DISH Network Granted "En Banc" Review in TiVo "Time Warp" Patent Case

--Last-Minute Reprieve Means DISH Will Not Have to Disable its DVR's Anytime Soon

The US Court of Appeals for the Federal Circuit in Washington, DC last Friday granted DISH Network and its sister company, EchoStar, an "en banc" (i.e. full-court) review in the so-called "Time Warp" patent case brought against it by DVR vendor, TiVo. (Note: the case began back in 2004, when TiVo sued DISH Network--then called EchoStar--alleging that it was violating its US patent, number 6,233,389. The so-called "Time Warp" patent, which was granted to the company in May, 2001, describes methods for recording one program while playing back another, and for watching a show as it is recording, as well as a storage format that supports "trick-play" capabilities, such as pause-live-TV, fast-forward, rewind, instant replays, and slow motion.) The decision surprised many observers, because "en banc" reviews are typically very seldom granted (around 3% of cases). Following news of the development, TiVo's stock declined in value by over 40% at one point Friday.

The review, which is expected to take several months, will see a panel of 10 or so judges from the appeals court revisit a March 3rd decision by three of the court's judges: the March 3rd decision upheld a ruling by the US District Court in Eastern Texas that DISH Network and EchoStar were in contempt of court for attempting a workaround that the lower court decided still infringed upon the TiVo patent. The lower court's contempt ruling would have forced the satellite TV provider to disable around 8 million of its DVR's--this in addition to the approximately $400 million in damages to TiVo that it has incurred so far in the case.

DISH Network/EchoStar and TiVo have each issued statements in response to the appeals court's decision to hold an "en banc" hearing: "DISH Network and EchoStar are pleased that the full Federal Circuit Court of Appeals has granted their petition for rehearing en banc," those companies' statement reads. "We believe the issues that will be considered by the full court on rehearing will have a profound impact on innovation in the United States for years to come." TiVo, meanwhile, stated that it is "disappointed that we do not yet have finality in this case despite years of litigation but we remain confident that the Federal Circuit's ruling in our favor will be reaffirmed after all of the judges on the Federal Circuit have had the opportunity to review the merits of this case."

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