Acacia Research Reports First Quarter 2008 Financial Results.

NEWPORT BEACH, Calif. -- Acacia Research Corporation (Nasdaq:ACTG) today reported results for the three months ended March 31, 2008.

"Acacia Research consolidated revenues for the first quarter of 2008 were $9,048,000 compared to $25,185,000 in the year ago period. Trailing 12-month revenues were $36,460,000 compared to $55,293,000 at the end of the first quarter of 2007. Acacia Research reported a first quarter GAAP net loss from continuing operations of $3,949,000 or $0.14 per share, including non-cash charges totaling $3,164,000," commented Acacia Research Corporation Chairman and CEO, Paul Ryan.

"Acacia Research's subsidiaries entered into 24 new licensing agreements in the first quarter generating revenues from 12 different licensing programs, including 4 new licensing programs. We also acquired control of 5 new patent portfolios in the quarter and now control 93 patent portfolios. Acacia expects continued growth in revenues, new licensing programs and the acquisition of new patent portfolios for future licensing, as we continue to build our leadership position in technology licensing. Quarterly revenues will continue to be uneven. Acacia is at an early stage in growing its business and our success to date in completing over 560 licensing agreements, covering 32 different technologies is generating interest from technology companies, universities and research centers wanting us to partner with them and take over the licensing of their patented technologies," concluded Mr. Ryan.

Acacia Research Corporation Consolidated Financial Results

For the Three Months Ended March 31, 2008 and 2007

Results from Continuing Operations

Acacia Research Corporation reported consolidated first quarter 2008 license fee revenues of $9,048,000, compared to $25,185,000 in the first quarter of 2007. First quarter 2008 license fee revenues included license fees from 12 of the Company's technology licensing programs, including initial license fee revenues for our Electronic Message Advertising technology, Remote Management of Imaging Devices technology, High Quality Image Processing technology and Wireless Traffic Information technology. First quarter 2008 license fee revenues also included fees from the licensing of our DMT[R] technology, Portable Storage Devices with Links technology, Image Resolution Enhancement technology, Pop-up Internet Advertising technology, Rule-Based Monitoring technology, Electronic Address List Management technology, Audio Communications Fraud Detection technology and Telematics technology. First quarter 2007 revenues included license fees from 22 new licensing agreements covering 11 of our technology licensing programs. To date, the Company has generated revenues from 32 of its technology licensing programs.

Trailing twelve-month license fee revenues were $36.5 million as of March 31, 2008, as compared to $52.6 million as of December 31, 2007, $47.9 million as of September 30, 2007, $46.8 million as of June 30, 2007, and $55.3 million as of March 31, 2007.

The first quarter 2008 net loss from continuing operations was $3,949,000, as compared to net income from continuing operations of $4,435,000 in the first quarter of 2007. Included in first quarter 2008 results from continuing operations are non-cash charges totaling $3,164,000, comprised of non-cash stock compensation charges of $1,829,000 and non-cash patent amortization charges of $1,335,000. First quarter 2007 results from continuing operations included non-cash charges of $2,079,000, comprised of non-cash stock compensation charges of $763,000 and non-cash patent amortization charges of $1,316,000.

Marketing, general and administrative expenses consist of employee compensation and related personnel costs, including non-cash stock compensation expenses, office and facilities costs, legal and accounting professional fees, public relations, marketing, stock administration and other corporate costs, and patent related development, commercialization, research, consulting and maintenance costs. First quarter 2008 marketing, general and administrative expenses increased to $6,349,000, including non-cash stock compensation charges of $1,829,000, from $4,328,000, including non-cash stock compensation charges of $763,000, in the comparable 2007 period. Excluding non-cash stock compensation charges, marketing, general and administrative expenses increased $955,000. The net increase was due primarily to the addition of licensing, business development and engineering personnel since the end of the comparable 2007 period, an increase in business development and licensing related patent research and consulting costs and an increase in corporate, general and administrative costs. The overall increase in marketing, general and administrative expenses is reflective of the continued growth and expansion of our operating subsidiaries' intellectual property acquisition, licensing and enforcement businesses and related ongoing operations. The increase was partially offset by a decrease in consulting expenses due to the expiration of the consulting agreement with the former CEO of Global Patent Holdings, LLC in January 2007 and a decrease in severance related costs.

