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Leading Mexican online casino and sports betting operator Caliplay has initiated legal proceedings against Playtech and several of its subsidiaries.

Unveiled before the 46th Civil Court of Mexico City on 22 August 2023, the legal tangle centres on Caliplay’s demand to end existing relationships with Playtech, Playtech Malta, and Playtech Software Limited.

This lawsuit is particularly noteworthy as it pertains directly to the operations of Caliplay’s regulated business in Mexico.

The disagreement relates to whether Caliplay still holds an option to redeem the additional services fee element of a strategic agreement between the two companies.

Both companies issued market announcements in February on the issue.

The option relates to whether the amount payable by Caliplay to Playtech upon exercise would either be agreed between the parties, or failing which, determined by an independent investment bank to value Playtech’s current entitlement to receive the additional services fee until 31 December 2034.

For the six months ended 30 June 2022, the amount of this services fee was €34.4m, according to Playtech.  

The option was stated as being exercisable for a period of 45 days following the approval of the audited accounts of Caliplay for the year ended 31 December 2021.

Playtech believes the option has long expired, while Caliplay has not sought to exercise the option to date and has made clear its belief that the option is still to expire.

At the time, Caliplay accused Playtech of omitting vital information.

Caliplay has now shared an update to shed light on the ongoing scenario for both customers and business associates.

On 28 August, the Mexican Court not only affirmed its jurisdiction over the matter, but also dispensed several interim orders awaiting the claim’s final adjudication.

Among these, a pivotal order has directed Playtech to persist in supplying software and services to Caliplay, safeguarding the latter’s customers and ensuring business runs smoothly.

The decision comes even as some of Playtech’s principal rights – including direct payment receipts from Caliplay for the said services – have been put on hold.

Caliplay has expressed its eagerness for a swift resolution to the matter and will keep communication lines open with Playtech to settle any disagreements amicably.

In response, Playtech said it only became aware of the legal proceedings today (5 October) following Caliplay’s announcement and has not yet had access to the court filings in Mexico or been officially served.

“Caliplay is a highly valued customer and partner of Playtech and this has been an extremely productive relationship for both parties,” said Playtech in a short statement to shareholders.

Mr. Ron Yosef Samoaloff, along with the Public Property and Trade Register of the State of Baja California, have also been enlisted as respondents in the case.

London-based investment bank Peel Hunt said it did not have enough information to evaluate the situation: “Caliente’s action appears to seek to end its contracts with Playtech. Given the profit in Mexico, and the challenge of instantly replacing a technology supplier, that makes no sense.

“We expect some clarity to emerge once Playtech comments on the court papers.”

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