Social Casino High 5 Prohibited in Washington State, Players Set to Receive Compensation
A judge in Washington state has concluded that two social casino apps operated by High 5 Games are considered illegal gambling in the state, potentially leaving the company liable for large-scale damages.
The ruling by Judge Tiffany Cartwright on June 11, 2022, could mean High 5 Games has to pay out big under the state's Recovery of Money Lost at Gambling Act (RMLGA), not just play chips.
Judge Cartwright backed the plaintiff, Rick Larsen, a former player, in his argument that the games breached Washington's Consumer Protection Act (CPA) and RMLGA.
Compensation to be Decided
Larsen initiated a class-action lawsuit against High 5 Games in 2018. Players of High 5 Casino and High 5 Vegas receive virtual coins for free when signing up on platforms like Facebook, Google Play, the App Store, and more. Once they exhaust their virtual funds, they must buy additional coins with real money to carry on playing, as Larsen did, spending $7,470.50, according to court papers.
As a class-action lawsuit, those who bought virtual currency for one of the apps in Washington after April 9, 2014, might qualify for compensation.
The RMLGA specifies that anyone who loses money or anything of value on illegal gambling games has the right to recover it from the game's operator.
Lawyers representing Larsen served subpoenas on Amazon, Apple, Google, and Facebook, revealing that Washington residents spent over $21.6 million on the apps between 2014 and 2023. However, the judge did not consider this amount as definitive, stating that damages should be decided by a jury.
Value at Risk
In her decision, Judge Cartwright referred to a prior legal precedent. In March 2018, federal judge Milan D. Smith of the Ninth Circuit court of appeals ruled that the virtual play chips in another social casino's games, Big Fish, could be considered "something of value" under Washington State law.
This is crucial because Washington defines gambling as "risking something of value on the outcome of a contest of chance or a future contingent event not under the person’s control or influence to receive something of value in the event of a certain outcome."
Washington stands apart from other states where similar cases have been filed in attributing "value" to virtual playing chips.
The Big Fish case eventual settlement for the plaintiffs totaled $155 Million. Cartwright found that High 5's virtual coins operate in the same way.
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