Gaming in North America: The litigation nation?

From Light & Wonder to Wynn Resorts, Gambling Insider looks at why the US court system seems to have been flooded with gambling-based court cases.

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The US has been infamous for its litigious society, otherwise known as a suing culture, for a long time. Whether it’s because of high-profile stories, such as the McDonald's hot coffee lawsuit, or just the sheer amount of cases that seem to come from the States, it’s difficult to refute that it is as integral to the States as 50 stars are on a banner. 

The casino and gaming industry is no exception to this, it seems. There have been a wide range of cases filed in US courts this year already, and although they have manifested in different ways, they do all have a running theme. From skill gaming in Pennsylvania to sports betting in Florida...

Before we can unpick the intricacies of this notion and analyse it properly, let’s have a quick look at some recent cases themselves.

Light & Wonder vs Aristocrat 

Aristocrat, along with its subsidiary Aristocrat Technologies Australia, recently filed documents with the District Court of Nevada against its slot supplier rival, Light & Wonder. According to Aristocrat, Light & Wonder failed the Defend Trade Secrets Act of 2016, but what exactly happened?

Years ago, Aristocrat released its Dragon Link slot game. Then in 2023, Light & Wonder released its latest line of slot games; Dragon Train… but these are common themes in slot games, right? We see lots of Ancient Greece slots, so why not two dragon slots?

Well, the problem is that several employees left Aristocrat to join Light & Wonder, including its Chair of the Board of Directors, Jamie Odell, who was previously the CEO at Aristocrat from 2009 to 2017.

The most important lesson is that companies remain vigilant while operating across different jurisdictions, or invest in a robust legal department. In today's market, the reality is probably that both are needed

According to Aristocrat, it’s not just the dragon theme that’s the problem, it’s the fact that “one or more of Aristocrat’s trade secrets [are] embodied in the Dragon Link and Lightning Link games” and that “Light & Wonder knew or had reason to know that it had received the information” through ex-Aristocrat employees.

At the time of writing, 18 pieces of evidence have been submitted to the courts, which cover menus, game rules, symbols, pay tables and bonus features.

In response, a spokesperson from Light & Wonder said: “These actions are entirely without merit, and we will be vigorously defending against them, including seeking the dismissal of this baseless lawsuit.”

Obviously, Gambling Insider has no comment on the outcome of an ongoing court case. But it is a very interesting case to observe neutrally.

Fanatics vs DraftKings

Michael Hermalyn used to work as the SVP at DraftKings, a popular sportsbook in the US. He joined the operator in September 2020 and left in February 2024 to work as the President, VP and Head of the LA Office for Fanatics. 

In response, DraftKings filed with the District Court in the District of Massachusetts to bar Hermalyn from working at Fanatics. While Judge Julia Kobick did reject this, DraftKings wasn't done, and it placed a temporary order banning Hermalyn from utilising trade secrets, soliciting customers or employees. 

The injunction points out that since Fanatics launched its sportsbook in 2021, over 180 DraftKings employees have applied to work for the company.

In response to this action, Hermalyn claimed DraftKings has a history of “aggressively” smearing the reputation of people to “instill fear” if they try to leave the company. 

According to the court documents, “Rather than develop credible evidence, DraftKings liberally distorts reality and resorts to unnecessary character assassination of its former employee.

“They are fabrications designed to malign and destroy the reputation of a senior employee who had the audacity to seek out a better opportunity.”

Fontainebleau vs Wynn 

If you’ve caught on to the running theme so far, you’re not going to be surprised about what this last case is about. 

By comparison, the UK does not see as much litigation as the US does. Naturally, there are B2B cases across history, but the two biggest examples of UK litigation are actually between bettors and casinos

According to Wynn Resorts, the newly opened casino resort Fontainebleau induced its employees to breach non-compete clauses. In return, Fontainebleau submitted a counterclaim to the Clark County District Court, denying any allegations of employee poaching and accusing Wynn of using bullying tactics.

