Bodog's Domain Names Confiscated

[Simmo!]

1st Technology LLC owns a patent on a process for taking bets online and claims that Bodog’s downloadable software infringes the company’s patent, which has been granted in the United States as well as elsewhere in the world.

Were this to relate to the casino side of things then this would be an RTG infringement, not a Bodog one. My bet is that this relates to sports betting, reference the quote:

1st Technology LLC owns a patent on a process for taking bets online

My bet (patent # 2340928 ) is that 1st Tech simply owns one particular method for taking bets which happens to be the method Bodog uses. Chances are that this only affects sports betting and only affects companies using the same specific method that alledgedly infringes the patent. It's clearly bad news for Bodog, but...

the implications for the online gaming industry as a whole are huge

...is pure conjecture. Basically we don't know the whole story yet and shouldn't necessarily take the comments of third party editorial and industry observers out of context or at face value until the full facts are known. The press love to blow things out of proportion lets not forget - the truth is often far less interesting than the speculation!

[jetset]

Bodog (or New Bodog!) uses a special proprietary version of the RTG software which has been extensively "tweaked", I'm informed.

Some time ago Ayre purchased rights to the source code and his developers have apparently improved on it since.

This sentence from the litigation is interesting imo: "The violation relates to the method for the production and transmission of enhanced multimedia information."

That could cover a wide field, especially in a diverse group like Bodog.

Remember Molnick - the Home Gaming Network - i2corp guy who claimed he held the patents to live online gaming and launched several cases? I wonder if there is a connection to him, or if this 1st Technology LLC is another claimant to the patents on this sort of technology?

[jetset]

More detail emerging on this issue. Note the Las Vegas connection!

The following article is from The Vancouver Sun:

Gambling site Bodog hit with $48-million judgment in U.S. court

Wednesday, August 29, 2007

"Online gambling website Bodog.com was out of service Monday and remained inoperative Tuesday, apparently due to a $48.6-million default judgment obtained by a Las Vegas company against Bodog in a patent infringement case.

".....but according to Nevada court documents, 1st Technology LLC of Las Vegas obtained a $48.6-million default judgement on June 14 against Bodog Entertainment Group S.A., Bodog.net and Bodog.com.

The Las Vegas company obtained the judgment after the Bodog companies failed to answer allegations, filed in U.S. District Court in Nevada, that downloaded software used by Bodog customers to facilitate its gaming activities infringed upon 1st Technology's patents.

It is not clear why Bodog officials did not respond to the allegations. One possibility is they were scared away by the U.S. Department of Justice, which has declared war on Internet gambling.

Through a series of high profile arrests of online gambling executives, the Justice Department has made it clear that online gambling is illegal and anybody operating or facilitating such activities is subject to prosecution.

Since then, (Bodog CEO Calvin] Ayre has avoided stepping on American soil, but he continues to return to Vancouver, where Bodog runs a marketing-support business in Vancouver called Riptown Media and a call centre in Burnaby called Triple Crown Customer Service.

Meanwhile, 1st Technology has been steadily tightening the noose on Bodog, which was previously run out of Costa Rica but is now based in Antigua.

In an affidavit filed in conjunction with the court action, 1st Technology lawyer Kristopher Rath complained that, despite the default judgment, Bodog "continues to act with impunity in the United States."

"The Bodog entities infringing activities are responsible for over $65 billion in cumulative transactions to date, with approximately two-thirds of this revenue currently being derived from infringing United States activities," he said.

The lawyer noted that, according to a Forbes interview with Ayre, "Bodog handled $7.3 billion dollars of revenue which translates to over $4.8 billion in revenue in the United States with revenue growing 300 percent per year since 2004."

He also noted that, according to the Forbes interview, Ayre "has amassed a current wealth of $1 billion, which was derived in large part through infringement of 1st Technology LLC's patent.

"However, despite reaping the rewards of U.S. commerce, the Bodog entities evade United States law and courts, and Mr. Ayre gloats about his companies' ability to operate above American law."

The lawyer said 1st Technology "continues to suffer massive and irreparable harm because of the Bodog entities' wrongful conduct", and the "only way to stop this harm is to enjoin Bodog's United States activities."

In the early 1990s, Ayre got into trouble with the B.C. Securities Commission over his dealings with Bicer Medical Systems, listed on the former Vancouver Stock Exchange. In 1996, he admitted to serious offences in connection with that company and agreed to a 20-year ban from the B.C. securities market.

[SlotsWizard]

The above sounds about right. It seems a company with a patent on gaming software has successfully sued Ayre in a Seattle court for patent infringement and has been awarded $48 million.

On August 21, a writ of execution was granted and that likely allowed the plaintiff to take over the rights to the domain name.

They'll get the domain name but I doubt they'll see a penny of that $48 million.

