Appeals Court Gives EchoStar Go-Ahead To Sell DVRs

Earlier, a U.S. District Court judge barred the sale of DVRs that a jury had decided infringed on TiVo patents. An appellate court quickly overturned the ban.
A federal judge in Texas on Friday ordered EchoStar Communications Corp. to stop selling digital video recorders in the United States, but an appellate court immediately blocked the ban requested by TiVo in its patent lawsuit against the satellite TV company.

U.S. District Court Judge David Folsom had barred EchoStar from selling DVRs containing technology that a jury decided in April infringed on TiVo patents. EchoStar, however, immediately appealed to the Federal Circuit Court of Appeals in Washington, D.C., which blocked the order from taking affect while the higher court considered the case.

The 10-member jury in Marshall, Texas, awarded TiVo $74 million in damages after finding that EchoStar willfully infringed on TiVo intellectual property. The two companies are fighting over technology that enables consumers to record one show while watching another.

In the latest tussle, both companies claimed victory in the back-to-back rulings. TiVo said the Texas ruling "recognizes that our intellectual property is valuable and will ensure that moving forward EchoStar will be unable to use our patented technology without our authorization."

EchoStar, however, said the appellate court decision ensured that it could continue to sell all its DVR models. "We continue to believe the Texas decision was wrong, and should be reversed on appeal."

The company also said it was working on modifications in its new DVRs, and to DVRs already sold, in order to "avoid future alleged infringement." EchoStar maintains that it has not done anything wrong.

EchoStar, based in Englewood, Colo., is known for its DISH Network brand. TiVo, headquartered in Alviso, Calif., was the first to market the DVR. The company claims to hold more than 86 patents, and have 138 more pending.

TiVo's lead in the market has been slipping over the last several years, as cable and satellite TV companies offer set-top boxes with many of the same DVR features. TiVo's biggest distributor is DirectTV Group Inc., which agreed in April to extend its relationship with TiVo for another three years.

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