DFNN gets P310M damage award on lotto dispute

A LOCAL court has awarded gaming technology solutions provider DFNN Inc. higher damages amounting to P310 million in relation to its complaint against state-controlled Philippine Charity Sweepstakes Office (PCSO)’s “illegal” termination of a wireless lotto equipment lease agreement.

To recall, an arbitration court earlier earlier ruled in favor of DFNN on this wireless lotto dispute with PCSO but awarded only P27 million in liquidated damages.

Finding the damage award insufficient, DFNN filed a petition to correct the computation of damages and increase the award by 11 times to over P310 million.

Quoting a Feb. 17 decision by the Regional Trial Court of Makati branch 66 in a disclosure on Monday, DFNN said the court had granted this petition and ordered the correction of the arbitral award to P310,095,149.70 plus 6 percent interest from date of finality of the decision until final satisfaction thereof by the PCSO.

DFNN president and chief executive officer Ramon Garcia Jr. said: “We are very pleased with the positive outcome of our petition. Our goal has always been to ensure that the maximum restitution is effected and that the interests of our shareholders are continually safeguarded. Our confidence in the legal process is once again upheld. We would like to thank all those who have supported us and continued to believe in our cause.”

The arbitration panel earlier ruled that the PCSO had erred when it rescinded DFNN’s equipment lease agreement covering systems design development and upgrade for lotto betting via personal communication devices such as text, GPRS, BlueTooth, 3G, WiFi protocols and other wireless devices.

The disputed equipment lease agreement was executed by the parties during the Arroyo administration in 2003, providing for the exclusive lease from DFNN all the hardware, software, and knowhow to design and develop a system that would allow the processing of bets from personal communication device users nationwide. But in 2005, prior to the commercial operation of the system, DFNN was informed of the PCSO’s decision to terminate the deal, after which the PCSO began negotiating with third parties to carry out the project.