Court orders Verizon to pay ActiveVideo first royalty payment

Verizon (NYSE: VZ) will be forced to pay interactive TV technology vendor ActiveVideo a royalty payment of about $11 million by Dec. 16, after a U.S. District Court judge denied a motion from Verizon that it stay an injunction issued last month while it appeals a patent-infringement verdict.

ActiveVideo, which supplies interactive TV technology to Verizon rival Cablevision (NYSE: CVC) for its iO: Interactive Optimum service, will collect royalty payments of $2.74 per subscriber from Verizon. The telco counted about 3.8 million FiOS TV subscribers at the end of the third quarter.

Verizon has said it is working with Cisco (Nasdaq: CSCO) to develop alternative interactive TV technology for products such as its FiOS TV widget bazaar and video-on-demand platform that won't infringe on ActiveVideo's intellectual property. The court has given it until May 23 to deploy the new technology.

ActiveVideo executives cheered Monday's ruling, and said they will demand that Verizon pull FiOS products that it claims rip off its technology. "We will do everything necessary to continue to prevail in this case, should Verizon continue in its ongoing act of piracy, and we will not hesitate to demand that FiOS VOD, widgets and any other infringing services be terminated on May 23 if our rights remain violated," ActiveVideo president Jeff Miller said in a prepared statement.

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