HomeGambling IndustryChumba Casino operator targeted in lawsuit in US

Chumba Casino operator targeted in lawsuit in US

4 min. read
Chumba Casino

Virtual Gaming Worlds (VGW), a popular developer of free-to-play games as well as the operator behind brands such as Chumba Casino, Luckyland Casino and Global Poker, is facing a new class-action lawsuit in the United States alleging that the company is flaunting gambling laws.

Social casinos come under heavy fire in fresh lawsuit

VGW is taking legal heat over the operation of its social casino and free-to-play brands in the United States. The lawsuit, filed in Georgia, argues that sweepstakes and social casinos have not been yet legalized in the Peach State, and the present operations of the brands were a breach of local gambling laws.

The main plaintiff named in the city is a local woman, Destiny Kennedy, who argues that the sweepstakes format is an attempt to hide the fact that VGW is in fact running an illegal gambling operation, the lawsuit argues. Social and sweepstake casinos are very popular all over the United States.

They are often the only legalized form of iGaming in many states that otherwise have prohibitive laws on social and sweepstake casinos in the first place. Despite local bans on online casinos, many of these states have accepted the common rationale that social and sweepstake casinos are indeed not "real money contests."

The concept has been assaulted in various courts to no avail as well, only now, Kennedy is willing to push forward and see if she can prove otherwise. In a statement, the plaintiff explained:

"VGW proactively defrauds Georgia citizens because VGW advertises that its operations are legitimate and legal when, in reality, VGW knowingly and wilfully operates what constitutes an illegal gambling enterprise."

Kennedy does have a personal bone to pick with the operator, as she lost $1,150 playing across its websites. According to Kennedy loss is only accrued because the "free-to-play" concept pushed by social casino operators is faulty, as it doesn’t really mean that you get to play for free because the real goal of the operator is to purchase Sweeps Coins, which do cost real money.

However, these casinos also support complete free-to-play and the purchase of Sweeps Coins is a personal choice, which Kennedy had decided in favor of. Yet, her lawsuit tries to prove that VGW’s real business model is the sale of these coins for real money. So far, the lawsuit has been moved to the Georgia Northern District Court, after being filled with the State Superior Court in mid-May.

Kennedy’s argument will be particularly difficult to prove in court precisely because of the above reasons. The 42-page lawsuit will have to achieve that is generally held to be a non-starter in legal terms.

However, her team hopes that the use of Sweeps Coins, which can be redeemed for cash directly to the consumer’s bank account or digital wallet, could serve as the basis of the case. One Sweeps Coin is roughly the equivalent of $1. The lawsuit goes on to lambast VGW more explaining that this "camouflaged" illegal gambling was precisely what was prohibited under Georgian law.

This is not the first time VGW has come under fire after a previous lawsuit was filed against the company again in Georgia by one John Doe. As a reminder, VGW had to withdraw from Michigan, facing similar pressure from local courts.

Image credit: Chumba Casino

07 Jun 2024
4 min. read
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