A pivotal lawsuit in Germany aimed at reimbursing gambling losses has been referred to the European Court of Justice (ECJ). The Federal Court of Justice of Germany (BGH) was initially scheduled to decide on whether unregulated operators should refund player losses earlier this month. However, this hearing was canceled after the defendant, an Austria-based sports betting operator, withdrew its appeal.

Last week, a regional court decision on player reimbursement lawsuits mandated that all German civil courts, including the BGH, must either suspend proceedings or submit them for review. This action, spearheaded by the German law firm Hambach & Hambach, ensures that online sports betting and casino issues related to EU law will now be heard by the ECJ. The European court will ultimately make the final ruling on these cases.

The BGH has faced criticism for its perceived reluctance to refer cases to the ECJ. During a March ruling on a sports betting case, the BGH neither suspended nor submitted a referral, which some saw as a hesitation to seek an overarching EU law decision. This could have led to ongoing legal confusion without a decisive EU court ruling until regional courts intervened.

Potential Precedent of Reimbursement Rulings

Claus Hambach, partner at Hambach & Hambach, along with senior associate Phillip Beumer, cautioned that a decision to reimburse players could establish a problematic precedent in Germany.

“Mass media reports have already picked up on the above note by the Federal Court of Justice,” stated Hambach & Hambach. “According to representatives of the ‘player claim industry’, this might now result in a deluge of complaints and court cases.”

They warned that such an outcome could be driven by significant advertising and media coverage, indicating that financiers appear ready to continue backing these claims, potentially extending to sports betting losses, not just casino losses.

Hambach & Hambach expressed concern that reimbursing players might inadvertently bolster the black market. “Germany’s massive black market will even grow further. If players are reimbursed for losses with unlicensed operators, this will only incentivise them to bet with unlicensed operators as the case law basically established betting without a risk of loss.”

Challenges with the Black Market in Germany

A 2023 study by the University of Leipzig highlighted the prevalence of offshore operators in Germany’s online gambling market, revealing that nearly half of all online gambling occurs with these unlicensed entities. The channelisation rate in Germany’s online gambling space stands at just 50.7%, with the study estimating that the black market accounts for three-quarters of online revenue. This situation results in the state missing out on hundreds of millions in tax revenue.

In response, both the German Online Casino Association (DOCV) and the German Sports Betting Association (DSWV) have urged the German gambling regulator (GGL) to make onshore operators more attractive to bettors. By improving the appeal of regulated platforms, these associations hope to draw players away from the black market and ensure that gambling activities contribute to the national economy.

As this lawsuit progresses to the European Court of Justice, its outcome could significantly impact the regulatory landscape for online gambling in Germany and potentially across the European Union. The final decision by the ECJ will be crucial in shaping the future of player reimbursements and the fight against the black market in the gambling industry.

Source: “Germany loss reimbursements lawsuit to be sent to European court”. iGamingBusiness. May 20, 2024.

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The Netherlands’ Minister for Legal Protection, Franc Weerwind, has been urged to back a universal loss limit to the country’s Remote Gambling Act (KOA). Backed by the ChristianUnie (CU) Party, the measure seeks to make up for the deficiencies of the current safer gambling rules.

The proposal would introduce a universal loss limit across the 27 online gambling licensees in the Netherlands. This measure, according to the CU, is needed because the current rules have failed to prevent excessive online gambling.

The universal loss limit will apply across all operators in the country, preventing players from going to play with another operator once they hit the limit.

Mirjam Bikker, leader of the CU, emphasized that the measure has already secured majority support from many parties in the country, including the Christian Democratic Appeal, Conservative Reform Party, Dutch Socialist Party and Green Alliance.

The proposal was submitted to Weerwind who is currently responsible for the ongoing reform of the KOA.

Weerwind Says Such a Measure Would Be Difficult to Implement

Weerwind recently addressed the matter, confirming that he has received the CU’s request. However, the Minister for Legal Protection said that he doesn’t plan to advance the proposal to ministers.

According to Weerwind, a universal limit will be both time-consuming and too complicated to properly implement. Weerwind added that he believes lawmakers should instead concentrate on already existing proposals as the vote looms.

