Washington state class action takes aim at online casino

Gamble Stack

“Free to play” games are all the rage in online gaming.

It’s a relatively recent development perfectly suited to our “always on” media and entertainment environment. Game developers realized that there were great profits to be made through selling small items or extra benefits within the context of a game – extra lives for the player’s avatar, access to new levels of play or special items that enhance the gaming experience – charging for the extra benefits but without ever charging for the game itself. Hence the term free-to-play, even if the quality of the play is enhanced by the additional expenses.

In a new class action complaint filed in the Western District of Washington, plaintiff Sean Wilson speculates that this model is profitable because, while games are often addictive in and of themselves, the add-on items present their own separate brand of addictive allure. Free-to-play games offer two addictive experiences for the price of one.

Wilson is suing Huuuge Inc., an online gaming company founded in 2014, over its … dare we say it … hugely successful Huuuge Casino gaming app, which he claims is built on this two-for-one-addiction model (although in Huuuge’s defense, it claims to want only “to give maximum joy and fun to players all across the globe”).

Wilson’s central complaint is that Huuuge offers “free chips” to its new players to play on the casino’s slot games. These chips, Wilson claims, are “inevitably” lost by the players, who are then offered deals to purchase more chips – $4.99 for 100 million is one package deal offered to first-time purchasers. Since the player is encouraged to purchase more chips to continue playing, and because the winners are selected randomly, Wilson maintains that Huuuge’s online slots are a gambling enterprise under Washington state law – and therefore illegal. He alleges that the chips, though worthless on their own, represent “something of value” since they are needed to play the game.

Huuuge is accused of violations of Washington state law, including its consumer protection act, and unjust enrichment. The suit seeks damages on behalf of the class and an injunction from the court to end the alleged illegal conduct.

The Takeaway

A lot of popular online games today use in-app purchases as a revenue driver, and many are starting to see pushback against this practice. Three other online gaming companies saw similar class actions (although all three were led by the same law firm) in the state of Washington. These cases could have major implications for the casual games market and we will continue to monitor their progress.