Dale Dietrich
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DAY EIGHT: TiVo-EchoStar Trial (Monday Apr. 10)

Categories: CasesPatents

Echostar’s CEO, Charles Ergen, took the stand. Tivo’s lawyer, Sam Baxter, established that Ergen’s ownership in Echostar translates to $7.5 billion. [Dale's Note: Can you hear "David & Goliath in the back of your head?] In an attempt to discredit Echostar’s early claims that TiVo was bringing this case only because it was a loosing money, Baxter asked Ergen if this was fair. He pointed out that Echostar had lost $3.9 billion before it turned a profit. Ergen conceded that losses are to be expected when a company has to do a lot of R&D and customer education. When asked again if this was fair Ergen responded “I’ve seen a lot of criticism (of TiVo) from Wall Street, but I can’t say if it is fair.” When asked if profitability and criticism gives somebody the right to take someone’s IP, Ergen responded “no”, adding he and his company respected others inventions. Baxter attempted to get Ergen to agree that DVR is indispensable to Echostar’s customer retention but Ergen would not directly answer the question when asked several different ways. Baxter net referred to early Echostar comparative advertising copy which read “for people who think the idea behind TiVo is cool, but the price isn’t”. Baxter pointed out how TiVo is a verb and that sportscasters say things like “I wish I had TiVo’d that moment”. He asked Ergen if he had ever heard anyone say “I wish I’d 501′d that moment”. Ergen agreed he had never heard that. Ergen testified that Echostar had no need to steal TiVo technology since it employs its own staff of “the best engineering experts in the world’). [Dale's Note: Whether patented technology is independently developed has no bearing whatever on whether it infringes on someone else's patent claims - innocent infringement is just as much infringement as willful infringement.]

Echostar’s last witness was Dr. Nathaniel Polish, an inventor of DVR products. He testified that TiVo’s technology was nothing new and that more than 50 DVR-related patents had been granted before TiVo obtained one for its media switch. Among inventions that preceded TiVo’s was the Screamin’ Streamer, an EchoStar product, and the MRx1. On cross-examination Polish acknowledged that the Screamin’ Streamer was only used in-house and never marketed commercially and admitted that the MRx1 was not capable of recording and playing live TV simultaneously. Tivo’s attorney quipped, if the MRX1 was such a good product, “one wonders why they threw it out the door shortly after…” Media Four was purchased by Echostar.

Echostar rested its case and testimony is expected to be completed today (Tuesday the 11th). Judge Folsom told the jury they will have Wednesday off as he prepares his final instructions. As Friday is a holiday for some, the judge left it for the jurors to decide if they wish to deliberate Friday or not.

FYI… the following was posted by MTChamp on the Motley Fool subscription only board:

For those who use PACER, you may have already read some notices by Echostar in response to the courts rulings against Echostar, that testimony by EchoStar’s expert validity expert, Dr. Polish, was not allowed. He was going to argue prior art.

The other notice has to do with a couple of documents or exhibits Echostar wanted to show the jury from the Patent Trade Office as I understand it, to show that TiVo’s patent is being re-examined for validity. I guess the PTO is making sure there was no prior art that would invalidate the TiVo patent. I don’t know the details of why the PTO would do this, however the court would not allow Echostar to talk about it.

TiVo also filed a brief regarding EchoStar’s objections to some demonstatives of a possible prior art invention called Media Streamer. Echostar objected to some slides that TiVo was to show that illustrate how this Media Streamer device could not record a program while watching it and could not store and extract video at the same time. I guess the labeling wasn’t to the courts liking so TiVo has reworded these demonstratives with the language contained in a supplemental claim construction order made in March 2006.

Sources: Marshal News Messenger  |  Motley Fool (Subscription)

Note: This story is being discussed in this TiVo Community thread.

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