UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13G

o

Rule 13d-1(b)

x

Rule 13d-1(c)

o

Rule 13d-1(d)

CUSIP No. 003881307

1.

Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only)
David M. Knott

2.

Check the Appropriate Box if a Member of a Group (See Instructions)

(a)

o

(b)

x

3.

SEC Use Only

4.

Citizenship or Place of Organization
United States of America

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

5.

Sole Voting Power
1,229,308

6.

Shared Voting Power
78,250

7.

Sole Dispositive Power
1,309,908

8.

Shared Dispositive Power
13,050

9.

Aggregate Amount Beneficially Owned by Each Reporting Person
1,322,958

10.

Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See Instructions)  o

11.

Percent of Class Represented by Amount in Row (9)
4.7%

12.

Type of Reporting Person (See Instructions)
IN

CUSIP No. 003881307

1.

Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only)
Dorset Management Corporation
11-2873658

2.

Check the Appropriate Box if a Member of a Group (See Instructions)

(a)

o

(b)

x

3.

SEC Use Only

4.

Citizenship or Place of Organization
United States of America

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

5.

Sole Voting Power
1,229,308

6.

Shared Voting Power
78,250

7.

Sole Dispositive Power
1,309,908

8.

Shared Dispositive Power
13,050

9.

Aggregate Amount Beneficially Owned by Each Reporting Person
1,322,958

10.

Check if the Aggregate Amount in Row (9) Excludes Certain Shares (See Instructions)  o

11.

Percent of Class Represented by Amount in Row (9)
4.7%

12.

Type of Reporting Person (See Instructions)
CO

Item 1.

(a)

Name of Issuer
Acacia Research Corporation

(b)

Address of Issuer’s Principal Executive Offices
500 Newport Center Drive

Newport Beach, CA 92660

Item 2.

(a)

Name of Person Filing
David M. Knott; Dorset Management Corporation

(b)

Address of Principal Business Office or, if none, Residence
485 Underhill Boulevard, Suite 205

Syosset, New York 11791

(c)

Citizenship
David M. Knott - United States of America;

Dorset Management Corporation – New York

(d)

Title of Class of Securities
Common Stock, $0.001 Par Value

(e)

CUSIP Number
003881307

Item 3.

If this statement is filed pursuant to §§240.13d-1(b) or 240.13d-2(b) or (c), check whether the person filing is a:

(a)

o

Broker or dealer registered under section 15 of the Act (15 U.S.C. 78o).

(b)

o

Bank as defined in section 3(a)(6) of the Act (15 U.S.C. 78c).

(c)

o

Insurance company as defined in section 3(a)(19) of the Act (15 U.S.C. 78c).

(d)

o

Investment company registered under section 8 of the Investment Company Act of 1940 (15 U.S.C 80a-8).

(e)

o

An investment adviser in accordance with §240.13d-1(b)(1)(ii)(E);

(f)

o

An employee benefit plan or endowment fund in accordance with §240.13d-1(b)(1)(ii)(F);

(g)

o

A parent holding company or control person in accordance with § 240.13d-1(b)(1)(ii)(G);

(h)

o

A savings associations as defined in Section 3(b) of the Federal Deposit Insurance Act (12 U.S.C. 1813);

(i)

o

A church plan that is excluded from the definition of an investment company under section 3(c)(14) of the Investment Company Act of 1940 (15 U.S.C. 80a-3);

(j)

o

Group, in accordance with §240.13d-1(b)(1)(ii)(J).

Item 4.

Ownership

Provide the following information regarding the aggregate number and percentage of the class of securities of the issuer identified in Item 1.

(a)

Amount beneficially owned:   

(b)

Percent of class:

(c)

Number of shares as to which the person has:

(i)

Sole power to vote or to direct the vote   

(ii)

Shared power to vote or to direct the vote    

(iii)

Sole power to dispose or to direct the disposition of   

(iv)

Shared power to dispose or to direct the disposition of   

David M. Knott; Dorset Management Corporation

See Rows 5 through 9 and 11 on  pages 2 and 3.

Item 5.

Ownership of Five Percent or Less of a Class

If this statement is being filed to report the fact that as of the date hereof the reporting person has ceased to be the beneficial owner of more than five percent of the class of securities, check the following   x.

Item 6.

Ownership of More than Five Percent on Behalf of Another Person

N/A

Item 7.

Identification and Classification of the Subsidiary Which Acquired the Security Being Reported on By the Parent Holding Company or Control Person

N/A

Item 8.

Identification and Classification of Members of the Group

N/A

Item 9.

Notice of Dissolution of Group

N/A

Item 10.

Certification

By signing below I certify that, to the best of my knowledge and belief, the securities referred to above were acquired and are held in the ordinary course of business and were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities and were not acquired and are not held in connection with or as a participant in any transaction having that purpose or effect.

February 12, 2007

Date

/s/ David M. Knott

Signature

DORSET MANAGEMENT CORPORATION

By:

/s/ David M. Knott

  David M. Knott, President