VGW Holdings Ltd., a prominent operator in the sweepstakes casino industry, is facing a class-action lawsuit filed on December 3, 2024, in the Southern District of New York. The lawsuit alleges that VGW’s platforms, including Chumba Casino, LuckyLand Slots, and Global Poker, operate as illegal online gambling sites under the guise of social casinos.
The plaintiffs claim that VGW’s dual-currency model, which allows players to purchase virtual Gold Coins and receive Sweeps Coins redeemable for real cash prizes, constitutes unauthorized gambling under New York law. They argue that this system exploits legal loopholes to conduct gambling activities without proper licensing or regulation.
There’s more—tech giants Apple and Google are named as co-defendants in the lawsuit. This follows a class-action lawsuit filed less than a month earlier in the New Jersey Federal Court. That case also targeted other sweepstakes casinos, along with Google and Apple.
The plaintiffs allege that these companies have facilitated and profited from the purported illegal gambling operations by distributing VGW’s apps through their platforms (App Store and Google Play Store) and processing payments.
This case could have far-reaching implications for tech giants, questioning the extent of their responsibility in regulating apps hosted on their platforms. A ruling against them might prompt stricter controls or even changes in app marketplace policies.
This legal action is part of a broader trend of scrutiny and litigation against sweepstakes casino operators in the United States. VGW has faced similar lawsuits in other states, including a recent case in New Jersey alleging violations of the Racketeer Influenced and Corrupt Organizations (RICO) Act.
Impact of the Recent Court Case Dismissal
In a related development, VGW recently secured a legal victory in Georgia. A federal court dismissed a class-action lawsuit against the company, citing a lack of personal jurisdiction. This case was among several that VGW has been defending across the US, reflecting the ongoing legal challenges faced by sweepstakes gaming operators.
While the dismissal in Georgia is a positive outcome for VGW, which could set a precedent for the sweepstakes industry as a whole, the company continues to confront multiple legal battles nationwide.
The outcome of the New York lawsuit and others can significantly impact the future operations and regulatory landscape of sweepstakes casinos in the States.
Author: Alex Windsor
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