EBET’s Legal Challenge Falls Flat as Nevada Court Drops Case

The United States District Court for the District of Nevada recently dismissed a lawsuit by former esports betting supplier EBET against iGaming solution provider Aspire Global International and its parent company, NeoGames, operating under the Aristocrat umbrella. The court motivated its decision by a lack of personal jurisdiction, meaning the defendants did not have sufficient ties to the state for the court to oversee the case. 

EBET Must Move the Legal Fight Elsewhere

Judge Gloria M. Navarro noted that EBET failed to alleviate jurisdictional concerns and did not effectively prove that Aspire and NeoGames maintained “minimum contacts” with Nevada. Although EBET maintained that the companies maintained a business presence within the state and highlighted a mention of Nevada law in a promissory note, the court deemed these factors insufficient.

The court further observed that attending trade conferences in Las Vegas was not a sign that the defendants had any significant business presence justifying legal proceedings in Nevada. Aspire and NeoGames stood by their claims that they conducted their business activity and negotiations outside Nevada, primarily through remote communications, and that contract provisions designated Malta as a dispute resolution jurisdiction.

Following the dismissal, Judge Navarro granted EBET a timeframe of 21 days to file an amended complaint if it could provide more jurisdictional facts. This development could significantly hinder EBET’s plans for further legal action, as Maltese regulations make it challenging to conduct legal action there, and local laws generally favor companies regulated there.

The Company Suffered Significant Setbacks

The outcome marks a substantial loss for EBET, which had pursued damages and the cancellation of its 2021 €65 million ($67.5 million) acquisition agreement with Aspire. EBET alleged that NeoGames and Aspire misrepresented the value and stability of the sold assets, which comprised several B2C gaming brands. According to EBET, Aspire exaggerated the player accounts and the financial health of the assets to get a lucrative deal.

The decision comes after a tumultuous period for EBET, which halted operations last year during struggles to remain profitable in the highly competitive iGaming space. Though it attempted to restructure debt and streamline its operations, the company defaulted on a $37.1 million debt in June 2023. The company’s creditors auctioned some of its gaming brands to repay debts.

While Aspire and NeoGames welcomed the dismissal, EBET must either alter its complaint to justify its jurisdiction claims or bring the legal action to Malta, as stipulated in the original contract. With neither option seeming likely, the company could face another obstacle in its pursuit to recover losses from its ill-conceived 2021 acquisition.