[Satellite News 04-21-11] EchoStar and sister company Dish Network won favorable judgments April 20 in two separate U.S. district and federal court cases, the companies announced.
    In one case, U.S. District Court Judge Roger Benitez ordered Jung Kwak, founder of set-top box distributor Viewtech Inc., to pay Dish Network $214.9 million as a result of the U.S. pay-TV operator’s suit against Kwak’s company for distributing piracy software used to unscramble encrypted subscription programs.
    In the lawsuit, Dish Network claimed that Viewtech’s receivers could be modified with piracy software to receive encrypted Dish Network programs and that the units purportedly were designed for free-to-air satellite programs. Kwak, who represented himself in the case, did not oppose the claim and is serving an 18-month prison sentence after pleading guilty to orchestrating a conspiracy to circumvent Dish’s security measures. Bentiez’s decision came after the granted EchoStar’s request for a summary judgement.
    “Viewtech’s sale of more than 1 million code-cracking satellite boxes leaves me no choice but to order the company to pay the claim in full, since the Digital Millennium Copyright Act calls for statutory damages between $200 and $2,500 for each piracy device sold,” Benitez said in his ruling. “These receivers were designed, marketed and sold for piracy.” A bankruptcy judge agreed to let EchoStar pursue Viewtech’s assets.
    Separately, Dish Network and EchoStar also won a unanimous verdict from the U.S. Federal Circuit Court of Appeals to vacate a previously issued U.S. district court contempt ruling against the two companies in the broadcasters’ ongoing legal battle with TiVo over DVR set-top box designs.
    The ruling is the latest development in a lawsuit that has spanned more than five years. EchoStar filed its initial lawsuit against TiVo in 2005 over four patents it acquired from IBM. In 2006, a jury found Dish and EchoStar liable for infringing TiVo’s patent when the broadcasters began making their own set-top boxes. EchoStar relies on Dish Network, which has taken the primary role in the lawsuit, for most of its business.
    While Dish Network and EchoStar said they were pleased with the federal court’s decision, the two companies expressed disappointment in the Federal Circuit Court’s 7-5 split decision affirming the District court’s ruling to uphold TiVo’s patent disablement claim covering certain older generation MPEG-2 DVRs.
    “We intend to seek review of that part of the decision by the U.S. Supreme Court and seek a stay of the injunction while doing so. We also will be making a motion to dissolve the injunction based on TiVo’s recent representations to the U.S. Patent and Trademark Office substantially limiting the scope of the claims at issue in this case,” EchoStar said in a company statement.
    Dish Network said existing customers with DVRs would not immediately be impacted by the court decision. “We have already upgraded many of our customers [from the older MPEG-2 DVRs] and, if we are unsuccessful in obtaining a stay, we will work as quickly as possible to upgrade the remaining customers to our current generation DVRs, as these are not at issue in the ruling,” the company said.