Overview
In a ruling yesterday, Judge Swain denied Dish Networks' motion for an anti-suit injunction against the major broadcast television networks, holding that the majority of the claims at issue should be heard in the California district court where the TV networks had filed suit against Dish. The suits concern Dish Network's new "auto hop" function, which allows viewers to record the prime time programming of CBS, Fox, ABC and NBC, then skip commercials with the push of a single button, which we have covered before on the SDNY Blog. After Dish began offering the new auto hop feature to customers, press reports suggested that the networks were planning to sue Dish for breach of copyrights and licensing agreements. Dish filed suit in the SDNY, seeking a declaratory judgment that auto hop did not infringe any of the networks' copyrights or breach any licensing agreements. Hours after Dish's suit, Fox, CBS and NBC filed suits in the Central District of California. Dish then moved for an anti-suit injunction in the SDNY staying prosecution of the California litigation, which Judge Swain granted on a temporary basis.
Yesterday, Judge Swain held that Dish's motion for a declaratory judgment was an improper anticipatory litigation, and that the "coercive litigation" in California was the appropriate arena for the claims that overlap between the two suits. Those claims for which Dish seeks a declaratory judgment that are not present in the California action -- breach of licensing agreements with CBS and NBC and all claims against ABC, which brought no claims in California -- would continue before Judge Swain, though she urged the parties to agree to consolidate discovery in the cases if possible.
In light of the Court's determination that Dish's complaint constitutes an improper anticipatory filing, and the existence of coercive litigation as to most of the issues in California, the Court finds that there is no useful or appropriate purpose in entertaining Dish's declaratory judgment action to the extent that it overlaps with the litigation pending in the Central District of California. Accordingly, insofar as Dish's complaint pertains to Fox's copyright and contract claims and CBS/NBCU's copyright claims, this action will be dismissed without prejudice to litigation of Dish's assertions in the pending Central District of California actions. Because CBS and NBCU have not asserted contract claims in California, and because ABC has not filed suit against Dish, this action will continue as to Dish's contract claims against CBS/NBCU, and as to all of the claims and counterclaims asserted with respect to ABC. There are numerous ways to mitigate whatever inefficiencies might result from allowing these claims to proceed in separate venues. CBS and NBCU are represented by the same national law firm (indeed, with the exception of ABC, each of the parties is represented by at least one firm that has offices on both coasts of the United States), which will facilitate coordination; the California actions may be consolidated; and, if the parties are unable to reach an agreement to consolidate the claims that remain in this district with those in California, the courts can, with the cooperation of the parties, coordinate the proceedings so as to minimize any inefficiencies.