TiVo Shares Soar on Prelim ITC Ruling Against Comcast

ITC expected to hand down final results in September
Tivo - Rovi Logo New 400x300.jpg

TiVo shares rose more than 15% Tuesday amid an initial determination by the International Trade Commission finding that various respondents, including Comcast, had violated two TiVo patents and that a final ruling is expected in September.

 TiVo, which merged with Rovi last fall and retained the TiVo name, said Monday in this SEC filing that the initial determination by the administrative law judge in the ITC case was delivered last Friday (May 26), noting that the judge determined that a violation of section 337 had occurred with respect to two TiVo patents – No. 8,006,263 and 8,578,413 – and that other four patents asserted by TiVo in the case “were found to have no violation at this point.”

The ‘263 and ‘413 patents describe “Interactive Television Program Guide with Remote Access.” Section 337 is tied to cases about alleged unfair competition in the importation of products, and their subsequent sale, into the U.S.

Comcast had no comment on the initial determination. TiVo issued this statement:

“We are pleased that the International Trade Commission Administrative Law Judge ruled in our favor and found that two of our asserted patents are valid and infringed, and we look forward to the Commission affirming the final results in September.  This ruling reinforces the need for Comcast to take the necessary licenses to our intellectual property.”

The ITC’s initial determination is “likely to lead to a settlement/license from Comcast in order to avoid potential treble damages from an adverse District Court ruling,” B. Riley & Co. analyst Eric Wold wrote in a research note, according to Variety.

In 2016, prior to its merger with TiVo, Rovi filed a patent suit against Comcast in the Eastern District of Texas, Marshall Division, alleging that the cable operator, together with a handful of its set-top suppliers, including Arris/Pace, Technicolor and Humax, are infringing on 14 patents that, it claims, covers features such as remote recording and search for Comcast’s X1 platform.

RELATED: Rovi Sues Comcast and MSO’s Set-Top Suppliers

Elsewhere on the legal front, Hulu recently filed a lawsuit in California against TiVo that asks the court to find that Hulu isn’t required to renew an expired licensing deal because three TiVo patents asserted against Hulu in an earlier case have either expired, are no longer valid, or are linked to a service that Hulu no longer offers.

TiVo shares were up $2.55 (15.5%), to $18.95 each, in afternoon trading Tuesday.