Two automated poker table giants going to court

chips and cards

If you've been in a casino lately, you may have noticed a new model for poker play: the automated poker table.

Under such a setup, there's no poker paraphernalia (chips, cards, etc.) or dealer. Players sit at individual electronic screens around a table, and a computer program divides up the chips, keeps track of all the action and determines the winner.

As much as this innovation may appear to be the wave of the future, a war is brewing that could have repercussions for automated poker.

In what could be a pivotal battle for the future of automated poker tables in casinos, Lightning Poker, which owns and sells the Lightning Poker gaming table, has filed a patent infringement lawsuit against PokerTek and its PokerPro automated poker tables.

On March 4, Lightning Poker, a subsidiary of Shuffle Master, Inc., filed a complaint in the United States District Court in New Jersey alleging that PokerTek's development infringes on the patent that was filed by Lightning Poker in 2004 for electronic poker tables.

PokerTek is accused of using, selling and offering for sale poker tables that infringe Lightning Poker's U.S. patent. The complaint is seeking unspecified monetary damages from PokerTek as well as a permanent nationwide injunction barring the use and sale of all of PokerTek products.

"Although Lightning Poker recognizes and respects the constant innovation in gaming technology, we cannot permit willful infringement of our valuable intellectual property. PokerTek has exploited the innovations covered by our patent for its own benefit in the face of our patent," said Brian D. Haveson, president and CEO of Lightning Poker.

"Lightning Poker is a pioneer in automated poker and annually invests millions of dollars in research and development to create technologies that bring significant value to our customers and players. We are determined to remain a leader by leveraging our superior functionality and high reliability, and by vigorously defending our intellectual property," Haveson continued.

Responding to the lawsuit yesterday, PokerTek CEO Chris Halligan stated that the case is without merit and that PokerTek looks forward to defending its interests in court.

"This is not the first time Lightning Poker has sued us," Halligan commented. "Its last lawsuit was unsuccessful and we will work to ensure a similar outcome here. We remain focused on growing our business and extending our lead in the marketplace."

Halligan noted that PokerTek has more than 40 patents itself and will use those patents to prove that it hasn't violated Lightning Poker's intellectual property rights.

Timing could prove pivotal in the case. Lightning Poker filed its application in 2004, but it wasn't granted until December 2007. PokerTek's patent application for the PokerPro table was filed in March 2005 and was also granted in 2007.

Thus, resolution of the dispute may require that a patent arbitrator determine which of the two companies holds the intellectual property rights or, alternatively, that they simply developed a similar product independently of each other.

With both companies traded on the NASDAQ stock exchange and a loss in the courts potentially affecting their trading prices, the battle between Lightning Poker and PokerTek for the future of automated poker tables could be a major one.

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