Dish Network 2015 Annual Report Download - page 169

DISH NETWORK CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
F-65
Phoenix Licensing, L.L.C./LPL Licensing, L.L.C.
On October 17, 2014, Phoenix Licensing, L.L.C. and LPL Licensing, L.L.C. (together referred to as “Phoenix”)
filed a complaint against us and our wholly-owned subsidiary DISH Network L.L.C. in the United States District
Court for the Eastern District of Texas, alleging infringement of United States Patent Nos. 5,987,434 entitled
“Apparatus and Method for Transacting Marketing and Sales of Financial Products”; 7,890,366 entitled
“Personalized Communication Documents, System and Method for Preparing Same”; 8,352,317 (the “317 patent”)
entitled “System for Facilitating Production of Variable Offer Communications”; 8,234,184 entitled “Automated
Reply Generation Direct Marketing System”; and 6,999,938 entitled “Automated Reply Generation Direct
Marketing System.” Phoenix alleged that we infringe the asserted patents by making and using products and
services that generate customized marketing materials. Phoenix is an entity that seeks to license a patent portfolio
without itself practicing any of the claims recited therein. On September 15, 2015, we and certain other parties filed
a petition for a covered business method patent review of the 317 Patent (the “CBM Patent Review”) before the
United States Patent and Trademark Office. On November 4, 2015, the Court dismissed all of Phoenix’s claims in
the action against us with prejudice pursuant to a settlement agreement. As a result, we withdrew from the CBM
Patent Review.
Qurio Holdings, Inc.
On September 26, 2014, Qurio Holdings, Inc. (“Qurio”) filed a complaint against us and our wholly-owned
subsidiary DISH Network L.L.C., in the United States District Court for the Northern District of Illinois, alleging
infringement of United States Patent No. 8,102,863 (the “863 patent”) entitled “Highspeed WAN To Wireless LAN
Gateway” and United States Patent No. 7,787,904 (the “904 patent”) entitled “Personal Area Network Having
Media Player And Mobile Device Controlling The Same.” On the same day, Qurio filed similar complaints against
Comcast and DirecTV. On November 13, 2014, Qurio filed a first amended complaint, which added a claim
alleging infringement of United States Patent No. 8,879,567 (the “567 patent”) entitled “High-Speed WAN To
Wireless LAN Gateway.” Qurio is an entity that seeks to license a patent portfolio without itself practicing any of
the claims recited therein. On February 9, 2015, the Court granted DISH Network L.L.C.’s motion to transfer the
case to the United States District Court for the Northern District of California. During October 2015, DISH
Network L.L.C. filed petitions before the United States Patent and Trademark Office challenging the validity of the
863, 904 and 567 patents. On November 3, 2015, the case was stayed pending resolution of these proceedings
before the United States Patent and Trademark Office.
We intend to vigorously defend this case. In the event that a court ultimately determines that we infringe the
asserted patents, we may be subject to substantial damages, which may include treble damages, and/or an injunction
that could cause us to materially modify certain features that we currently offer to consumers. We cannot predict
with any degree of certainty the outcome of the suit or determine the extent of any potential liability or damages.
Technology Development and Licensing L.L.C.
On January 22, 2009, Technology Development and Licensing L.L.C. (“TDL”) filed suit against us and EchoStar, in
the United States District Court for the Northern District of Illinois, alleging infringement of United States Patent
No. Re. 35,952 (the “952 patent”), which relates to certain favorite channel features. TDL is an entity that seeks to
license an acquired patent portfolio without itself practicing any of the claims recited therein. The case was stayed
in July 2009 pending two reexamination petitions before the United States Patent and Trademark Office, which
concluded in August 2015 and resulted in 42 out of the 53 claims of the 952 patent being invalidated. As a result,
the case resumed in August 2015. A trial date has not been set.
We intend to vigorously defend this case. In the event that a court ultimately determines that we infringe the
asserted patent, we may be subject to substantial damages, which may include treble damages, and/or an injunction
that could cause us to materially modify certain features that we currently offer to consumers. We cannot predict
with any degree of certainty the outcome of the suit or determine the extent of any potential liability or damages.