Dish’s Tivo Bill: $328 Million and Counting
by Peter Kafka
Posted on November 9, 2009 at 6:27 AM PT
You think you’re paying too much for cable TV? Check out this nugget, buried in satellite TV provider Dish Networks’ (DISH) quarterly filing: The company has spent $328 million in its legal battle against Tivo (TIVO) this year, and that bill could keep growing.
Dish has rung up the tab while fighting one of the many patent suits Tivo has brought against cable and satellite providers, accusing them of ripping off its DVR technology. Tivo has won an initial series of rulings against Dish, forcing the company to hand over a slug of cash, but more could be coming, the satellite company noted today. What would that mean? In Securities and Exchange Commission legalese:
Depending on the amount of any additional damage or sanction award or any monetary settlement, we may be required to raise additional capital at a time and in circumstances in which we would normally not raise capital. Therefore, any capital we raise may be on terms that are unfavorable to us, which might adversely affect our financial position and results of operations and might also impair our ability to raise capital on acceptable terms in the future to fund our own operations and initiatives. We believe the cost of such capital and its terms and conditions may be substantially less attractive than our previous financings.
Gulp. On the other hand, as Barclays Capital’s Vijay Jayant notes this morning, if Dish were really worried about a coming legal bill, the company probably wouldn’t want to hand its shareholders a $900 million dividend. Let’s see how investors react today.
