Scientific Games was ordered to pay $315 million by a federal court after an ant-trust lawsuit charged that a company subsidiary had sued under false patent claims to keep an automatic card shuffler off the market.
Shuffle Tech filed an antitrust lawsuit against Scientific Games in 2014 that stemmed from previous litigation patent violation litigation brought by SHFL Entertainment against four companies.
U.S. District Judge Matthew Kennelly, sitting in Chicago, tripled the jury’s original $105 million award after announcing the verdict. Scientific Games was also ordered to pay the plaintiff’s legal fees.
“We’re quite happy, but it’s so fresh, we’re not sure what the next steps are,” Rick Schultz, the CEO of Chicago-based Shuffle Tech told the website after the verdict.
Shuffle Tech filed an antitrust lawsuit against Scientific Games in 2014 that stemmed from a patent infringement lawsuit filed in Nevada by SHFL Entertainment, which is now part of Scientific Games, against three companies—DigiDeal Corp., Aces Up Gaming Inc. and Poydras-Talrick Holdings LLC. The companies worked with Shuffle Tech in 2012 to launch its first automatic card-shuffler.
The jury verdict awarded $45 million to Shuffle Tech, $25 million to Poydras, $15 million to Aces Up and $20 million to DigiDeal, which assigned its rights in the suit to Shuffle Tech. The judge tripled those awards.
In a filing with the Securities and Exchange Commission Tuesday, Scientific Games said, “The company believes the jury reached the wrong result and will seek review of both the finding of liability and the damages award, both before the trial court and, if necessary, on appeal.”
According to a rundown of the trial by the Law360 website, Shuffle Tech worked with gambling equipment manufacturer DigiDeal on a card-shuffling machine to market to casino operators. The companies debuted the device at the Global Gaming Expo in Las Vegas.
SHFL Entertainment then filed a patent infringement suit against DigiDeal. Shuffle Tech said the company, at the time, knew the patents were unenforceable.
SHFL Entertainment was acquired by Bally Technologies in 2013 for $1.3 billion. A year later, Scientific Games acquired Bally for $5.1 billion.
Shuffle Tech had planned to make and sell 800 shufflers during their first year on the market and 1,200 every year after, with a nearly $7,500 profit on each shuffler, the company’s attorney said during the trial.
In an interview, Schultz told CDCGamingReports.com that legal fees consumed the company’s investment money it planned to use to develop the games. DigiDeal agreed to stop making and selling the card shuffler.
“Being a small company, we had the ability to develop a great product, but we didn’t have the ability to compete with a large corporation with those type of resources and defend ourselves against a sham lawsuit,” Schultz said.