For reference, the minister previously proposed compulsory financial risk checks on player accounts that spend more than €350 a month. Approved by the Ministry of Justice, his proposals also include a €150 non-universal loss limit for customers under the age of 24.

However, the CU pointed out that, since there are 27 legal operators in the Netherlands, young people can still go to another operator once they hit the monthly €150 limit. As a result, they can still spend all their money on gambling.

Representatives of the CU and CDA critiqued Weerwind’s reluctance to tackle gambling addiction head-on and introduce the necessary measures to protect Dutch consumers. The latter party previously argued that the KOA has failed to protect local players from harm and must therefore be abolished.

In the meantime, the Netherlands continues its efforts to protect the safety of local gamblers. To that end, the country recently banned untargeted gambling advertisements, hoping to mitigate some of the damage.

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The booming popularity of weight loss drugs is making an impact on unexpected sectors, with the casino and gaming industry finding itself on shaky ground. 

Weight Loss Drug Market Set to Soar to $77B

Shaun Kelley, an analyst at Bank of America, highlighted the potential correlation between obesity and problem gambling. Studies indicate that a considerable portion of casino revenue, estimated between 10% to 30%, comes from customers displaying problematic betting patterns, some of whom are also struggling with obesity. If these individuals turn to weight loss drugs, it could create a 0-4% revenue headwind for the US commercial gaming sector, particularly affecting slot machines and regional gaming establishments.

The implications would extend beyond casinos. Traditional food and beverage producers like Walmart, as well as fast-food chains such as McDonald’s and Taco Bell, might face challenges as consumers, influenced by these drugs, shift towards healthier dietary choices. Conversely, athletic apparel brands like Deckers and Lululemon could see a boost as consumers prioritize healthier lifestyles, redirecting savings from reduced food consumption into fitness-related expenses.

Mark Purcell, a biopharmaceuticals analyst at Morgan Stanley, noted that analysts are predicting the weight-loss drug market to grow exponentially, with revenue in the segment expected to reach $77 billion by 2030.

How Weight Loss Drugs Could Reshape Multiple Industries

Amidst these changes, gaming giants like Boyd Gaming, Caesars Entertainment, MGM Resorts International, Penn Entertainment, and Red Rock Resorts find themselves at the center of attention. MGM and Caesars, the largest operators on the Las Vegas Strip, might benefit as weight loss encourages more people to travel. However, regional operators like Boyd Gaming and Penn Entertainment, which have a significant presence in Nevada, could face challenges due to the shift towards healthier living.

The casino industry is not the only one under scrutiny. Airlines, especially those like United Airlines, could experience significant savings if passengers shed weight. United Airlines could potentially save $80 million annually with a mere 10-pound weight loss per passenger, reducing overall fuel consumption. Analysts suggest that this trend might be acknowledged by other major airlines like Delta Air Lines, American Airlines, Southwest Airlines, JetBlue Airways, and Spirit Airlines.

As the weight loss drug phenomenon continues to reshape consumer behavior, industries across the board are bracing themselves for a new reality, with the gaming and casino sector at the forefront of this unexpected transformation. Only time will reveal the true extent of the impact on these businesses as consumers navigate a landscape altered by healthier choices and changing habits.

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The company, which specializes in the development, licensure and operations of online gaming and e-commerce platforms, has offered an in-depth look at its performance. Although revenue over the period hit a record $11.3 million, the results were marred by the reported loss.

Golden Matrix Not Worried about Temporary Slowdown

Regardless, the company has been enjoying a steadfast upward trajectory leaving its first nine-month revenue for the fiscal 2023 year up 22% to $32.4 million, ahead of the $26.5 million posted in the same period a year earlier. Golden Matrix CEO Brian Goodman welcomed the results and commented on the performance, adding that the year has been good for Golden Matrix, and so has the quarter.

“The Company achieved record revenues and posted its seventh consecutive quarter with positive cash flow from operations,” Goodman said. He addressed the issue of the company’s net loss of $965,628 which he said was driven by several factors, including the recent acquisition of MeridianBet Group, which incurred due diligence and legal expenses.

The company also attributed part of its loss to the rollout of the Mexplay brand and the associated marketing costs. Mexplay is Golden Matrix’s B2C online casino brand that launched in Mexico earlier this year.

