(CN) - Dish Network's DVR technology continues to infringe on TiVo's patent, the Federal Circuit ruled, clearing the way for TiVo to claim more than $200 million in damages and sanctions.
The federal appeals court upheld a Texas judge's ruling that Dish Network's sister firm, EchoStar, violated a court order to stop infringing TiVo's patented digital video recording technology.
U.S. District Judge David Folsom ruled that EchoStar violated his order by creating and selling "design-around" DVRs that still infringed TiVo's patent.
He ordered EchoStar to pay more than $200 million in damages and sanctions, a decision the Federal Circuit upheld Thursday on a 2-1 vote.
"We are persuaded that there was clear and convincing evidence before the district court to find that both types of EchoStar receivers continue to infringe and that it was not an abuse of discretion for the court to find EchoStar in contempt of the infringement provision," Judge Alan Lourie wrote.
EchoStar argued that it shouldn't be held in contempt, because Folsom's order wasn't a complete ban on its DVR software, but required it to disable only the infringing storage and playback functions.
"'All' plainly means all," Lourie wrote, calling EchoStar's interpretation a "stretched reading" of Folsom's injunction.
Lourie pointed out that EchoStar apparently understood the scope of the injunction when it asked the district court to grant an emergency stay.
"EchoStar repeatedly stated that the injunction would render millions of its customers without DVR service or require them to go through considerable trouble and expense of obtaining DVR service from another provider," Lourie wrote.
In a dissenting opinion, Judge Randall Rader said EchoStar's modifications elevated its DVRs out of infringing territory.
"Citing a broad injunctive provision and a substantially altered accused design, this court ... punishes a good faith design-around effort," Rader wrote.
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