BODOG TO APPEAL NEVADA PATENT RULING IN OCTOBER

28 September 2007

But 1st Technologies have hired some serious legal firepower


There could be fireworks in Nevada on October 11 when Bodog, presumably in the form of its new Morris Mohawk brand licensee, confronts 1st Technologies in the first face-to-face clash of a $48 million patent dispute that has thus far cost Bodog its brands (see previous InfoPowa reports)

According to Bodog boss Calvin Ayre's blog, the two sides will argue the validity of the default judgment handed down to the gaming company by Nevada judiciary and a judge in the Superior Court of King's County in Seattle, Washington.

1st Technology claims the $48 million default judgment is fair and good because Bodog (which was not present to contest the claim) infringed its United States Patent No. 5,564,001 entitled "Method and System for Interactively Transmitting Multimedia Information Over a Network which Requires a Reduced Bandwidth" while operating in the United States.

Giving a hint at the defence strategy, Ayre writes that Bodog Entertainment SA as a Costa Rican company is an international entity that has neither a presence or assets in the United States. He adds that it is not part of the Bodog Group of Companies and has no assets, and that domains are not assets and the domains it held were on behalf of other unspecified companies.

Domain names are a part of the world community based on ICANN's charter and mission statement, which brings into question whether or not they could or should be seized.

Bodog's main defence, though seems to rest on its contention that it was not properly served on the Nevada patent action, thus destroying the allegation that it was in default at the hearing.

Ayre writes: "Nobody involved with the company that was sued or anyone with BodogLife [a new brand recently launched as a consequence of the patent dispute] has any knowledge of anyone getting served and this is the basis of the appeal of the judgment on Oct 11th. You cannot have a valid default judgment without having valid service as far as we know."

Describing the court's decision as "ridiculous" Ayre goes on to opine that it will be overturned and the domains reinstated as Bodog's. However, the new BodogLife brand will continue to be the group's prominent brand going forward.

Patents issued by the U.S. Patent and Trademark Office grew to 165 485 last year from 96 727 in 1990. Patent-infringement lawsuits, meanwhile, doubled to 2 400 from 1988 to 2001, according to the National Academy of Sciences.

Bodog's lawyers will face a formidable adversary in court, it appears. 1st Technologies is represented by one of the most successful patent action law firms in the United States - the 26-lawyer Chicago firm of Niro, Scavone, Haller &. Niro, devoted exclusively to plaintiff intellectual property actions, often on a contingency basis where the company gets 45 percent of proceeds from a license, jury verdict or settlement.

The head of the firm, Raymond Niro has won dozens of patent-related jury verdicts worth more than $400 million, according to Law.com. Among his truimphs Niro won one of Colorado's biggest patent-infringement cases in 1997 when a Denver jury awarded inventor Ron Chasteen $57 million from snowmobile maker Polaris Industries and its engine supplier, Fuji Heavy Industries. An appeals court boosted the award to roughly $95 million.

Other major cases include the Research in Motion action, where the Canadian maker of BlackBerry hand-held e-mail devices, settled with NTP Inc. of Virginia on March 3 this year for $612.5 million. RIM refused to pay royalties to NTP for its wireless e-mail technology but lost at trial and faced a potential shutdown.

Another was the miniscule patent holder Freedom Wireless, which won a $148.1 million award from Boston Communications Group and four other companies last year in an infringement case over a patent for prepaid cellphone systems, whilst in a dispute between Denver-based Qwest and Texas company PhoneTel, more than a dozen technology and telecommunications companies settled on caller-ID technology developed by deceased Japanese inventor Kazuo Hashimoto. All settlements exceeded $65 million.

Law.com succinctly observes: "Raymond Niro sues first, settles fast, and collects millions..."

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