8:02am PT by Eriq Gardner
DirecTV, Al Jazeera Settle $75 Million Lawsuit
DirecTV and Al Jazeera America have reached a deal that resolves dueling legal claims over carriage of the Qatari-backed cable news network.
The satellite giant filed a lawsuit in July 2014 with allegations that AJA breached a "most favored nation" clause by giving other distributors better terms. Specifically, after the Qataris purchased Al Gore's Current TV in early 2013, Time Warner Cable was able to execute termination of the news network's carriage upon a change in its ownership. TWC was then given better pricing so that AJA would appear on the cable service.
Per Current TV's MFN obligations, AJA was then obligated to offer other distributors similar terms. AT&T, DirecTV and others filed claims to enforce these obligations.
Al Gore then brought a lawsuit alleging that Al Jazeera was "encouraging distributors to file baseless claims" so as to dip into $65 million held in escrow in the Al Jazeera-Current deal. The former vice president is still on the warpath. On Thursday, he filed a second lawsuit in Delaware Chancery Court against Al Jazeera with aims to have his legal expenses reimbursed.
Meanwhile, DirecTV amended its own lawsuit against AJA in June to include the results of audits uncovered in the discovery phase. The satcaster upped claimed damages to $74.5 million over the alleged MFN breach and withdrew a separate claim that AJA also breached the contract by not delivering the type of programming promised by Current. That was withdrawn because AJA's carriage agreement with DirecTV expired in July. The parties worked on a renewal.
As negotiations proceeded, AJA filed amended counterclaims saying that DirecTV had since March, stopped making licensing payments. Instead of forking over millions, DirecTV was allegedly withholding the money as a quasi-advance on the damages it expected to win from AJA at a trial scheduled for January.
DirecTV has now filed a notice that the entire case has been settled. No terms have been released, but it's likely part of a new carriage deal.
In a statement, a DirecTV spokesperson says, "We’re pleased to have settled the MFN violation lawsuit with Al Jazeera America and ensure that our customers receive a fair deal. Al Jazeera America continues to be available on the DIRECTV and U-Verse platforms.”
“We’re pleased to extend our partnership with DirecTV,” said Al Anstey, CEO, Al Jazeera America. “Al Jazeera America is committed to its mission of delivering in-depth, unbiased and trusted journalism of the highest quality. I look forward to continuing to work together to grow our audience and deliver more compelling news and remarkable stories that inform, educate and inspire audiences across America.”