“We have made important investments during the quarter in systems and people to accelerate the growth of our B2C segments, both RKings and Mexplay,” Goodman explained.

However, these are all just temporary setbacks, as the company is now planning to drive significant results as the synergies should finally kick in and introduce new opportunities for the group, which are also expected to reflect positively on its future financial performance.

“Closing of the MeridianBet acquisition will be a watershed event which is expected to catapult Golden Matrix into the global gaming markets as a highly competitive participant,” Goodman said confidently.

Mexplay Already Showing a Lot of Promise

The company is already seeking some interesting developments that make it optimistic about the future of its operations. For one, Mexplay has already achieved 32,800 registered consumers as of July 31, 2028. The total wagering volume in the third quality with Mexplay hit $5.8 million, and total deposits amounted to $476,000.

Not least, RKingsCompetitions Ltd, another group property, completed 1,212 competitions and gave away more than $12 million in various prizes during the first nine months of the fiscal year.

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Excessive smoking and alcohol consumption impact millions of American adults and even teens. While getting hooked on nicotine or booze is worrying, people who get addicted easily can consume food excessively or engage in gambling, making such abuses just as worse as alcohol and smoking. Amid such concerns, modern medicine continues to actively seek and test drugs that can help people quit smoking, consume alcohol or even help with combatting addiction to gambling and food.

One drug, called Ozempic, has helped millions of Americans lose weight. However, unconfirmed online reports suggest that the drug also helped others get off drinking, stop smoking and even helped fight gambling addiction. An estimated of 50 million Americans have already seen the benefit of the aforementioned drug when it comes to weight loss, a report released by DailyMail reveals.

But what is Ozempic and what does it do? Ozempic is a prescribable diabetes drug that consists of semaglutide, its active ingredient. The injectable drug is known to have positive results when it comes to weight loss with diabetics but some anecdotal reports also claim that it can be beneficial when treating addictions to food, alcohol and even gambling.

A discussion posted on Reddit earlier this year tells the story of a person that was addicted to Adderall, as well as gambling. The person claimed that once he started taking Ozempic, they immediately saw how “stupid” gambling is and significantly decreased the intake of Adderall which stemmed from surgery. “Almost immediately the thought of gambling seemed so obviously stupid – not just dumb financially but a waste of time. It actually seemed boring to me for the first time ever,” wrote the person who claimed that Ozempic worked “almost like a literal miracle.”

Evidence about the Effectiveness of Semaglutide against Addiction Is Insufficient

The Harvard psychiatrist who explores the connection between metabolism and mental health, Dr Chris Palmer, explained: “The exact same brain circuits that are regulating our food intake are also playing a role in our addictive behaviors.” He said that actions or substances that are related to survival and reproduction result in a dopamine award and this is precisely what addictive substances can trigger as well. According to Dr. Palmer, substances that can trigger this dopamine reward system can be considered addictive and those can include food, alcohol, nicotine or even foods with lots of fat or sugars.

While there are other unconfirmed reports and claims about the miracle benefits of semaglutide when it comes to combatting addiction, hard evidence and trials with humans are insufficient. Without any doubt, people affected by problem gambling or addicted to smoking or alcohol need to first consult with an expert rather than taking prescription drugs that may have unexpected long-term effects on their health.

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The global gaming community is in shock as news broke of the unexpected passing of Tony Santo, the visionary CEO and director of Gateway Casinos & Entertainment. 

Gateway Casinos Bids Farewell to CEO Tony Santo

Gateway Casinos & Entertainment, a prominent player in the gaming arena, confirmed the heartbreaking news. Tolek Strukoff, president of Gateway, expressed deep sorrow, saying: “It is with great sadness that we announce the passing of Tony Santo. You could often find Tony visiting sites and staff from dawn to dusk connecting about their work, families, and lives. Tony was an iconic leader in the US and Canada and grew Gateway from a small regional gaming company to one of the largest gaming companies in Canada.  However, Tony would say himself he didn’t do it – we did it together.”

