New Class Action Lawsuit Takes Aim at Sweepstakes Operators

Operators of sweepstakes casinos and sportsbooks have thrived over the last few years, but the industry may be in significant trouble.

A new class action lawsuit has been filed in the Southern District of New York over the sweepstakes gaming industry. The lawsuit targets the operators of these platforms, Apple, and Google. 

The lawsuit claims sweepstakes platforms illegally offer gambling through apps provided on the Apple App and Google Play stores. It accuses operators and their app store partners exploited a legal grey area to provide a gambling experience that is ruining lives. One of the plaintiffs in the suit claims that they lost over $1,000 playing on sweepstake casino apps.

Apple and Google were added to the suit after the plaintiffs discovered they were receiving some of the profits generated by sweepstakes platforms.

What Are Sweepstakes Games?

Sweepstakes casinos and sportsbooks are allowed to offer a gambling experience because the platforms do not accept real money wagers. Instead, customers use packs of coins that can be used to wager with and claim prizes. There are ways to earn some of these coins for free, but the platforms also sell packs. 

As a result, sweepstakes platforms are allowed to operate in most of the US, including giant markets where gambling remains illegal, such as California and Texas. 

Operators Have Been Under Fire in 2024

Last year, the sweepstakes gaming industry continued to grow, which led to increased attention from the country’s legal gambling industry. The American Gaming Association (AGA) has been sounding the alarm over the danger of the industry, which was allowed to avoid the strict regulations that legal sports betting and online casino operators are required to follow.

The AGA requested that lawmakers in each state examine sweepstakes gaming and set new regulations. The goal is to protect residents and crucial tax revenue from regulated gambling markets.