Echostar Launches Lawsuit Against Insurance Companies; Alleges Conspiracy to Deny Coverage

August 3, 2000

EchoStar Communications Corp. can’t find satellite insurance. And the Littleton-based company doesn’t think it’s purely a coincidence.

EchoStar filed suit in U.S. District Court in Denver Monday, claiming 13 international insurers have conspired to leave the company without coverage.

“That is unprecedented in the market, for insurers not to be willing to provide insurance on satellites in orbit,” said David Moskowitz, EchoStar’s senior vice president and general counsel. “To think that each came to that conclusion on their own, in my opinion, is implausible.”

Insurance coverage has lapsed for three of EchoStar’s satellites in orbit, and the company is attempting to extend a policy that expires next month for its Echostar 5 satellite. Echostar said in its complaint that insurance companies’ refusal to negotiate or offer appropriate premium levels are a result of a claim it filed on EchoStar 4, which malfunctioned after launch. Until insurance can be found, EchoStar will self-insure its satellites.

DirecTV, a competitor based in California, claims it has had no problems procuring coverage for its satellites.

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