A panel of three judges from the U.S. Ninth Circuit Court of Appeals has denied Australian operator PlayUp’s preliminary injunction bid against Dr. Laila Mintas, the company’s former U.S. CEO, on the grounds that she violated the terms of her employment contract.
The suit was originally filed in a Nevada federal court last December, in the wake of a botched sale to crypto company FTX that was reportedly valued at $450 million. PlayUp has alleged that Mintas was responsible for blowing the deal by making disparaging comments about PlayUp to FTX representatives.
At the time, Judge Gloria Navarro of the U.S. District Court for Nevada agreed with PlayUp’s claim and granted a temporary restraining order against Mintas.
However, shortly after that decision, Navarro changed course and denied PlayUp’s first injunction request just two months later, citing new information in the case. PlayUp then appealed to the Ninth Circuit Court, which subsequently affirmed Navarro’s ruling July 18, saying that the company had not met the requirements needed for an injunction.
According to the court’s ruling, “A plaintiff seeking a preliminary injunction must establish that [it] is likely to succeed on the merits, that [it] is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in [its] favor, and that an injunction is in the public interest.” The ruling states that of these elements, the likelihood of success based on merits was the key prohibitive factor.
In similar cases, a “sliding scale” criteria may also be used, but PlayUp’s request did not satisfy those requirements either, according to the court. Rather, the ruling asserted that it seemed “more likely” that Mintas had been “turned into the scapegoat” for the failed merger, and that there was evidence to suggest that other PlayUp executives also played a hand in how events unfolded.
The Ninth Circuit judges made sure to note, however, that the case may still proceed to trial, and that it was merely ruling on the fact that Navarro’s initial decision could not be considered as an abuse of discretion.
After the ruling was announced, PlayUp CEO Daniel Simic told iGaming NEXT that the company was “nonetheless pleased that the court made it very clear that the case in the US will be held on the merits at trial.”
“In the meantime, we are focusing on the swift progression of the separate proceedings presently underway in the US District Court and Australian Federal Court,” Simic added.
