Strip casinos sue Web gaming sites

Grace Leong

Friday, Nov. 12, 1999 | 11 a.m.

Three Las Vegas hotel-casino operators are seeking a preliminary injunction against three Internet casino operations, prohibiting them from appropriating their trademarks and domain names.

In a U.S. District Court suit, Mirage Resorts Inc., Mandalay Resort Group and the Stardust hotel-casino accused the defendants of "cybersquatting" and deceiving the public by allegedly passing off their online casino services as those affiliated and sponsored by the hotel-casinos.

Cybersquatting refers to the practice of registering an Internet name similar to a trademarked term, with the intent of reselling it to the trademark holder at a profit. Network Solutions Inc. of Herndon, Va., hands out the rights to the domain names -- which refers to the central part of a web address between "www" and "com" -- on a first-come, first-serve basis.

The defendants named are Los Angeles-based Stardust Co. and its owner John Dunn; and two affiliate online casinos Starluck Corp. and Planet Luck Casino owned by Ed Servicio, who operates from Santa Domingo, the Dominican Republic.

The Stardust resort-casino said it discovered in July 1999 the defendants' domain names contained its trademarks when it allegedly received a contract from a third party who wanted to place a bet on Stardust Co.'s online casino.

The suit alleged the plaintiffs' counsel checked Network Solutions' registry of domain names and found Dunn had registered the domain names "stardust casino.com," "miragecasino.net," "stardustgaming.com," "stardustcompany.com," "dunescasino.net," "goldennuggetcasino.com," "themontecarlocasino.net" and "thecircuscircus.com."

Mirage Resorts Inc. owns the Mirage and Golden Nugget hotel-casinos, as well as the Dunes name. Mirage Resorts demolished the Dunes hotel-casino and built Bellagio at its location.

Mandalay Resort Group, formerly Circus Circus Enterprises Inc., owns the Circus Circus hotel-casino.

Mirage and Mandalay jointly own the Monte Carlo.

The suit alleged four of the domain names were linked to active online casino sites -- the Stardust, Mirage, Golden Nugget and Monte Carlo casinos -- where actual money bets could allegedly be placed and winnings paid in U.S. dollars over the Internet.

The suit said Stardust Co.'s active casino websites were initially linked to an offshore Internet gaming service owned by Giordano Casinos, but these were later linked to Planet Luck, Servicio's service, after it received notice from the plaintiffs' counsel to stop infringing their trademark rights.

The plaintiffs stressed Internet bettors, who rely solely on the integrity of the company offering gaming services through a website, are at risk of unfair practices because Internet gaming is unregulated and unlicensed.

"While the defendants might choose to run a completely reputable and above board operation, they might also not choose to do so, and at present, there is no governmental authority to ensure that consumers are protected when placing a bet over the Internet with these defendants," the suit said.

"There is no question that if the defendants defraud, or even offer poor quality services to consumers under the 'Stardust,' 'Mirage,' 'Golden Nugget,' 'Dunes,' 'Circus Circus' and 'Monte Carlo' names, then the plaintiffs' marks will be tarnished," the suit said.

The suit said the danger of consumer confusion is heightened also because both parties offer casino services on their Internet websites under the Stardust, Mirage, Golden Nugget, Dunes, Circus Circus and Monte Carlo marks.

"When a user types 'Golden Nugget' and 'casino' into the 'Yahoo!' search engine, there is a link to the defendants' 'Golden Nugget' casino, an online casino, in the first 10 webpages that are listed," the plaintiffs said in the suit.

The suit alleged the Monte Carlo, Stardust and Mirage casino websites show reproductions of the Las Vegas resorts' marquis signs and the Mirage casino site shows a photograph of the Las Vegas Mirage hotel-casino.

The plaintiffs said the defendants continued to infringe on their trademark rights despite repeated demands that Stardust Co. relinquish their domain names.

The suit said the plaintiffs' counsel received a letter on Aug. 22, 1999, from Stardust Co.'s counsel Robert Smith, allegedly stating the plaintiffs "should have taken the Internet names more quickly if they wished to use them."

"Internet domain law favors whoever gets the domain name first. We're more than reasonable. We're willing to give up the domain names for a reasonable price," said Dunn.

"We're not asking for $3 million. We just want to cover the cost of building the four sites, which cost about $3,000 each," he said. "They are trying to rewrite domain and online gaming laws because they want to protect their casino industry."