Social sweepstakes company Sweepsteaks Ltd. is being sued, along with brand ambassador and rapper Drake, in the state of Virginia. Streamer Adin Ross and Australian George Nguyen are also named in the lawsuit, which is being brought by LaShawnna Ridley and Tiffany Hines.
The lawsuit, which was filed in Virginia on December 31, claims that Drake, Ross, and Nguyen preyed on consumers to encourage them to participate in gambling. It goes on to claim that Stake.us’s products, which use Stake Cash and Gold Coins, hold real dollar values and are tantamount to real gambling.
Stake.us’s role
Sweepsteaks Ltd is owned and operated by Ed Craven and Bijan Tehrani. The pair established Stake in 2017, having launched the iGaming studio Easygo a year earlier. The group also owns the streaming platform Kick. Five years after the launch of the global site, Stake.us was launched as a sweepstakes casino.
Sweepstakes casinos are popular in jurisdictions where online gambling has not been regulated. They use Sweeps Coins rather than traditional currency. These coins are typically bundled with Gold Coins, which are used for fun play and have no intrinsic value.
However, Sweeps Coins can also be won at table games and slots on the sweepstakes casinos, and can be exchanged for prizes, often including cash. Critics of sweepstakes casinos argue that the use of Gold Coins and Sweeps Coins circumvents existing online gambling laws.
Drake’s role
Two Stake players, LaShawnna Ridley and Tiffany Hines, have argued that because the coins can be exchanged for cash, playing on the Stake.us sweepstakes casino is the same as real money gambling.
They say that Drake, who became brand ambassador for Stake in 2022 and regularly gives away money to viewers on his live Stake casino streaming shows, along with Ross and Nguyen, has actively preyed upon them and other consumers, exposing them to the risks of gambling.
The lawsuit
The suit goes on to accuse Stake.us of operating an unlawful money transmission service. Supposedly, the three accused parties allegedly sent money to one another using the site’s tipping service, which does not have any regulatory oversight.
Finally, the complainants go on to state that the money raised by Drake was used to deploy streaming bots to artificially inflate Drake’s streaming numbers on major streaming platforms. According to the filing, these practices date back to 2022 and are still continuing today.
This is the latest case to be brought against the parties. A similar class action lawsuit was raised by Justin Killham in Missouri in October. Last week, that case was moved from the state court to the federal court.
Current state of US sweepstakes casinos
Sweepstakes casinos have come under fire in US courts in the past year. States including California, Montana, Washington, and Idaho have all introduced laws prohibiting them and other states look set to follow.
Indiana is set to discuss the issue of dual-currency online casinos this week, while Tennessee and Maine are also in the process of discussing similar bills.
