Court Docket: Possible Settlement In Voom-Dish LawsuitAMC Networks Stock Jumps 4% 10/18/2012 8:57 AM Eastern
A new posting on the court’s docket raises the possibility of a settlement in the case of AMC Network’s Voom high definition programming service against Dish Network.
In a note, Tom Claps, an analyst with Susquehanna Financial Group who has been following the case closely, wrote that “the Court’s docket just posted an entry for Monday, October 22 at 9:30 a.m.—‘Pos. Settlement.’”
Claps said the court is not commenting on this new development.
On Wednesday, the contentious trial was postponed till Monday. Judge Richard Lowe dismissed the jury and said the parties had to deal with a variety of legal issues that need the court’s immediate attention, according to Claps.
Voom, launched by Cablevision’s Rainbow programming unit and now part of AMC Networks, sued EchoStar, now Dish Network, for $2.4 billion charging that the satellite distributor breached a 15 year contract to carry the suite of HD channels.
A settlement could include restored carriage for AMC Networks’ cable channels, which have been blacked out on Dish Network since July. AMC Networks claims that its channels were pulled by Dish to give it leverage in talks to settle the suit.
“We continue to believe that a settlement in this case is the most logical outcome for all parties involved. In our view a settlement would incorporate a new carriage agreement between AMCX and DISH, as well a cash component to account for potential damages in the VOOM case,” according to Claps.
News of the possible settlement drove AMC Networks’ stock price higher. AMC was trading at $45.28 cents, up $1.72 or 3.95%
“We believe a resolution to the case would be a material positive for AMC Networks (and more modest benefit for Cablvision). So far, we believe the evidence presented in the case has overwhelmingly supported VOOM's position, leading us to believe that a settlement could include a generous cash component as well as restored carriage for AMC's four networks,” said Anthony DiClemente, analyst at Barclays Capital, in a note Thursday.