* Dish had been seeking more than $152 million
* Dispute centered on 2005 licensing agreement
* ESPN says it's "gratified" by verdict
By Nate Raymond and Liana B. Baker
NEW YORK, Feb 28 A federal jury on Thursday
found sports programmer ESPN liable for only one
breach-of-contract claim made by Dish Network Corp and
awarded Dish $4.86 million, a mere fraction of the more than
$152 million it had sought.
In a unanimous verdict, the 10-member jury in Manhattan found
ESPN liable for breaching a 2005 licensing agreement by allowing
rivals to pay lower rates for ESPN Deportes, a Spanish language
channel, without extending the same offer to Dish.
But the jury rejected most of Dish's central claims that
ESPN, an affiliate of Walt Disney Co, had breached its
contract by giving better deals to rival distributors.
The award comes amid growing friction between distributors
and program makers throughout the entertainment industry.
Filed in 2009, the lawsuit centered on the terms of
distribution agreements that ESPN had negotiated with Dish and
its competitors for channels that included ESPN Classic, which
shows re-runs of older sports events, and ESPN Deportes.
In its rejection of some of Dish's claims, the jury said
ESPN was not liable for letting Comcast Corp in 2006
distribute additional packaging tiers and subscriber packages
without first notifying Dish and allowing it a chance to have
the same deal. Dish said this cost it $78.9 million, and said
that had it gotten the same offer as Comcast, it never would
have agreed in 2009 to a deal reducing distribution of ESPN
Classic in exchange for expanding distribution of the college
sports channel ESPNU.
Dish said that caused another $52 million in damages.
The trial may have an impact on future negotiations between
the two companies, whose distribution agreement is to expire
Dish, controlled by billionaire founder Charlie Ergen, has
often used lawsuits to gain leverage in these types of
negotiations, analysts said.
The case was in fact just the latest courtroom brawl
between Dish and ESPN. In 2008, Dish sued ESPN and several
Disney subsidiaries for not providing high-definition feeds for
channels, including ESPN News and Disney Channel.
Dish is currently appealing a New York state court jury
verdict in favor of ESPN and Disney in 2011 that said they could
keep $56 million in fees.
A state judge had separately ruled that Dish owed ESPN and
Disney $66 million in interest due to late payments under their
agreements. An appellate court later upheld that decision.
Stanton Dodge, Dish's general counsel, said in a statement
that the company would "remain vigilant in our efforts to ensure
that programmers honor their contractual commitments."
A spokeswoman for ESPN said it was "gratified" the verdict
rejected all but one of Dish's claims.
Dish shares closed down 7 cents at $34.90 on the NASDAQ,
while Disney shares were up 37 cents at $54.85 on the New York
The case is Dish Network LLC v. ESPN Inc., et al., U.S.
District Court, Southern District of New York, 09-06875.