Valve just beat patent holder Leigh M. Rothschild at trial in federal court after he tried suing Steam over technology the company already had permission to use.
The case centered on a patent that claims to cover storing and streaming broadcast content in the cloud. Patent US8856221B2 describes what critics call an extremely broad system—essentially a computer with memory and a processor that sends data to users over a network.
Here’s where it gets messy. Valve and Rothschild already settled a dispute years ago. That earlier settlement gave Valve a sweeping license described as perpetual, irrevocable, royalty-free, and worldwide. The license covered Rothschild’s entire patent portfolio.
But Rothschild came back anyway. He sued Valve again over the same technology through a different company associated with him. Valve argued this violated their prior agreement.
Instead of just defending against the infringement claim, Valve went on offense. The company sued Rothschild himself—not just the shell entity bringing the lawsuit. Valve’s case landed in the U.S. District Court for the Western District of Washington, where state anti-patent trolling laws gave them extra ammunition.
The patent in question drew attention before. The Electronic Frontier Foundation featured it as a “Stupid Patent of the Month” for trying to claim ownership over basic webserver functionality.
Rothschild’s legal team also stumbled during the case. Bloomberg Law reported that his attorneys had to apologize after submitting court filings with AI-generated citation errors. The citations referenced cases that didn’t exist or were inaccurately described.
