BY PETER SHINKLE
St. Louis Post-Dispatch

Satellite signal piracy is an international affair. Defendants in a recent suit hail from such far-flung climes as the Cayman Islands, Bulgaria and, most particularly, Canada.

In one case, a man from the Cayman Islands is accused of smuggling two Bulgarian hackers into Montana, where they allegedly used a sophisticated laboratory at a state university to break the code of a U.S. company's satellite TV system.

Once the hacking job was done, Canadian companies allegedly sold the pirate technology into the United States to people who want to steal satellite TV signals.

That's the allegation at the core of a lawsuit that satellite TV company DirecTV Inc. filed in 2000 against a group of Canadians, Bulgarians and others. It underscores the prominent role of Canadians in satellite signal theft, a vice that has led DirecTV to file more than 8,700 lawsuits against individuals across the United States.

The dispute highlights a world where hackers work for companies with ample resources. Even a subsidiary of Rupert Murdoch's mammoth News Corp. has come under criminal investigation amid allegations that it broke into the security system of a French satellite TV company and exposed its code to hackers.

The French company, Groupe Canal Plus S.A., sought $4 billion in damages last year against News Corp. subsidiary NDS.

Murdoch has denied the claims, and the suit against NDS was settled. However, other satellite companies, including Echostar Satellite Corp., have sued NDS, accusing it of hacking their systems and exposing them to theft.

Murdoch has offered to buy DirecTV for $6.6 billion. Critics point to the hacking allegations and have urged regulators to block the deal.

Meanwhile, DirecTV is trying to stop Canadian hackers. In April, it claimed Canadians and others were using 63 Web sites - with names like piratesatellite.net - to sell signal theft technology. A federal judge in Florida issued a temporary order shutting the sites down.

DirecTV does not do business in Canada. But its signal falls there and many Canadians would like to get the programming.

As a result, DirecTV says, businesses have sprung up to develop and sell technology to steal the signals. DirecTV and NDS, which developed access cards and other technology for DirecTV, have fought back.

In 1996, they filed suit in Seattle against Canadians Norman Dick and Ron Ereiser, claiming they made and distributed phony access cards to receive satellite signals. A federal judge later ordered Dick, Ereiser and the other defendants to pay $14.8 million to DirecTV and NDS.

A federal grand jury in Seattle in 1997 indicted Dick and three other men on charges they manufactured and sold counterfeit DirecTV access cards. One pleaded guilty; Dick and the other two have not appeared in court to face the charges.

With phony access cards becoming widely available, DirecTV and NDS unveiled their second generation of cards. And almost immediately, Ereiser went to work on cracking the second generation card, DirecTV and NDS say.

Ereiser conspired with a U.S. citizen living in the Cayman Islands to get two Bulgarians into Montana illegally in 1997 to hack the code for the second generation card, DirecTV and NDS claimed in a lawsuit filed in Montana.

The lawsuit claims the Bulgarians used research equipment at Montana State University's Image and Chemical Analysis Laboratory in Bozeman. It claims Ereiser used the research to manufacture and sell pirate access cards.

The Cayman Islands man, Herb Huddleston, settled by agreeing to pay $700,000 to DirecTV. He and some other defendants agreed to stop making or selling technology for use in signal theft.

Jan Saggiori, a Swiss hacker accused of helping Huddleston and the Bulgarians, also settled by promising not to hack DirecTV technology.

But Saggiori says he never hacked the access card, and the lawsuit was a ploy by NDS to get him to work for it. "If you don't want to work for them, they hit you to force you to work for them," he wrote in an email Wednesday to the Post-Dispatch.

An NDS spokeswoman could not be reached for comment.