Stake.us has been named in a lawsuit in Alabama, with plaintiff, Laura Hall claiming the company’s sweepstakes-based casino operations are illegal.
Alabama resident, Hall seeks to recover losses from playing on the site and requests ‘declaratory and equitable relief’, meaning she’s requesting the court to declare Stake.us’s operations unlawful and order corrections for any harm caused. Although the lawsuit is labeled as a class action, it has not yet been certified by the court.
This creates another legal annoyance for Stake.us and its parent company, Sweepsteaks Ltd, which is already involved in similar private cases in California and Illinois. However, these are far from the only ongoing sweepstakes-related lawsuits, with other examples including Virtual Gaming Worlds AKA VGW fighting a case in Delaware, and Google and Apple being named in a RICO lawsuit in New Jersey for their role as payment providers to multiple sweeps casinos.
That said, in the case of Hall vs Sweepsteaks Limited, Alabama is known for its anti-gambling laws, which go beyond any of the states mentioned above in terms of strictness. The Yellowhammer State has no commercial casinos, no online casinos, and even no lottery – it only has a handful of tribal casinos. Many popular sweepstakes casinos – such as McLuck, High 5, and Kickr – choose not to operate there, while others – like Stake.us, RealPrize, and WOW Vegas – evidently see the state as fair game.
Still A Hard Argument to Prove
We will watch this case for any developments, but, despite plenty trying, no plaintiff has yet managed to bring a convincing and successful case against online sweepstakes casinos in the US. The industry operates under sweepstakes law via a dual-currency system, and this allows participants to earn virtual currency through non-cash transactions, avoiding the classification of real-money gambling.
Lawmakers who want to ban the format are likely to have more success by changing state laws to specifically prohibit sweepstakes casino gaming in the first place. We’ve seen multiple states debate such proposals this year, and so far, Montana seems the closest to bringing one of these bills into law. It’s also worth noting, however, that such bills have failed in states like Arkansas, Maryland, and Mississippi.
Ryan Seacrest and VGW Also Facing Fresh Lawsuit
While Stake.us is facing legal challenges, another prominent figure is also in the spotlight due to sweepstakes casino promotions.
A case was brought against media personality, Ryan Seacrest last week for his ongoing endorsement of Chumba, the original sweepstakes casino operated by VGW (also named in the case).
In the same way that musical artist, Drake promotes Stake.us via social media channels, Seacrest is a brand ambassador for Chumba.
The plaintiff in this case, Aubrey Carillo states:
“Defendant Seacrest regularly appears on ChumbaCasino.com’s Instagram feed and promotes ChumbaCasino.com on his own Instagram account…California Penal Code § 322 provides that it is a misdemeanor to ‘aid or assist’ in ‘advertising [or] publishing’ an illegal lottery. That is what Defendant Seacrest does for ChumbaCasino.com.”
We often see cases like this, but as stated above, such lawsuits are notoriously hard to prove, and could almost be classed as nuisance suits.
In a report on this story on celebrity news site, TMZ, a Chumba spokesperson stated that it “operates its social casino in strict compliance with all applicable laws and regulations. This lawsuit has no merit and Chumba will vigorously defend its legal right to operate its business.”
Originally published: May 5th 2025
Author: Joseph Allen
Updated:
