The cable operator will pocket $525M and AMC Networks will end up with $175M the companies said today in an SEC filing. This was the last big question remaining after Dish Network agreed in October to pay $700M to settle the breach of contract suit that Cablevision and AMC filed. They asked the courts to determine whether Dish had the right in 2008 to terminate its 15-year deal to air the VOOM Networks suite of HD channels. The channels, formerly owned by Cablevision, were packaged with AMC when the cable company spun off the network operation last year. The cash split between Cablevision and AMC does not account for the income that the cable networks company will receive from the fee increase that Dish agreed to pay to continue carrying channels including AMC, IFC, Sundance Channel, and WeTV.
Sure looks that way — for the company, not Dish Network subscribers. AMC Networks shares are +3.9% in early trading following yesterday’s $700M agreement with Dish Network to settle the $2.4B breach of contract case involving the defunct VOOM suite of HD channels. But the surprise is that Dish is up 2.2%. Consider that a sigh of relief from shareholders who feared the worst from the lousy hand chairman Charlie Ergen had to play in court. A series of rulings by New York Supreme Court Judge Richard Lowe III found that Dish destroyed or covered up important evidence that probably would have hurt its case — and made Dish a likely loser against the charge that in 2008 it wrongly terminated its 15-year deal deal to carry VOOM. Yet Ergen’s decision in June to drop the AMC channels appears to have paid off. The $700M settlement was “well below Street expectations” of at least $1B says Wells Fargo Securities’ Marci Ryvicker. Barclays Equity Research’s James Ratcliffe calls the amount “quite reasonable” in light of the court setbacks.
Cablevision Systems and AMC Networks announced today they have settled all litigation with Dish Network. Settlement includes a new long-term agreement for Dish to resume carriage of AMC Networks including AMC, IFC, Sundance Channel and WE TV. AMC will return today on Dish channel 131. The other networks will return November 1. That’s good news for Dish subscribers who missed watching The Walking Dead, Breaking Bad, Mad Men and other AMC shows because Dish had dropped the networks back in June. Dish had maintained publicly it was a carriage fee dispute, but Cablevision-AMC Networks said it really was because of a $2.4 billion breach of contract suit over the satcaster’s decision to drop the now-defunct VOOM Channels that were included as part of AMC Networks spinoff from Cablevision into a separate company.
Settlement terms also call for Dish to pay Cablevision $700 million in cash. As part of the settlement Dish will receive wireless multichannel video and data spectrum licenses that cover a population of 150 million in 45 markets including New York, Los Angeles, Chicago, San Francisco and Philadelphia.
As the trial proceded in New York Court last week, things looked increasingly bad for Dish as the judge repeatedly denounced the satcaster for its behavior following a string of embarrassing revelations that suggest it tried to hide evidence that it feared might hurt its case. On Thursday, a note was posted on the New York State Supreme Court website …
Listen to Episode 6 of our weekly podcast Deadline Big Media With David Lieberman. This week, Lieberman and host David Bloom discuss whether the big entertainment companies, with their reliance on ever-increasing cable-TV fees, are driving off a fiscal cliff; what happened to Google in its awful quarterly earnings report; what to expect from the rest of earnings season; and whether a possible settlement of the $2.5 billion VOOM lawsuit will finally bring AMC Networks TV shows back to the Dish Network.
New York Supreme Court Judge Richard Lowe III abruptly dismissed the jury for the day, telling both sides in the case that they need to focus on the legal issues that have sidetracked the trial pitting AMC Networks against Dish Network in a breach of contract dispute relating to AMC’s now-shuttered VOOM HD channels. Dish chairman Charlie Ergen now is expected to take the stand Monday, according to Susquehanna’s Thomas Claps, who is watching the trial. The Wall Street Journal reports that lawyers for both sides were meeting in private before the judge cancelled the proceedings.
