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Alliance Gaming Corp. Sues New Jersey Firm

23 January 2001

LAS VEGAS, Nevada -- Jan. 23, 2001 -- Alliance Gaming Corp. of Las Vegas sued New Jersey-based International Sports Wagering Inc., alleging it breached a contract by discontinuing its Nevada home-based sports wagering service and entering a $140 million contract to license its gaming software to Global Interactive Gaming Inc. for use worldwide except in Nevada.

ISW's "SportXction" wagering system, which could only be accessed from Nevada, offered patrons the ability to wager in real-time, even play-by-play. The service had received the approval of the Nevada Gaming Control Board.

Alliance Gaming, in a Clark County District Court lawsuit, disputed ISW's claim that it suspended its sports wagering system because it felt the service would not attract enough players or revenues.

The suit alleged ISW's exclusive agreement with Global Interactive "changed its focus" and allegedly caused its Nevada operations to become an "administrative and technical distraction and an impediment to dealings with sports leagues in the United States."

Alliance Gaming said ISW failed to pay for equipment it leased to run certain programs that would allow the SportXction system to verify that a sports wager is being placed in Nevada, a requirement for being able to wager via a computer.

The suit alleged ISW failed to buy the equipment at its "net book value" or to reimburse Alliance for the depreciated value of the equipment after ISW used the equipment to get the Nevada Gaming Control Board's approval to start using the system.

The defendant could not be reached for comment.

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