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New Twist In EchoStar-TiVo Patent Dispute

In the latest development in the long-running patent litigation between digital video recorder (DVR) manufacturer TiVo and satellite operator Dish Network and its affiliated set-top supplier EchoStar, the U.S. Patent and Trademark Office (USPTO) has agreed to EchoStar’s request to reexamine the software claims of TiVo’s “Time Warp” patent.

Dish Network’s and EchoStar’s alleged infringement of the patent is the basis of TiVo’s litigation against the companies—and the reason Dish and EchoStar paid TiVo $105 million in damages in October after the Supreme Court denied Dish’s appeal of a Texas district court ruling that found Dish and EchoStar had indeed infringed on TiVo’s intellectual property.

The next phase of the formal litigation with EchoStar comes in February, when a U.S. district court judge will consider TiVo’s request to find EchoStar in contempt for not disabling its DVR devices so that they do not infringe on the “time-warp patent.” If it is found guilty, EchoStar may have to pay substantial additional damages to TiVo.

As a research report this morning from investment firm Sanford Bernstein notes, the USPTO completed its most recent re-examination of TiVO's patent on

November 11, when the federal agency upheld the validity of the TiVO claim against EchoStar/Dish Network. But EchoStar/Dish has petitioned the USPTO to review the patent again. EchoStar’s petition points to two prior patents, each of which were already considered separately in the November PTO review, but which EchoStar/Dish believes would lead the PTO to a different conclusion if considered together.

“We are pleased that the Patent and Trademark Office (PTO) granted our Petition for Re-Examination of the software claims of Tivo’s ‘389 patent, which are the subject of Tivo’s current motion for contempt,” said EchoStar in a statement released late Tuesday.

“The PTO found that there is a ‘substantial new question’ of patentability as to the software claims in light of prior patents that appear to render TiVo's ‘389 patent invalid as obvious.”

TiVo, for its part, was unimpressed by the news from the USPTO.

"EchoStar's latest tactic follows numerous failed attempts to invalidate TiVo's groundbreaking Time Warp patent,” said the company in a statement. TiVo added that the USPTO grants “most patent reexamination requests” and that it didn’t expect EchoStar’s latest gambit to be successful.

“We are confident that the USPTO will once again confirm the validity of all of the claims of the Time Warp patent," said TiVo.

While that may be the case, this latest development does throw further uncertainty on the ultimate outcome of the TiVo/EchoStar dispute, as Bernstein pointed out to investors in its report.

“It is unclear how quickly the U.S. PTO will issue findings of this latest re-examination of the TiVO patent, and it is similarly unclear how, or if, this latest development might impact the timeline for the enforcement phase of TiVO's claims against Dish Network,” wrote Bernstein analysts.

That said, the evidentiary hearing regarding TiVO's contempt claims against Dish Network/EchoStar is still expected to proceed in the U.S. District Court in Texas on Feb. 17 and 18, as recent emergency motions from EchoStar/Dish Network to delay the hearing have been denied.