Valve Beats Patent Troll Leigh Rothschild in Court on Every Count

Leigh Rothschild has built a career out of suing people. Over 1,200 lawsuits filed across decades, with targets ranging from Apple all the way down to small businesses that had no realistic shot at fighting back. He picked the wrong company this time.

On February 17, 2026, a federal jury in Seattle sided with Valve on every single count in its lawsuit against Rothschild and a cluster of his associated companies. The verdict found Rothschild and his entities in violation of Washington's Patent Troll Prevention Act and Consumer Protection Act, and confirmed a breach of contract. All counts. No partial wins for the defence. Nothing.

The damages awarded came to $152,000 - which, yes, is not a life-changing sum for a company of Valve's size. That's not really the point though.

How It All Started

Back in 2016, Valve did what most companies do when Rothschild comes knocking. They settled. The agreement gave Valve a perpetual, royalty-free, worldwide licence to a portion of Rothschild's patent portfolio, including technology tied to cloud-based content storage.

That should have been the end of it.

In 2022, one of Rothschild's shell companies, Display Technologies LLC, sued Valve anyway. The claim targeted the Steam Deck and Steam broadly, alleging infringement of a patent for "displaying content." Valve's lawyers sent over a copy of the 2016 contract. The case was eventually dismissed, but Rothschild's team dragged their feet getting there, only dropping it once they were practically cornered.

Then in 2023, another claim landed. This time over US Patent No. 8,856,221, described as a "system and method for storing broadcast content in a cloud-based computing environment." A patent Valve already held a licence for.

Valve decided it was done playing defence.

Valve Went After the Man Himself

This is where the strategy gets interesting. Most patent trolls operate through a web of tiny shell companies with no real assets. If an LLC loses a case, it folds, the troll walks away personally untouched, and the whole cycle starts again somewhere else.

Valve's legal team knew this. So rather than targeting one of Rothschild's many LLCs, they filed suit against Rothschild personally, alongside Rothschild Broadcast Distribution Systems LLC, Display Technologies LLC, Patent Asset Management LLC, Meyler Legal LLC, and his former attorney Samuel Meyler. The argument was that these entities functioned as Rothschild's "alter egos," making him directly liable rather than letting any single company absorb the hit and disappear.

It worked.

The jury agreed that Rothschild and his associated entities had made bad-faith assertions of patent infringement, breached the 2016 licensing agreement, and violated Washington state law. Judge Jamal Whitehead had already ruled before trial that the voluntary dismissal of the 2022 case did not cure the breach of contract - so Rothschild's team had no real escape route left by the time this reached a jury.

There was an odd subplot during proceedings, too. Rothschild's legal team filed a motion containing 13 fabricated legal citations, which the court later determined had been generated by AI without proper verification. Sanctions were imposed. The defence apologised before trial. Not a great look.

Why This Verdict Matters Beyond Valve

$152,000 is a rounding error for Valve. The company spent considerably more than that on legal fees across three years of litigation. But that was never what this was about.

By fighting this all the way through to a jury verdict under the Patent Troll Prevention Act, Valve has set a precedent that other technology companies in Washington state can point to. The ruling signals that shell company structures won't automatically protect serial patent litigants from personal liability, and that bad-faith assertions carry real legal consequences - not just a nuisance settlement.

Rothschild must also declare the patent at the centre of the lawsuit invalid and provide injunctive relief to Valve. The court still needs to set a date to address the remaining disputes around Valve's invalidity and unenforceability claims.

For a company that gave the world Half-Life, Portal, Left 4 Dead, Team Fortress, and DOTA 2, and built Steam into the dominant PC gaming storefront it is today, this is a win that goes well beyond one courtroom. Valve has shown that fighting back, properly and personally, is an option - and one with teeth.