WASHINGTON: Dish Network got a break last night when a federal court extended the company’s ability to use the digital recording function in its set-top receivers. A lower court had ruled in early June that the recording function violated patents belonging to TiVo, and that it had to be disabled. TiVo has been chasing Dish for nearly five years over the satellite provider’s use of DVR technology that it says violates TiVo patents. Over the course of the legal battle, Dish has been ordered to pay damages of $103 million and stop using the technology. The satellite provider then proffered its own work-around, but the U.S. District Court for the Eastern District of Texas found it still violated TiVo’s patents and slapped Dish with another $105 million in damages plus ordered it to disable its DVRs.

The U.S. Court of Appeals for the Federal Circuit initially granted a temporary stay of the ruling on June 3, and extended it pending the outcome of Dish’s appeal. Opening briefs are due July 17; TiVo’s is due Aug. 25; Dish’s reply is due Sept. 4, with oral arguments anticipated in November.

“While the news can be viewed as a small victory for Dish--this is the company's second permanent stay--the case is clearly not over yet,” wrote Wachovia’s Marci Ryvicker. “At the end of the day, we still believe that Dish will be ‘forced’ to enter into a licensing agreement with TiVo.”

Dish, based in Englewood, Colo., said it was pleased the federal court determined that it “‘met its burden of demonstrating the requisites for a stay,’ including, at a minimum, that we have a substantial case on the merits. Dish has around 13.6 million customers; around 4 million have set-tops with DVR capability.

TiVo, based in Alviso, Calif., said in a statement that the the court had ruled in its favor once before and it was confident regarding a second win. “We are pleased that the court recognizes the urgency of ruling on this appeal and has ordered an expedited briefing schedule.”
-- Deborah D. McAdams