With a New York appellate court ruling that ongoing litigation over the now-defunct Voom HD service should head to trial, Dish Network is threatening to remove AMC Networks from its air -- but the satellite operator said its decision to drop AMC channels is due to viewership declines and the programmer's "high renewal price."
The programmer said the No. 2 DBS provider has expressed its intent to drop AMC, Sundance Channel, IFC and WeTV from its lineup by the end of June, following an April 26 ruling in which the Appellate Division of the New York State Supreme Court denied Dish's application to further appeal a prior trial court decision sanctioning it for bad-faith destruction of evidence in the case.
Dish countered that AMC "distorts the facts of the current situation and incorrectly attempts to tie together two separate issues."
According to Dish, the satellite operator's contract with AMC ends in June "and we have decided not to renew."
"AMC Networks channels such as IFC, WE, AMC and Sundance overall have had significant declines in viewership among Dish subscribers," the company said in a statement. "AMC Networks' very limited popular programming is non-exclusive, and available to our customers through multiple other outlets such as Amazon.com, iTunes and Netflix."
The litigation between the two companies, dating back to 2008, involves the suite of networks known as Voom HD (a subsidiary of Rainbow Media, the predecessor company to AMC Networks). Dish had agreed to carry the HD channels, but in 2008 terminated the carriage contract and Voom HD filed suit, seeking more than $2.5 billion in damages.
In a pre-trial decision, the trial court judge ruled that the DBS provider had destroyed evidence in the case, citing its "pattern of egregious conduct and questionable -- and, at times, blatantly improper -- litigation tactics." The Appellate Division recently affirmed the trial court ruling, writing that Dish "acted in bad faith in destroying electronically stored evidence." As such on April 26, the Appellate Division denied Dish further appeal processes, leaving the case to be set for trial.
AMC officials said that within days of this ruling, Dish told the programmer of its intention to drop the four channels by June 30.
"AMC Networks has some of the most acclaimed programming on television, with shows like Mad Men, The Walking Dead and Breaking Bad. In fact, AMC's The Walking Dead is the number one scripted drama with Dish subscribers," said AMC Networks in a statement. "It is unfortunate that, because of setbacks in an unrelated litigation, Dish even suggests that they might deny their customers access to some of their favorite networks and shows that are offered by every other major satellite and cable TV provider."
Dish responded that the decision to drop AMC channels "is solely dependent on their high renewal cost when compared to their low viewership. Dish will make alternative high-value channels available to our customers as replacements."
According to the satellite TV provider, the Voom litigation is a separate matter.
"Almost seven years ago, we agreed to carry certain Voom channels because Voom promised to make substantial investments in compelling content. Voom did not keep that promise, resulting in lackluster channels that generated little consumer or distributor interest. Dish decided to exercise its right to terminate the Voom agreement. The questions involved in the discovery dispute do not change those facts."