The emails were discovered over the weekend and disclosed in court today — and they’re “hurting [Dish Network] in a big way,” according to an account from George Reed-Dellinger of advisory firm Washington Analysis. Susquehanna Financial Group’s Thomas Claps, who’s also monitoring the case, calls it “the most damaging evidence to date” against Dish in AMC‘s $2.5B breach of contract suit involving the satellite company’s 2008 decision to drop the now-defunct VOOM HD channels. It’s so important that Claps says Dish “may re-think its strategy” to have Chairman Charlie Ergen testify — and might be more motivated to negotiate a settlement with AMC that would return its channels to the No. 2 satellite provider before the end of the month when the jury is expected to reach its verdict. Dish dropped AMC in June.
New York Supreme Court Judge Richard Lowe III continues to hammer Dish Network as it prepares to mount a defense in AMC Networks’ $2.5B breach of contract suit involving the now-defunct VOOM HD networks. The judge said today that Dish must allow investigators to examine internal information, according to an account of the proceedings from Susquehanna Financial Group’s Thomas Claps. Dish “has no credibility” with the court, Lowe said following rulings in which he charged that the satellite distributor destroyed evidence and tried to delay the current case long enough to create a mistrial.
New York Supreme Court Judge Richard Lowe III was visibly angry with Dish Network today, thumping his desk as he accused the company of disrespecting the court, according to an account of the VOOM case proceedings from Andrew Harms of advisory firm Washington Analysis. “I don’t care how much money you got,” Lowe’s quoted as saying to Dish lawyers after the company failed to comply with his order to turn over documents that he said were not privileged. If Dish doesn’t give him electronic copies of the material, he said, then he might rule in favor of AMC Networks in its $2.5B breach of contract suit before Dish even presents its case — leaving it to the jury to just decide on the size of the damages.
That’s what New York Supreme Court Judge Richard Lowe III and AMC Networks charged in court today according to Susquehanna Financial Group’s Thomas Claps. The judge became “extremely animated” and accused Dish of “blatant misconduct and attempts to delay” AMC’s $2.5B breach of contract suit, Claps reports. It seems that Dish yesterday appealed Lowe’s ruling requiring the satellite company to turn over documents that it considered privileged — but didn’t give the Appellate Division a copy of the documents, preventing it from reaching a quick decision. Claps says that Lowe characterized that as “further evidence of Dish’s ongoing, inappropriate conduct in this case” and accused the company of “attempting to ‘spin its wheels’ and delay the proceedings so that the current trial schedule could be jeopardized — and possibly result in a mistrial.” (Earlier the judge found that Dish inappropriately wiped out emails that might have supported AMC’s case.)
AMC chief Josh Sapan was under the gun today as Day 3 of the VOOM trial focused on a key question: Did AMC and its former parent, Cablevision, hide from Dish a budget that would have clearly given the satellite company the right to end its 15-year agreement to carry the now-defunct VOOM suite of HD channels? AMC’s $2.5B suit alleges that Dish breached the contract in 2008 when it dropped VOOM. But Dish says AMC and Cablevision already violated the deal by failing to invest at least $100M a year in VOOM — something the budget would have revealed. Challenged to explain why it wasn’t shown to Dish, Sapan said the company “never raised questions about what we were spending on,” according to an account of today’s proceedings by SNL Kagan reporter Deborah Yao. The CEO added that the budget was just hypothetical because it hadn’t been approved by the board. Dish’s lawyer also pressed Sapan to say that the $100M spending requirement applied to domestic programming — not overhead and overseas expenses. But the AMC exec said it was “crystal clear” in negotiations that the dollar figure covered all costs, Barclays Equity Research analyst Anthony DiClemente reports. Dish Network CEO Charlie Ergen is expected to take the stand next week.
Not only do they finally have a jury, lawyers presented opening arguments today in AMC Networks’ $2.5B breech of contract suit against Dish Network. And lawyers representing AMC seemed to draw blood by ”repeatedly highlighting Dish’s systematic, bad faith, year-long destruction of evidence during the critical stages of this dispute,” says Susquehanna Financial Group’s Thomas Claps, who’s tracking the proceedings. He says that this “will be impactful in determining the outcome of the case.” The trial will determine whether Dish had the right in 2008 to terminate its 15-year deal to air the VOOM Networks suite of HD channels. The defunct channels, formerly owned by Cablevision, were packaged with AMC when the cable company spun off the network operation this year. Dish’s contract with VOOM required backers to spend at least $100M a year on the channel. The big question is whether spending devoted to overhead and for overseas activities should count. AMC says it should; Dish says it shouldn’t — which would mean VOOM fell short of the $100M threshold. On Monday jurors likely will hear Cablevision founder Chuck Dolan’s side of the story.
