TiVo and AT&T have settled a patent lawsuit that was to start trial next week, the parties confirmed.
Under the terms of the settlement, AT&T agreed to pay TiVo an initial payment of $51 million, followed by quarterly guaranteed payments through June 2018, totaling $164 million -- which together yield minimum payments of $215 million.
At a Citi media conference in San Francisco on Wednesday, Tom Rogers, CEO and president of TiVo, said that total fees from the AT&T settlement could approach $300 million if AT&T’s U-verse pay-TV service reaches certain subscriber growth levels. He characterized the settlement as, “very good news” for TiVo.
In addition, AT&T will pay incremental recurring per subscriber monthly license fees through July 2018, should AT&T's DVR subscriber base exceed certain levels.
"We are extremely pleased to reach an agreement with AT&T, which acknowledges the value of our intellectual property," said Rodgers.
The settlement comes after a U.S. Appeals Court last year upheld a lower court decision that Dish TV had violated TiVo patents for the DVR service it offered to subscribers. Dish then agreed to pay TiVo close to $600 million to settle the case without further litigation.
TiVo has also filed suit against Verizon for patent infringement and that litigation is continuing.
But the DVR and advanced TV platform provider has also been sued by others, including Microsoft, and more recently by DCBT. The latter alleges that TiVo is violating a patent entitled “System and Method for Capturing and Transferring Selected Portion of a Video Stream in a Computer System.” TiVo has until Jan. 9 to respond to the DCBT complaint.
Microsoft cited two patents that it alleges TiVo is violating, including one related to electronic program guide technology that was issued in 1996, a year before TiVo was formed. The other relates to interactive TV technology, which was filed in 1995 and issued in 1998.
The Microsoft suit, filed with the U.S. District Court for Northern California, is currently on hold until a decision is issued for a similar complaint filed by the software giant with the U.S. International Trade Commission.
An AT&T rep confirmed the settlement and terms as outlined by TiVo, but said the company was not commenting further.