dzungaria lvii: Oh No They Didn't! - Dish Network Settles Suit With AMC

Monday, October 22, 2012

Oh No They Didn't! - Dish Network Settles Suit With AMC

Dish Network Corp. settled a long-running lawsuit with AMC Networks in a deal that will return AMC's channels to Dish's satellite lineup after nearly four months, the companies said.

As part of the settlement, Dish will pay $700 million in cash to AMC and its sibling company, Cablevision Systems Corp. Included in the total is $80 million for Dish to purchase wireless-spectrum licenses from Cablevision, the companies said.

In the suit, which dates back four years, AMC's Voom unit had sued Echostar Communications Corp., now known as Dish, for breach of contract over Voom's now-defunct suite of high-definition TV channels. Voom claimed damages of $2.5 billion.

That legal dispute was complicated when Dish dropped AMC's channels from its satellite TV lineup at the end of June, citing the high programming cost of the channels relative to their low viewership. AMC said at the time that the blackout was related to the Voom lawsuit.

Dish will resume carrying AMC channel, which airs such popular shows as "The Walking Dead," effective Sunday. The satellite operator will resume carriage of AMC's other channels, Sundance Channel, IFC and WE tv, on Nov. 1. Dish is also adding back the Fuse music channel, owned by another AMC sibling company, Madison Square Garden Co. which has been off Dish's service since 2010. The companies said Dish had entered into a long-term distribution agreement for the channels.

The deal "delivers a fair value for both parties," said Dave Shull, Dish senior vice president of programming, in a statement. AMC Chief Executive Josh Sapan said in a statement, "We are glad to partner again with Dish."

Speculation that settlement talks were under way emerged late last week after the judge hearing the case adjourned trial proceedings shortly before Dish Chairman Charlie Ergen was due to testify. Proceedings in New York State Supreme Court were set to resume Monday.

Both companies had reason to resolve the programming dispute. Dish has 14 million subscribers, about 13% of AMC's potential audience, so the blackout was depriving AMC of a sizeable chunk of its possible audience at a time when "The Walking Dead" was drawing big audiences. The second episode of the latest season of that drama was due to air Sunday night.

Dish, meanwhile, was under pressure from subscribers to restore the AMC channel. Its Facebook page was flooded with complaints from customers unhappy that AMC wasn't available.

Dish had also been on the defensive in the trial, coming under criticism from the judge, Richard B. Lowe III, who said at one point that the company had "no credibility when it comes to document exchange and turning everything over." Ten days ago the judge granted AMC the right to hire a forensic team to examine Dish's computer hard drives for any deleted draft copies regarding a 2007 audit Dish undertook of the Voom channels.

In proceedings in November 2010, the judge had ruled that the satellite provider systematically destroyed emails relevant to the case within a reasonable period of expecting that the dispute would go to court.

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