Class Action: Double Down Casino Is Unlawful Gambling

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Double Down Interactive LLC was hit with a class action lawsuit by an Illinois woman for allegedly operating an unlawful quasi-casino with “camouflaged” gambling with its Double Down Casino apps.

Plaintiff Margo Phillips claims in the unlawful gambling class action lawsuit filed in an Illinois state court on April 10 that Double Down is operating unlawful gambling devices.

Customers download Double Down Casino onto their computers via Facebook, their Android or Apple iOS devices, in which customers can play slot machines games, roulette, black jack and other casino games.

When customers first download Double Down, they are given a bunch of virtual chips for free to use to play on the various games. After those chips are lost, customers may then buy more chips, which start at $2.99 for 150,000 chips. Customers are able to then “win millions of additional chips that they would otherwise have to purchase.”

However, players are also able to “cash out” their chips, by selling their accounts on a secondary market.

Phillips explains that Double Down Casino is an example of a “free-to-play” videogame that has become common with “the proliferation of internet-connected mobile devices.”

According to the Double Down Casino class action lawsuit, “in 2012, free-to-play games of chance generated over $1.6 billion in worldwide revenue and are expected to grow to over $2.4 billion by the end of 2015.”

As a result, “with free-to-play games of chance, developers have begun exploiting the same psychological triggers as casino operators.”

Phillips cites gaming experts, who explain that the game makers only need a very small percentage of their customers to pay for the virtual currency to be profitable.

The Illinois woman also cites researchers who have “found that [free-to-play] casino gamers share many similar sociodemographic characteristics (e.g. employment, education, income) with online gamblers.”

The researchers also found that playing free-to-play games lead players to eventually opt for online gambling.

“The similarity between free-to play games of chance and games of chance found in casinos has led governments across the world to intervene to limit their availability,” the Double Down Casino class action lawsuit explains.

“Unfortunately, such games have eluded regulation in the United States. As a result . . . defendant’s Double Down Casino has thrived, and thousands of consumers have lost millions of dollars unwittingly playing defendant’s unlawful game of chance,” the unlawful gambling class action lawsuit adds.

“Double Down Casino has been immensely profitable. In 2014, defendant saw revenues of over $240 million from the sales of online chips in its videogames,” Phillips says in the unlawful gambling class action lawsuit.

“However . . . defendant’s Double Down Casino games are nothing more than camouflaged unlawful games of chance,” she explains.

Phillips claims that after she purchased Double Down Casino, she bet and lost more than $1,000 from January 2013 through 2015.

She is seeing to represent a class of Illinois residents “who lost $50 or more to defendant through Double Down Casino.”

The Illinois woman is charging Double Down Interactive with violating the Illinois Loss Recovery Statute and unjust enrichment.

The unlawful gambling class action lawsuit is asking that Double Down pay “the amount of losses suffered by Plaintiff Phillips and each member of the class.”

A similar class action lawsuit was filed on April 10 against Sky Union, LLC, makers of the virtual game Castle Clash, in which players must pay additional money to purchase “gems” in order to make progress in the game. Plaintiffs Jose Soto, Christine Exelby and Tanner Eastman all allege that Castle Clash is also an unlawful game of chance.

The plaintiff is represented by Rafey S. Balabanian, Benjamin H. Richman, Amir C. Missaghi, Courtney C. Booth  of Edelson PC.

The Double Down Casino Unlawful Gambling Class Action Lawsuit is Margo Phillips v. Double Down Interactive LLC, Case No. 2015CH06068, in the Circuit Court of Cook County, Illinois County Department, Chancery Division.