The Week That Was: September 8th – 12th

Following a potentially landmark decision by the Dutch Senate to tax both legal and illegal gaming operations, across the pond in the Seventh Circuit United States Court of Appeals, PartyGaming plc is facing more than $250 million in potential damages in a copyright infringement suit. Here’s what’s happening:

• Copyright infringement litigation has been brought against PartyGaming plc by WMS Gaming Inc to the tune of a potential $287,000,000 USD. WMS Gaming claims that PartyGaming plc was “persistent, knowing and willful” in its illegal and unauthorized use of copyright protected WMS trademarks Jackpot Party and Super Jackpot Party between the years of 2004 and 2006. Though the actual damages to the relatively small WMS Gaming Inc were valued at $2,673,422.10 by a district court, WMS seeks to lay claim to a goodly portion of the nearly $2 billion in revenue generated by PartyGaming over the two period of time in question. Judge Wood of the 7th Circuit issued this statement: “We add that while the figure WMS seeks, $287,391,140.70, is considerably larger than the damages award granted by the district court, $2,673,422.10, the record shows that in a single year (2005,) the defendants reported revenues of $977.7 million – nearly $1 billion. The record shows persistent, pervasive, knowing and willing infringement for several years by PartyGaming, as it repeatedly refused to cease and desist even after receiving several forms of actual notice of its unlawful activity from both the Patent and Trademarks Office and from WMS.”
• The Dutch Senate has passed a hotly contested bill which establishes a blanket tax of 40.85% on all online gaming enterprises with operations in the Netherlands, including illegal ones. The fear behind the bill is an over-extension of the federal powers of taxation and a recession in the federal government’s willingness to prosecute wrong doers. Follow this link for a complete story on the new Dutch gaming tax.
• Champion of online gaming and Democratic Congressman Barney Frank has entered yet another bill potentially curbing the effects of the UIGEA into the US House of Representatives. The bill would seek to eliminate the regulatory capacity of the US financial institutions in the processing of “illegal” online gaming. Steve Barlett, CEO and President of the Financial Services Roundtable offered his support in letter form to the US Government: “I wish to be clear that we do not support the notion that financial services companies should be “deputized” to police gambling activity in any form or function.” But all anti-UIGEA legislation has been stalled in Congress with strict voting along party lines, Democrats supporting Frank’s deregulatory legislation and Republicans maintaining the party line first set by then Senate Majority Leader, Bill Frist.
• Renowned Spanish wine region, La Rioja has initiated governmental mechanisms towards a study into the realities of potential sports betting shops within its physical boundaries. The study will potentially address a slew of issues ranging from the logistics of licensing such operations to the monetary influxes and criminal effects on the community. La Rioja Director of General Taxes, Resurreccion Saez sees no reason to hold sports betting giants like William Hill out of the wine producing giant: “Considering the fact that La Rioja is already legally generating income from sports betting on the Pelota game, there should be no reason why this cannot be replicated for other types of sports as well via betting shops.”

And that’s what’s happening in poker.