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MGT Sues Casinos

Shock is spreading across the casino industry this week, after gaming development firm MGT sues casinos as big as Caesar’s Entertainment, MGM resorts, WMS Gaming, Penn National Gaming, and Aruze Gaming America for what it claims is patent infringement where their slot machine games are concerned. This news follows the market close on Friday, when they made their sudden announcement to the surprise of many professionals and experts.

The patent that they are trying to uphold is to do with networked machines that have a shared display bonusing event, and to put it a little more into context you may recognise some of the games that have been listed in their statement: Pirate Battle, Reel ‘em In Compete to Win, Great and Powerful Oz, Battleship, Clue, and Paradise Fishing are all involved, and of course some of the biggest casinos in the world are being sued here. This is a huge scale operation for relatively tiny MGT Gaming, who are only worth $17 million and could stand to gain many times that if their suit is successful. They were struggling under huge amounts of debt in 2010, but after having sold some of their assets and then seen some new investors they have managed to pay back all of their debt and re-establish themselves as a viable company. They currently hold thirteen patents with another nineteen pending, though the slot machine dispute is the only one that they have so far taken action on.

It was not until May 2012 that they quietly announced their first gaming patent, a step into the gambling industry that takes them away from their previous field of medical patents. They now claim that the games made by WMS Gaming in the list (Pirate Battle, Reel ‘em In, Oz, and Battleship) as well as those made by Aruze Gaming (Paradise Fishing) are subject to the patent, and that the casinos which run the games (Caesars, MGM, and Penn National) should also pay them for using the software. This could give them a double digit royalty award worth billions if they are successful.

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