DISH Network Corp and EchoStar Corp said on Tuesday they were pleased the Patent and Trademark Office (PTO) issued an initial office action rejecting TiVo Inc's software claims as invalid.

Dish and Echostar said they believe the PTO's conclusions are highly relevant to the issues on appeal, as well as the pending sanctions proceedings in court.

In July, Dish and EchoStar won a stay, pending their appeal, of a Texas court's order that they disable millions of digital video recorders that infringe on TiVo's patent for time warp technology. In 2006, a jury awarded TiVo about $74 million in damages plus interest, for a total payment by EchoStar and DISH of $104 million.

U.S. District Judge David Folsom imposed additional damages of $103 million plus interest against DISH and EchoStar for continuing to infringe on TiVo's patent while they appealed the jury verdict. That appeal was unsuccessful.

In a statement, TiVo said on Tuesday the PTO's preliminary finding will not affect EchoStar's appeal of the June 2009 ruling by the United States District Court for the Eastern District of Texas finding EchoStar to be in contempt of court.

It said it was not unusual for the PTO to provide a preliminary finding of invalidity and to later find the claims are valid after hearing an explanation from the patent owner.

(Reporting by Susan Zeidler; editing by Andre Grenon)