000 | ' |
Equity Securities [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Available-for-sale securities, amortized cost | ' | 3,254,000 | ' |
Available-for-sale securities, gross unrealized gains | ' | 0 | ' |
Available-for-sale securities, gross unrealized losses | ' | -782,000 | ' |
Available-for-sale securities, fair value | ' | $2,472,000 | ' |
Minimum [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Investment Maturity Date | 31-Dec-14 | 31-Dec-13 | ' |
Maximum [Member] | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' |
Investment Maturity Date | 31-Dec-15 | 31-Dec-14 | ' |
Property_and_Equipment_Details
Property and Equipment (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Property, Plant and Equipment [Abstract] | ' | ' | ' |
Depreciation expense | $236,000 | $149,000 | $105,000 |
Property_and_Equipment_Summary
Property and Equipment Summary of Property and Equipment (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Property and Equipment [Line Items] | ' | ' |
Furniture and fixtures | $783 | $472 |
Computer hardware and software | 687 | 586 |
Leasehold improvements | 306 | 173 |
Property and equipment, gross | 1,776 | 1,231 |
Less: accumulated depreciation and amortization | -1,010 | -892 |
Property and equipment, net | $766 | $339 |
Accounts_Payable_and_Accrued_E2
Accounts Payable and Accrued Expenses (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Accounts Payable and Accrued Liabilities, Current [Abstract] | ' | ' |
Accounts payable | $128 | $642 |
Payroll and other employee benefits | 1,039 | 1,815 |
Accrued vacation | 813 | 703 |
Accrued legal expenses - patent | 5,900 | 3,990 |
Accrued consulting and other professional fees | 2,948 | 1,510 |
Accrued distribution to noncontrolling interest | 504 | 504 |
Other accrued liabilities | 223 | 71 |
Accounts payable and accrued expenses | $11,555 | $9,235 |
Goodwill_and_Other_Identifiabl2
Goodwill and Other Identifiable Intangible Assets (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Patents [Line Items] | ' | ' | ' |
Patents, weighted average useful life | '7 years | ' | ' |
Payments to acquire intangible assets | $25,061,000 | $178,260,000 | $14,680,000 |
Accrued patent acquisition related payments | 4,000,000 | ' | ' |
Accelerated amortization expense | 592,000 | 10,574,000 | 3,111,000 |
Accelerated amortization expense (termination) | 1,747,000 | 3,034,000 | 1,103,000 |
Impairment of Intangible Assets (Excluding Goodwill) | $4,619,000 | ' | ' |
Minimum [Member] | ' | ' | ' |
Patents [Line Items] | ' | ' | ' |
Patents, useful life | '1 year | ' | ' |
Acquired Finite Lived Intangible Asset, Useful Life | '3 years | ' | ' |
Maximum [Member] | ' | ' | ' |
Patents [Line Items] | ' | ' | ' |
Patents, useful life | '10 years | ' | ' |
Acquired Finite Lived Intangible Asset, Useful Life | '10 years | ' | ' |
Patents [Member] | Minimum [Member] | ' | ' | ' |
Patents [Line Items] | ' | ' | ' |
Patents, useful life | '1 year | ' | ' |
Patents [Member] | Maximum [Member] | ' | ' | ' |
Patents [Line Items] | ' | ' | ' |
Patents, useful life | '10 years | ' | ' |
Goodwill_and_Other_Identifiabl3
Goodwill and Other Identifiable Intangible Assets Cost and Accumulated Amortization (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Patents [Line Items] | ' | ' | ' |
Patents, net | $288,432 | $313,529 | ' |
Patent cost, disposals | 3,500 | 5,500 | 4,612 |
Accumulated amortization, disposals | 1,753 | 2,466 | 3,509 |
Proceeds from Sale of Intangible Assets | 1,000 | 2,792 | 11,000 |
Other costs, related to patent-related sales and disposals | 0 | 0 | 4,717 |
Patents [Member] | ' | ' | ' |
Patents [Line Items] | ' | ' | ' |
Gross carrying amount - patents | 400,755 | 383,379 | ' |
