Dish, TiVo Stocks Rise After Legal Settlement

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Shares of Dish hit a 52-week high and closed up 19 percent amid the settlement, which analysts said was more favorable than they had expected, and strong first-quarter results, while TiVo shares gained 3 percent.

NEW YORK – Shares of satellite TV giant Dish Network and DVR pioneer TiVo rose Monday after the settlement of long-running DVR patent litigation.

Dish shares opened and closed with a bigger gain as some analysts said the $500 million settlement payment came in below what they had projected, and Wall Street also cheered stronger-than-expected first-quarter results. The stock hit a 52-week high of $29.95 early in the day and closed at $29.79, up 19 percent. It was the stock's biggest one-day gain since 2008, according to Bloomberg.

TiVo shares rose more than 5 percent early in the day before closing up 3 percent at $9.86.

“Today is truly a historic day for TiVo,” CEO Tom Rogers said Monday morning in a conference call about the legal settlement, highlighting that it is one of largest patent settlements of all time and provides an “excellent outcome” for the company and its shareholders. He said the company expects to have more color on the financial impact on TiVo’s results this year and beyond during its earnings report later this month.

Rogers acknowledged though that TiVo could have earned a bigger payment if it had continued the legal showdown, but said the courts worked slowly, meaning the process may have dragged on for several years amid rising legal costs. And Dish was looking to extend the legal case in any way possible “even when the merits clearly were not in its favor,” Rogers said, given Dish the chance to replace infringing DVR boxes.

“Dish had more of the negotiating leverage,” said Wells Fargo analyst Marci Ryvicker

But Rogers said the settlement and related talks created “mutual respect” between Dish and TiVo, and the two companies are looking for ways to collaborate, including on digital services of Blockbuster, which Dish acquired last week.

And he vowed that in patent litigation with AT&T, Microsoft and Verizon his company would “vigorously” and “very aggressively” pursue its rights.


Twitter: @georgszalai