Falling Gemstar Can't Catch a Break

Like the seemingly invincible Mike Tyson -- after he got knocked out by longshot Buster Douglas in 1987 -- the once-intimidating Gemstar-TV Guide International (GMSTE Quote) has entered a more fallible stage of its history.

Gemstar, the developer of interactive, onscreen television program guide technology, suffered a double whammy late last week in separate litigation actions with Scientific-Atlanta (SFA Quote) and other companies accused by Gemstar of infringing on its intellectual property.

For Gemstar, which started suffering a streak of patent-related legal setbacks earlier this year, it appears the losses will require the company to take a less adversarial tack as it continues to aspire to becoming a television gateway for the great mass of the nation's couch potatoes.

The market's declining esteem for Gemstar's patent portfolio, along with revenue-recognition decisions that the company has decided to reverse, have battered Gemstar's stock. Shares fell 10 cents to close at $4.12 Friday, down 88% from its 52-week high. The company said last week that Nasdaq had put it on the short list for delisting, because of the company's failure to file recent financial reports. The company is fighting the Nasdaq delisting process.

Broken Lock

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