News Corp. unit cleared of piracy in DISH suit

SANTA ANA – A federal court jury today broadly cleared News Corp.’s NDS unit of satellite television piracy charges in a suit brought by DISH Network that could have been worth more than $1 billion.

The jury awarded only $1,500 in damages from NDS for a single test incident with a satellite television smart card.

DISH had alleged that NDS employed a rogue software engineer, or hacker, who systematically broke into its network, stole software code, and posted information on the Internet to let users unscramble DISH’s signals and receive satellite television for free.

Jurors deliberated for a single day after a month-long trial before ruling in favor of NDS on the majority of charges in the suit.

“We’ve been completely vindicated on this whole lawsuit,” NDS attorney Richard Stone said after the jury’s decision was read in U.S. District Court for the Central District of California. He called the DISH charges a “pack of lies.”

“We will not be changing our practices. We employ former pirates to make our system more secure, not to wreak havoc on the marketplace,” Stone said.

DISH lawyers declined to comment.

DISH claims it lost $900 million in revenue and system-repair cost. Punitive damages could have taken the award to as much as $1.6 billion.

But NDS had argued that it used and uses former hackers to stop piracy, and that it had in fact found a piracy ring in Canada that was the culprit for DISH’s hack.

The suit was originally brought by EchoStar Communications, which later split into two companies, DISH and EchoStar Corp., with DISH becoming the primary plaintiff.