DIRECTV and DISH Network have filed lawsuits in three states seeking to overturn unfair taxes imposed only on satellite television customers. These suits were filed to protect satellite TV customers, who already pay their fair share of taxes and should not be forced to suffer from an unfair tax policy that singles them out for choosing a competitive and affordable alternative to cable.

Listed below are summaries of the lawsuits currently filed across the United States.

KENTUCKY
In March 2005 Kentucky passed a tax law imposing combined excise and gross revenues taxes of 5.4 percent on satellite television services. Cable television companies effectively are exempted from almost all of the tax because the new state taxes they pay are redistributed to local governments in lieu of the five percent franchise fee previously paid by cable companies -- the end result is they pay hardly any new tax at all.

On May 4, 2005, DIRECTV and EchoStar filed suit in federal court, DIRECTV, Inc., et al. v. Department of Revenue, challenging the constitutionality of the new taxes because they give an unfair competitive advantage to local cable television companies and discriminate against satellite television subscribers.

FLORIDA
Florida's communications services tax discriminates against satellite television companies and their subscribers by imposing a rate of tax (10.8 percent) that is substantially higher than the tax rate imposed on cable television service (6.8 percent). This is one of the highest taxes on television services anywhere in the country.

On May 4, 2005, in DIRECTV, Inc., et al. v. State of Florida Department of Revenue, EchoStar and DIRECTV filed suit in state court to challenge the constitutionality of this tax because it discriminates against satellite TV viewers. The case is currently pending before Judge Cooper in the Leon County Circuit Court of Florida's Second Judicial Circuit.

OHIO
DIRECTV and Dish Network applaud the Ohio Supreme Court's decision to review a Court of Appeals ruling regarding a discriminatory tax imposed on satellite TV subscribers. We look forward to a Supreme Court decision that will promote fair competition in the state and lower prices for consumers.

TENNESSEE
DIRECTV, Inc. and EchoStar Satellite Corporation and its DISH Network filed a lawsuit on Aug. 19, 2003 challenging the legality of Tennessee's discriminatory tax scheme on video services. Cable subscribers in Tennessee are not taxed on the first $15 of their service while satellite subscribers are taxed on their entire bill.

The lawsuit, DIRECTV, Inc. et al. v. Chumley, challenges the constitutionality of this tax scheme because it discriminates against satellite television customers by effectively charging them a higher rate than that imposed on cable subscribers. This case is currently pending in the Chancery Court of Davidson County.

NORTH CAROLINA
Following an unsuccessful request to the North Carolina Department of Revenue to obtain refunds for customers who had paid millions of dollars in taxes under a 5% satellite-TV tax, a lawsuit was filed against North Carolina. DIRECTV, Inc. and EchoStar Satellite Corporation and its DISH Network filed the suit to challenge the tax that discriminates against satellite TV viewers while benefiting local cable TV firms.

The lawsuit, DIRECTV, Inc. et al. v. North Carolina, challenges the constitutionality of the state?s taxing policies and charges that local cable companies, who are not similarly subject to the tax, are thereby given an unfair competitive advantage.