DISH, EchoStar Settle with TiVo for $500 Million

ALVISO/ENGLEWOOD: DISH Network and EchoStar have agreed to pay $500 million to TiVo to settle their long-running patent dispute.

TiVo, DISH Network and EchoStar have agreed to dismiss all pending litigation between the companies with prejudice and to dissolve all injunctions against DISH Network and EchoStar. The parties also granted certain patent licenses to each other: TiVo has licensed its Time Warp patent to DISH, along with certain related patents. TiVo also granted EchoStar a license under the same patent and certain related patents to design and make select DVR-enabled products solely for DISH Network and two international customers. EchoStar granted TiVo a license under certain DVR-related patents for TiVo-branded, co-branded and ingredient-branded products.

The $500 million settlement includes an initial payment of $300 million with the remaining $200 million distributed in six equal annual installments between 2012 and 2017.

"We have tremendous respect for TiVo’s management, and we have always said that regardless of the outcome of the case, there were many ways that we could work together with TiVo," said Charlie Ergen, the chairman and CEO of DISH Network. "The results of TiVo’s formidable intellectual property enforcement program speak for themselves, and consequently, we are pleased to put this litigation behind us and move forward. Additionally, we believe that our agreement with TiVo provides us a competitive advantage as one of the few multichannel operators with rights to operate under TiVo’s Time Warp patent, which ultimately will allow us to enhance the performance of our award-winning DVRs. We look forward to continuing to offer DISH Network customers the most choices in video service."

"We are extremely pleased to reach an agreement with DISH Network and EchoStar which recognizes the value of our intellectual property," added Tom Rogers, the president and CEO of TiVo. "The compensation from this settlement, including the resulting reduction in legal expenditures, puts TiVo in an enviable financial and strategic position. This settlement, which brings the total compensation paid by DISH Network for use of TiVo’s ‘389 patent family to over $600 million, demonstrates the significant return afforded to our shareholders by diligent enforcement of TiVo’s intellectual property rights. Those efforts will aggressively continue with other parties."

Additionally, TiVo will play a role in helping DISH Network promote the Blockbuster digital video service. Ergen added, "We are excited to work with TiVo to help develop our Blockbuster video service. Resolving the patent infringement case allows us to further engage with TiVo on a variety of exciting strategic initiatives, like Blockbuster, where we are uniquely positioned to collaborate."