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Verizon ordered to pay $250 million to TiVO

TiVo and Verizon has finally reached an agreement when the latter decided to settle the case by handing out $250.4 million.

In another case, Verizon also offered to pay $260 million to ActiveVideo ending a legal case associated with on-demand video.

A spokesperson from Verizon confirmed the two settlements but did not give any more details. “We are pleased to have reached settlements with both TiVo and ActiveVideo in these two matters,” the spokesman said.

A regulatory filing report showed Verizon paying TiVo, a DVR specialist, $100 million in cash as initial payment on September 28, with another $150.4 million following payable in the next 25 quarters. The agreement between the two companies will expire on 31 July 2018, which will give the two companies advanced television patents.

The deal also asks Verizon to pay higher monthly fees to users of Fios digital video recorder offerings if the growth of the company’s DVR subscriber base reaches a certain level. If the two companies agrees before December 21 2012 on a “commercial services agreement”, Verizon is entitled to earn a credit of  up to $29.4 million deductible from the quarterly payments.

The most recent deal by TiVo is another sign of the company’s growth throughout the years. The company focuses on working with satellite and cable operators to distribute its technology instead of selling its DVR boxes. TiVO has resorted to many law suits to further that aim.

[email protected] was embroiled in a similar law suit last January. It finally agreed to pay TiVo at least $215 million. TiVo initially sued both Verizon and [email protected] in 2009 over three DVR patents. An agreement with Dish and EchoStar was also reached by TiVo last year, with the satellite TV providers paying $500 million. TiVo had also filed law suits against Motorola and two other companies.

Separately, ActiveVideo announced in a press release that Verizon will pay $260 million to comply with the order of a judge from a a US District Court, including an unspecified sum of money. Both companies will not sue each other for years and have agreed to cross-license their patents. No other details are provided about the terms of the deal but the CEO of ActiveVideo said that his company and TiVo will not have a relationship outside the IP cross licensing.

ActiveVideo does not normally license its patents, providing software to providers instead so they can offer video via the cloud. Some partners of ActiveVideo includes Time Warner  Cable, Cablevision, and Comcast.

A lawsuit was filed by ActiveVideo against Verizon in May 2010, claiming that Verizon’s Fios service violated four of its patents core to interactive television services like video on demand.

An appellate court reinforced the initial ruling, ordering Verizon to pay ActiveVideo the award.

source: CNET