The lawsuit is an antitrust complaint, alleging that WPT Enterprises conspire with the casinos used in their broadcasts to prevent competition by agreeing not to televise any other tournaments held at participating casinos except the World Poker Tour tournaments. These casinos include the Bellagio, the Borgata, Bay 101, the Bicycle, Commerce, Mandalay Bay, and the Aviation Club de France.
A central focus of the lawsuit appears to be the waiver signed by players regarding image rights. Chris Ferguson said in a press release, “They are using our names and images to sell their products without our prior consent and without any compensation. We cannot let these wrongful actions stand. We will prosecute this lawsuit for as long as it takes to change WPTE’s unlawful ways.” When asked about the financial struggles of WPT Enterprises in the context of this lawsuit, Ferguson said “Look, we don’t want to kill the goose that laid the golden egg. We are simply looking for fair value for all players.”
While discussion on the teleconference today included many topics, the focus clearly is on player compensation and protection for their image rights. “The mandatory WPTE releases also conflict with many of Plaintiffs’ exclusive merchandising and sponsorship deals. Based upon these anticompetitive releases, WPTE has used players’ names, likenesses, and images-without prior notice or compensation to promote, among other things, its online poker website, video games, and instructional poker camps.” (from the 19 July 2006 Complaint)
WPT Enterprise (NASDAQ: WPTE) had F2005 revenues of $17.56MM with operating income of $681k. While the WPT has been instrumental in the overall increase in the popularity of poker, WPT Enterprises financially has struggled. The market valuation of the company hovered around $105MM near the market close today. The company went public on 10 June 2004, closing at $6.86/share. Last summer, the stock moved in the twenties amid takeover speculation. It closed today at $5.15/share.
Representatives at WPT Enterprises were traveling and unavailable for comment.