After some pretty dismissive comments on the prospect of litigation
by Empire Online from Party Gaming spokesmen last week, Empire Online
came back strongly Tuesday with an emphatic announcement that it is
launching litigation against Party Gaming with a claim of "several
hundred million dollars" that will probably be decided
in the law courts of Gibraltar.
Empire spokesmen said that the company has been assured by a top British Queens Counsel in London that it has a strong case.
However, the fight is likely to be prolonged; a Partygaming spokesman responded by saying that the legal action by Empire could be considered as the first "pantomime" of the (festive) season. The spokesman concluded that Partygaming remained "highly confident" of any legal outcome.
The legal action follows Partygaming's move to separate or "ringfence" its online poker system from that of its "skins".
After the Partygaming decision on skins, online players using Empire Poker were left on the smaller poker site with fewer players. Many industry observers and analysts interpreted PartyGaming's move as an attempt to pressure the skins, which were both allies and competitors, and investors feared that Empire would lose its players to the larger PartyPoker site
Empire has lost more than half its market value since it floated in June. "The company seeks substantial damages and injunctive relief from Partygaming," Empire said Tuesday, also revealing that it was holding "confidential arbitration proceedings" with an unnamed Partygaming subsidiary.
Earlier this year, a GBP 790 million bid by the British gambling group, Sportingbet for Empire fell through. Two takeover attempts by Partygaming for Empire were also abandoned recently.
Empire Online has now initiated legal proceedings in the Gibraltar High Court.