Capital Markets Technologies and former CMT business partner Paul Jenkins have reached a settlement as part of the company’s P.E.I. Supreme Court e-gaming lawsuit. Meanwhile, 13 defendants also named as defendants in the suit still remain.
To provide a context for the story, people often think of online casinos as a source of enjoyment and a fun activity that can be done from the privacy of one’s home. Or on a phone or tablet. And most operators have been offering everything from online slots to table games for many years, some even going on two decades.
A governmental organization sometimes gets involved and tries to monopolize games. Whether various countries in Europe or provinces in Canada, they try to regulate the games. Including issuing licenses to experienced operators who bring the games and technology to the players. And occasionally, a province like Prince Edward Island, tries to go it alone.
P.E.I. hired some businessmen to seek companies that would be able to develop a proprietary online gaming system and to become a regulator. It all happened in the early 2010s. However, the project quickly got out of hand, prompting P.E.I. to abandon all online gaming plans by early 2012.
The entire process was so rife with incompetence that lawsuits continue today. In fact, 13 defendants are still fighting a massive e-gaming lawsuit brought by a company caught in the middle of the mess.
Capital Market Technologies Sues for $25M
In April 2015, Capital Markets Technologies sued P.E.I. for $25 million due to a breach of good faith.
The e-gaming lawsuit filed in P.E.I. Supreme Court alleged that it and another company were involved in discussions to develop a system to manage online payments for the online gambling project. The government contended it worked only with the other company. However, CMT produced a memorandum of understanding (MOU) to develop the financial services system on an exclusive basis.
CMT named government officials, such as the P.E.I. Premier Chief of Staff. And the case subsequently became front-page news across Canada as the case moved on through the years.
New CMT e-gaming Lawsuit Asking for $50M
By March 2017, CMT had filed a new statement with the Supreme Court. It alleges that the P.E.I. government breached CMT’s good faith performance of contract and failed to act honestly in the performance of its contractual obligations. The new claim came with 1,000 pages of backup documentation and a $50 million price tag for damages.
CMT has provided evidence showing that the P.E.I. government worked with other companies in violation of the MOU. The lawsuit further alleges that numerous members of the government deliberately violated MOU conditions.
CMT also claims it underwent a securities investigation by the Department of Justice and Public Safety under malicious circumstances to destroy CMT’s progress on the program. CMT ultimately paid $15K in fines via a settlement agreement, for which it blames the P.E.I. government.
One Settlement Down, 13 More Outstanding
In total, CMT named more than a dozen people in its e-gaming lawsuit. Meanwhile, the company has settled with one of them. Namely, Paul Jenkins, who was a participating businessman but not part of the government.
Though the terms of the settlement are confidential, the judge in the case dismissed the claims against Jenkins, as well as a countersuit that he filed against CMT. However, CMT will be responsible for $150,000 in legal costs.
This leaves 13 defendants still fighting against the CMT lawsuit. The most prominent among them are former P.E.I. Premier Robert Ghiz and former P.E.I. Finance Minister Wes Sheridan. Also named are Ghiz chiefs of staff Allan Campbell and Chris LeClair. As are government workers Brad Mix and Cheryl Paynter.
Online Gaming: Not as Easy as It Looks
There are many online gaming sites operating around the world, with a good number of them open to Canadian residents. It is therefore easy to look at them and believe that their platforms and services can be replicated. What Prince Edward Island discovered was that the online gaming industry is much more complicated than it seems.
Canadian provinces that have incorporated forms of online casino games into their gambling offerings are traditionally linked with firms that have been in business for years. Whether by servicing customers as a payment provider, games developer, or platform provider. These firms connect with the lottery commissions of the provinces to offer gaming.
The complications within internet gaming is one of the many reasons sites like this rank and review various online casinos. It helps customers navigate a complex and sometimes overwhelming industry with guidance from experts who know its ins and outs.
Years later, P.E.I.’s government continues to pay for its misunderstanding of the gaming world.