Light & Wonder withdraws second slots title as Aristocrat legal battle continues
Supplier opts to “voluntarily stop commercialising” Jewel of the Dragon after its competitor amends court claim to include accusations of trade secret misappropriation
Light & Wonder has withdrawn its Jewel of the Dragon slot from its offering for an unspecified period amid its ongoing legal dispute with Aristocrat.
As confirmed by Light & Wonder CEO Matt Wilson, the supplier opted to take the course of action after Aristocrat amended its existing court complaint related to trade secret misappropriation to include Jewel of the Dragon.
The initial legal compliant had focused on a separate game, Dragon Train, which was developed off the back of stolen trade secrets, according to Aristocrat.
Although Aristocrat’s original complaint from February 2024 did mention Jewel of the Dragon, it has now been updated to include a claim of trade secret misappropriation. The new amendment was filed with the District Court of Nevada.
The claim centres around the math used in the design of Dragon Train by the game’s designer Emma Charles, who previously worked for Aristocrat.
Aristocrat has also taken aim at Light & Wonder’s social casino version of Dragon Train, stating that Dragon Train Grand Central would “reap the benefits” of trade secret misappropriation.
Wilson revealed that Light & Wonder requested the opportunity to file a response, which was granted by the court and expected to be filed by 11 April.
The firm has declared it will “voluntarily stop commercialising and offer to replace Jewel of the Dragon to minimise any confusion and potential disruption to our customers”.
The impact of Jewel of the Dragon’s withdrawal was played down by Wilson during a call with analysts, as the CEO noted the game represents less than 1% of the supplier’s entire slot portfolio.
“It’s a small game relative to the universe of games that we create. If you think about it through the lens of the premium installed base, its 150 games, compare that to Dragon Train, which was 2,200 games,” Wilson explained.
It was a sentiment shared by Light & Wonder CFO Oliver Chow, who noted that Jewel of the Dragon accounts for less than $10m in revenue.
Wilson added: “Taking Jewel of the Dragon out of play from a lease perspective is simple. We’ve got a broad portfolio of games we can quickly convert to, and it just limits the noise.
“The game has some similarities to [Aristocrat’s] Dragon Link, but it’s not the same game.”
In Aristocrat’s original claim, the Australian supplier identified several elements of Jewel of the Dragon that had allegedly been copied.
Since then, as per Light & Wonder’s release, issued on 2 April, the company has detailed how “certain Aristocrat PAR sheets dated 2015 that appear to have been available to certain members” of the team behind the development of the Jewel of the Dragon game.
PAR sheets, according to the statement, are used by suppliers to outline the characteristics of a game, such as its payout structure, its odds, and how it operates.
Wilson explained how commonplace it is for PAR sheets to be seen by competing companies.
“These PAR sheets have been historically provided to customers to allow them to meet regulatory requirements and to understand their own exposure as it relates to the likelihood of large but infrequent award amounts,” the CEO said.
“Because PAR sheets have been so widely distributed, it has historically been common for PAR sheets from industry players, including Light & Wonder, to end up in the hands of competitors.”
The Light & Wonder CEO also shed light on an independent review of the company, which evaluated all of its released games from 2021 onwards and found “no evidence of contagion” from competitor’s products.
Aristocrat’s amended complaint is believed to reference a Light & Wonder game yet to be released, which Wilson revealed was in development but has been scrapped “out of an abundance of caution”.
In the days leading up to Light & Wonder’s update, speculation surrounding more litigation hampered the company’s share price, which fell by nearly 20% within a five-day period.
However, in the immediate aftermath of Wilson’s comments addressing the legal battle, Light & Wonder’s stock climbed by 4.6% to sit at a price of $91.95 per share.
However, in pre-market trading today, 3 April, the supplier’s stock is down 3%.
Light & Wonder remains confident that the removal of Jewel of the Dragon is “not expected to have a material effect” on group revenue.
In turn, the supplier has reaffirmed its financial guidance for 2025, with Light & Wonder expected to generate net post-tax profit between $565m and $635m, alongside adjusted EBITDA of $1.4bn.