Voom at Issue in Cablevision-Dish Network Trial Set for April
A New York State supreme court judge pushed for a settlement and set an April trial date in Cablevision’s $2.5 billion breach of contract suit against Dish Network stemming from the failed Voom HD satellite service. Judge Richard Lowe on Wednesday asked Cablevision and Dish to discuss a possible settlement, but set April 6 as the start of a four-week trial if an agreement isn’t reached.
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The judge expressed frustration with the length of the legal battle and the companies’ inability to reach a settlement, and encouraged the sides to communicate directly, Credit Suisse analyst Stefan Anniger said in a note to investors following a pre-trial conference. Cablevision and Dish have begun those discussions and a settlement “remains a possibility,” though likely for a smaller sum than Cablevision sought in filing the suit in 2008, Anniger said. An settlement could be reached through direct negotiation or mediation, he said. “Our initial work suggests that it is unlikely Cablevision will win such a large award,” Anniger said. “We suspect that if Cablevision were to win any award, it would be substantially less” and any court victory would likely be appealed by Dish, Anniger said. Dish and Cablevision officials weren’t available for comment.
Cablevision shut down the Voom HD satellite service and its 15 channels in March 2005, a little over a year after the service launched by offering HD News, Worldsport, Rush HD and other channels. Voom HD later signed a 15-year carriage agreement with Dish, then known as EchoStar. Cablevision’s Rainbow Media, which was weighing an IPO at the time, gained distribution for Voom with Dish and BSkyB, which carried Rush HD and Voom HD in Ireland and the U.K. Dish stopped carrying Voom in May 2008 as it added 22 of its HD channels, which it claimed at the time were more popular. Voom countered that Dish disliked the carriage contract’s financial terms. Cablevision formally shut Voom down in December 2008. Dish initially emerged as a candidate in late 2004 to buy Cablevision’s Rainbow DBS business, including Voom HD, for about $200 million, but never reached a final agreement. Rainbow leased 13 transponders for the service on an SES Americom satellite at 61.5 degrees west. Voom, which had 40,000 subscribers at its peak, sold its satellite receivers and service through Brandsmart, Sears and others.