Massachusetts class action challenges sweepstakes-based gambling

[The Buzz]

A new legal challenge to the sweepstakes-based gambling industry has emerged in Massachusetts.

A class action lawsuit has been filed against VGW Holdings US, the parent company of popular online gambling platforms Chumba Casino, Luckyland Slots, and Global Poker. The lawsuit, filed on behalf of an individual identified as "M.M.", was submitted to the Superior Court of Suffolk County.

This legal action could have significant implications for the future of sweepstakes-based gambling operators in the state.

From Poker.org:

Filed by attorney Joel D. Smith of the Boston law firm Smith Krivoshey PC, the action claims several causes and claims for relief, alleging violations of Massachusetts's gambling laws, unjust enrichment, and other deceptive practices including the whitewashing of the word "gambling" from the VGW sites in question, despite plaintiff's assertions that the sites are, indeed, real-money gambling.

For the time being, the lawsuit references only the Chumba Casino and Luckyland Slots sites along with several VGW corporate entities. Global Poker is not mentioned, possibly because the lead plaintiff, M.M., did not gamble on Global Poker. However, if certified as a class action and other plaintiffs are added, Global Poker could be added as an additional defendant, since it employs the identical dual-currency sweeps model and also offers many of the same slots and other casino table games as the othertwo VGW sites.

Targeting US's 'real-money gaming market' for over a decade
VGW, or Virtual Gaming Worlds, as it's more fully known, is the largest sweeps-based online operator on the planet. Founded way back in 2011, when the online poker world's "Black Friday" crackdown changed the online gambling world, it has since grown into a multi-billion-dollar concern headed by its Australian founder Laurence Escalante.

As alleged as part of the complaint, VGW has acknowledged all along to certain parties that it is offering a form of online gambling, despite its claims to the contrary. The cover sheet submitted to the case offers this:

"Although Defendants deny that their websites involve gambling (despite the obvious purpose of the websites), they admitted to investors that the websites are intended to target the 'real-money gaming market' in the United States. Defendants also admitted to investors that the websites are modeled on 'Internet cafe sweepstakes', which was a widespread practice during the early 2000s that criminals tried to use to evade state gambling laws.

"The Massachusetts Attorney General and courts across the US consistently determined that Internet cafe sweepstakes are a form of unlawful gambling, and Massachusetts law directly prohibits the use of fake 'sweepstakes' as a pretext for gambling."

Read more here: https://www.poker.org/latest-news/ma...-asXo15k6CyWp/

[universal4]

Not really shocked by this is any way. I assumed it was only a matter of time until this kind of case would come up.

Wonder if they actually needed specifics of anyone actually needing to admit the sites were offering some form of gambling, however it feels like this fact might make the case a bit stronger against Virtual Gaming World (VGW).

Would also think that a number of other states will watch this case closely and it may well be only the first case of it's kind against operators that have similar structures based on sweepstakes.

Rick
Universal4

[allfreechips]

Same thoughts, We accept deposits to get more gold coins, gold coins can get you Sweeps coins than can pay out... just adding a layer of coins is not enough i dont think lol

[MJM]

Surprised it's taken this long for action like this, probably going to see more now that the AGA is lobbying against the sweeps industry.