CryptoLogic Sued by Licensee

15 January 2002

Gaming software developer CryptoLogic is the target of a lawsuit filed by one of its licensees, Casino Monte Carlo N.V., and its operator, Claude Levy, the gaming software company said late last week.

Casino Monte Carlo has a license for online gaming software from WagerLogic, a subsidiary of CryptoLogic. The Toronto-based company met with its legal counsel, Alan Lenczner, last week to discuss the matter. In a statement, CryptoLogic said it is aware that sections of the lawsuit, which was filed in Ontario, have been published on the Internet. CryptoLogic Director of Communications Nancy Chan-Palmateer said the lawsuit was filed in late December.


" Our position is, as well as legal opinion is, that the suit is frivolous and without merit."
- Nancy Chan-Palmateer
CryptoLogic

According to www.gamblingmagazine.com, CyrptoLogic is being sued for $800 million in damages. At press time, the above Internet site featured a photo of an open can of worms. The photo was titled, "Legal update for Jean Noelting the CEO in trouble" (sic). Noelting is the president and CEO of CryptoLogic.

In the suit, Levy claims that CryptoLogic's software is faulty and that the company has been deceitful, Chan-Palmateer said. The software company's opinion of the suit is that it is not a realistic claim, she added.

"At the end of the day, his statements have no substance," Chan-Palmateer said. "He's a licensee that is using the same software that our other licensees are, who are doing quite well. Our position is, as well as legal opinion is, that the suit is frivolous and without merit."

Casino Monte Carlo is not a major licensee of the software company, the spokeswoman said. It represents less than 1 percent of CryptoLogic's revenue.

Chan-Palmateer said the company has not yet decided what action it will take in response to the lawsuit or whether it will counter-sue. She said she believes Levy lives in Belgium.

"He is not a resident in Canada nor North America, so we will need to look at what the best way to deal with it is, but it's just again a normal course process, and we're not going to get into a public debate about what he's saying or not saying," she said. "It's not anything we think has material consequence."