Amazon agrees to a $201m settlement related to social casino apps

• Amazon reaches a settlement agreement with plaintiffs in Washington
• The case would see plaintiffs be entitled to seek $200m from app developers of social casinos
• Amazon has welcomed the settlement and awaits a judge to approve it

Amazon has agreed to a $201m settlement with consumers as part of a legal proceeding filed on Thursday and is still awaiting approval by a judge. The company will not be paying this money out of pocket, however.

Amazon agrees to $201m settlement, says app developers ought to step up

The settlement is part of a legal proceeding filed against the company in 2023 as a class-action lawsuit, alleging that Amazon violated Washington gambling and state protection laws by allowing transactions in social casino apps available on the Amazon Appstore

Essentially, the plaintiffs argued that Amazon facilitated illegal gambling. Amazon’s settlement will allow US consumers to pursue up to $200m in damages from third-party software developers who have offered what is described as "illegal gambling" on the marketplace.

In other words, the company will not be footing the bill itself. However, it would agree that the judgment is issued against it, while transferring the burden to developers to pay for any reimbursement costs consumers are seeking.

The company has welcomed the verdict and has said that it will continue to offer choice on its Appstore, but that developers would be required to "improve the customer experience," insisting that apps must comply with the applicable laws.

The company said that it would not hesitate to remove apps. Overall, Amazon is denying wrongdoing in the matter. The plaintiffs who filed their case against Amazon have pursued similar causes in the past, and have already returned more than $650m to affected consumers.

Settlement would mark a significant win for Amazon if approved

"The class is poised to recover a significant portion of their total losses that keeps pace with the settlements achieved against ​the social casino developers," the plaintiffs said.

It is not clear whether Amazon will face similar outcomes in other states, but the settlement - providing that it is approved by a judge - is an important precedent for the company, passing the burden onto developers to ensure that their products are compliant with local gaming laws.

Social casinos have been under assault across the United States, with lawmakers and regulators pushing back against the sector and arguing that the sweepstakes currencies used by such apps are a way to dodge gambling laws.

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