Card-Shufflers and Allegedly Fraudulent Patents Antitrust Class Action

This complaint makes antitrust allegations against three related companies—Scientific Games Corporation (SGC), Bally Technologies, Inc. (BTI), and Bally Gaming, Inc. (BGI, formerly SHFL Entertainment or Shuffle Master). The companies make automatic card shufflers, and the complaint asserts they “procured patents by fraud and then asserted those patents in sham lawsuits against competitors,” to exclude other companies from the market, which required customers to pay more for card shufflers than they would have in a competitive market.

The class for this action is all persons or entities who directly bought or leased automatic card shufflers in the US, its territories, and Washington, DC from any of the defendants in this case or their predecessors, subsidiaries, or affiliates, between April 1, 2009 and the present.

The defendant companies in this case make card shufflers under the Shuffle Master, DeckMate, and Bally brands.

Automatic card shufflers are important to casinos with certain types of games. “In many jurisdictions,” the complaint says, “shuffling by hand is illegal as well, making these machines a necessity.”

The complaint alleges that the defendant companies have created a 100% monopoly, which “has been achieved as the result of purposeful abuse of the patent system and the judicial process by Bally and SGC and their predecessor entities. For more than a decade, Defendants have filed sham patent infringement lawsuits against every potential competitor that has marketed competitive card shufflers to casinos in the United States, leaving United States casinos and other direct purchasers with essentially no choice in automatic shufflers since at least 2009.”

The complaint alleges that some SHFL patents included information stolen from the “Roblejo Shuffler,” a machine created by Halvard Solberg. It claims that SHFL “wrote and amended claims to include features” that SHFL had taken from the Roblejo Shuffler, then concealed information about the Roblejo Shuffler and other shufflers from the US Patent and Trademark Office. Under the law, the complaint alleges, SHFL was required to disclose this prior art in its applications and it would not have been issued its patents if it had not been hidden from USPTO examiners.

The company Casinos Austria Research Development, GmbH (CARD) “filed suit seeking declaratory judgement of non-infringement for CARD’s one2six shuffler of certain patents held by SHFL” because of this. SHFL first filed a countersuit for infringement and obtained a preliminary injunction against CARD. Then it bought CARD for $50 million. According to the complaint, SHFL bragged to the press about this strategy of forcing a distress sale.

The complaint provides more details about SHFL’s lawsuits against a number of other companies. The complaint alleges, “Defendants sought to enforce patents that they knew were invalid and unenforceable—and continued to pursue litigation against other competitors even after multiple rulings against them” because they were able to force the other companies out of business through the expenses of litigation.

Article Type: Lawsuit
Topic: Antitrust
Tags: Antitrust, Gambling or Gambling Games, Patent Litigation