Court: Rio can serve summons by e-mail in dispute

Thursday, March 21, 2002 | 11:11 a.m.

CARSON CITY -- A federal appeals court has upheld a pretrial judgment in favor of Las Vegas' Rio hotel-casino, which sued a Costa Rica sports betting company for infringing on its trademark on the Internet but couldn't find the company to serve a summons.

So the 9th U.S. Circuit Court of Appeals, in a decision Wednesday, said The Rio could use e-mail to serve its summons, notifying Rio International Interlink of the suit. The court said it was treading on "untrodden ground" in authorizing e-mail summons but added the Las Vegas hotel had tried and failed to serve the suit in the more traditional ways.

The Rio in Las Vegas had registered numerous trademarks with the U.S. Patent and Trademark Office including the Internet symbol of "www.playrio.com." The Costa Rican company, in conducting its sports betting business on the Internet, used the names of "betrio" and "riosports."

The Costa Rican company also advertised in Las Vegas, inviting customers to bet by Internet or through a 1-800 telephone number.

The Las Vegas casino filed suit in federal court in Las Vegas, alleging infringement on its trademark. The Costa Rican company had an attorney in the United States and a company in Miami, which acted as its international courier. But neither was authorized to accept service of suits.

The Rio in Las Vegas sent an investigator to Costa Rica, but he could not find the business to serve the summons.

U.S. District Judge Philip Pro, noting the failures, said the Las Vegas casino could use e-mail.

The appeals court, in a decision written by Judge Stephen Trott, said, "Indeed, when faced with an international e-mail scofflaw, playing hide-and-seek with the federal court, e-mail may be the only means of effecting service of process.

"Certainly in this case, it was a means reasonably calculated to apprise RII of the pendency of the lawsuit and the Constitution requires nothing more," Trott said.

The Costa Rican company, in its appeal, contested the service by e-mail.

When the Costa Rican company failed to comply with other court directives, Pro cited it for bad faith, entered a default judgment and ordered it to pay $96,000 in court costs and attorney fees. The appeals court upheld the finding.