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EchoStar Shares Tumble

Mar 10, 2005  •  Post A Comment

EchoStar Communications’ shares fell as much as 8 percent Thursday after the company learned of a setback in its patent fight with digital video recorder maker TiVo and that the Securities and Exchange Commission is investigating the company for accounting irregularities.

The company’s shares traded more than $2 off their Wednesday closing price, sinking to $28.31 a share Thursday afternoon.

Driving down the stock price was a federal court’s refusal to dismiss patent infringement claims by TiVo against EchoStar, setting the stage for a trial to begin in Texas Oct. 4.

At the same time, Bloomberg News reported Thursday that the SEC had opened an inquiry into EchoStar CEO Charlie Ergen’s role in the company’s accounting practices. The probe comes as the company itself launches its own investigation into how the company booked transactions with suppliers and into a series of consulting payments made to a friend of Mr. Ergen.