Zappia, who is a shareholder, is filing the lawsuit on behalf of multiple other investors, bringing a class-action lawsuit against the company. In his complaint, Zappia speaks about being “misled” by the company, including on specific matters that have established a “conflict of interest” and have been perceived as “material omissions.”

Case to Be Viewed ahead of Shareholder Meeting

The trigger is the forthcoming acquisition of GAN’s B2B and B2C divisions for $107.6 million by Sega Sammy, which was pitched last year and will now be decided on during a shareholder meeting on February 13, 2024.

According to Zappia, one of the issues with the negotiations has been a reduction in the tabled offer, which began at $2.51 per share but was finally settled for $1.97, citing the changing nature of business within GAN, and the fact that WynnBet, a North American sports betting operator, had left certain key markets.

Zappia’s case also requests access to several documents that can flesh out further details about the exact negotiations that led to the announcement of the proposed deal on November 7, 2023. Previous discussions had taken place on September 30, 2022, the lawsuit’s text alleges.

Zappia further raises an issue with both the Financing Special Committee and the Merger Special Committee, without enough clarity provided into both to know how the final prices were negotiated and hence the suggested material omissions. The complaint similarly alleges conflicts of interests of board members with the proposed transactions.

GAN Denies Wrongdoing of Any Sort

GAN for its part has already refuted the claims that its current or former members of the Board of Directors have been complicit with underhand practices that have done damage to the business for personal gain. All proceedings surrounding the suggested merger were conducted in line with due process, a SEC filing for GAN says, which details the case.

The Zappia v. Gan ltd. has been filed with the United States District Court for the Southern District of New York in January, as confirmed by the same SEC filing provided by the company. Other defendants named in the case are Seamus McGill, Michael Smurfit, David Goldberg, Susan Bracey, and Eric Green, as per the same filing.

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A new lawsuit, filed by attorneys in Missouri on behalf of seven plaintiffs, seeks to address the gray market for such machines. The plaintiffs argue that they have been hurt by the illegal operations of the thousands of machines that are currently available in the state, and seek damages from the owners of the venues that host them – usually convenience stores that use the machines as a lifeline to plunge gaps and keep going. Some big names have been named in the latest filing.

Missouri Gambling Machines Targeted in New Lawsuit

Legal action against the machines though is something that casino operators would happily back, as they have been trying to shutter the gray market for these machines for many years now. Missouri though has always come short of discussing the issue more broadly in legislation. This is mostly to do because a lot of constituents run businesses that need video lottery terminals or VLTs in order to stay in business. The lawsuit alleges there is a political backchannel between companies and corrupt politicians, too, although not in as many words.

When the pandemic hit, these machines often proved the only way to stay open, many owners argue. And yet, casinos riposte that because of the sector, their own bottom lines had suffered and they had not been able to contribute nearly as much as they could have if the machines had not been allowed to operate in the first place.

The lawsuit names Warrenton Oil Co, an operator of convenience and gas stores, and Torch Electronics, as the defendants. Torch Electronics is an operator of such machines, and it has been assailed by disgruntled parties repeatedly over the past several years. Mally Inc. is another company which runs supermarkets, and a number of other parties that the attorneys argue are responsible for the proliferation of what they insist is an illegal gambling market.

Unfair Practices and Vulnerable Consumers

Torch, however, is not the manufacturer of these machines. That is a company based in North Carolina, called Banilla Games. But the plaintiffs are not just fighting the legality of the sector per se – in fact, they are more interested in what they see as unfair practices by the machines. Wins are usually rounded down to the nearest whole increment, the lawsuit alleges. So, if you were to win $5.99, players would only be paid back $5 instead.

The lawsuit further takes a hit against the entire institution of these machines, arguing that the games are created in a flashy manner that wrongfully suggests that players may in fact win money. Another issue the lawsuit alleges is that there are hardly sufficient consumer protection measures to keep vulnerable people safe.

The lawsuit goes on to allege that “even toddlers” have been seen gambling at machines run by Torch. The suit also goes on to name various political donations the company, and other defendants, made in order to “guarantee” that no legislation moves against them.

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A Southern Nevada casino is now facing a class action lawsuit for allegedly leaving its systems vulnerable and exposing the personal information of hundreds of thousands of customers and employees.

Lack of Timely Notice

Initiated by a California resident who claims his computer was part of a ransomware attack due to the casino security breach, the class action lawsuit accuses the company operating the Rising Star Sports Ranch Resort in Mesquite and The Brook in Seabrook, New Hampshire, of failing to provide the affected with timely and adequate notice, Las Vegas-based 8 News Now reported.

Rancho Mesquite Casino was the victim of a cyberattack in November 2022 during which a hacker accessed sensitive information of more than 200,000 casino customers and company employees, including their full names and social security numbers but it was in December when it sent notices to its clients about the breach.

In a letter sent to those whose personal data was exposed over the course of the several days of the hacker attack and enclosed in the court filing, the company explained that there was “a cybersecurity incident” on November 9 affecting Eureka during which parts of the casino company’s systems “were encrypted by an unauthorized actor.” Eureka Security is an Israeli-based cloud data security provider.

“Upon discovering the incident, we immediately took steps to secure our systems, began an investigation, and a cybersecurity firm was engaged to assist,” wrote the casino company to the affected parties, telling them that “although the investigation is ongoing, we identified certain data that the unauthorized actor accessed during the incident.”

“We began a review of the data and identified that the data included some of your information,” the letter concluded, pointing out that the data exposed to the hacker attack included names and social security numbers. The company also opened a dedicated phone line and offered one year of credit monitoring for those affected.

Negligence and Breach of Contract

The lawsuit accuses the casino operator of negligence, breach of contract and other counts, asking a jury to award monetary damages to the class members for the company’s failure to encrypt their sensitive information, and order the operator to strengthen its cybersecurity defenses.

“Simply put, plaintiff and class members now face substantial risk of out-of-pocket fraud losses such as loans opened in their names, medical services billed in their names, tax return fraud, utility bills opened in their names, credit card fraud, and similar identity theft,” claim the class action lawsuit documents.

The casino operator was repeatedly contacted by the reporting media with a request for comments but did not respond.

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