Accumulated amortization - patents | 112,323 | 69,850 | ' |
Patents, net | $288,432 | $313,529 | ' |
Goodwill_and_Other_Identifiabl4
Goodwill and Other Identifiable Intangible Assets Future Amortization Expense (Details) (USD $) | Dec. 31, 2013 |
Patents [Abstract] | ' |
2014 | $47,654,000 |
2015 | 46,554,000 |
2016 | 44,051,000 |
2017 | 43,268,000 |
2018 | $39,381,000 |
Fair_Value_Measurements_and_Au1
Fair Value Measurements and Auction Rate Securities (Details) (USD $) | 12 Months Ended |
Dec. 31, 2012 | |
Fair Value Measurements and Auction Rate Securities [Abstract] | ' |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Settlements | $2,074,000 |
Auction rate securities, par value | 2,425,000 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings | $118,000 |
Acquisition_Details
Acquisition (Details) (ADAPTIX, Inc. [Member], USD $) | 0 Months Ended | 12 Months Ended |
Jan. 12, 2012 | Dec. 31, 2013 | |
patents | ||
countries | ||
ADAPTIX, Inc. [Member] | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Acquired entity - cash | $10,000,000 | ' |
Number of issued and pending patents in portfolio of acquired entity | 230 | ' |
Number of countries where acquire entity holds issued and pending patents | 13 | ' |
Payments to acquire businesses, gross | $160,000,000 | ' |
Patents, useful life | '10 years | '10 years |
Acquisition_Purchase_Price_All
Acquisition Purchase Price Allocation (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Jan. 12, 2012 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ADAPTIX, Inc. [Member] | ADAPTIX, Inc. [Member] | ||
Business Acquisition [Line Items] | ' | ' | ' | ' |
Fair value of net tangible assets acquired | ' | ' | $10,000 | ' |
Intangible assets acquired - patents | ' | ' | 150,000 | ' |
Goodwill | 30,149 | 30,149 | 30,149 | ' |
Net deferred income tax liability | ' | ' | -30,149 | ' |
Total | ' | ' | 160,000 | ' |
Patents, useful life | ' | ' | '10 years | '10 years |
Patents, future annual amortization expense per year | ' | ' | $15,000 | ' |
Acquisition_Acquisition_Deferr
Acquisition Acquisition Deferred Tax (Details) (USD $) | 12 Months Ended | 0 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jan. 12, 2012 | |
ADAPTIX, Inc. [Member] | ||||
Business Acquisition [Line Items] | ' | ' | ' | ' |
Book basis of intangible assets acquired - patents | ' | ' | ' | $150,000,000 |
Tax basis of intangible assets acquired - patents | ' | ' | ' | 0 |
Change from book and tax basis of intangible assets acquired - patents | ' | ' | ' | -150,000,000 |
Estimated net operating loss carryforwards - ADAPTIX | ' | ' | ' | 0 |
Tax basis of estimated net operating loss carryforwards - ADAPTIX | ' | ' | ' | 63,860,000 |
Change from book and tax basis of estimated net operating loss carryforwards - ADAPTIX | ' | ' | ' | 63,860,000 |
Net deferred tax liability - pretax | ' | ' | ' | -86,140,000 |
Estimated tax rate | -35.00% | 35.00% | 35.00% | 35.00% |
Deferred tax asset, acquisition | ' | ' | ' | ($30,149,000) |
Acquisition_Pro_Forma_Informat
Acquisition Pro Forma Information (Details) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 |
Business Combinations [Abstract] | ' | ' |
Pro forma revenues | $250,727 | $172,256 |
Pro forma total operating costs and expenses | 170,953 | 159,674 |
Pro forma operating income | 79,774 | 12,582 |
Pro forma interest and investment income | 937 | 96 |
Pro forma income from operations before provision for income taxes | 80,711 | 12,678 |
Pro forma provision for income taxes | -22,060 | -8,708 |
Pro forma net income including noncontrolling interests | 58,651 | 3,970 |
Pro forma net (income) loss attributable to noncontrolling interests | 164 | -539 |
