The television smart card contains software to unlock pay-TV signals. Canal+ spent $35 million developing its smart card, which now controls access to the company's $4.1 billion business.WHAT HAPPENED
Canal+ charges that in 1998 its key rival, NDS Group, a subsidiary of News Corp., hired Israeli hackers to break the code and then put the secrets on the Web. NDS denies these claims.THE DAMAGE
Millions of nonsubscribers in Italy, Britain, and East Europe buy counterfeit cards and watch pay-TV channels for free. Canal+ estimates the damage at more than $1 billion.THE SUIT
Filed Mar. 11 at U.S. District Court in Northern California, Canal+ charges NDS with conspiracy and racketeering. NDS executives say the company is preparing a countersuit.
Data: BusinessWeek, Canal+