Voom Opening Statements Focus on Dish Bad Faith

Echostars says programming spending fell short

By Jon Lafayette -- Broadcasting & Cable, 9/28/2012 5:15:34 PM

Jury selection and opening arguments were completed Friday in the case pitting Cablevision's Dolan family against Dish Network's Charlie Ergen.

In its billion dollar suit, the discontinued HD programming service started by the Dolans and now an asset of AMC Networks, claims Ergen's Echostar breached its carriage agreement. Beyond the money, the dispute is relevant because AMC claims its channels were taken off Dish partly for leverage in settling the suit.

According to analyst Tom Claps of Susquehanna Financial Group, there were few revelations in the opening statements.

"However, Voom did score additional points by repeatedly highlighting Dish's systematic, bad faith, year-long destruction of evidence during the critical stages of this dispute," Claps said

Dish's main argument was that overhead should not have been included when calculating how much was being spent on Voom. In its agreement with Echostar, Voom was bound to spend $100 million annually on the services' suite of channels. Dish contends Voom spent only $60 million on programming in  2006.

"After hearing the opening statements, it remains our view that Voom (AMCX/CVC) is in a stronger position with respect to the core issues in this case, and that Voom will likely receive a favorable verdict if this case does not settle," Claps said.

Cablevision chairman Charles Dolan is expected to be the first witness to take the stand on Monday morning.