Cablevision Settles Set-Top Box Suit

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By Eleanor Tyler

Dec. 14 — Cablevision Systems Corp. and CSC Holdings LLC have reached a settlement with plaintiffs alleging they were forced to lease a set-top box from Cablevision to get cable service.

Cases against cable television providers for allegedly tying lease of a set-top box to provision of premium cable television service are percolating through several courts.

The settlement in the U.S. District Court for the District of New Jersey comes roughly one month after an Oklahoma federal court threw out a $6.31 million jury verdict against Cox Communications Inc. after plaintiffs failed to prove Cox tied set-top box rentals to the purchase of premium cable service .

Also in November, a Pennsylvania federal court rejected a $15.5 million settlement between Comcast Corp. and premium cable subscribers in a similar suit for lack of a reliable customer list to use in deciding who should be included in the class.

Small Payment, Free Box Market

According to a motion for preliminary approval of the settlement filed Dec. 11, Cablevision will let subscribers use set-top boxes they got from rival providers and will give affected subscribers free access to some premium channels or services.

Cablevision also agreed to activate any certified set-top box that a subscriber buys from a third party. Current and former subscribers will also get credit or cash value of roughly $20 to $40 based on their tenure with the company and some additional value in free service. The motion numbers current subscribers at 2.6 million.

The settlement class includes all New Jersey, Connecticut and New York Cablevision subscribers who paid to rent a set-top box from April 30 2004 to the settlement approval date.

Cablevision also agreed to pay counsel fees and expenses not to exceed $9.5 million and a service award to the representative plaintiffs of no more than $5,000 each.

The settlement must meet the court's definition of “fair reasonable and adequate” to win preliminary approval. If so, the court will hold a fairness hearing before finally approving the deal. The court must also approve any award of counsel fees and costs.

To contact the reporter on this story: Eleanor Tyler in Washington at etyler@bna.com

To contact the editor responsible for this story: Tiffany Friesen Milone at tmilone@bna.com