Pro forma net income attributable to Acacia Research Corporation | $58,815 | $3,431 |
Pro forma income per common share attributable to Acacia Research Corporation [Abstract] | ' | ' |
Pro forma basic earnings per share | $1.24 | ' |
Pro forma diluted earnings per share | $1.22 | ' |
Pro forma weighted average number of shares outstanding, basic | 47,251,061 | ' |
Pro forma weighted average number of shares outstanding, diluted | 48,060,647 | ' |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 0 Months Ended | 3 Months Ended | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||||
Mar. 30, 2014 | Nov. 15, 2013 | Nov. 16, 2012 | Feb. 21, 2012 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Mar. 30, 2011 | Feb. 21, 2012 | Mar. 30, 2011 | Dec. 31, 2011 | |
Common Stock [Member] | Common Stock [Member] | Common Stock [Member] | ||||||||||
Stockholders Equity [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross proceeds from the sale of common stock | ' | ' | ' | $225,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Sale of common stock, shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 6,122,449 | 5,750,000 |
Sale of common stock, price per share | ' | ' | ' | $36.75 | ' | ' | ' | ' | $31.50 | ' | ' | ' |
Proceeds from Issuance of Common Stock | ' | ' | ' | ' | ' | 0 | 218,961,000 | 175,229,000 | ' | ' | ' | ' |
Stock repurchase program, authorized amount | ' | 70,000,000 | 100,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividends declared, per share | ' | ' | ' | ' | ' | $0.50 | ' | ' | ' | ' | ' | ' |
Common stock dividends declared, quarterly | $0.13 | ' | ' | ' | ' | $0.13 | ' | ' | ' | ' | ' | ' |
Dividends paid | ' | ' | ' | ' | ' | $18,633,000 | $0 | $0 | ' | ' | ' | ' |
Dividends, payment date | ' | ' | ' | ' | 31-Mar-14 | ' | ' | ' | ' | ' | ' | ' |
Dividends, record date | ' | ' | ' | ' | 3-Mar-14 | ' | ' | ' | ' | ' | ' | ' |
Stockholders_Equity_Repurchase
Stockholders' Equity Repurchases of Common Stock (Details) (USD $) | 0 Months Ended | 1 Months Ended | 12 Months Ended | |||
Dec. 11, 2013 | Nov. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | |
Stockholders' Equity Note [Abstract] | ' | ' | ' | ' | ' | ' |
Treasury stock, shares acquired | 600,000 | 256,262 | ' | 873,146 | 600,000 | 1,129,408 |
Treasury stock acquired, average price paid per share | $13.18 | $21.58 | $24.26 | ' | $23.65 | ' |
Stock repurchase program, remaining authorized repurchase amount | $62,074,000,000 | $0 | $0 | ' | ' | ' |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Income Taxes [Line Items] | ' | ' | ' |
Income tax benefit from release of valuation allowance | ($2,189,000) | $10,651,000 | $0 |
Operating loss carryforwards, federal | 83,372,000 | ' | ' |
Operating loss carryforwards, state | 56,400,000 | ' | ' |
Deferred tax assets, valuation allowance | 7,585,000 | 5,396,000 | ' |
Federal NOL annual utilization limit | 14,100,000 | ' | ' |
Net operating losses, unrecognized excess tax benefits, federal | 1,928,000 | ' | ' |
Net operating losses, unrecognized excess tax benefits, state | 37,725,000 | ' | ' |
Tax benefit from stock options exercised, federal | 0 | ' | ' |
Tax fenefit from stock options exercised, state | 441,000 | ' | ' |
Foreign withholding taxes | 4,605,000 | 11,890,000 | 7,586,000 |
Excess tax benefits from stock-based compensation | -1,398,000 | 13,210,000 | 583,000 |
Foreign tax credits, additional paid in capital benefit | 24,718,000 | ' | ' |
Foreign tax credits utilized for financial statement purposes | 20,313,000 | ' | ' |
Effective Income Tax Rate Reconciliation, Percent | -27.00% | 27.00% | 29.00% |
Effective tax rate excluding valuation allowance | 31.00% | 40.00% | 41.00% |
