A Georgia resident has launched a class action lawsuit against Virtual Gaming Worlds (VGW) and its subsidiary companies, claiming they are operating illegal online gambling websites within the state. The lawsuit, initiated by Destiny Kennedy, targets VGW Holdings Limited and its subsidiaries, VGW Malta Limited, VGW Luckyland Inc., and VGW GP Limited, for allegedly violating Georgia’s gambling laws by running internet gambling platforms such as Chumba Casino, Global Poker, and LuckyLand Slots.

VGW Falsely Marketing Online Gaming Platforms as ‘Just for Fun’

Kennedy’s complaint, filed in the Georgia Northern District Court on May 17, 2024, asserts that VGW’s activities breach the Georgia Code stipulations. She argues that the company falsely markets its platforms as “just for fun gameplay,” misleading users into believing that the sites are legal and purely for entertainment, according to information published by Top Class Actions. 

However, Kennedy claims that the real purpose of these sites is to facilitate illegal gambling, as users wager and lose real money through a dual-currency system involving Sweeps Coins and Gold Coins.

Kennedy’s legal action seeks to represent a broader class of Georgia residents who have lost money on VGW’s platforms. Kennedy reports a personal loss of approximately $1,150 from playing games on the implicated websites. The lawsuit demands monetary compensation for these losses and requests a jury trial to address the grievances of all affected consumers in Georgia.

VGW’s model, which includes both free-to-play currency and a purchasable Sweeps Coins system that can be redeemed for cash, is at the core of the allegations. Kennedy argues that while the sites allow for gameplay without real money, the primary goal is to encourage users to buy Sweeps Coins, thus disguising the gambling aspect under a veneer of legality. 

Kennedy Opted Out of VGW’s Arbitration Agreement

The case also highlights Kennedy’s proactive stance in opting out of VGW’s arbitration agreement, which typically redirects disputes to private arbitration rather than court trials. This move distinguishes her case from similar lawsuits that have been compelled to arbitration due to the terms agreed upon by users.

VGW has a history of legal challenges in the United States, having previously settled a lawsuit in Kentucky for over $11 million concerning its LuckyLand brand. The outcome of the current lawsuit in Georgia could have significant implications for VGW’s operations in states where online gambling remains heavily regulated or prohibited.

Last year, VGW also had to withdraw from the Michigan market, discontinuing its social gaming brands Chumba Casino, Global Poker, and Luckyland Slots, after facing regulatory pressure. 

As the Georgia case proceeds, VGW has yet to respond to the allegations. 

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Prominent social casino operator Virtual Gaming Worlds (VGW) has announced its decision to pull out of the Michigan market. The move follows a series of regulatory crackdowns on unlicensed gambling operations, ultimately forcing VGW to discontinue its popular social gaming brands, including Chumba Casino, Global Poker, and Luckyland Slots, in Michigan.

Social Casinos Thrive Despite Regulatory Challenges

Social casinos, a growing trend in states where real-money online casinos are not yet legalized, offer players a similar gaming experience without dealing in actual US dollars. Instead, these platforms use their own digital currencies, providing players with the opportunity to win genuine prizes. Despite the absence of real money transactions, the allure of tangible rewards has attracted a substantial user base to these platforms.

VGW’s official statement regarding its withdrawal from Michigan read: “VGW continually evaluates their business operations in the interests of all their stakeholders, and after careful consideration, they have decided to take this course of action.”

VGW’s decision comes in the wake of an order by Michigan Attorney General Dana Nessel, who directed Golden Hearts Games to halt its operations in the state after a thorough two-year investigation. The move reflects the state’s commitment to cracking down on unlicensed gambling establishments, emphasizing the importance of consumer protection and adherence to gaming laws.

Michigan Players Race Against Clock as VGW Ends Social Casino Funding Options

Players in Michigan have until November 1 to purchase digital currencies on VGW’s platforms. After this date, funding options will cease, leaving players with existing balances the opportunity to utilize them until December 1. Furthermore, players have until February 1, 2024, to redeem any available prizes on the sites. VGW has assured players that their personal data will be handled in accordance with the company’s privacy policy, emphasizing their commitment to data protection and privacy.

This unexpected exit from the Michigan market highlights the rapidly changing landscape of online gambling in the United States. While social casinos have provided a viable alternative in states without legalized online gambling, the growing trend toward regulation and legalization of real-money online casinos raises concerns about the future of these platforms.

As more states consider legalizing online gambling, social casinos, once considered a secure option, face increasing uncertainty. Meanwhile, in June, Michigan’s licensed iGaming and online sports betting operators generated a total revenue of $169.3 million, experiencing an 8.9% decrease due to a significant drop in sports betting caused by the absence of major sporting events, leading to a 21% decrease in handle.

Despite the decline, online casinos earned $151 million, and online sports betting brought in $18.3 million. Michigan has 15 legal online gambling and sports betting operators, and the Michigan Gaming Control Board anticipates receiving nearly $51 million in funding for 2024 to support its regulatory efforts.

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