GeoComply Seeks Injunction Against Geolocation Rival XPoint in Federal Court

Posted on: January 30, 2023, 09:24h. 

Last updated on: January 31, 2023, 05:05h.

Steve Bittenbender Read More
Expertise: Legislation, Sports Betting, Horse Racing.

UPDATE (1/31, 12:45 pm ET) – This story has been updated to include a comment from XPoint on GeoComply’s motion for an injunction.

GeoComply Solutions, a technology company that provides cybersecurity solutions to verify a user’s identity and location, is seeking an injunction in federal court against a competitor it claims has infringed on its patent for geolocation services it provides to gaming operators.

GeoComply
A map produced by GeoComply Solutions shows the geolocation transactions it handled for sports betting operators in Ohio and New York earlier this month. GeoComply has sued XPoint and claimed its service infringes on a patent owned by the Canadian company. (Image: GeoComply/Twitter)

The preliminary injunction, filed on Friday in the US District Court in Delaware, is the latest step the Canadian-based company has taken in the lawsuit against XPoint Services, which was filed four months ago.

GeoComply took XPoint to court after learning about the launch of iGaming operator PlayStar NJ in New Jersey last August.

On Friday, Jan. 27, GeoComply filed a preliminary injunction motion to immediately stop Xpoint from continuing to sell what we believe is our stolen intellectual property, during the pendency of this lawsuit,” GeoComply said in a statement. “As we have shared repeatedly, GeoComply welcomes healthy competition and new ideas; intellectual property theft is neither. We don’t have any further comment at this time.”

XPoint, in response, called GeoComply’s injunction request “simply a continuation of their ongoing, meritless action” against the upstart company. XPoint also accuses GeoComply of trying to maintain a monopoly in gaming geolocation by trying to block “an innovative competitor with superior technology,” according to the company’s statement.

“We believe GeoComply is engaged in a meritless fishing expedition to learn more about Xpoint’s technology,” the statement concluded. “We look forward to prevailing in this action.”

XPoint Seeks Dismissal

While GeoComply is seeking an injunction, XPoint is asking US District Judge William C. Bryson to dismiss the case entirely, arguing that GeoComply does not have a case.

In a brief filed last month in support of its motion to dismiss, attorneys for XPoint noted that other federal district courts have ruled geolocation claims similar to GeoComply’s are not patentable.

“There is no dispute that the collection and analysis of geolocation data was conventional, and the purported advance here— the consideration of whether a user’s device contains certain programs—is insufficient because the claims neither recite an improvement to conventional methods for detecting programs nor specify how the program information is used to verify geolocation data,” the XPoint motion stated. “The patent thus claims only an abstract result—not a patent-eligible technological improvement.”

On Tuesday afternoon, Bryson will hold a teleconference to discuss XPoint’s motion to dismiss the case and a motion filed by GeoComply three weeks ago to compel start-up gaming operator Out The Gate (OTG) to comply with subpoenas in the case.

In response, OTG, which has been approved for sports betting licenses in Ohio in partnership with the SPIRE Institute, issued a statement earlier this month claiming that GeoComply publicly disclosed “an outdated, confidential report” from the New Jersey-based operator.

OTG President Joe Brennan, Jr., said in the statement that the company used public data for both vendors when determining which one to use. They did not, though, have access to either XPoint’s or GeoComply’s source code. He also accused GeoComply of misrepresenting information from that report, which Brennan added was not complete at that time.

That report was part of a court filing, and it has since been sealed.

Brennan added that XPoint has not violated OTG’s trust, and the operator eventually chose XPoint to handle its geolocation needs.

About GeoComply

GeoComply, which was founded 12 years ago, works with several major operators in the gaming realm. That includes DraftKings, FanDuel, and MGM. However, the company also provides tech services to other online entities, such as Amazon Prime Video.

GeoComply says it reviews 10 billion transactions annually and that its geolocation software has been installed on more than 400 million mobile devices.