convicted

DBS Will Recoup Some Court Costs From Litigation with NDS Group Americas

Dish Network and its conditional access provider, Nagrastar LLC, may have gained only few dollars at trial in a fight with competitor NDS Group Americas, but the court has determined that the direct-broadcast satellite company will get $8.3 million back for its attorneys’ fees and court costs.

Dish sued News Corp.-owned NDS, also a conditional access technology developer, in 2003, alleging the company had commissioned a hack of Dish’s anti-piracy cards. Information on that hack ended up on the Internet and the resulting wave of piracy forced Dish to swap out 9 million compromised “smart cards” in use in customers’ homes that year.

The litigation finally went to trial earlier this year.

In testimony, NDS workers confirmed they had “reverse engineered” Dish’s anti-piracy hardware, but asserted the task was undertaken to determine weaknesses in the product so NDS could make stronger anti-theft products.

In April, an eight-person jury found that NDS had violated three of the six counts that were submitted for its consideration. However, the jury awarded Dish only $1,549 in damages.

In a ruling Dec. 4, Judge David O. Carter of the U S. District Court for the central district of California, ruled that due to the size and scope of the trial (five years, more than 80 depositions from witnesses in Europe and Israel) the award of attorney’s fees is justified. Dish did not get all it asked for, however, because it prevailed on only half the charges, convincing the jury that NDS workers had hacked the security system and received signals without authorization. That’s a violation of the Cable Communications Policy Act and California state anti-piracy statutes.

“We are pleased that Judge Carter ordered NDS to pay us $8.3 million in fees and costs. We will continue to take all legal measures to fight piracy and fraud. We are pleased that both NDS and Dish Network/Nagrastar can put this issue behind us and hope that we can collectively with other industry players and work to ensure signal security in the future,” according to a statement issued by Dish Network.

Nagrastar, which is 50% owned by Dish, did not receive any damages at trial and was not directly awarded attorney fees.

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