【75k weekly raffle stake winners】Stake.us hit with new lawsuit in Illinois over alleged illegal gambling

The complaint, filed by Illinois resident Brayden Urdan on behalf of himself and similarly situated individuals, accuses Stake.us of operating “an unlicensed and illegal online casino” while allegedly misleading users into believing the platform offers only casual, risk-free gameplay.

This follows a similar class action filed against the company in California last month, and comes on the heels of a major legal victory for Edelson PC, the law firm now representing Urdan.

Just last month, Edelson secured a $25m class action win in Washington against High 5 Games, over its social casino business model.

The Illinois complaint alleges that Stake.us “is a virtual clone of Stake.com, rebranded to mislead regulators and consumers into believing it offers harmless gameplay instead of unlawful gambling.”

Stake.com is a crypto-based gambling platform, which is not legally available in most US states.

“Vehicle for real-money gambling”

Similar to the California class action, at the heart of the complaint is Stake’s dual-currency system.

Users purchase “Gold Coins” for casual gameplay and receive “Stake Cash” as a bonus.

“Unlike Gold Coins, Stake Cash can be wagered on casino games and cashed out for real money at a fixed 1:1 ratio to the US Dollar exposing Stake Cash as a clear vehicle for real-money gambling,” the complaint states.

The complaint further alleges that players can acquire limited free Stake Cash through occasional promotions, such as receiving a single Stake Cash per day as a Daily Login Bonus or five Stake Cash by completing a cumbersome mail-in request.

“But these methods are deliberately obscure, impractical, and insufficient for regular gameplay,” the complaint alleges.

“Ultimately, once a promotional Stake Cash is exhausted, the only viable way to continue gambling is to purchase additional Stake Cash.”

“To obtain more Stake Cash, players must buy coin bundles containing both Gold Coins and Stake Cash,” it continues.

“Defendant characterises these transactions as primarily Gold Coin purchases with Stake Cash supposedly included as a free bonus. However, the pricing structure makes it clear that players are actually paying for Stake Cash.”

Although the company advertises that “no purchase is necessary” to obtain Stake Cash, the complaint claims such statements are “highly misleading.”

It further alleges that by offering Stake Cash as a wagerable, cash-equivalent token, Stake.us operates as an unlicensed online casino in direct violation of Illinois gambling laws.

Under Illinois law, gambling must take place in licensed, physical venues overseen by the Illinois Gaming Board.

The complaint also notes that Stake fails to provide any of the basic consumer protections required of licensed gambling operators, such as mechanisms for responsible gambling or addiction support resources.

Marketing tactics

The complaint further accuses Stake of aggressive marketing tactics aimed at vulnerable users, particularly younger consumers.

“By showcasing popular influencers achieving substantial wins, Stake strategically employs social proof and aspirational marketing to give the misleading impression that large payouts are common,” the complaint reads, “enticing users to shift from casual play into real-money gambling with Stake Cash.”

Plaintiff Brayden Urdan says he began playing on Stake.us in August 2022 and has since lost more than $15,000, with $10,000 of the losses sustained in the last six months alone.

He claims that after notifying the company of the issue on 31 March, Stake responded on 3 April by cutting off his access to the platform.

Seeking relief

The complaint demands restitution for financial losses, statutory damages, and injunctive relief to halt Stake’s alleged unlawful operations in Illinois.

Gaming attorney Daniel Wallach, a vocal critic of sweepstake casinos, told NEXT.io: “There’s a good reason why Illinois is referred to as the gambling class action lawsuit capital of the United States.

“It has a very favourable ‘loss-recovery’ statute that allows for the recovery of treble damages, conditioned only on the ‘loser’ not filing suit within six months.

“Since very few people who’ve suffered gambling losses ever sue the gambling operator – much less within six months – this quickly opens the door to a representative class action lawsuit for treble damages,” he explained.

This latest case adds to a growing wave of legal scrutiny targeting social casinos that use virtual currencies in a way that courts are increasingly willing to interpret as gambling.

In the High 5 Games case, a Washington jury ruled that even non-cashable virtual chips can qualify as “something of value” under state law — a precedent that could have broad implications for the sector.

Noting that the Illinois case was brought by the same law firm, Wallach said: “This is the firm’s first foray into sweepstakes casino litigation, and they chose this one as their first case, which should tell you something.

“They’ve wisely identified several vulnerabilities in Stake’s business model, most notably the nearly 1:1 correlation between real money spent and ‘Stake Cash’ received, which suggests that the primary purpose of the transaction is to acquire ‘Stake Cash,’ not Gold Coins,” Wallach added.

Stake.us has not yet publicly responded to the Illinois complaint. NEXT.iohas reached out to the company for comment.