TIVO vs E*

[CuriousMark]

Scott has posted repeatedly that those DVRs will not be shut off. Period. TiVO knows this. They don't even want them turned off. They want money out of Dish. Worst case, if it all goes against Dish, is that they will pay a fortune to TiVO or buy them. TiVO is publicly traded, at a bit over $6 per share.

TiVO's whole business plan seems to have become one of making a profit thru legal maneuvers when you can't thru business actions.

I think it is less about getting the money out of Dish than it is getting their Intellectual Property respected so that others (cable companies for example) doing the same as Dish will see that taking a license is the correct thing for them to do. For that to happen Dish has to be willing or forced to take a license. The current lever to force that is DVR shutdown. It may not be the lever TiVo would prefer, but it is the only one they have at the moment.

While all of this has been going on TiVo's business plan has morphed from one of "fight them" to one of "join them" in that they now have partnerships with DirecTV, Comcast, Cox, Amazon, Disney, Netflix, Jaman and Google youTube. Dish is still refusing to come around and join the big happy family and is choosing to continue going it alone. The current situation has arisen out of Dish's legal maneuverings to avoid obeying an injunction. Dish could end that today if they wanted. They could buy a license, join the family and not a single DVR would be at risk.

 

[navychop]

I think it is less about getting the money out of Dish than it is getting their Intellectual Property respected ....

1. They are a business. Getting it "respected" means getting money for it.

2. It is a massive stretch, admittedly one they are getting away with, to say it is "their" intellectual property. DVRs were out before TIVO ever hit the streets. Look at Replay. The concept is fairly simple, and obvious. But we can believe the patents are way too broad and easily granted till the cows come home- it's what the courts say that matters.

3. Come the revolution, I'll fix it all!

 

[CuriousMark]

1. They are a business. Getting it "respected" means getting money for it.

2. It is a massive stretch, admittedly one they are getting away with, to say it is "their" intellectual property. DVRs were out before TIVO ever hit the streets. Look at Replay. The concept is fairly simple, and obvious. But we can believe the patents are way too broad and easily granted till the cows come home- it's what the courts say that matters.

3. Come the revolution, I'll fix it all!

My point is that an ongoing license arrangement is more important than a one time cash settlement. If all they wanted was money, they could have gone for the one time payout and left it at that.

It is the court that is saying there was infringement on the specifics of this one patent, which is only a small but critical part of the whole DVR picture.

I'll be selling torches and pitchforks at the edge of the village to anyone willing to storm the legal system castle.

 

[Greg Bimson]

2. It is a massive stretch, admittedly one they are getting away with, to say it is "their" intellectual property. DVRs were out before TIVO ever hit the streets. Look at Replay.

So let's take a look at Replay...

In 2001, ReplayTV's owner SonicBlue sued TiVo over the implementation of DVR's. ReplayTV was trying to defend its patent portfolio against violations by another company. Two months later, in February 2002, TiVo countersued ReplayTV. TiVo was trying to defend its patent portfolio against infringement by another company. However, TiVo sued ReplayTV over alleged infringement of TiVo's Time Warp patent, the same patent that DISH/SATS DVR's have been found to infringe. It is quite possible they both infringed upon each other's patents. And the suit was dismissed by both parties when they agreed to end the lawsuit.

So I don't buy that just because DVR's were available that aspects of DVR functionality aren't patentable. Heck, Alexander Graham Bell was able to patent the telephone even though wires were strung across America for the telegraph. The Time Warp patent was upheld upon review by the PTO, thus making it bulletproof.

So it isn't like this is some exceptional case.

 

[jacmyoung]

...So it isn't like this is some exceptional case.

Agreed.

For the same reason, if the patent can be designed around, well it can be.

E*'s biggest mistake was back then they simply copied everything TiVo gave them, then told TiVo to take a hike. TiVo's DVR patent was not diffecult to work around, if what E* described of their new DVR software is true.

TiVo said themselves during the trial that there were many DVR technologies, TiVo was only going after the one they had the patent on, that E* infringed on.

 

[flyingsquirrel]

Has anyone considered that the delay may be the judge's way of encouraging the parties to settle? I think that if this were a priority with him, he would have ruled. Is there any requirement that he rule in any kind of timeframe? I don't think so.

Is his ruling going to make all that much difference? Whoever loses will appeal. In this case NOT issuing a ruling may lead to a conclusion faster than an actual ruling.

 

[CuriousMark]

Has anyone considered that the delay may be the judge's way of encouraging the parties to settle?

Yes, several have suggested the same. His comment to TiVo and Dish Lawyers at the last hearing that these kinds of cases drag on forever seems to bolster that belief too. It sounds like he wants it to be over, and isn't thrilled to have to deal continued hearings, so taking his time certainly could be a way of saying "settle already".

 

[Greg Bimson]

But what exactly will a delay accomplish? DISH/SATS thinks TiVo wants too much money, so they won't settle. TiVo will want quite a bit of money, so they won't settle until they get what they want.

There will be no settlement until after the decision is rendered, either leaving TiVo in the drivers seat or DISH/SATS driving the getaway car until TiVo can try to pin something else on them.

Is his ruling going to make all that much difference? Whoever loses will appeal. In this case NOT issuing a ruling may lead to a conclusion faster than an actual ruling.

If the decision is issued in TiVo's favor and a stay of the following order is not granted by the Court of Appeals, that will make the whole case come to a conclusion more quickly. And much more costly for DISH/SATS.

