Academic

Geoff Manne on how EchoStar is messing with TiVo

By Tung Yin

Geoff Manne has an interesting post at Truth on the Market about the Tivo/EchoStar litigation, in which he argues that EchoStar is essentially abusing the court process by dragging out patent infringement litigation against it, including "designing around" TiVo's patent by making what appear to be non-substantive changes in the technology:

EchoStar is seemingly within the reasonable bounds of due process to suggest that such an outcome might be required if its new technology is sufficiently different than its old. But the question is really one of process: who gets to decide if the technology is sufficiently similar?the District Court that heard the original case and issued the original injunction, or EchoStar? Seen this way, it is evident that the costly, strategic behavior lurking just under the surface of this case and that pervades EchoStar?s conduct belies the innocence of its arguments and points out the enormous cost that establishing such precedent could impose on innovation and the economy more broadly.

Geoff's conclusion:

It is difficult to see how either due process or economic efficiency is furthered by EchoStar?s position. This case demonstrates that a determined infringer can make minor changes, drag out judicial proceedings, and seek to run out the clock on a patent, thereby squandering both judicial resources as well as incentives for innovation. This is particularly true for devices that involve software or other complex products where inconsequential changes can be exaggerated. An EchoStar victory in this case will dim technological progress and diminish the role of the courts in enforcing the property rights that facilitate that progress.

I'm a big fan of TiVo, even to the point of abandoning within days the digital video recorder that Comcast offered for free for 6 months.  While I'm a happy and loyal TiVo customer, I don't think I'd ever be an investor, because I'm too worried about how easily its business model can be duplicated.  If the courts administer a judicial smackdown to EchoStar, though, that should help sustain TiVo's business, for which I'll be grateful.

Full post as published by The Yin Blog on November 24, 2010 (boomark / email).