Dish Network 2014 Annual Report Download - page 162

DISH NETWORK CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
F-56
California Actions. The NBC plaintiffs and Fox plaintiffs filed amended complaints in their respective California
actions adding copyright claims against EchoStar and EchoStar Technologies L.L.C., a wholly-owned subsidiary of
EchoStar. In addition, the Fox plaintiffs’ amended complaint added claims challenging the Hopper Transfers™
feature of our second-generation Hopper set-top box.
On November 7, 2012, the California court denied the Fox plaintiffs’ motion for a preliminary injunction to enjoin
the Hopper set-top box’s PrimeTime Anytime and AutoHop features, and the Fox plaintiffs appealed. On March
27, 2013, at the request of the parties, the Central District of California granted a stay of all proceedings in the
action brought by the NBC plaintiffs, pending resolution of the appeal by the Fox plaintiffs. On July 24, 2013, the
United States Court of Appeals for the Ninth Circuit affirmed the denial of the Fox plaintiffs’ motion for a
preliminary injunction as to the PrimeTime Anytime and AutoHop features. On August 7, 2013, the Fox plaintiffs
filed a petition for rehearing and rehearing en banc, which was denied on January 24, 2014. The United States
Supreme Court granted the Fox plaintiffs an extension until May 23, 2014 to file a petition for writ of certiorari, but
they did not file one. As a result, the stay of the NBC plaintiffs’ action expired. On August 6, 2014, at the request
of the parties, the Central District of California granted a further stay of all proceedings in the action brought by the
NBC plaintiffs, pending a final judgment on all claims in the Fox plaintiffs’ action. No trial date is currently set on
the NBC claims.
In addition, on February 21, 2013, the Fox plaintiffs filed a second motion for preliminary injunction against: (i) us
seeking to enjoin the Hopper Transfers feature in our second-generation Hopper set-top box, alleging breach of their
retransmission consent agreement; and (ii) us and EchoStar Technologies L.L.C. seeking to enjoin the Slingbox
placeshifting functionality in our second-generation Hopper set-top box, alleging copyright infringement and breach
of their retransmission consent agreement. On September 23, 2013, the California court denied the Fox plaintiffs’
motion. The Fox plaintiffs appealed, and on July 14, 2014, the United States Court of Appeals for the Ninth Circuit
affirmed the denial of the Fox plaintiffs’ motion for a preliminary injunction as to the Hopper Transfers feature and
the Slingbox placeshifting functionality in our second-generation Hopper set-top box.
On January 12, 2015, the Court ruled on the Fox plaintiffs’ and our respective motions for summary judgment,
holding that: (a) the Slingbox placeshifting functionality and the PrimeTime Anytime, AutoHop and Hopper
Transfers features do not violate the copyright laws; (b) certain quality assurance copies (which were discontinued
in November 2012) do violate the copyright laws; and (c) the Slingbox placeshifting functionality, the Hopper
Transfers feature and such quality assurance copies breach our Fox retransmission consent agreement. The only
issue remaining for trial is the amount of damages (if any) on the claims upon which the Fox plaintiffs prevailed on
summary judgment, but the Court ruled that the Fox plaintiffs could not pursue disgorgement as a remedy. At the
parties’ joint request, the Court has stayed the case until October 1, 2015, and no trial date has been set.
New York Actions. Both the ABC and CBS parties filed counterclaims in the New York action adding copyright
claims against EchoStar Technologies L.L.C., and the CBS parties filed a counterclaim alleging that we fraudulently
concealed the AutoHop feature when negotiating the renewal of our CBS retransmission consent agreement. On
November 23, 2012, the ABC plaintiffs filed a motion for a preliminary injunction to enjoin the Hopper set-top
box’s PrimeTime Anytime and AutoHop features. On September 18, 2013, the New York court denied that motion.
The ABC plaintiffs appealed, and oral argument on the appeal was heard on February 20, 2014 before the United
States Court of Appeals for the Second Circuit. Pursuant to a settlement between us and the ABC parties, during
March 2014, the ABC parties withdrew their appeal to the United States Court of Appeals for the Second Circuit;
we and the ABC parties dismissed without prejudice all of our respective claims pending in the United States
District Court for the Southern District of New York; and the ABC parties granted a covenant not to sue. Pursuant
to a settlement between us and the CBS parties, on December 10, 2014, we and the CBS parties dismissed with
prejudice all of our respective claims pending in the New York Court.