DISH, EchoStar win stay of TiVo patent award

LOS ANGELES (Reuters) - A U.S. appeals court on Wednesday stayed a Texas court's order forcing set-top box maker EchoStar Corp and satellite pay TV provider DISH Network Corp to disable millions of digital video recorders that infringe on a patent held by TiVo Inc, the companies said in a statement.

The move is the latest in a long-running court battle that resulted in a jury verdict in TiVo's favor in 2006, followed by an unsuccessful appeal by sister companies DISH and EchoStar.

The jury awarded TiVo about $74 million in damages plus interest, for a total payment by EchoStar of $104 million.

The stay comes a day after U.S. District Judge David Folsom imposed additional damages of $103 million plus interest against DISH and EchoStar for continuing to infringe on TiVo's patent for "Time Warp" software -- which allows users to record one TV program while watching another -- while it appealed.

In his final judgment, Folson gave EchoStar and DISH 30 days to disable all but about 192,000 DVRs distributed among its 13.6 million customers.

DISH and Echostar made good on Wednesday on a pledge to appeal and secure a stay postponing execution of the order.

"We are pleased that the Federal Appeals Court in Washington temporarily stayed the district court's order in the TiVo litigation," DISH and EchoStar said in a statement. "DISH Network customers can continue using their DVRs. We believe we have strong grounds for appeal."

DISH was formerly known as EchoStar Communications Corp. It spun off its technology assets over a year ago, including its set-top box division, to create EchoStar Corp.

The news dampened trading in TiVo shares, which experienced their biggest single day gain in four years on Wednesday.