Las Vegas sports wagering suppliers in litigation

Grace Leong

Thursday, Aug. 17, 2000 | 11:06 a.m.

Sports betting giant Autotote Systems Inc. of Newark, Del., filed a lawsuit accusing Las Vegas Dissemination Co. of infringing its copyrights for pari-mutuel gambling software.

Las Vegas Dissemination (LVD) is an Autotote licensee and is the operator of Autotote's pari-mutuel wagering system for the Nevada Pari-Mutuel Association, according to the lawsuit filed this week in U.S. District Court.

The Nevada Pari-Mutuel Association consists of major Nevada casinos that use Autotote's system to pool betting information from casinos and racetracks.

Patty Jones, the Nevada Pari-Mutuel Association's director, said the majority of 67 active casinos with pari-mutuel books in Nevada use Autotote's betting terminals. Computerized Bookmaking Systems Inc. of Las Vegas, the largest seller of Autotote terminals in Nevada, said casinos and licensed race books and sports books use close to 1,000 Autotote terminals.

The gambling system accepts bets, pools bets from tracks and off-track locations like casinos, calculates odds and payoffs and cashes winning tickets.

Autotote alleged Las Vegas Dissemination in 1995 hired away Autotote software engineers, who then allegedly used Autotote's trade secrets to make unauthorized modifications to its software.

LVD is accused of using the source code for the Autotote computer programs -- which was loaded on the system to facilitate debugging -- to enable Autotote's system to communicate with the betting terminals of Autotote rival United Tote.

United Tote is a subsidiary of Anchor Gaming of Las Vegas.

Autotote attorney Mark Solomon alleged this copyright infringement allowed LVD to use United Tote terminals instead of Autotote terminals. He said Autotote is taking legal action in part to prevent further license revenue losses as LVD's alleged infringement of Autotote's copyrighted programs could help United Tote gain a bigger market share.

"This could create a potential huge security breach," he said. "If United Tote wanted to make Autotote fail, they could hack into our hub system if they had access to the program that (LVD) created that allows their terminals to talk to our hub systems."

Autotote, which said it derives its revenues from licensing wagering systems worldwide, said it could lose revenue because it believes LVD intends to market the modified software to United Tote, which in turn may sell its modified terminals to other owners of Autotote's system.

The lawsuit also alleges LVD violated a contract that restricts its use of the system to a specified number of tracks and sports books when it tried to "supplant Autotote as the hub system operator for the Atlantic City casino pari-mutuel market."

The defendant could not be reached for comment on the allegations.