The Circuit: AT&T case judge a ‘judicial machine,’ patent reform, Netflix and Starz talks break down

LEADING THE DAY: The judge assigned to oversee the Justice Department case against AT&T, U.S. District Judge Ellen S. Huvelle, has ruled against the government before in antitrust cases, The Washington Post reported. In 1999, she ruled against the Justice Department, which was seeking to block a merger between Comdisco and SunGard, two computer-disaster-recovery companies, saying that the industry was changing quickly and still open to competitors.

Huvelle, who was described as a “judicial machine,” declined to comment on specifics about the case she’s about to hear but said that she has little interest in the politics surrounding the facts.

Reuters reported Friday that AT&T might be considering a two-track plan to reach a settlement before the case goes to court, and could offer up divestitures as a part of a deal.

Eric Schmidt on patents: As Congress prepares to take up the issue of patent reform again next week, Google chairman Eric Schmidt weighed in on the issue, saying that patents are “terrible.”

TechCrunch reported that Schmidt, speaking at the Dreamforce conference in San Francisco, proposed that patent evaluation be crowdsourced so that anyone could comment on them.

Patent reform stands the best chance in Congress that it’s seen in years, with House, Senate and administration support.

Netflix, Starz cut ties: Netflix and Starz have parted ways, according to a Thursday release from the TV channel. The company said that it had ended negotiations with Netflix and that it will no longer stream its content on the site after its current agreement expires Feb. 28, 2012.

The Starz deal gave Netflix streaming customers access to Sony and Disney content at the same time it aired on cable. Starz had been criticized in the past for letting Netflix air its content cheaply — its last contract was for $30 million a year, the Los Angeles Times reported.

Oracle, SAP: SAP won its case Thursday to overturn a $1.3 billion copyright-infringement award given to Oracle. Oracle argued that SAP had used stolen information to lure customers away to a competing SAP product.

A federal judge called the award “grossly excessive,” and has offered Oracle at $272 million award, the Associated Press reported, adding yet another twist to a four-year case. If Oracle does not accept the award, there will be a new trial

TechCrunch’s Arrington resigns to set up VC fund: TechCrunch founder and co-editor Michael Arrington stepped down from the influential tech blog Thursday, saying that he will be starting up a venture-capital firm. Fortune reported that Arrington, who has invested in start-ups before, had obtained a waiver from AOL to invest in start-ups earlier this year.

Hayley Tsukayama covers consumer technology for The Washington Post.

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