CG Technology sues DraftKings, FanDuel for patent infringement

cg-technology-patent-infringement-suit-draftkings-fanduelSports betting tech provider CG Technology has sued daily fantasy sports operators DraftKings and FanDuel, claiming that the operators are infringing on multiple CG Technology patents.

Last week, CG Technology (the former Cantor Gaming) filed separate complaints in Nevada District Court against the DFS operators, accusing them of violating seven patents owned by CG Tech. The suits list two co-plaintiffs; the Nevada-based Interactive Games LLC and UK-based Interactive Games Ltd.

CG Technology, which provides land-based and online sportsbook technology for eight Las Vegas casinos, says the DFS operators are infringing patents covering the transmission of identification codes and game control signals to a processor, which allows the sites to accomplish all sorts of necessary tasks, including identifying players, tracking results, and generating user pay records and other information.

The suits indicate that CG Technology sent cease-and-desist letters to the DFS operators as far back as July 2014. CG Technology says it attempted to reach a “negotiated non-litigation arrangement” with the DFS operators but was rebuffed, leaving it no option but to sue to protect its “innovative technology.”

CG Technology and its co-plaintiffs are seeking an injunction barring the DFS operators from continuing to use the technology in question, as well as damages to cover the patent violations plus further damages for the operators’ unwillingness to abide by the cease-and-desist demand.

So far this week, it’s been a mixed bag for DFS on the regulatory front, as the Minnesota House of Representatives voted to approve a bill to explicitly legalize the activity in the state, subject to some consumer protection measures, including limits on number of contests a player can enter and a prohibition on scripting tools. A similar measure in the Senate must clear at least one more committee hurdle before the full Senate gets a chance to vote yea or nay.

Meanwhile, Maryland legislators opted not to approve DFS legislation before their current session expired Monday night. The failure to explicitly authorize DFS opens up the possibility that the state Attorney General’s office could make good on vague threats to commence legal action against DFS operators.