Shuffle Master, Mikohn settle suits

Gary Thompson

Wednesday, Dec. 29, 1999 | 10:43 a.m.

Las Vegas-based gaming equipment suppliers Mikohn Gaming Corp. and Shuffle Master Inc. announced today they've settled their patent disputes and will enter into cross-licensing agreements for various products.

The pacts call for Shuffle Master to pay Mikohn $2.75 million by Friday for rights to Let It Ride and Three Card Poker games and for future royalties from those games.

Mikohn will receive exclusive rights to Bahama Bonus games, except in Nevada, and will get royalties based on future revenues from certain new games Shuffle Master develops.

Shuffle Master also has licensed certain of its intellectual property to Mikohn, including coin-sensing and multi-tiered game wagering patents in return for royalties of about $580,000 per year over the next five years.

The two companies also agreed to buy certain equipment from each other, including Mikohn's progressive table game and slot signage, controllers, electronic displays and slot glass, as well as Shuffle Master's card shuffling systems, coin sensors and other associated table game electronics.

Mikohn will become Shuffle Master's exclusive source in North America for progressive controllers and displays for table games. Shuffle Master will become Mikohn's exclusive source for automatic card shuffling machines.

Mikohn Chairman David Thompson said the agreements are "highly positive and have the potential to provide significant benefits as they are implemented."

Shuffle Master Chairman Joseph Lahti said the pacts "signal the beginning of a new spirit of cooperation in which there is opportunity for each company to leverage the resources of the other."

Mikohn stock was quoted at $4.96875, up 3.125 cents a share, in midday trading today, while Shuffle Master shares were at $8.375, down 6.25 cents.

"It would be interesting if the bigger equipment manufacturers such as International Game Technology and WMS Industries Inc. borrowed a page from the book written by Mikohn and Shuffle Master, settle their patent disputes and start doing more business with each other in the future," said Dave Ehlers, chairman of Las Vegas Investment Advisors Inc.

"This would bring the best of player-friendly games to casino environments, benefiting both casinos and players."

IGT has sued WMS alleging patent infringement on touch-screen technology.