Court Awards $2M For DBS Piracy Damages

Author:
Updated:
Original:

A federal court in Seattle late last month awarded DirecTv
Inc. and NDS Americas Inc. $2.27 million in damages from two defendants accused of
distributing counterfeit access cards for the Digital Satellite System.

NDS makes the security access cards and encryption system
for DSS.

Dennis DeFlorville had been caught with 142 counterfeit
cards and was ordered to pay the two plaintiffs $1.42 million, or $10,000 for each card. A
U.S. District Court also ordered Randall Massner to pay $850,000 for the 85 cards he
admitted to possessing in a deposition.

The judgments are part of an ongoing civil case filed by
DirecTv and NDS in June 1996. Its trial date is set for June 1, 1998. A number of
defendants have already settled with DirecTv and NDS.

According to Larry Rissler, special counsel for signal
integrity at DirecTv, the judgment marks the largest monetary award DirecTv has won
against signal pirates to date.

DeFlorville and Massner are just two of more than 30
defendants that DirecTv has alleged are part of an international conspiracy to crack
DirecTv's conditional access system. According to Rissler, NDS and DirecTv used
federal RICO (Racketeer Influenced and Corrupt Organizations) statutes to help bring the
case to trial.

In the civil case, DirecTv and NDS alleged that defendants
from five countries conspired to design, manufacture, distribute and sell counterfeit DSS
cards created through a process called reverse engineering. Counterfeit cards allow DSS
owners to obtain programming from DirecTv and U.S. Satellite Broadcasting whether or not
they've paid for it. Some signal pirates subscribe to basic programming packages and
use the pirated cards to steal additional programming, such as premium movie services or
seasonal sports packages.

Rissler would not speculate on how many counterfeit DSS
cards there may be in circulation today.

In addition to litigation, DirecTv and NDS have taken
action on the technical side to help slow down -- if not prevent altogether -- theft of
the DSS signal. The companies completed a security card swap-out last June, and also
activate periodic electronic countermeasures. Rissler said the last electronic
countermeasure was completed late last month. He said he did not want to specify how often
the electronic countermeasures were taken because he does not want to tip off potential
pirates.

The alleged conspiracy involved defendants from the U.S.,
Canada, Bermuda, the Cayman Islands and Mexico. Some of them may be subject to criminal
prosecution.

Rissler said the current Seattle case is a very interesting
one. "We've had death threats against some of the people who've
investigated this," he said.

DirecTv will continue to publicize its court
victories."We think publicity is a deterrent," Rissler said.

Related