There’s still no jury for AMC Networks’ $2.5B breach of contract suit against Dish Network — and the New York State Supreme Court won’t reconvene until Thursday. The jury was supposed to have been picked last week, but the process “is still ongoing,” reports Barclays Equity Research’s Anthony DiClemente. He says opening arguments could come Thursday “at the earliest.” The delays seem to hurt AMC more than Dish: The satellite company dropped AMC’s channels in June, and it’s hard to imagine Dish returning them to its 14.1M subscribers without a deal. DiClemente says that the trial now could run to late October which poses “some risk” to his Q4 earnings estimates for AMC, although he says it doesn’t change his forecast that the network owner will win “either a favorable settlement or judgment” in its favor. The trial will determine whether Dish had the right in 2008 to terminate its 15-year deal to air the Voom Networks suite of HD channels. The defunct channels, formerly owned by Cablevision, were packaged with AMC when the cable company spun off the network operation this year.
It seems there were only 16 prospective jurors available today, not enough to begin the selection process, Susquehanna Financial Group’s Thomas Claps reports. So New York Supreme Court Judge Richard Lowe III apologized, and put AMC Networks‘ $2.5B breach of contract suit against Dish Network on hold until Monday. But before adjourning he “encouraged the parties to engage in discussions,” Claps says. That could be important for those among Dish’s 14.1M subscribers who want to watch AMC’s series The Walking Dead when it returns for its third season October 14.
Dish dropped AMC’s channels in June and they likely won’t return to the the No. 2 satellite company unless there’s a deal. If the trial proceeds, then jurors will see a parade of media moguls including Chuck and Jim Dolan, AMC chief Josh Sapan, and Dish Chairman Charlie Ergen explain whether Dish had a right in 2008 to terminate its 15-year deal to air the Voom Networks suite of HD channels. The defunct channels, formerly owned by Cablevision, were packaged with AMC when the cable company spun off the network operation this year.
It looked today like the companies were talking about a deal that might resolve AMC Networks’ $2.5B breach of contract suit against Dish Network — and possibly return AMC‘s channels to the No. 2 satellite company — according to Susquehanna Financial Group legal specialist Thomas Claps. On Day One of the trial, lawyers had a half-hour meeting with New York Supreme Court Judge Richard Lowe III, followed by a long private conversation. But when the judge asked if they’d worked things out, they said they hadn’t. That might backfire on Dish: The judge shared the wording of the instructions he plans to give the jury about whether members “may” or “must” infer that some emails that Dish destroyed would have helped AMC’s case. (The trial asks whether Dish had a contractual right in 2008 to terminate its 15-year deal to air the Voom Networks suite of HD channels, now owned by AMC.) While the jury instructions weren’t made public, Claps says that “Dish’s counsel argued extensively…that the Judge’s instruction was improper.” The judge also barred one of Dish’s expert witnesses from discussing a point that the satellite company considers key to its argument. The plan now is for the jury to be selected tomorrow morning. That process could become challenging: Candidates might be scratched if they watch AMC programs, know about the dispute, or subscribe to Dish, Claps says.
Get ready to pony up if you bet that there’d be a settlement before AMC Networks’ $2.5B breech of contract suit against Dish Network goes to trial. Lawyers are scheduled to pick jurors tomorrow in a case that AMC says motivated Dish to drop the company’s channels in June. (Dish says AMC’s channels cost too much.) Beginning Thursday jurors will see a parade of media big shots explain whether Dish had a right in 2008 to terminate its 15-year deal to air the Voom Networks suite of HD channels. They were launched by Cablevision, but the Voom business entity was included with AMC last year when the cable company spun off its former networks unit. Cablevision founder Chuck Dolan is due up on Thursday followed by AMC chief Josh Sapan and, on Monday, Cablevision CEO Jim Dolan. Dish Chairman Charlie Ergen is expected to testify around October 3 when the defense presents its case.