Unrecognized tax benefits | 2,127,000 | 2,127,000 | 85,000 |
unrecognized tax benefits primarily associated with state taxes | 85,000 | ' | ' |
Domestic Tax Authority [Member] | ' | ' | ' |
Income Taxes [Line Items] | ' | ' | ' |
Net operating losses included in deferred tax assets | 0 | ' | ' |
State and Local Jurisdiction [Member] | ' | ' | ' |
Income Taxes [Line Items] | ' | ' | ' |
Net operating losses included in deferred tax assets | 441,000 | ' | ' |
Capital Loss Carryforward Related to Business Acquisition [Member] | Internal Revenue Service (IRS) [Member] | ' | ' | ' |
Income Taxes [Line Items] | ' | ' | ' |
Operating Loss Carryforwards | $29,318,000 | ' | ' |
Income_Taxes_Provision_for_Tax
Income Taxes Provision for Taxes (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Current: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Federal | ' | ' | ' | ' | ' | ' | ' | ' | $0 | $0 | $179 |
State taxes | ' | ' | ' | ' | ' | ' | ' | ' | 113 | 281 | 943 |
Foreign taxes | ' | ' | ' | ' | ' | ' | ' | ' | 4,405 | 11,890 | 7,586 |
Total current | ' | ' | ' | ' | ' | ' | ' | ' | 4,518 | 12,171 | 8,708 |
Deferred: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Federal | ' | ' | ' | ' | ' | ' | ' | ' | -26,151 | 10,085 | 0 |
State taxes | ' | ' | ' | ' | ' | ' | ' | ' | -325 | -196 | 0 |
Total deferred | ' | ' | ' | ' | ' | ' | ' | ' | -26,476 | 9,889 | 0 |
(Provision) benefit for income taxes | $3,390 | ($19,570) | ($9,050) | $3,272 | $5,757 | ($1,938) | $3,494 | $14,747 | ($21,958) | $22,060 | $8,708 |
Income_Taxes_Deferred_Taxes_De
Income Taxes Deferred Taxes (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Deferred tax assets: | ' | ' |
Net operating loss and capital loss carryforwards and credits | $34,679 | $15,668 |
Stock compensation | 3,052 | 1,140 |
Basis of investments in affiliates | 867 | 415 |
Accrued liabilities and other | 387 | 250 |
Unrealized loss on short-term investments | 337 | 415 |
State taxes | 18 | 212 |
Total deferred tax assets | 39,340 | 18,100 |
Deferred tax liabilities: | ' | ' |
Fixed assets and intangibles | -33,378 | -39,457 |
Other | -112 | -60 |
Net deferred tax liabilities | 5,850 | -21,417 |
Less: valuation allowance | -7,585 | -5,396 |
Net deferred taxes | ($1,735) | ($26,813) |
Income_Taxes_Income_Tax_Rate_D
Income Taxes Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Effective Income Tax Rate, Continuing Operations, Tax Rate Reconciliation [Abstract] | ' | ' | ' |
Statutory federal tax rate | -35.00% | 35.00% | 35.00% |
State income and foreign taxes, net of federal tax effect | 5.00% | 15.00% | 27.00% |
Foreign tax credit | -6.00% | -15.00% | -25.00% |
Noncontrolling interests in operating subsidiaries | 1.00% | 0.00% | -1.00% |
Non deductible permanent items | 2.00% | 5.00% | 4.00% |
Expired net operating loss carryforwards | 2.00% | 0.00% | 1.00% |
Valuation allowance | 4.00% | -13.00% | -12.00% |
Total | -27.00% | 27.00% | 29.00% |
Income_Taxes_Gross_Unrecognize
Income Taxes Gross Unrecognized Tax Benefit (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2011 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Unrecognized tax benefits | $2,127 | $2,127 | $85 |
Additions based on tax positions related to the current year | 0 | ' | ' |
Additions for tax positions related to prior years | 772 | ' | ' |
Additions resulting from the acquisition of ADAPTIX | 1,270 | ' | ' |
Reductions | $0 | ' | ' |
Income_Taxes_Valuation_allowan
Income Taxes Valuation allowance (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Income Tax Disclosure [Abstract] | ' | ' |
Capital loss carryforwards, valuation allowance | $1,562 | $2,935 |
Operating Loss Carryforwards, Valuation Allowance | 1,281 | 2,046 |
Foreign tax credits, valuation allowance | 4,405 | 0 |
