Dumb and obvious patent
This patent fails the 'obvious to those skilled in the art' test. Try reading it. Basically it is a simple client - server structure with packet data aggregation. It is worded very awkwardly to try to obfuscate what they are patenting.. I can even think of a 1975 training system for the Air Force which would serve as an example of prior art. This system was converted from T1 dedicated link to Ethernet in the late 1980s.
There are other examples where the server is 'nominated' and state vectors are returned for the aggregated global system state may also be 1985's Sun Workstation's Mazewar, and some of the early Xwindows games like xtank. SGIs interactive 3-D tank game and flight game might also fit under this too (though I would have to go through their source code to see if it is distributed or if a 'server' gets nominated from the first two players entering the game).
I suspect that Microsoft showed them some prior art and threatened to have the patents invalidated. Paltalk caved and Microsoft paid them a small fee to have them keep quiet. This way the patent still 'stands' and can be used to attempt to block the Open Software movement, or at least slow them down.
-Science guy since I have been in this business for a very long time.. and my grey hairs agree with me. If there was a mafia guy.. I would probably use him instead because I know where many of the bones are buried and who may have prior art on patents - the result of being an old timer.