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Gambling Company Rolls Dice On Lawsuit And Comes Up Snake-Eyes

Posted  August 16, 2010

Thanks to a Nevada federal judge that dismissed its antitrust suit, casino payment company Sightline Payments, LLC, might be experiencing some fear and loathing in Las Vegas.

In March, Sightline sued its larger competitor, Global Cash Access Holdings, Inc., under Sections 1 and 2 of the Sherman Act, and under Section 7 of the Clayton Act.  Both companies offer services to provide cash access at casinos.  According to Sightline’s complaint, “[i]n 2008 alone [Global Cash] processed over 80 million transactions and put more than $21 billion into the hands of gaming patrons.”  Sightline’s complaint continues that Global Cash violated antitrust laws through a series of actions, including acquisitions, restrictive agreements with casinos in Las Vegas and Atlantic City, patent abuse, and disparagement of Sightline.  It sued for $300 million, plus costs and fees.  Interestingly, the head of Sightline previously served as Global Cash’s chief executive, and also was one of its founders.

In dismissing Sightline’s suit on August 9, Judge Philip Pro held that Sightline did not allege that Global Cash used its market share to engage in monopoly pricing or that Global Cash’s alleged disparagement of Sightline contained any falsehoods.  Regarding Global Cash’s restrictive agreements, Judge Pro wrote that “[a]n agreement between a manufacturer and a distributor to establish an exclusive distributorship does not, standing alone, violate antitrust law unless the agreement is intended to, or actually does harm competition in the relevant market.”   Sightline’s complaint, he continued, did not allege facts to meet that standard.

According to press reports, Sightline plans to roll the dice again by appealing the dismissal.  It looks like the company hopes its lawsuit won’t be leaving Las Vegas’ courts anytime soon.

Tagged in: Antitrust Litigation,