Operating expenses for the first quarter of 2008 and 2007 included inventor royalties expenses of $2,090,000 and $5,486,000, respectively, and contingent legal fees expenses of $2,641,000 and $8,636,000, respectively. The majority of our operating subsidiaries' patent portfolios are subject to patent and patent rights agreements with inventors containing provisions granting to the original patent owner the right to receive inventor royalties based on future net revenues, as defined in the respective agreements, and may also be subject to contingent legal fee arrangements with external law firms engaged on a contingent fee basis. The economic terms of the inventor and contingent arrangements, if any, vary across patent portfolios. As such, inventor royalties and contingent legal fees expenses fluctuate period to period based on the amount of revenues recognized each period and the mix of specific patent portfolios generating revenues each period. The first quarter 2008 decrease in inventor royalties expense and contingent legal fees expense was primarily due to the decrease in license fee revenues recognized in the first quarter of 2008, as compared to the first quarter of 2007, as described above.

First quarter 2008 patent-related legal expenses were $1,016,000, compared to $1,367,000 in the comparable 2007 period. Patent-related legal expenses include patent-related prosecution and enforcement costs incurred by outside law firms engaged on an hourly basis and the out-of-pocket expenses incurred by law firms engaged on a contingent fee basis. Patent-related legal expenses fluctuate from period to period based on patent enforcement and prosecution activity associated with ongoing licensing and enforcement programs and the timing of the commencement of new licensing and enforcement programs in each period. We expect patent-related legal expenses to continue to fluctuate quarter to quarter based on the factors summarized above, in connection with our current and future patent commercialization and enforcement programs.

Financial Condition

Total assets were $69,948,000 as of March 31, 2008 compared to $71,051,000 as of December 31, 2007. Cash and cash equivalents and investments totaled approximately $46,088,000 as of March 31, 2008 compared to $51,433,000 as of December 31, 2007. At March 31, 2008, investments included $6,000,000 of auction rate securities. At April 24, 2008, auction rate securities held totaled $5,750,000. The Company is in the process of completing its analysis of the fair value (in accordance with FAS 157, "Fair Value Measurements,") and classification (current versus non-current) of its auction rate securities, in light of the recent credit and liquidity conditions in the market affecting auction rate securities. Management expects to complete its assessment and reflect any impairment or reclassification of its auction rate securities, if any, in its Quarterly Report on Form 10-Q to be filed with the Securities and Exchange Commission on or before May 8, 2008.

Business Highlights and Recent Developments

Business highlights of the first quarter and recent developments include the following:

(Note: Acacia Patent Acquisition LLC, Disc Link Corporation, InternetAd Systems LLC, Diagnostic Systems Corporation, Telematics Corporation, IP Innovation LLC, Creative Internet Advertising Corporation, Contacts Synchronization Corporation, Screentone Systems Corporation, International Printer Corporation, and Mobile Traffic Systems Corporation are all wholly owned operating subsidiaries of Acacia Research Corporation):

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A conference call is scheduled for today. The Acacia Research Corporation presentation and Q&A will start at 1:30 p.m. Pacific Time (4:30 p.m. Eastern).

To listen to the presentation by phone, dial [phone] for domestic callers and [phone] for international callers, both of whom will need to provide the operator with the confirmation code 4191671. A replay of the audio presentation will be available for 30 days at [phone] for domestic callers and [phone] for international callers, both of whom will need to enter the code 4191671 when prompted.

The call is being webcast by CCBN and can be accessed at Acacia's website at www.acaciaresearch.com.

ABOUT ACACIA RESEARCH CORPORATION

Acacia Research's subsidiaries develop, acquire, and license patented technologies. Acacia Research's subsidiaries control 93 patent portfolios covering technologies used in a wide variety of industries including audio/video enhancement & synchronization, broadcast data retrieval, computer memory cache coherency, credit card fraud protection, database management, data encryption & product activation, digital media transmission (DMT[R]), digital video production, dynamic manufacturing modeling, enhanced Internet navigation, image resolution enhancement, interactive data sharing, interactive television, laptop docking station connectivity, microprocessor enhancement, multi-dimensional bar codes, resource scheduling, spreadsheet automation, and user activated Internet advertising.

Information about Acacia Research is available at www.acaciatechnologies.com and www.acaciaresearch.com.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This news release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based upon our current expectations and speak only as of the date hereof. Our actual results may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including the recent economic slowdown affecting the credit markets and technology companies, our ability to successfully develop products, rapid technological change in our markets, changes in demand for our future products, legislative, regulatory and competitive developments and general economic conditions. Our Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form 10-Q, recent Current Reports on Forms 8-K and 8-K/A, and other SEC filings discuss some of the important risk factors that may affect our business, results of operations and financial condition. We undertake no obligation to revise or update publicly any forward-looking statements for any reason

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