Santo’s journey with Gateway commenced in 2013 when he took the reins as president and CEO, leaving an indelible mark on the company’s trajectory. By 2017, he had become a pivotal figure on the company’s board. The extent of Santo’s influence was far beyond the boardroom. He was known for his hands-on approach, frequently immersing himself in the operations and connecting with staff at all levels

A graduate of the University of Nevada, Las Vegas, Santo’s expertise spanned the hospitality and gaming sectors. His leadership roles in Las Vegas earned him a reputation as an industry luminary. He eventually moved north to Canada, propelling Gateway to its present stature.

Santo announced his retirement plans in December 2019, only for the pandemic to indefinitely postpone his departure. Undeterred, he remained at the helm, guiding the company through unprecedented challenges.

Gateway Overcomes Ransomware Setback, Focuses on Data Security

Gateway, which employs around 7,000 individuals and operates thousands of slot machines and table games, faced a significant setback earlier this year due to a ransomware attack. The incident prompted a temporary closure of its Ontario casinos, raising concerns about data security. Though the company assured no guest information was compromised, the personal details of select employees were possibly accessed. A week after the attack Gateway initiated a phased reopening of its properties. 

With the incident’s aftermath, Gateway undertook a comprehensive restoration of its IT systems with support from cybersecurity experts. The breach, while unsettling, reinforced the company’s commitment to safeguarding its employees’ information. In other news, Gateway Casinos & Entertainment joined forces with Ontario Lottery and Gaming Corporation (OLG) in an affiliate marketing deal. Gateway customers in Ontario gained easy access to OLG’s iGaming and online sports betting, improving player experiences while maintaining responsible gambling practices.

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Last month, the government-owned gambling operator located in Norway announced that it had raised close to $24 million for good causes from January to April thanks to its Grassroots Share (Grasrotandelen) program. The latter directs 7% of all bets made by gamblers toward charity organizations picked by players themselves. In September 2022, the operator announced it will no longer advertise its sports betting services on television. 

Now, Norsk Tipping has announced a new policy upgrade that proves its commitment to responsible gaming and safe gambling policies. The operator has upgraded its loss limits aimed at players aged 20 and under to a maximum of NOK 2,000 ($181).

Players Under 20s, Deemed “More Vulnerable” Than Older Players  

Mentioning statistics originating from the University of Bergen and the Helpline for gambling addicts, the company’s director of responsibility and communication, Tonje Sagstuen, spoke about the higher incidence of gambling issues among younger customers compared to other age groups. 

By association, the same players are also prone to make bad choices when gambling. The company also explained that, at the moment, it counted approximately 30,000 active players who are under the age of 20. Of them, roughly 2,000 lost over NOK 2,000 ($181) during a month on at least one occasion over the course of the past 12 months.

Up until now, Norsk Tipping had a loss limit of NOK 20,000 ($1,819) per month for players of all ages. Now, according to the fresh decision, starting June 1 onwards, the smaller limit loss for players under 20 will come into effect.

While the operator which is backed by the Norwegian state preserves its 18 and above age limit for players, the fact that younger customers are subject to higher risks of harm related to gambling has convinced Norsk Tipping to make the important changes.

Following Suit

The operator’s choice for stricter gambling loss limits comes as a result of similar measures embraced by other large betting brands in Europe as a way of improving their player protection frameworks.

One example is the new €1,000 ($1,076) monthly deposit limit regulation introduced by Germany in 2021. Belgium opted for an even more restrictive limit of €200 ($215) per month for deposits in 2022. 

The imminent United Kingdom’s Gambling Act review White Paper also mentioned a monthly loss limit proposal of £125 ($156) along with a yearly £500 ($626) limit within a year prior to players being subject to specific affordability checks.

Also, according to the same proposal, the higher the spending levels, the larger the number of checkups are going to be, with suggested thresholds of £1,000 ($1,252) within a 24-hour timeframe and double the amount within three months’ time. 

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The famous horse trainer Bob Baffert was deeply conflicted after one of his horses was euthanized, while another one won the Preakness Stakes, all on the same day. Speaking with the Associated Press, Baffert noted that this day perfectly reflected the twists and turns of the sport.

National Treasure Won the Preakness Stakes

The horse that won the event was none other than National Treasure. Its participation in the event came right after Baffert’s two-year suspension expired. The trainer was originally suspended after the 2021 Kentucky Derby when one of his horses, Medina Spirit, tested positive for an anti-inflammatory drug that is not allowed during race days.

