The $2 million judgment against SeaChange International Inc. in the lawsuit
filed by nCUBE could cost the company as much as $14.4 million, according to
SeaChange's first-quarter earnings call.
SeaChange said that if the jury's decision is upheld and treble damages are
awarded, it would cost the company $12.3 million on top of the $2.1 million it's
already spent on legal fees. The company added that it's appealing the Delaware
The news clouded an otherwise robust revenue picture. SeaChange announced
first-quarter revenue of $33.7 million, a 12 percent jump over last year's $30.2
million. Video-on-demand revenue jumped 37 percent quarter over quarter from
$11.8 million to $16.1 million.
But one-time charges and adjustments -- including costs associated with the
nCUBE legal suits (SeaChange is also suing nCUBE in a separate case) -- forced
the company to post a net loss of $21.8 million in the quarter versus a profit
of $182,000 in last year's first quarter.
SeaChange said pro forma profits would have been $270,000 had it not been for
the one-time charges relating to the lawsuit and the Adelphia Communications
Corp. situation. Adelphia owes SeaChange $500,000, the company said.
SeaChange president Bill Styslinger said the nCUBE lawsuit wouldn't affect
second-quarter revenue or prevent future shipments. The company said it's
working on a 'workaround' that's addressed in the nCUBE suit.
SeaChange also announced that it will supply VOD servers to Comcast Corp.'s
deployment in Philadelphia, the MSO's largest system.