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(NASDAQ:TIVO) TiVo Inc.
TiVo shares fall in after hours trading on EchoStar appeal
- Oct 3, 2006 07:42 PM (AP Online)
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SAN JOSE, California, Oct 03, 2006 (AP Worldstream via COMTEX News Network) --
Shares of TiVo Inc. fell nearly 7 percent in after hours trading Tuesday when the digital video recording provider said
an appellate court had given EchoStar Communications Corp. a reprieve in the pair's ongoing patent battle.
The U.S. Court of Appeals for the Federal Circuit granted EchoStar's request for a stay on an injunction that would have
banned the satellite TV provider from making or selling DVR products in the United States, TiVo said. As a result, the ban,
which also would have forced EchoStar to disable machines already found in customers' homes, will be postponed, pending the
outcome of EchoStar's appeal.
TiVo sued Englewood, Colorado-based EchoStar in January 2004, alleging EchoStar and certain subsidiaries violated TiVo's
"time warp" patent that relates to the storage and playback of television programming. A jury ruled in April that EchoStar
infringed on TiVo's patented TV-viewing technology in making set-top boxes for its customers.
In August, the federal district court judge who presided over the jury trial in Texas issued the injunction against EchoStar
and ordered the company to pay TiVo $89.6 million (?70.35 million) in damages.
EchoStar appealed and said Tuesday it was "pleased" the appellate court blocked the Texas decision pending its appeal.
"This action by the Federal Court reinforces our belief that the Texas court made significant errors during the trial
process and we look forward to complete vindication of our position," EchoStar said in a statement.
TiVo downplayed the appellate decision as a routine legality.
"We are confident that the jury's decision in TiVo's favor will be upheld once the Federal Circuit has the opportunity
to review the entire record in this case. It is important to note that most injunctions in patent cases are stayed pending
appeal, and the appeal itself will be decided on a totally different standard of review," TiVo said in an official statement.
Also Tuesday, TiVo disclosed in a filing with the Securities and Exchange Commission that it paid IBM Corp. an undisclosed
amount of cash for a royalty-free, cross-licensing agreement involving all patents or patent applications dated before Sept.
28.
TiVo, which is still struggling to become profitable, reported in the same filing that it netted $64.7 million (?50.8
million) with its public stock offering of about 8.3 million shares in September.
TiVo shares fell in the after-hours session by 52 cents, or 6.9 percent, from Tuesday's closing price of $7.52. Shares
of EchoStar were trading at $32.10 in the extended session, up 3 cents from Tuesday's close of $32.07 on the Nasdaq Stock
Market.
Copyright (C) 2006 The Associated Press. All rights reserved.