Dish, EchoStar to pay $500 million TiVo settlement

[May 02, 2011]  WASHINGTON (AP) -- Dish Network Corp. and EchoStar Corp. will pay TiVo Inc. $500 million to settle a patent lawsuit over digital video recorder technology, the companies said Monday.

TiVo, based in Alviso, Calif., first sued Dish and EchoStar in 2004 for infringing on patents covering its "Time Warp" digital video recorder technology.

The recorders allow users to digitally record television programs and then play them back, as well as pause, fast-forward and rewind.

Under the settlement, Dish and EchoStar will initially pay TiVo $300 million. The remaining $200 million will be distributed in six annual installments between 2012 and 2017.

Also, TiVo granted Dish Network a license under its Time Warp patent and related patents until they expire. TiVo also granted EchoStar a license to make certain DVR-enabled products solely for Dish Network and two international customers.

EchoStar granted TiVo a license under patents EchoStar owns for TiVo-branded, co-branded and ingredient-branded products.

EchoStar is the former parent company of Dish Network and operates the satellites on which its service runs. It spun off Dish in 2008.

TiVo said it will also help Dish Network promote the Blockbuster digital video service. Dish bought Blockbuster Inc. out of bankruptcy last month.

The settlement deal comes on the heels of a decision by a panel of federal appeals judges holding Dish and EchoStar in contempt of court for failing to abide by an injunction. The judges had decided to send the case back to a lower court to consider whether technology being used in newer Dish boxes still infringes on TiVo's patents.

The April 20 ruling required Dish and EchoStar to disable the boxes and awarded $90 million in damages to TiVo. The settlement dismisses that judgment.

[Associated Press]

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