Sweepstakes powerhouse VGW continues to face legal and regulatory in the United States amid pushback against the overall sweepstakes sector. This time, the operator was slammed with a class action lawsuit in Connecticut.
VGW Faces Class Action in Connecticut
VGW received a cease-and-desist letter from the Connecticut Department of Consumer Protection earlier this year and was accused of conducting illegal gambling. Despite asking the sweepstakes casino operator to stop offering its products in February, the department understood that the business had only exited the state a few weeks ago.
VGW, which claims to offer social casino offerings, was described as an unlicensed online gambling operator by the Connecticut authorities. The plaintiff further complained that the gaming company had advertised its products as legal despite the fact that they constituted illegal gaming.
The Connecticut Department of Consumer Protection attached proof of VGW’s advertising activity, showing that the company had spent huge sums on advertising.
The Industry Maintains Its Pressure against Sweepstakes
As mentioned, this isn’t the first time that VGW has faced legal issues in the United States. The company is also embroiled in legal trouble in Georgia where it just scored a minor victory despite the headwinds.
The operator is also dealing with a lawsuit in Tennessee where it recently appealed a court order to remand sweepstakes lawsuits.
In August, VGW was forced to depart from Delaware amid increased pressure against the sweepstakes model.
Sweepstakes operators, for context, claim that their social gaming products do not technically constitute gambling. However, regulators have scrutinized sweepstakes, defining them as illegal gambling regardless.
In a recent industry memo, the American Gaming Association lambasted such companies, saying that the model’s status should be reexamined.
Speaking of which, a recent IGA webinar saw experts discuss the legal ambiguity surrounding sweepstakes gaming. AGA representatives likened sweepstakes to a legal gray zone that contrasts sharply with the regulated gaming environment. The association’s president, Chris Cylke added that gambling regulators and industry stakeholders remain cautious of this growing market.
The AGA and the IGA agreed to collaborate in pursuit of a solution to this problem.
