The United States District Court in the Central District of California has referred the Boyle v. Sweepsteaks Ltd. case, where the plaintiff accused Stake.us of being an illegal online casino, to arbitration. Sweepsteaks Ltd operates Stake.us.
Following a review of the terms and conditions, the plaintiff, Dennis Boyle, agreed when he signed up with Stake.us that all disputes would be resolved through arbitration, and the court enforced this motion to compel arbitration.
Key Takeaways
- The United States District Court in the Central District of California has enforced a motion to compel the Dennis Boyle v. Sweepsteaks Ltd case to arbitration.
- The plaintiff accused Sweepsteaks Ltd’s Stake.us of offering an illegal online casino with its sweepstakes games.
- The Social and Promotional Games Association has claimed the motion proves that Stake.us does not represent illegal gambling.
The lawsuit was filed by plaintiff Dennis Boyle in March and claimed the sweepstakes casino model used by Stake.us circumvented a prohibition on online casinos in California. The argument compared the model at Stake.us to those used at sweepstakes cafes, which were later deemed illegal.
However, Sweepsteaks Ltd argued that the District Court should not hear the case as its terms and conditions, which Boyle agreed to when he registered with Stake.us on November 29, 2022, said all disputes would be settled by arbitration.
While Boyle contested this clause by arguing that if Stake.us provides illegal gambling through its sweepstakes casino, the terms and conditions are voided, the District Court disagreed. U.S. District Court Judge James V. Selna ruled that the case must pass through arbitration before the illegality of Stake.us can be determined.
SPGA claims win following ruling
The Social and Promotional Games Association (SPGA), an organization that promotes sweepstakes gaming and advocates for its safe implementation, claimed the ruling proved that Stake.us is not an illegal online casino.
“This ruling affirms what we've long said: Social sweepstakes sites are not gambling. They are free-to-play games enjoyed responsibly by millions of American adults, and no purchase is ever necessary to play or have a chance to win prizes. Anyone can file a lawsuit making any claims they like. This ruling is a reminder that facts - and the law - still matter,” a spokesperson said in a statement to Covers.
The District Court ruling specifically reads, “the Court denies to rule on the issue of illegality” before the case goes through arbitration.
Sweepstakes casinos under the microscope
While the District Court ruling relieves pressure on Stake.us and its operator, sweepstakes casinos face challenges across the U.S. Earlier this week, Connecticut lawmakers approved SB 1235 to ban sweepstakes casinos in the state.
Several other U.S. states, like New Jersey and Nevada, have introduced similar legislation to restrict the operations of these sites. Even with the resolution of Boyle v. Sweepsteaks Ltd, pressure continues to build on U.S. sweepstakes operators.
