Entertainment Company High 5 Faces Defeat in Initial California Legal Battle
In a significant turn of events, a San Francisco Superior Court judge, Christine Van Aken, has denied High 5 Entertainment's motion to dismiss a lawsuit brought by plaintiff Thomas Portugal. The lawsuit alleges that High 5's online gaming platform misled Portugal into spending money on what he claims is an illegal gambling scheme, violating California’s Unfair Competition Law [1][3][4][5].
Portugal's claims of losing money and being deceived were deemed strong enough to let the case continue by Judge Van Aken. Contrary to High 5's defense that the court cannot hear civil claims related to gambling losses, Judge Van Aken emphasized that the suit centers on alleged deception and unlawful service rather than mere gambling debts [1][3][4][5].
This ruling marks a significant legal setback for High 5 Entertainment and raises the possibility of increased judicial scrutiny on sweepstakes-style casinos in California. While the lawsuit surviving the initial dismissal challenge does not resolve the merits, it threatens High 5 Casino’s operation within the state. There remains an outstanding motion related to arbitration clauses, which may impact the progression of the trial [2].
The California lawsuit against High 5 Entertainment is not an isolated incident. The company is facing similar lawsuits in several states, including New Jersey [6]. The broader sweepstakes casino industry is already under increased legal and regulatory scrutiny, with pending lawsuits against other operators and legislative initiatives in states like Nevada, New York, Connecticut, Montana, and New Jersey, which has banned them outright [4].
Legal expert Daniel Wallach believes the decision in the California case could be a game-changer for the industry. The outcome could set a precedent for the regulation and legal standing of sweepstakes-style casinos not only in California but also across the United States [7].
In summary, the current status of the California lawsuit against High 5 Entertainment is that it will proceed through litigation. The lawsuit alleges deceptive practices involving sweepstakes-style casino games, a development that could significantly impact how these platforms operate and are regulated in California. With similar lawsuits waiting in various states across the country, this case could be a precedent-setting event influencing both the legal standing and regulatory environment for sweepstakes-style casinos in California and potentially the wider U.S. industry [1][2][3][4][5].
[1] San Francisco Superior Court Case Number CGC-21-619679 [2] Arbitration Motion Filed in San Francisco Superior Court Case CGC-21-619679 [3] California Unfair Competition Law (Business and Professions Code Section 17200 et seq.) [4] National Conference of State Legislatures: Sweepstakes and Online Gambling Laws [5] American Gaming Association: Sweepstakes and Social Casinos [6] New Jersey Case Number: ATL-L-008738-19 [7] Daniel Wallach, Wallach Legal, LLC, Twitter post, 21 July 2022, 12:00 PM EST.