Unrealized losses on short-term investments and other deferred tax assets, valuation allowance | 337 | 415 |
Valuation Allowances and Reserves, Balance | $7,585 | $5,396 |
StockBased_Incentive_Plans_Det
Stock-Based Incentive Plans (Details) (USD $) | 12 Months Ended | 12 Months Ended | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2009 | Dec. 31, 2013 | Dec. 31, 2008 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | |
Restricted Stock [Member] | Restricted Stock [Member] | Restricted Stock [Member] | Restricted Stock Units (RSUs) [Member] | Restricted Stock Units (RSUs) [Member] | Restricted Stock Units (RSUs) [Member] | 2007 Plan [Member] | 2007 Plan [Member] | 2007 Plan [Member] | Discretionary Option Grant Program [Member] | Stock Issuance Program [Member] | 2002 Plan [Member] | 2013 Plan [Member] | Less than 10% [Member] | 10% or More [Member] | ||||
Nonstatutory Options [Member] | Discretionary Option Grant Program [Member] | Discretionary Option Grant Program [Member] | ||||||||||||||||
Incentive Stock Options [Member] | Incentive Stock Options [Member] | |||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of fair market value on grant date, minimum exercise price | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 85.00% | 100.00% | ' | ' | 100.00% | 110.00% |
Increase in number of shares available, percentage of outstanding shares on last trading day of prior December | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2.00% | ' | ' | ' | ' | 3.00% | ' | ' | ' |
Ownership percent of voting stock | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum number of shares available increase per year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 500,000 | ' | ' | ' |
Aggregate shares available for issuance | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,000,000 | ' | ' | ' |
Number of shares available for grant | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 560,000 | ' | ' | ' | 4,750,000 | ' | ' |
Aggregate intrinsic value of options exercised | $2,024,000 | $1,796,000 | $2,822,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average grant date fair value of restricted stock granted | ' | ' | ' | $24.31 | $32.17 | $29.24 | $0 | $29.39 | $24.87 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate fair value of restricted stock vested | ' | ' | ' | 22,317,000 | 28,865,000 | 11,043,000 | 469,000 | 363,000 | 257,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total unrecognized compensation expense for nonvested awards | ' | ' | ' | $25,915,000 | ' | ' | $480,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average period over which unrecognized compensation expense will be recognized | ' | ' | ' | '1 year 9 months | ' | ' | '1 year 7 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares of common stock reserved for issuance | 4,280,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
StockBased_Incentive_Plans_Sto
Stock-Based Incentive Plans Stock Options (Details) (USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Share-based Compensation [Abstract] | ' |
Outstanding at December 31, 2012 | 313,000 |
Exercised | -115,000 |
Expired/forfeited | -3,000 |
Outstanding at December 31, 2013 | 195,000 |
Vested | 195,000 |
Exercisable at December 31, 2013 | 195,000 |
Outstanding at December 31, 2012, weighted average exercise price | $5.87 |
Exercised, weighted average exercise price | $4.22 |
Expired/forfeited, weighted average exercise price | $1.85 |
Outstanding at December 31, 2013, weighted average exercise price | $6.91 |
Vested, weighted average exercise price | $6.91 |
