The command has indeed failed with message:
Last occurrence of "list'" must have "A" as 1st argument in
 "A -> list' A -> list' (A * A)%type".
Inductive foo (A : Type) (x : A) (y : A := x) : Prop :=  Foo : foo A x

For foo: Argument scopes are [type_scope _]
For Foo: Argument scopes are [type_scope _]