TVG Files Lawsuit Against Magna, HRTV and XpressBet

TVG Files Lawsuit Against Magna, HRTV and XpressBet
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TVG has filed a lawsuit against Magna Entertainment Corp., HRTV, and XpressBet for alleged patent infringement, the company announced May 18.

The federal lawsuit, which was filed May 17 in United States District Court for the Central District of California, seeks monetary damages and unspecified “injunctive relief to prevent the (companies) from continuing to infringe” on two specific TVG patents, according to a news release.

TVG claims its patents cover “important features of interactive wagering systems: audio or video racing feeds, and wagering on multiple tracks.”
 
In the release, TVG’s general counsel, John Hindman, was quoted as saying the defendants “have been unwilling to license patents from us.”

"While we have endeavored to work cooperatively with all industry participants, we ultimately have a responsibility to protect our valuable intellectual property from infringing use by others,” Hindman said in the release.

A spokeswoman representing TVG said May 18 the company would have no further comment on the matter beyond what is in the release.

The complaint, which includes 140-pages of exhibits detailing the two TVG patents, claims the defendants have continued the alleged abuse despite previous notification, calling such actions “deliberate and willful.”

“Defendants have directly infringed, contributorily infringed, and/or actively induced infringement … by making, using, importing, offering for sale, and/or selling in the United States an interactive wagering system incorporating technology that practices one of more claims (of the patents),” the lawsuit said.

TVG’s announcement of the litigation, which was released one day prior to the Preakness Stakes (gr. I) at MEC-owned Pimlico Race Course in Baltimore, also included this self-description of its company history:

“More than a dozen years ago, TVG pioneered the business of advance deposit wagering (ADW) on horse racing, in a mutually beneficial partnership with the nation's leading racetracks. TVG's long-standing efforts include substantial investments in technology and innovation, which have allowed ADW to flourish and yielded a substantial patent portfolio directed to interactive off-track wagering systems.

“TVG is the owner of 17 issued U.S. patents covering interactive wagering systems, with more than 140 issued and pending patents worldwide. TVG continues to invest in research and development to provide its customers with unique, innovative opportunities to participate in the dynamic sport of horse racing.”

William G. Ford, MEC secretary and legal counsel, told The Blood-Horse May 18 the company had not seen a copy of the lawsuit and preferred to reserve immediate comment.

“We’ll issue a statement at the appropriate time,” he said.

TVG and others have been at odds with MEC and Churchill Downs Inc. over fallout from the two racetrack powerhouses’ new shared content alliance, TrackNet Media Group. Under the terms of the announced TrackNet venture in early March, CDI acquired a 50% ownership interest in HRTV, a direct competitor to TVG.

Several wagering entities, including TVG and Youbet.com, were unable to negotiate deals with TrackNet Media to handle bets for the Churchill Downs meet, which included the high-volume May 5 card of the Kentucky Derby Presented by Yum! Brands (gr. I).

Churchill Downs was not mentioned in the press release. TVG contracts are still in effect on Arlington Park and Calder Racecourse, but are scheduled to respectively expire Aug. 6, 2007 and April 15, 2008, according to public filings.

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