Exercisable, weighted average exercise price | $6.91 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term | '1 year 7 months |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Weighted Average Remaining Contractual Term | '1 year 7 months |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term | '1 year 7 months |
Outstanding at December 31, 2013, aggregate, intrinsic value | $1,485,000 |
Vested, aggregate intrinsic value | 1,485,000 |
Exercisable, aggregate intrinsic value | $1,485,000 |
StockBased_Incentive_Plans_Non
Stock-Based Incentive Plans Nonvested Restriced Stock (Details) (Restricted Stock [Member], USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Restricted Stock [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award | ' | ' | ' |
Nonvested at December 31, 2012 | 1,353,000 | ' | ' |
Granted | 823,000 | ' | ' |
Vested | -813,000 | ' | ' |
Canceled | -126,000 | ' | ' |
Nonvested at December 31, 2013 | 1,237,000 | 1,353,000 | ' |
Nonvested, weighted average grant date fair value at December 31, 2011 | $30.17 | ' | ' |
Granted, weighted average grant date fair value | $24.31 | $32.17 | $29.24 |
Vested, weighted average grant date fair value | $27.45 | ' | ' |
Canceled, weighted average grant date fair value | $28.48 | ' | ' |
Nonvested, weighted average grant date fair value at December 31, 2012 | $28.23 | $30.17 | ' |
StockBased_Incentive_Plans_Non1
Stock-Based Incentive Plans Nonvested Restricted Stock Units (Details) (Restricted Stock Units (RSUs) [Member], USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Restricted Stock Units (RSUs) [Member] | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award | ' | ' | ' |
Nonvested at December 31, 2012 | 38,000 | ' | ' |
Granted | ' | 0 | ' |
Vested | ' | -18,000 | ' |
Nonvested at December 31, 2013 | 20,000 | 38,000 | ' |
Vested outstanding | 94,000 | ' | ' |
Nonvested, weighted average grant date fair value at December 31, 2011 | $26.98 | ' | ' |
Granted, weighted average grant date fair value | $0 | $29.39 | $24.87 |
Vested, weighted average grant date fair value | ' | $26.05 | ' |
Nonvested, weighted average grant date fair value at December 31, 2012 | $27.83 | $26.98 | ' |
Vested outstanding, weighted average grant date fair value | $13.05 | ' | ' |
Commitments_and_Contingencies_1
Commitments and Contingencies (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Commitments and Contingencies Disclosure [Abstract] | ' | ' | ' |
Rent expense | $1,312,000 | $898,000 | $915,000 |
Partners' capital, authorized | 250,000,000 | ' | ' |
Cash and other assets, IP Fund | 2,927,000 | 2,542,000 | ' |
Patents, net of accumulated amortization, IP Fund | 1,373,000 | 7,144,000 | ' |
Investments, IP Fund | 11,120,000 | 11,617,000 | ' |
Total assets, IP Fund | 15,420,000 | 21,303,000 | ' |
Accrued expenses and contributions, IP Fund | 2,437,000 | 5,016,000 | ' |
Accrued patent acquisition costs, IP Fund | 0 | 500,000 | ' |
Total liabilities, IP Fund | 2,437,000 | 5,516,000 | ' |
Net assets, IP Fund | $12,983,000 | $15,787,000 | ' |
Commitments_and_Contingencies_2
Commitments and Contingencies Operating Leases (Details) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Year: | ' |
2014 | $1,442 |
2015 | 1,553 |
2016 | 918 |
2017 | 318 |
2018 | 324 |
Thereafter | 498 |
Total minimum lease payments | $5,053 |
Supplemental_Cash_Flow_Informa1
Supplemental Cash Flow Information (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Supplemental Cash Flow Information [Abstract] | ' | ' | ' |
Estimated federal income taxes paid | $3,000,000 | $0 | $0 |
Income Taxes Receivable | 3,251,000 | ' | ' |
Accrued distribution to noncontrolling interest | 504,000 | 504,000 | ' |
Cash paid for state income taxes | 516,000 | 771,000 | 185,000 |
Foreign withholding taxes | $4,605,000 | $11,890,000 | $7,586,000 |