 

[jacmyoung]

I agree with what Greg said, only to add that if judge rules DISH not in contempt, and tells TiVo they must seek a new trial on the new design around, the whole case will come to a conclusion even faster

 

[jclewter79]

I am not very well versed in these things so, I will ask. Since tivo is a publicly traded company, what would stop E* from buying a controlling amount of their stock?

 

[MikeD-C05]

Charlie's stubborn ass cheapness.

 

[Zero327]

Charlie's stubborn ass cheapness.

I'm with Chuck on this one. You don't threaten me, try to extort me, put a legal gun to my head and then expect to get paid off so you can walk with my cash and I get your crap stock... I'd spend twice as much as it would cost to buy them, to put them in the ground...

 

[Greg Bimson]

I'm with Chuck on this one. You don't threaten me, try to extort me, put a legal gun to my head and then expect to get paid off so you can walk with my cash and I get your crap stock...

Except that DISH/SATS was found guilty of breaking the law, via infringement of a patent. It isn't extortion if you are guilty.

 

[CuriousMark]

I agree with what Greg said, only to add that if judge rules DISH not in contempt, and tells TiVo they must seek a new trial on the new design around, the whole case will come to a conclusion even faster

If Dish is ruled not in contempt and also ruled more than colorably different, then TiVo would have to file for a finding of infringement via the doctrine of equivalents on the hardware and software claims. Things would go back into discovery mode and a new trial would be scheduled. And the case would go on and on and on. Unless as, jacmyoung seems to be suggesting, TiVo Decides to throw in the towel at that point and simply quit, then it would all be completely over.

 

[vampz26]

I agree with what Greg said, only to add that if judge rules DISH not in contempt, and tells TiVo they must seek a new trial on the new design around, the whole case will come to a conclusion even faster

I think I asked this before but don't recall if you answered...

Are you still an E* sub? I thought you dumped them after being with both providers for a while...

 

[Zero327]

Except that DISH/SATS was found guilty of breaking the law, via infringement of a patent. It isn't extortion if you are guilty.

Yeah yeah... and in a Texas courtroom OJ would be innocent.

 

[DishSubLA]

I am not very well versed in these things so, I will ask. Since tivo is a publicly traded company, what would stop E* from buying a controlling amount of their stock?

Poison Pills. Now, Tivo could allow Ergan to be a "major investor" in the company, as he is in many other companies, without giving up control to Ergan. However, Tivo probably wants too much money for our thrifty Ergan. Also, conditions could be attached to any investment such as Dish paying for advertising or other costs. "Hell, no," one can imagine Eran saying. Tivo is in the process of shedding it's hardware business and becoming a strictly software provider--to major satellite and cable companies, and everything for Tivo is really riding on this case and it looks like it may take years to resolve. Dish is the one with the financial resources to let this drag on for years; Tivo is sill on life support and won't last that long.

 

[DishSubLA]

If Dish is ruled not in contempt and also ruled more than colorably different, then TiVo would have to file for a finding of infringement via the doctrine of equivalents on the hardware and software claims. Things would go back into discovery mode and a new trial would be scheduled. And the case would go on and on and on. Unless as, jacmyoung seems to be suggesting, TiVo Decides to throw in the towel at that point and simply quit, then it would all be completely over.

That is exactly what Dish lawyers strategy has been all along. This thing may never get resolved to Tivo's satisfaction, and Ergan is stubborn and believes he did not infringe (as supported by his experts and lawyers) and is willing to fight all the way to prove it, if he has to do so. The irony in all this is that in the end, regardless of who gets the "favorable" judgment, there very well could be some kind of deal between Dish and Tivo. Each is trying to force the other to the bargaining table with the upper-hand. The problem is, Tivo probably wants too much money, and Ergan is offering to little for Tivo's taste. This has years to go, and Dish can easily outlast Tivo in prolonged leagal battle. Even the judge sees it going to new trial, as evidenced by his comments cited in an earlier post.

 

[jacmyoung]

If Dish is ruled not in contempt and also ruled more than colorably different, then TiVo would have to file for a finding of infringement via the doctrine of equivalents on the hardware and software claims. Things would go back into discovery mode and a new trial would be scheduled. And the case would go on and on and on. Unless as, jacmyoung seems to be suggesting, TiVo Decides to throw in the towel at that point and simply quit, then it would all be completely over.

What I meant was even if TiVo does not throw in the towel, it will still be the end of this case. TiVo can go after the new design around, but it will have to be a new trial, independent of the current case.

BTW, the only way DISH may be found not in contempt is if the new design around is found more than colorably different. If one read the 9/4 transcript carefully, noticed the Q/A between the judge and the E*'s attorney on this issue.

The judge forced him to admit even with the design around, E* could still be found in contempt, how so? As the judge said, if the design around was only colorable.

If there were another reason to find E* in contempt, the judge would have mentioned it at that point, but he only pointed out that single reason E* might still be found in contempt.

The TiVo's "face of the order" violation has no ground to stand if the design around is more than colorable.

Now there is certainly the chance the judge finds E* not in contempt on the face, but still grants TiVo's wish of a further discovery on the new design around to determine the colorable difference issue, my bet is it is not likely because the judge on 9/4 repeatedly asked TiVo's attorney what if he found E* not in violation and TiVo had to seek a "new action" either in the DE court, or in his court again, what did that leave you TiVo?

But even if another discovery is granted, if what E* described of its new design around is indeed true, there is no way it can be only colorable. The difference between the new and the old design is so substantial I do not have any doubt it no longer infringes.

The only exception will be if E* was making this whole design around up, or the actual software code is not nearly as what they described.

 

[jacmyoung]

I think I asked this before but don't recall if you answered...

Are you still an E* sub? I thought you dumped them after being with both providers for a while...

Why do you want to know?