A second Light & Wonder slot has been pulled from casino floors following an amended complaint by Aristocrat in the longstanding copyright battle between the suppliers.
After analysts warned that a similar situation was evolving, Light & Wonder confirmed the removal of 150 Jewel of the Dragon machines from gaming floors.
In a statement released on Wednesday, the firm commented: “In light of this claim, we made the decision to voluntarily stop commercialising and offer to replace Jewel of the Dragon to minimise any confusion and potential disruption to our customers.
“The success we had in rapidly replacing the Dragon Train units, and the strong game performance of our broader portfolio, give us confidence that this is the best course of action for our customers at this point as we continue to build great games.”
The firm added that the footprint of Jewel of the Dragon was less than 1% of its premium installed base in North America, however, in a call explaining the decision, Light & Wonder representatives said the game accounted for mid-single-digit millions in annual revenue.
Copyright infringement goes beyond Dragon Train
The legal wranglings between Aristocrat and Light & Wonder have been rumbling on for over a year. The original lawsuit focused on the Dragon Train title, which Aristocrat claims copies key elements of its Dragon Link casino game.
The company alleges that Light & Wonder has “engaged in a wide-ranging campaign to copy Dragon Link that coincides with the hiring of multiple former Aristocrat executives and game designers”.
Last September, a decision in Nevada saw the granting of an injunction and the subsequent order for Light & Wonder to remove the Dragon Train gaming machines in North America. However, a similar decision was not granted in Australia.
In the latest update to the complaint, Aristocrat said that Light & Wonder has copied original audio-visual elements and distinctive trade dress in the development of Jewel of the Dragon, as well as Double Dragon and one other unreleased title.
The complaint also states that Jewel of the Dragon was a “cheap knock-off” of the Dragon Link title, which is why Light & Wonder then chose to develop Dragon Train.
“L&W’s misappropriation of Aristocrat trade secrets extends well beyond the use of confidential Aristocrat math information to develop Dragon Train. Aristocrat’s information has been widely disseminated throughout L&W and has been used by L&W employees to develop other games,” the amended complaint argues.
In response, Light & Wonder said that an internal audit flagged that an early math model of Jewel of the Dragon could be in question, given the scrutiny faced by Dragon Train. Light & Wonder added that later versions of the game did not include these math models but pulled the game out of caution.
Impact unlikely to be far-reaching
Macquarie analysts expect the impact against the Jewel of the Dragon title to be less far-reaching than that of the Dragon Train game.
The group commented: “We are not going to speculate here, but we think the main takeaway is that LNW’s exposure with Jewel of the Dragon should be significantly lower than with Dragon Train.
“As it stands, our view is that this development does not derail LNW’s path to reaching its $1.4bn 2025 EBITDA target.”
Light & Wonder President and CEO Matt Wilson has also previously emphasised that the firm is closing in on the creation of Dragon Train 2.0 machines that are “in compliance with the order”.
He said: “When you think about what’s in question here in this order, it’s really a small portion of the overall game that is Dragon Train, it’s just certain aspects of the maths that are being challenged.
“There are a lot of elements in this game that have made it successful. There’s the Dragon Train secondary Hold and Respin feature, the art, the sounds, the animation and the brand. These things are not affected by the order.”
Alongside developing new machines, Light & Wonder has also released a social gaming version, Dragon Train Grand Central, which has also caught the attention of Aristocrat.
While Light & Wonder argues that the game does not involve any trade secrets that are part of the original case, Aristocrat claims that the title is still reaping the benefits derived from the alleged misconduct by leveraging the original game’s title and reputation.
Light & Wonder has until April 11 to respond to Aristocrat’s amended complaint, which was filed on March 14.
