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Read Full BioSweepstakes casino operators are facing 21 new lawsuits in Alabama as residents attempt to recover losses on the platforms. The total number of legal cases against companies is now over 40, surpassing that of any other state.
The latest round of lawsuits was highlighted by sports betting and gaming lawyer Daniel Wallach. One lawsuit against Heuston Gaming cites Alabama law, which allows any person to bring a case to recover money lost in gambling.
Ala. Code § 8-1-150 states that a gambler can recover losses by filing a lawsuit within six months of losing money. If they do not take this opportunity, then any other person can sue the operator. Notably, if successful, any funds recovered will go to the plaintiff who files the lawsuit and not the gambler who lost the money.
Strict Alabama Gambling Laws Fail to Stop Sweeps
Alabama has some of the strictest laws against gambling in the country. It is one of the few states that has no state lottery. Additionally, it has no commercial casinos or sports betting.
Sweepstakes casinos offer users the chance to play casino-style games online, which the lawsuits argue violates Alabama’s laws governing gambling. Last year, a batch of 13 lawsuits filed against operators, including Stake, VGW, and High 5, did not persuade companies to exit the state.
The only major operator to withdraw from Alabama was B-Two, the company behind McLuck, Hello Millions, SpinBlitz, and PlayFame. However, the sites soon relaunched as cases in the state, and neighboring Georgia have been unable to secure legal victories.
Lawsuits: Sweepstakes Casinos are Illegal Gambling Platforms
Those filing lawsuits claim that the primary operations of the companies are to offer casino-style gambling. Users can play the games constantly rather than only during promotional periods.
Additionally, previous lawsuits have cited the fact that the payout for the games coincides with the industry standard for casino-style slot machines, at around 92%. They claim this proves that the primary purpose of the businesses is to offer gambling.
Operators argue that because users can play for free and earn Sweeps Coins through promotions, this makes the game fair and legal. Stake, for example, stated that it “does not operate an online casino in Alabama. It operates a social casino with free-to-play games in compliance with all relevant local laws and regulations.”
As the lawsuits against operators increase, Wallach says, “It may only be a matter of time before the Alabama Attorney General gets involved.”
Alabama May Relax Gambling Laws Soon
In the meantime, Alabama is considering relaxing its strict gambling laws. While efforts to expand legal gaming options have failed over the last two years, Rep. Phillip Ensler has indicated that he would push for gambling legislation if elected as lieutenant governor.
Ensler said that the state is losing out on hundreds of millions of dollars by not having a lottery. However, even if he is elected, he would not assume office until 2027, meaning it is unlikely much will change in Alabama’s gambling laws this year.
As lawmakers debate expanding gambling options, sweepstakes casinos and prediction markets continue to operate. A definitive ruling in one of the many lawsuits against sweepstakes operators could be pivotal in deciding the fate of other companies in the state.
Many other states passed legislation last year specifically outlawing sweepstakes casinos, while several attorneys general took action against companies. Iowa is the latest state to introduce a bill targeting the legal loophole that has allowed the industry to thrive. There appear to be no immediate plans to do the same in Alabama, but those filing lawsuits argue the law already forbids the platforms.
