It’s either the end of an era or the beginning of a new one, depending how you look at it: Dish Network and EchoStar have reached a $500 million settlement agreement with TiVo in the companies’ long-running legal battle over DVR patents. Under the deal, TiVo will receive $300 million up-front with the remaining $200 million distributed in annual $33 million installments through 2017. The deal ends all patent litigation between the two companies, and Dish Network will be picking up a license to TiVo’s so-called “time warp” DVR technology patent (along with others). TiVo has also agreed to help promote Dish Networks’ newly-acquired BlockBuster video service.
“We are extremely pleased to reach an agreement with Dish Network and EchoStar which recognizes the value of our intellectual property,” said TiVo president and CEO Tom Rogers, in a statement. “The compensation from this settlement, including the resulting reduction in legal expenditures, puts TiVo in an enviable financial and strategic position.”
The patent license agreement puts an end to a seven year patent battle between the two companies, focusing on TiVo’s “time warp” DVR technology patent and related technologies. The fight started back in 2004 and endured several high-profile rulings, including a Texas court awarding TiVo some $74 million in damages back in 2006, and then increasing that figure to more than $200 milion in 2009. The $500 million settlement agreement comes on the heels of a U.S. appeals court ruling last month that EchoStar DVRs did, in fact, violate TiVo’s time-warp patent, opening the door for a permanent injunction that would require Dish Network to disable DVR functionality in infringing products. At the time, Dish Network indicated it intended to pursue the case with the U.S. Supreme Court.
With licensing fees, the Dish Network settlement will be worth more than $600 million to TiVo. TiVo will also be picking up licenses to a selection of EchoStar patents for “TiVo-branded, co-branded and ingredient-branded products.”
With the long-running EchoStar dispute settled, TiVo now apparently intends to set its eyes on other companies.
“This settlement [..] demonstrates the significant return afforded to our shareholders by diligent enforcement of TiVo’s intellectual property rights,” said Rogers. “Those efforts will aggressively continue with other parties.”
