Playboy (NYSE: PLA) has settled its breach of contract legal dispute with DirecTV (NYSE: DTV), the company announced in an 8-K filing. The settlement will result in a $13 million charge on Playboy’s Q4 earnings. In addition to the cash settlement, DirecTV has been given the rights to run Playboy’s “Playboy TV”, “Spice:Xcess”, “fresh!” (and or “SKiN”) and “Playboy TV en Espanol” networks in the U.S. through December 2013.
In October, Playboy warned investors that it would take $20 million in impairment charges during Q3, mostly to programming expenses. About $3 million of the writedowns were related to the DirecTV lawsuit.
Last March, DirecTV filed the suit in California Superior Court arguing that Playboy and its Spice Hot Entertainment unit were in breach of contract, according to an earlier Bloomberg report. Specifically, DirecTV claimed that Playboy violated an agreement to offer the satellite company the same terms as any other cable or satellite operator.