GeoComply Alleges Intellectual Property Theft In Lawsuit

Written By J.R. Duren on October 5, 2022
patent violation online gambling lawsuit geolocation

If you don’t know about the ‘805 patent, you should. It involves an important US online gambling vendor and its process for ensuring online casinos, online poker sites, and online sportsbooks comply with legal standards.

The patent is at the center of a lawsuit between geolocation titan GeoComply filed in federal district court against newcomer Xpoint. The patent is a key component of GeoComply’s geolocation software, and, the company claims, Xpoint used the patented tech to launch its own geolocation services.

“GeoComply has spent valuable resources developing and refining—and patenting—its proprietary platform for reliably and accurately determining the true location of an end-user,” GeoComply wrote in its lawsuit. “Should XPoint continue to commercialize its geolocation technology, GeoComply will be forced to compete against its own patented invention.”

GeoComply went on to say that Xpoint is “aggressively attempting to expand its market share through its infringing geolocation.” In other words, Xpoint is expanding its business using GeoComply’s technology.

Why the ‘805 patent matters in the GeoComply-Xpoint online gambling lawsuit

The patent that GeoComply claims Xpoint is using protects technology that’s at the heart of GeoComply’s geolocation services. According to patent documents, the patent protects “a method for determining a geo-location” made up of a series of steps:

  • A bettor tries to log into a sportsbook
  • A server collects data related to where the device is
  • The tech identifies that an online gambling app or platform is located on the device being used
  • All this information is then sent to a second server
  • The second server generates a message about the device’s geolocation and sends it back to the first server

In short GeoComply’s technology, which was invented by co-founder and CEO Anna Sainsbury, confirms where a bet is taking place. Being able to block users who aren’t located in a state with legal online gambling is a key part of compliance.

The technology has been around for a decade but it recently came into the spotlight when Kansas launched sports betting. GeoComply’s geolocation technology was able to block more than 100,000 attempts to place illegal wagers in Missouri.

How Xpoint used GeoComply’s technology

GeoComply claims that Xpoint is using GeoComply’s device-first server-second service progression to identify a user’s location. The company claims Xpoint uses the technology as part of the geolocation services it offers to New Jersey online casino PlayStar.

GeoComply’s lawsuit details exactly how Xpoint presents its geolocation services on PlayStar’s website, how the technology works, and even includes a screenshot of Xpoint’s geolocation in action. All of it, the company says, is based on its ‘805 patent.

What does GeoComply want out of the lawsuit?

Because of this, GeoComply wants Xpoint to stop its use of the patented technology, and has asked the court to require Xpoint to:

  • Pay damages related to patent infringement
  • Pay GeoComply’s attorney fees
  • Stop using the technology
  • Pay GeoComply all profits Xpoint earned as a result of the patent infringement

GeoComply has also asked the court to find Xpoint guilty of all the claims in the lawsuit.

In addition to stopping a company from the proverbial stealing of secrets, quashing Xpoint’s alleged attempts at using GeoComply’s technology sends a message to other companies that may want to use GeoComply’s geolocation patent.

Photo by Shutterstock
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J.R. Duren

J.R. Duren has covered the gambling beats for more than a dozen states for Catena Media since 2015. His past reporting experience includes two years at the Villages Daily Sun, and he is a first-place winner at the Florida Press Club Excellence in Journalism Contest.

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