[jetset]

BODOG IGNORED PATENT LITIGATION SAYS OPPOSING LAWYER (Update)

Background to litigation against Bodog continues to surface

Following previous reports on the 1st Technology LLC vs Bodog Entertainment Group SA, further detail is beginning to emerge, along with critical comment by lawyers representing 1st Technology in its $49 million patent infringement suit against the Antiguan based online gambling group.

The confrontation apparently began last September, when 1st Technology, which has enjoyed some success in previous actions against other companies, sued Bodog before Judge Roger L. Hunt in a federal court in Nevada. Lawyers for 1st Technology claimed that Bodog was illegally using a "method and system for interactively transmitting multimedia information over a network which requires a reduced bandwidth," according to court documents.

It is alleged that Bodog failed to appear in court to defend itself and lost the case by default, and Judge Hunt issued an order that Bodog was to pay $48 937 456 to 1st Technology by March 2007 for patent infringement.

When the order had not been complied with on the due date, it appears that the case was transferred as an enforcement issue to the state of Washington sometime in June, but Bodog again failed to make an appearance, according to 1st Technology's attorney Venkat Balasubramani.

The lawyer is adamant that all appropriate notifications were correctly given for both the lawsuit in Nevada and the subsequent action in Washington state. "I can't speculate as to why they might have done that [failed to appear]. It's safe to assume they knew about it and definitely ignored it," Balasubramani added.

1st Technology was left with no alternative but to note that Bodog had failed to respond to the default judgment and ask that all Bodog domains be confiscated and transferred to them. This was so ordered by Judge John Erlick on August 21, requiring registrars to transfer Bodog related domains to the control of 1st Technology.

"The Court makes it clear that the intent of this order is to allow the Plaintiff to liquidate or otherwise monetize the Domain Names without incurring any expense," said Judge Erlick in his ruling. "Plaintiff may decide not to auction the domain names, and instead may operate the Domain Names in any manner it sees fit, including exploiting any traffic to the sites accessible via the domain names."

Balasubramani, who is expert in commercial litigation involving the Internet and technology explained that the purpose behind the order was to satisfy as far as possible the apparently ignored 1st Technology judgment.

It is becoming clear that a great deal of preparation and planning by a competent legal team has gone into the action against Bodog. Balasubramani says that 1st Technology LLC has engaged a considerable multi-legal team that is now dedicated to enforcing its judgement against Bodog, embracing commercial and intellectual property rights. It intends to demonstrate that no company that has customers in the United States is above or beyond U.S. legal jurisdiction, he said.

And apparently the message has struck home at Bodog, with a 1st Technology spokesman disclosing that lawyers from both companies are now in communication.

[winbig]

Do you honestly think that Calvin would step foot in the USA?

What do you also bet that the DoJ "encouraged" this lawsuit to be filed?

[SlotsWizard]

Do you honestly think that Calvin would step foot in the USA?

Not a chance... unless extradited by our northern neighbors.

What do you also bet that the DoJ "encouraged" this lawsuit to be filed?

I certainly wouldn't bet against that possibility. The timing of this is very "convenient".

[jetset]

1st Technologies has been successful in "persuading" a number of major online companies to license its Internet technology, it appears from googling the company and indeed from our own archived reports going back as far as 2005.

They must know that $49 million won't be easily obtained, and I'm guessing it's now all about an agreement on legal costs and licensing negotiation.

If 1st Technologies can add Bodog to it's growing list of licensees (which appears to include Playtech, Orbis-Openbet, Sportingbet and others) it will have again made its point and some cash to boot.

Bodog is in a tough position here - for all Ayre's bravado about a successful defence it seems to me that to contest this Bodog would have to accept a US court's jurisdiction over it, which could give rise to more extensive complications for its business.

Like you, I don't see Ayre risking a personal appearance in the US under present circumstances.

But the road to compromise looks to be still open.

[Professor]

Bodogfight.com and Bodogbeat.com are now closed also.

I know Bodog wants to fight, but the branding damage all this is causing far exceeds $48M. I would negotiate a settlement ASAP.

While its doubtful that any officers of Bodog will want to appear in a US court there is no reason they couldnt have legal counsel appear to represent their interests.

[NASHVEGAS]

Bodogfight.com and Bodogbeat.com are now closed also.

I know Bodog wants to fight, but the branding damage all this is causing far exceeds $48M. I would negotiate a settlement ASAP.

While its doubtful that any officers of Bodog will want to appear in a US court there is no reason they couldnt have legal counsel appear to represent their interests.

What is the chance Calvin and his boys/girls would be subpoenaed? I have posted for months(search) along with Rollo and a few (very) others in regards to Calvin and either have been ignored (which is reasonable) or flipped off by most here in denial.I wonder if some will now have selective memories. My posts were not totally based on speculation fwiw but of course then again hearsay and a mans past as well as his challenges and mockery of the US government offers no gurantees either. At least, some of the supposed truth is starting to surface through the media now of Calvin's shady past........time will tell if his ship has started to sink.