Will DirecTV Sue You Next?

Files Suit Against 'Smart Card' Users Claiming Theft Of Satellite TV

(CBS)  John Demarco Jr. is one of those "fix it" guys. His son and daughter both have computers "Dad" built by hand.

Demarco calls his talent for mechanics "just another hobby." But CBS News Correspondent Byron Pitts reports that hobby has him in hot water with the satellite company DirecTV.

Demarco is one of at least 9,000 people nationwide being sued by DirecTV.

Demarco says he bought a computer that had a smart card reader and writer and the book to go with it and now the company has accused him of "stealing TV."

DirecTV claims "smart card" technology is "knowingly" being used to steal its satellite signal, giving customers hundreds of free TV channels.

DirecTV executives claim the company has lost nearly a billion dollars. They hope to regain the money from the names on a mailing list of people that have purchased smart cards on the Web.

But that strategy has some problems.

According to experts, smart cards have other uses. It is possible that people listed in DirecTV's lawsuit never intended to steal a satellite signal.

"This is one of the major failures of DirecTV management," says Bob Scherman of Satellite Business News. "That they have spent a huge amount of money pursuing an anti-privacy campaign that has not reduced the number of people stealing direct TV."

DirecTV declined requests for an on-camera interview, but did answer a few questions in writing. Regarding smart cards, the company insists "these devices are designed for the sole purpose of stealing DirecTV's programming."

As for Demarco, he's been forced to hire a lawyer. He says the lawsuit could cost him $2,000-$10,000, so he's selling his wife's new car.

"DirecTV had a big pond in front of their building and it was full of carp and they suspected that there was a piranha in the pond and they threw in a stick of dynamite and they go 'Look, we found the piranha.' But they killed everything else at the same time," says Demarco, comparing himself to one of the carp.

A federal judge in South Carolina has dismissed eight cases so far, but DirecTV is filing more across the country every day.