Telecom giant Verizon Communications (NYSE: VZ ) has agreed to pay digital recording company TiVo (Nasdaq: TIVO ) more than $250 million to resolve a patent dispute regarding its DVR technology, TiVo announced today. The issue had been scheduled to go to trial next month.
This isn't the first lawsuit TiVo's benefited from. DISH Network and EchoStar Corp. last year agreed to pay up to $500 million in fees and damages and earlier this year TiVo reached a $215 million agreement with AT&T.
The terms of the settlement with Verizon include a $100 million initial cash payment followed by quarterly payments totaling $150.4 million through July 2018. Verizon also agreed to pay monthly license fees through July 2018 to TiVo for each of its DVR subscribers over a certain level. TiVo will void $29.4 million in payments if the two companies work together well on certain joint initiatives.
Shares in TiVo surged as much as 7% Monday morning on the news. Verizon shares remained steady.
It was also announced today that Verizon has agreed to pay set-top box maker ActiveVideo more than $260 million to settle a patent dispute with that company. A District Court had previously ordered the company to pay; the companies agreed to cross-license their patents and abstain from suing each other for a period of years, according to an ActiveVideo press release that said the settlement was confidential. Verizon paid an unspecified amount of money on top of the $260 million, according to ActiveVideo.