National Treasure won the Preakness Stakes on Saturday, effectively trampling Mage’s chance for a Triple Crown. The victory at the $1.65 million race marked a record-breaking eighth Preakness victory for Baffert.

National Treasure’s victory marked the first Preakness race victory for its jockey, John Velazquez. The rider praised the horse for its outstanding performance.

The champion horse paid $7.80 to win, $4 to place and $2.60 to show. The favorite to win the race was the Kentucky Derby champion Mage, which ended up finishing third.

The Passing of Havnameltdown Upset the Trainer

While National Treasure’s win certainly made Baffert proud, the prior death of another horse saddened the trainer.

Baffert’s Havnameltdown, a three-year-old colt, injured his left front leg in an undercard race just a few hours before the Preakness Stakes. As a result of its injury, the young horse had to be euthanized, much to Baffert’s dismay.

The trainer revealed that he felt pained seeing the horse get hurt. Because of that, he couldn’t properly enjoy National Treasure’s victory.

The only silver lining is that Luis Saez, Havnameltdown’s jockey, did not seem badly hurt. While he was immediately rushed to a hospital, the X-rays failed to detect a serious injury.

Baffert couldn’t take Havnameltdown out of his head all day, saying that the incident has really affected them.

Luckily, US horse racing deaths are at their lowest level since they started being tracked back in 2009. However, a string of recent incidents has once again highlighted the dangers of the sport and the need to do more to prevent on-track deaths.

As a result, new medication and doping rules will be introduced next Monday, with horseracing authorities hoping to make a change.

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Online gaming and sports betting operator Rush Street Interactive, Inc. (RSI) published its financial report for the fourth quarter of 2022 and the full year ended December 31, 2022, posting revenue increases of 27% and 21%, respectively.

Strong Revenue Growth

RSI generated in the last business quarter of 2022 revenue of $165.5 million to contribute to a full-year 2022 revenue of $592.2 million. For comparison, in Q4 2021 the Chicago-based gaming company registered revenue of $130.6 million, while for the full year, it amounted to $488.1 million.

Commenting on the results, Richard Schwartz, chief executive officer of RSI, outlined that the strong quarter and record results for the year were driven by a growth of 95% in RSI’s Latin American and new North American markets the company had launched operations after 2020.

Net Loss, Negative Adjusted EBITDA

The company’s net loss in Q4 2022 was $31.1 million, registering a decrease of 18.4% from $38.1 million in the fourth quarter of 2021. Quarterly adjusted EBITDA was a loss of $17.3 million, down 44.6% from the adjusted EBITDA loss of $31.2 million in Q4 2021.

For the full year, net loss significantly increased to reach $134.4 million, up 88.9% from $71.1 million in the year prior. Consequently, full-year adjusted EBITDA came at negative $91.8 million to register an increase of 41% from $65.1 million in 2021.

“We expect to achieve positive Adjusted EBITDA for the second half of 2023 and continue to be selective as we prioritize investments in markets with higher returns,” Schwartz said.

2023 Revenue Guidance

RSI used the report to initiate revenue guidance for the full year 2023, expecting to achieve revenue of between $630 million and $700 million, based on certain assumptions, including professional and college sports calendars remaining intact, the company maintaining operations in all jurisdictions it operates now, and that results from new jurisdiction launches are excluded.

“Looking forward, we will continue to focus on earning and retaining customer loyalty, by treating them well, being thoughtful, developing seamless experiences and reducing friction at every possible point. We have built our proprietary platform and culture around a disciplined operating philosophy, which is reflected in our results,” Schwartz concluded in his comments.

Other Financial Highlights

RSI noted that its adjusted advertising and promotions expenses in the fourth quarter marginally dropped to $63.2 million, as compared to $64 million in the respective quarter of 2021, while for the full year, there was an increase of 16.9% to $218.4 million ($186.9 million in 2021).

The number of real-money monthly active users increased proportionally in the quarter and the year: 22% in Q4 and 29% in full-year 2022, allowing RSI to register average revenue per monthly active user of $327 in the fourth quarter and $315 during the year. The full-year result is down 9% year-over-year.  

At the end of the reported period, December 31, 2022, RSI’s cash balance stood at $180 million of unrestricted cash and cash equivalents.

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