Summary
- Light & Wonder might need to reach a settlement with Aristocrat regarding the Jewel of the Dragon series.
- Aristocrat had previously brought up the issue during the Dragon Train lawsuit.
- Macquire analysts have stated that Light & Wonder anticipates no significant effect on its performance.
Light & Wonder might find itself in a similar predicament as it did a few months ago. Aristocrat Gaming is once again considering whether a game developed by Light & Wonder could be a copycat of one of its products.
Light & Wonder may face more legal pressure from Aristocrat
Aristocrat previously engaged in legal action against Light & Wonder, claiming that the latter's Dragon Train game was too similar to Aristocrat's Dragon Link titles. The court favored Aristocrat, issuing a preliminary injunction that prohibited Light & Wonder from offering the Dragon Train games in the United States due to their significant resemblance to Aristocrat's intellectual property. Interestingly, this lawsuit did not extend to Australia, where Light & Wonder sold and installed approximately 10,000 units of Dragon Train. However, Aristocrat may now turn its attention to another game by Light & Wonder. Aristocrat is reportedly investigating Light & Wonder’s Jewel of the Dragon series, specifically citing that the Red Phoenix game resembles Aristocrat’s Autumn Moon game. This concern was initially raised during the first litigation involving Dragon Link and Dragon Train. Macquarie, a global financial services company, indicated that there has been preemptive communication between Light & Wonder and Aristocrat about this issue. It seems Light & Wonder reached out to Aristocrat to potentially prevent another significant legal dispute.
Jewel of the Dragon series not as materially impactful as Dragon Train series
Chad Beynon, an analyst at Macquarie, mentioned that after discussing with Light & Wonder's management team, he was informed that the Jewel of the Dragon represents only a small fraction of the size of the Dragon Train fleet, according to Inside Asian Gaming. He further noted, To clarify, Light & Wonder sold approximately 10,000 Dragon Train units in Australia, which were not required to be deactivated or replaced due to legal proceedings. However, they did have to replace the Dragon Train units within their U.S. gaming operations. As the management pointed out, there are significantly fewer Jewel of the Dragon units compared to the Dragon Train. The possibility of Aristocrat taking legal action against Light & Wonder over the Jewel of the Dragon product, and specifically the Red Phoenix, remains uncertain. Nonetheless, Light & Wonder is confident that even in the worst-case scenario, it would not significantly impact the company’s predefined objectives.
