Online Gaming Phenomenon

Pending a determination of the rights of the parties on forum issues and the merits, a Registrar’s Lock was put in place to preclude further dealing with Domain Name registration.  Jurisprudence was marshalled on a host of international issues, including the legality of placing a wager through an internet site, (both by the law of the jurisdiction where the wager was placed, and the law of the jurisdiction of the host), and the effect of banking law in the host jurisdiction.

The essential claim in the Supreme Court of British Columbia was that the owner of the Domain Name entered into a license agreement with our client for the use of that name in return for certain royalties.  The allegation was that the owner of the Domain Name, thereafter wrongly purported to assign and transfer the Domain Name to a non-arm’s length corporation incorporated under the laws of Samoa.  The Samoan Corporation was the Defendant in the Supreme Court proceedings.

The matter first came before the Supreme Court of British Columbia on a motion by the Defendant challenging jurisdiction.

The Court held that it did have jurisdiction.  The key finding by Justice Preston in his Reasons (Uninet Technologies Inc. v. Communication Services Inc. [2003] B.C.S.C. 1674) is found at paragraph 34 where he states as follows:

“34.   The potential basis for a finding that the court should accept jurisdiction is that the pleadings in this action (1) create a substantial connection with this jurisdiction and (2) raise an arguable case for relief.  The proceedings in this jurisdiction that the plaintiffs seek to employ as their jurisdictional linchpin are arbitration proceedings – not proceedings in this court.  It would not, in my view, be sound public policy to differentiate between a cause of action that was litigated in the courts and one that was, by contract between the parties, required to be arbitrated.  The substantial connection test should apply equally to them.  To differentiate between them would be to discourage arbitration in matters with an inter-jurisdictional component.”

Thereafter, the matter was appealed to the British Columbia Court of Appeal – the highest Court in the Province – where the appeal was dismissed.  In its decision, the Appeal Court described the case as “… a reflection of the globalization of the Internet-based economy and the ability of modern business entities to move assets and information across borders as their interests may dictate.  It is not surprising that these circumstances are difficult to fit into traditional legal concepts of jurisdiction and even into their modern touchstone, real and substantial connection”. [Uninet Technologies Inc. and Poker.com Inc. v. Communication Services Inc. [2005] B.C.C.A. 114 @ para. 3]

The Defendant filed a leave application to the Supreme Court of Canada.  Before the matter was heard, the parties settled their dispute.

To view these cases, please visit the following links:

Uninet Technologies Inc. et al v. Communication Services Inc., 2003 BCSC 1674 (CanLII)

UniNet Technologies Inc. v. Communication Services Inc., 2005 BCCA 114

© 2001 Kornfeld Mackoff Silber LLP.