Understanding VGW's Class Action Lawsuit & its Impact

Watch Understanding VGW's Class Action Lawsuit & its Impact - SportsGrid on Dailymotion

Transcript

00:00And I think we need to educate people a little bit, Sam, about this class action lawsuit.

00:10And again, what is this sweepstakes company VGW?

00:14This is the first I'm hearing of this company, possibly because I don't live in New York

00:17and I'm not familiar with it, but what exactly is it and what are they being accused of?

00:21Yeah, VGW stands for Virtual Gaming World.

00:25They run websites like Chumba Casino, Luckyland Slots, and Global Poker, which operate under

00:31the sweepstakes model, which essentially allow people to play their online casino games for

00:37free.

00:38They also give them the option of paying money, but by allowing folks to play for free, giving

00:42them that option, they avoid the regulation of gambling laws in many states.

00:48New York has cracked down on these a little bit, but we've seen them really proliferate

00:52across the country, especially in markets without online casinos and without online

00:56sports betting.

00:57This class action lawsuit was filed in New York just last week, and it also names Google

01:03and Apple as well, essentially saying that these tech giants helped facilitate payments

01:09from the VGW platforms to the people who are playing.

01:14The plaintiffs in the suit claim they lost tens of thousands of dollars and were being

01:19essentially pushed onto unregulated gambling platforms.

01:22It also seeks to make this a RICO lawsuit, which obviously we hear a lot about in the

01:27racketeering world, in the unregulated gambling world as well, but I'd say this is pretty

01:32interesting because it's the first of its kind that we've heard of in this case.

01:37And over the past year, the sweepstakes model has really boomed while states have maybe

01:42not legalized iGaming as fast as many had hoped.

01:47You have a lot of companies turning towards new sources of revenue.

01:50With the sweepstakes model, they're able to launch easily, quickly in all of these states,

01:54and it's kind of just getting the spotlight now.

01:57Some people have called it exploiting a loophole.

01:59Others have said that it offers kind of this product in these markets that haven't legalized

02:03yet.

02:04So it'll be really interesting to see how this develops.

02:07Obviously you can file a lawsuit at any time.

02:09So this isn't essentially damning in any way, but the fact that it's in New York, the fact

02:15that it seeks to be a RICO is pretty important.

02:17We'll see if it forces other regulators or other states to take a look as well.