In a statement, Wynn Resorts said: “The facts of our original claim against Fontainebleau are clear: Fontainebleau induced Wynn employees to breach their lawful employment contracts. We believe Fontainebleau engaged in that practice because we believe they lack the ability to develop, and based upon numerous recent news reports, to retain talent. 

“They cannot solve these widely reported problems by encouraging employees to break the lawful employment contracts they have negotiated with other employers. We strongly objected to that behaviour because it is clearly unethical, and we shall soon find out if a court believes it is also unlawful.”

This has been in response to several executives, who moved from Wynn Resorts to Fontainebleau once the latter had opened.

Wynn Resorts continued: “Fontainebleau counterclaim, filled with fictitious accusations, was clearly designed to incite social media chatter and is devoid of answers to our original claim.”

However, Fontainebleau insists that the employees were not poached, instead leaving on their own due to dissatisfaction with Wynn Resorts. 

As part of the counterclaim by Fontainbleau, the operator explains that several executive members of staff stayed at Wynn during the last stages of Fontainbleau’s construction. During this time, these executives got to meet staff who were currently working for Wynn, all while Wynn Resorts “were more than happy to take significant revenues – exceeding seven figures – from Fontainebleau’s team” while they were staying at the property.

According to Fontainbleau's claim, once Wynn Resorts realised staff were thinking of handing in their notice, they resorted to bullying tactics to try and prevent this. According to the reports, one staff member even received a “profanity-filled” email from Wynn’s CEO, Craig Billings.

Fontainebleau said: “As [we] have now come to know from subsequent interactions, Billings demonstrated a disturbing lack of dignity and judgement normally exhibited by CEOs of publicly traded companies.” 

Wynn concluded: “We clearly hope Fontainebleau will achieve the success to which it aspires; their success, if it comes, will benefit all of us.”

Two sides of the Atlantic Ocean

By comparison, the UK does not see as much litigation as the US does. Naturally, there are B2B cases across history, but the two biggest examples of UK litigation are actually between bettors and casinos.

The first was in 2017 when Phil Ivey was accused of cheating in Crockfords Casino, London, after he admitted to using an edge-sorting technique to win £7.7m ($9.6m). This became a landmark case because the offence wasn’t illegal but instead dishonest, which led to a change in how the UK Supreme Court handled dishonesty in a legal sense.

The second case was between Andrew Green and Betfred, after the operator refused to pay out a £1.7m prize. The online casino and bookies claimed that the jackpot was due to a defect, but the courts ruled in favour of Green – who eventually received the £1,722,923.54 winnings, plus interest, but not without plenty of suffering in between.

There have been a wide range of cases filed in US courts this year already, and although they have manifested in different ways, they do all have a running theme

Each and every country has its own set of laws it must abide by, even when it deals with international affairs such as the gambling industry. So, if America sees more court cases than other countries, does it mean its laws are stricter? Well, not necessarily. 

Are we likely to see a suing culture spread in the gambling industry?

Even though in a perfect world, no one would do any wrong to get sued in the first place, that is unfortunately not the world we live in. As the gambling industry continues to globalise, it’s likely that operators will have to grow accustomed to how other cultures operate; whether it’s the aversion to online gambling in Asia, stricter regulations in Europe or lawsuits in America. 

The most eagle-eyed readers probably already noticed that while the Light & Wonder vs Aristocrat case may have been filed in the US courts, the slots themselves are based in Australia.

Of course, there’s nothing innately wrong with this. If a law has been broken, it’s only fair that a court of law gets to hear both sides and make a decision based on the evidence presented. This process is what upholds modern society and keeps it civilised. 

As with many things in this life, it’ll come down to personal opinion whether you agree or not that America has a suing culture, or whether it’s necessary or not. The most important lesson is that companies remain vigilant while operating across different jurisdictions, or invest in a robust legal department. In today's market, the reality is probably that both are needed.


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