GAN Hits MGM Resorts with Patent Infringement Suit

Posted on: March 23, 2022, 07:55h. 

Last updated on: March 23, 2022, 12:48h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

Gaming technology provider GAN Ltd. (NASDAQ:GAN) is suing MGM Resorts International (NYSE:MGM). It alleges the Mandalay Bay operator is infringing on one of the tech company’s patents to link its casino and sports betting customer loyalty platforms.

GAN MGM
Actor Jamie Foxx in an ad for BetMGM, pictured above. GAN is suing the gaming company, alleging patent infringement. (Image: The Times)

In its complaint filed Monday in the U.S. District Court for the District of Delaware, GAN says the litigation pertains to the ‘296 patent, for which the company was granted protection by the US Patent and Trademark Office (USPOT) in September. That patent is titled “Network Gaming System and Casino Management System Link.”

The ‘296 Patent claims specific technologic improvements over prior land-based loyalty rewards systems or patron data management and is directed to technologies connecting internet-based gaming system networks with one or more management systems for managing patron data, loyalty programs and other data,” according to the legal filing.

In plain English, GAN says its patent-protected technology helps casino operators more effectively link rewards programs from brick-and-mortar casinos to comparable online offerings. The UK-based company claims MGM is infringing on the ‘296 patent to bolster the ties between its traditional casino and BetMGM rewards platforms.

GAN Claims MGM Knew About the Tech

GAN claims MGM knew about its technology as far back as 2016 when the two sides mulled a relationship revolving around “GAN’s online gaming software-as-a-service solutions.”

The plaintiff asserts that because of MGM’s long-running knowledge of the GAN technology, the casino operator’s acts “constitute induced and/or contributory infringement.”

With the US iGaming and sports wagering industries taking off in a dramatic fashion, operators are incentivized to better connect related rewards platforms to traditional customer loyalty programs. In recent months, some management teams from casino companies are noting that bettors accruing points online, be it through internet casinos or sports wagering, are more likely to visit an operator’s land-based venues.

In February, MGM introduced MGM Rewards as the replacement for M life Rewards. That was followed by the launch of the BetMGM Rewards program. Under the new program, bettors earn BetMGM rewards points and MGM rewards tier credits with each wager placed.

BetMGM, a 50/50 joint venture of MGM Resorts and UK-based gaming giant Entain Plc., is the largest internet casino company in the US, and consistently ranks among the top three online sportsbook operators in the markets in which it does business.

GAN Claims It’s Suffering, MGM Is Gaining

GAN believes MGM will continue infringing upon the patent unless a court prevents it doing from so. The plaintiff adds the Bellagio operator had noticed it was violating the patent, indicating its acts “have been and are willful,” entitling GAN to damages and legal fees under various US codes.

Upon information and belief, MGM has derived and received and will continue to derive and receive, gains, profits and advantages from the aforesaid acts of infringement in an amount not presently known to GAN. MGM’s infringing acts have caused damage to GAN, and GAN is entitled to monetary relief in an amount to be determined at trial,” according to the legal filing.

GAN is seeking damages in the form of “at least a reasonable royalty” to be determined at trial.