Tiltware strikes back!

Thursday, January 8, 2009 13:41 | Filled in poker

As the deadline arrived for filing an answer to the complaint filed by Clonie Gowan, Tiltware has instead chosen to try to enlist the court’s support in whittling down some of the charges.  The pleading is not especially interesting to a non-legal audience, since it asserts few facts related to the poker world that we like to gossip about.  In fact, the only really interesting poker fact I see in the pleading is that the 13 named individuals do not all own shares in Full Tilt.  The pleading does not specify which named defendants are in fact shareholders, it simply denies that all 13 are shareholders.

In terms of the legal arguments there are a variety of things going on here:

1)  The pleading is trying very hard to sever the claims against the individual pokers players and leave only the claims against the company.  It makes the point that if Gowan has a breach of contract claim, the remedy is against the company.  It seeks to dismiss the breach claim with regards to the individuals, who would not be parties to the breach of contract.  It also asks that the entire count be dismissed with regard to the company because Gowan did not plead her claim with enough specificity.  They seem to be pretty much going through the motions there, because the real hope is to dismiss the claims against the individuals.  Although the court is going to give wide latitude to Gowan since she presumably needs discovery to make her case in detail, it does appear that Gowan’s allegations on their face don’t really involve the individuals in the breach of contract claim.

2)  The defendants only acknowledge service on Tiltware, not on Pocket Kings or Kolyma.  This is pretty important, since the direction of the money is probably fairly fluid and it is quite possible that the money was not distributed via Tiltware.  Obtaining a judgment against Tiltware might well result in a significantly smaller judgment.  It stands to reason that Full Tilt would channel the income through foreign corporations to obtain more favorable tax treatment and to avoid confiscation by the US authorities.  I suspect that Tiltware itself (a US corporation) has received quite modest income.  The pleading sets that up, by mocking Gowan’s claim of $4 billion in value.  They also take some pains to point out that “Full Tilt Poker or FTP” is a non-entity.  There is no such company and it is merely a brand name and website.

3)  Defendant also seeks to remove the individuals from the minority opression action.  This is probably the place where Gowan has the best chance to keep the individuals on the hook.

4)  The bad faith claim extends the arguments in the breach of contract claim.  If the individuals were not party to the contract, they are not liable for any possible bad faith.  They also try to extricate the company by saying that if she prevails, money will make her whole, so there is no basis for turning this into a tort action.

5) The unjust enrichment claim is alleged to be a duplication of the breach claim and they claim that Gowan has not alledged facts that would support her claim as a matter of law.

6)  They ask that the fraud claims be dismissed or at least that Gowan be required to state what the fraudulent conduct was with more specificity.

The main goals of the defense motion are to reduce the lawsuit to a more simple contract claim and to extricate the individual defendants as far as possible.  They seek to represent the claim as a simple contract or employment dispute between Gowan and Tiltware.

You can read the entire pleading for yourself, if you are so inclined.

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