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NCR Sues Dish Network Over Blockbuster Kiosks

31 May, 2011 By: Erik Gruenwedel

As expected, NCR Corp. has filed a lawsuit against Dish Network Corp., saying the new owner of Blockbuster LLC does not have the right to halt a license agreement it holds operating more than 9,000 Blockbuster Express kiosks.

Duluth, Ga.-based NCR, which filed the complaint May 27 in U.S. District Court in Wilmington, Del., said it would suffer irreparable harm, in addition to millions of dollars invested, in a kiosk business launched in 2008 with the Blockbuster brand.

Blockbuster Inc., which sold its assets in April to Dish for $320 million, earlier this month sent NCR a letter saying it would be ending the license agreement. NCR, in the complaint, argued that Blockbuster Inc. has no legal right to terminate a license agreement it originally agreed to and signed.

“The Blockbuster notice letter didn’t allege that NCR had used the trademarks in any way not provided for by the agreement or that had denigrated their value, nor did the Blockbuster notice letter explain why Blockbuster, as opposed to Dish, had the right or power to provide any notice under the license,” NCR said in the complaint.

Since acquiring Blockbuster, Dish has aggressively sought to re-establish the brand across all distribution platforms — sometimes ignoring conventional wisdom.

The same day NCR filed the suit, Blockbuster began offering 99-cent daily rentals on catalog and recent releases on thousands of titles. And through July 4, customers who rent a new release at $2.99 can rent for free unlimited second titles (one at a time) valued $1.99 or below.

Dish is also giving new satellite TV customers 90-day free memberships to Blockbuster Online. The promotion includes up to five free in-store rental exchanges.

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