BREAKING: DISH Held In Contempt (For Real)

Dave Zatz —  March 4, 2010 — 21 Comments

I’ve been covering the TiVo/DISH/EchoStar patent infringement case for years. (With varying degree of interest.) And it looks like we’re that much closer to a conclusion given today’s ruling/affirmation by the United States Court of Appeals for the Federal Circuit:

Appellants (collectively, “EchoStar”) appeal from the district court’s decision finding them in contempt of the court’s permanent injunction order. TiVo Inc. v. Dish Network Corp., 640 F. Supp. 2d 853 (E.D. Tex. 2009). Because we find that the district court did not abuse its discretion in imposing sanctions against EchoStar, we affirm the finding of contempt.

The Premiere may not have moved the needle, but there’s nothing like the prospect of (large sums of) cold, hard cash to whip the investors into a frenzy:

Yes, TiVo should be receiving (additional) cash from DISH and/or EchoStar. And, yes, it looks like a number of DISH DVRs will be disabled. Davis Freeberg and I are still sifting through the ruling to get a better sense of what this ultimately means and if DISH/Echo has any moves left. I’d also keep an eye on Engadget’s resident legal eagle for a more thorough analysis.

21 responses to BREAKING: DISH Held In Contempt (For Real)

  1. About time, although TiVo’s patents seem obvious today, that is the system we have so other companies need to pay the creator. If TiVo didn’t actually implement these patents years ago, I’d be signing a different tune.

  2. Man, I had been looking to build my position in TIVO in advance of the coming Directv receiver. Thought the 8.50-10 range was good. MAN, just missed my timing by a few days – and that’s not like me.

    Must be my excitement for tonites HABS game. ;-)

  3. haha, DISH went down 5.71 today

  4. Both companies have put out statements… TiVo believes they’ll receive about $300 million in damages and sanctions, but aren’t done with DISH yet. DISH says current DVR customers will not be impacted by this ruling and they’re looking to appeal.

  5. Hopefully TiVo uses the cash to hire more developers to implement all those things we wanted in the Premiere box! $300M is many many years of R&D costs!

  6. They don’t have to disable PVRs already placed with subscribers, but all the ones they have in stock have to be disabled, which basically means they can’t be sold as PVRs.

    EchoStar got totally pwned, basically. They can’t sell PVRs anymore without infringing in some way.

  7. Now they will have the money to implement all the great ideas/complaints of their own customers…. oh wait… nvrmd… maybe S5?

  8. Love the iphone screenshot showing how the battery only has around 1/3 of its juice left before lunch. Appreciate the comic relief when we all know it is so much easier to screengrab from a laptop.

  9. Actually, iPhone screengrabs are very easy and perfectly sized. I originally thought to take a shot of the Google finance page, but it wasn’t as clearly presented (colors, contrast) as this. Which is why I deviated. And I took the screenshot while WALKING to my laptop out in the car.

    But yeah, my battery life sucks on weekdays. It’s not the iPhone actually, it’s because I get no reception in the office (thank you, AT&T) and I always forget to turn the radio off. Continually hunting for a single it’ll never find kills the battery.

    It’s probably also worth mentioning at this time that I’ve never bought, sold, or owned TiVo stock. And I generally could care less how the market reacts. But this spike is newsworthy.

  10. I was just giving you flak as battery life is my biggest pet peeve.

    Keep up the good work!

  11. Now now, before we spend Tivo’s money for them, we need to get a few things straight first.

    As my mom once told me, just because someone has a lot of money, it doesn’t mean they’re good with it.

    See reference: Tivo’s R&D department. Indeed a potential case study.

    Make sure that gets fixed first so we don’t end up with a Series5 with just a 500GB hard drive and a qwerty remote with “SUPER” Glo three years from now. :)

  12. I guess Tivo could take some of that gain and give it to Linux developers. Since they got the OS for free. Naaa! We’d rather grab free stuff and sue people on patents.
    Jurks!

  13. I’m not buying this move. The 27$ target now makes it over 3B$ on a 100M profit company (and that only in the past year moving to profit) and losing subs. My puts are now up 100% today, holding for something like 4-500% :-)

    feel free to delete comment Dave. ;-)

  14. I’m not the TiVo Community forum. Talk stock as much as you like, pump whomever at will. I only delete ass hats, personal attacks/name calling, and undisclosed company trolls. :)

  15. Perfect timing to improve the morale at TiVo HQ after the lackluster reaction to TiVo Premiere.

    FWIW, I don’t think the market reaction is due to the hundreds of millions DISH/Echostar will have to pay. It’s market being hopeful that courts affirming TiVo patents will lead to a string of licensing deals with the multitude of other providers/vendors offering DVRs.

    Dave — what are the chances of that happening, i.e. what is the scope of TiVo’s patents and how many other companies may be forced to license TiVo’s IP?

  16. Ivan, I’m no patent or legal expert.

    We do know TiVo has open cases against AT&T and Verizon. Microsoft is helping back AT&T in their case and Verizon just bought a patent for leverage in theirs. Who knows.

    The DISH case seemed unique because TiVo gave them prototype hardware which was never returned. Something like that. A deal never materialized between the two co’s but the claim was that the insider info was used to develop the infringing technologies. Not sure if that makes it somewhat different, more meaningful. Then again, willfulness probably only matters in sentencing, not proving infringement as Dale taught me.

  17. Analyst: Dish May Have To Shut Down 8M DVRs After TiVo Legal Loss:

    http://www.multichannel.com/article/449679-Analyst_Dish_May_Have_To_Shut_Down_8M_DVRs_After_TiVo_Legal_Loss.php

    [caveat: this guy could be an idiot for all I know]

  18. Dave,

    Don’t forget that the FiOS DVR is also based on MS technology, not sure if the impeding part does though.

    I have my hopes that Verizon and TiVo strike a deal and part of that deal brings FiOS VOD to TiVo. Remember that FiOS VOD is already IP based, so this would be much easier for TiVo to implement than on traditional RF networks.

  19. Ben,

    FiOS DVR based on MS technology? I’m not sure what you’re talking about. Their live stuff is QAM over fiber. Their STBs were Motorola and are moving to Cisco. Neither of whom uses Microsoft’s MediaRoom stuff. The VOD stuff is IP-based, but it uses MPEG-2 encoders, no VC-1. The backoffice is Tandberg.

    What MS technology?

    As far as allowing Tivo’s to use Verizon VOD… I agree it might not be that hard. They can/do use CableCard based boxes for the live stuff, so that’s no problem. The VOD stuff as you say is IP, and is even MPEG-2, though I can imagine them moving to h.264 before long since all their STBs support it, but Tivo can handle that too. They’d have to build in an RTSP client to handle VOD, but that wouldn’t be that hard as you say. No hardware required at least.

  20. Unique or not, the courts found Echostar/Dish guilty of violating patents, not breech of trust or corporate espionage. And even if a borrowed Tivo prototype was noteworthy in the original suit, the thing that is going to be noteworthy in every comming suit is going to be the ‘legal precedent’ of this suit.
    The timewarp patent is VERY broad too. It’s hard not to violate it, not matter what tecniques you use (as Echostar just discovered after claiming to have adjusted their technology). Part of the patent actually reads “The invention allows the user to store selected television broadcast programs while the user is simultaneously watching or reviewing another program.”

  21. I’ve been a loyal and (very) happy Dish customer for 10+ years. Too bad Tivo had to waste their and Dish’s resources in an attempt to stay afloat. I plan to stick with the Dish I love and now won’t even consider a Tivo.

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