A cut of all purchases
A lawsuit filed in California claims that tech giant Apple is supporting and handsomely profiting from “illegal” social gambling apps.
The class action complaint dated January 22 was filed in the US District Court for the Northern District of California. The focus of the complaint is on social casino apps that are completely free to play, but allow people to purchase in-game currency using real money. These apps do not provide a way for users to cash out their chips.
both highly addictive and very profitable for the operators
The complaint claims that these types of social casino games are both highly addictive and very profitable for the operators. Apple is the defendant in this case as it hosts these apps and gets a 30% share of all in-app purchases. The filing claims that the “illegal games” would not be so highly profitable without the help of Apple.
As well as hosting these apps and processing payments, Apple also gives user insights and data to app developers. Therefore, the complaint further alleges that Apple has “ongoing participation in an illegal gambling enterprise.”
Allegations against Apple
The complaint estimates that people spent about $6bn on virtual casino currency last year. In terms of specific offenses, the plaintiffs believe Apple is guilty of violating the slot machine ban in California, collecting unlawful debts, and racketeering. The complaint deems that there are more than 50 “illegal” social casinos currently on the App Store.
Both claim they have spent $15,000 or more on in-app currency at social casinos.
Cheree Bibbs and Donald Nelson are the two plaintiffs named in this case. Both claim they have spent $15,000 or more on in-app currency at social casinos. The filing also documents instances of other people spending upwards of $40,000 on these games.
The lawsuit seeks restitution, an injunction, damages, and other relevant relief as a result of Apple’s facilitation of social casino apps.
Similar lawsuits
This is not the first time that Apple has been the subject of gambling-related lawsuits. In June 2020, plaintiffs filed a $5m class action lawsuit in San Jose, California against Apple for allegedly allowing children to gamble using loot box elements in games found on the App Store.
In October of last year, plaintiffs filed lawsuits against Apple in a couple of states. A woman in Connecticut sued Apple over social casino games that led to her losing thousands of dollars. Both Apple and Google were subject to a complaint in Alabama about free-to-play casino apps in their respective app stores.
Casino game developer Big Fish Games had to pay $155m to people who made purchases in social games. A judge ruled last fall that the games constituted illegal gambling in Washington State. So while past legal action has been successful in this type of matter, in this particular case, it was a game developer rather than a platform provider that had to pay out damages.