DIRECTV 2005 Annual Report Download - page 43

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THE DIRECTV GROUP, INC.
arbitration panel, and we anticipate that these demands for arbitration will be consolidated for hearing,
which is scheduled to occur beginning in late January 2007.
Finally, in June 2005, we filed suit against Darlene in the United States District Court for the
Southern District of New York seeking specific performance and declaratory relief with respect to the
release agreement and covenant not to sue executed by Darlene in February 2004 in connection with
the DLA LLC reorganization and related transactions. Darlene has filed an answer and counterclaim.
***
(b) Previous reported legal proceedings which have been terminated during the fourth quarter
ended December 31, 2005 are summarized below:
In April 2001, Robert Garcia, doing business as Direct Satellite TV, an independent retailer of
DIRECTV System equipment, instituted arbitration proceedings against us in Los Angeles, California
regarding commissions and certain chargeback disputes. On October 4, 2001, Mr. Garcia filed a class
action complaint against us in Los Angeles County Superior Court asserting the same claims and a
Consumer Legal Remedies Act claim. Mr. Garcia alleged $300 million in class-wide damages and
sought certification of a class of plaintiffs to proceed in arbitration with court oversight. In
February 2004, the trial court compelled the matter to arbitration and relinquished all jurisdiction in
connection with the case. On November 5, 2005, the parties agreed to settle and dismiss with prejudice
all claims each had asserted against the other in the arbitration, effective as of August 5, 2005. Neither
party paid any money to the other in connection with the settlement, and each party agreed to bear its
own costs and attorneys’ fees.
***
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
***
30