The world’s “second best hacker” says he was hired under the table by media conglomerate News Corp, which owns the Wall Street Journal, MySpace, Fox News, and DirecTV.

Christopher Tarnovsky, testifying in Echostar v. NDS, says he was paid $20,000 -- mailed inside electronics sent from Canada -- to break into DISH Network’s satellite system and steal security codes necessary for pirating DISH Network’s satellite signals. EchoStar communications, which owned the DISH Network before a split in December of 2007, alleges that hackers from NDS Group, owned by News Corporation, employed hackers to flood the market with smart cards for satellite receivers designed specifically to steal paid DISH content. Both EchoStar and DISH, as separate entities, are plaintiffs in the case.

The suit alleges that the smart cards cost DISH $900M in lost sales and network repairs.

Tarnovsky says that while he was employed to develop “pirating software,” it was not used against DISH or any other rival – instead, it was designed to secure DirecTV’s network.

DISH attorneys said Tarnovsky constructed a device called “The Stinger” – which Tarnovsky admitted to doing – that was able to interface with any smart card, regardless of which company it was designed to work with. Tarnovsky says his actions with The Stinger were aboveboard, but DISH attorneys claimed that hackers and/or NDS employees used it to reprogram at least 50 DISH Network smart cards.

“I never got money for reprogramming Echostar cards,” Tarnovsky testified. “Someone is trying to set me up.”

Patent records reveal Tarnovsky received patent protection on a “system for testing, verifying legitimacy of smart card in-situ and for storing data therein” in 2005.

Earlier, fellow hacker and associate Tony Dionisi testified that he recalled Tarnovsky bragging to him about The Stinger, and told the court that he knew of “another hacker and NDS employee” who used the machine to reprogram DISH’s smart cards.

Tarnovsky says he was paid on a regular basis for 10 years, and received paychecks from Harper Collins, News Corp’s publishing company.

DISH lead attorney Wade Welch, speaking earlier this month, said NDS’ plan was to take hackers “off the streets” and “turn them on the competitors.”

“They called it the Black Hat Team,” said Welch.

NDS says it’s done nothing wrong. “Because this is a competitive business, NDS also monitors competitors,” said NDS attorney Richard Stone. “NDS has done nothing to illegally harm or damage EchoStar. All NDS has done is compete hard and fair in the marketplace.”