The rights of U.S. schools and colleges to use a powerful new tool for enhanced communication and instruction are at risk, because a little-known California company claims it owns the patent on what enables streaming video. The company has already sent demands for royalty payments to several U.S. universities.

Newport Beach-based Acacia Research Corp. seems to have a message for schools: Either stop the transmissions now, or prepare to pay the company as much as 2 percent of the revenue generated from courses that employ such technology.

The threat became real when some colleges and universities--including Johns Hopkins University in Baltimore, the University of Virginia, the University of Wyoming (UW), and a number of schools in the Oregon State University System (OSUS)--began receiving "cease-and-desist" letters from the company.

Legal experts from these and other schools say the royalty demands could spell trouble for revenue-generating distance-education programs, which are relied upon to connect students across great distances while appealing to pupils with vastly different learning styles. If the royalty demands exceed the profits generated by such courses, they say, the practice could become cost-prohibitive, adding a debilitating expense to schools' already waning technology budgets.

Education observers fear demands for a percentage of revenues might be merely a prelude to demands for licensing fees from all schools and universities that use streaming video, regardless of whether the technology generates revenue.

To skirt a potential disaster, legal counsel for universities across the country have begun looking for ways to insulate their institutions from potential lawsuits. But while much is being debated, nothing has been decided, a fact that has college lawyers contacted by eSchool News largely mum on the topic of strategy.

Lawyers have been so tight-lipped, in fact, that officials from the University of Virginia and the Johns Hopkins University declined to go on record with eSchool News about the letters. Those who are willing to talk, however, say they are concerned.

Ben Rawlins, general counsel for the OSUS, said the proposed 2-percent royalty claims would result in a significant amount of money for the state's universities and could be enough to threaten the existence of video-streaming and distance-learning programs in some institutions, but he declined to comment on the validity of Acacia's patents or on the university's defense, stating, "Everything is still under consideration."

For universities, Rawlins said, the question is whether the technology has been around long enough for it to be considered in the public domain, or whether Acacia has the right to claim collective control over the broader use of the technology itself--mainly, the process by which audio and video are transmitted across the internet--as opposed to a specific hardware device or media player used to make such transmissions possible. OSUS reportedly is consulting with patent lawyers to further investigate the company's claims.