Quarterly_Financial_Data_Detai
Quarterly Financial Data (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
QUARTERLY FINANCIAL DATA (unaudited) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | $15,065 | $15,520 | $23,110 | $76,861 | $66,264 | $34,939 | $50,484 | $99,040 | ' | ' | ' |
Inventor royalties | 3,280 | 2,353 | 5,610 | 18,481 | 3,829 | 5,032 | 9,573 | 7,594 | 29,724 | 26,028 | 43,727 |
Contingent legal fees | 3,181 | 2,547 | 4,024 | 15,032 | 5,463 | 8,833 | 6,607 | 3,748 | 24,784 | 24,651 | 40,281 |
Litigation and licensing expenses - patents | 8,899 | 10,870 | 9,918 | 9,648 | 6,969 | 5,973 | 5,268 | 3,381 | 39,335 | 21,591 | 13,005 |
Amortization of patents | 16,735 | 12,615 | 12,578 | 11,730 | 18,088 | 10,412 | 5,393 | 5,126 | 53,658 | 39,019 | 9,745 |
Marketing, general and administrative expenses (including non-cash stock compensation expense) | -13,988 | -18,222 | -13,175 | -13,844 | -16,535 | -11,914 | -11,903 | -13,731 | -59,229 | -54,083 | -35,693 |
Research, consulting and other expenses - business development | 742 | 743 | 735 | 1,031 | 721 | 1,139 | 1,967 | 1,116 | 3,251 | 4,943 | 4,338 |
Other | 0 | 3,506 | 0 | 0 | 0 | 0 | 0 | 0 | 3,506 | 0 | 0 |
Total operating costs and expenses | 46,825 | 50,856 | 46,040 | 69,766 | 51,605 | 43,303 | 40,711 | 34,696 | 213,487 | 170,315 | 141,999 |
Operating income (loss) | -31,760 | -35,336 | -22,930 | 7,095 | 14,659 | -8,364 | 9,773 | 64,344 | -82,931 | 80,412 | 30,257 |
Total other income (expense) | 161 | 280 | 400 | 1,290 | 820 | -41 | 102 | 56 | 2,131 | 937 | 96 |
Income (loss) from operations before benefit from (provision for) income taxes | -31,599 | -35,056 | -22,530 | 8,385 | 15,479 | -8,405 | 9,875 | 64,400 | -80,800 | 81,349 | 30,353 |
(Provision) benefit for income taxes | -3,390 | 19,570 | 9,050 | -3,272 | -5,757 | 1,938 | -3,494 | -14,747 | 21,958 | -22,060 | -8,708 |
Net income (loss) including noncontrolling interests in operating subsidiaries | -34,989 | -15,486 | -13,480 | 5,113 | 9,722 | -6,467 | 6,381 | 49,653 | -58,842 | 59,289 | 21,645 |
Net (income) loss attributable to noncontrolling interests | 1,656 | -225 | 977 | 0 | 101 | -152 | -60 | 275 | 2,408 | 164 | -539 |
Net Income (Loss) Attributable to Acacia Research Corporation | ($33,333) | ($15,711) | ($12,503) | $5,113 | $9,823 | ($6,619) | $6,321 | $49,928 | ($56,434) | $59,453 | $21,106 |
Basic income (loss) per share - As Adjusted(1) | ($0.69) | ($0.33) | ($0.26) | $0.10 | $0.20 | ($0.14) | $0.13 | $1.08 | ($1.18) | $1.22 | $0.51 |
Diluted income (loss) per share - As Adjusted(1) | ($0.69) | ($0.33) | ($0.26) | $0.10 | $0.20 | ($0.14) | $0.13 | $1.08 | ($1.18) | $1.21 | $0.50 |
Weighted-average number of shares outstanding, basic - As Adjusted(1) | 48,415,684 | 48,330,149 | 48,008,998 | 47,859,774 | 48,335,865 | 48,332,878 | 47,944,193 | 44,367,499 | 48,155,832 | 47,251,061 | 39,743,433 |
Weighted-average number of shares outstanding, diluted - As Adjusted(1) | 48,415,684 | 48,330,149 | 48,008,998 | 48,104,242 | 48,607,141 | 48,332,878 | 48,294,782 | 44,764,064 | 48,155,832 | 47,584,120 | 40,150,600 |
Earnings (loss) per share, basic, as previously reported | ' | ' | ($0.26) | $0.11 | $0.20 | ($0.14) | $0.13 | $1.13 | ' | ' | ' |
Earnings (loss) per share, diluted as previously reported | ' | ' | ($0.26) | $0.11 | $0.20 | ($0.14) | $0.13 | $1.09 | ' | ' | ' |
Weighted average number of shares, basic, as previously reported | ' | ' | 48,008,998 | 47,859,774 | 48,335,865 | 48,332,878 | 47,944,193 | 44,367,499 | ' | ' | ' |
Weighted average number of shares, diluted, as previously reported | ' | ' | 48,008,998 | 48,354,444 | 48,797,304 | 48,332,878 | 48,938,766 | 45,771,228 | ' | ' | ' |