The City of Los Angeles has filed a civil lawsuit against renowned sweepstakes casino Stake and six game providers, among others, accusing them of jointly operating an illegal gambling business under the guise of a "social casino".
In a historic move, the Los Angeles City Attorney’s Office has filed a sweeping civil lawsuit targeting both Stake.us, the U.S. sweepstakes casino arm of crypto-gambling giant Stake.com, and several of its key gaming suppliers. This unprecedented legal action, lodged in California Superior Court, USA, accuses the defendants of operating an illegal gambling operation under the guise of a legitimate "social casino" and seeks significant sanctions, restitution, and injunctions to halt their activities.
Stake.us is accused of running a de facto unlicensed casino by using a dual-currency system—"Gold Coins" and "Stake Cash"—that mimics real-money betting, misleading consumers by promoting itself as "America’s Social Casino". The lawsuit claims the platform specifically targets California residents, exposing them to addictive gambling environments that falsely appear harmless.
Notably, the suit names major industry players—including Evolution, Pragmatic Play, Hacksaw Gaming, Big Time Gaming, Red Tiger, NetEnt, and identity verification provider Veriff—as alleged accomplices who knowingly enabled and benefited from the illegal operation.
The City Attorney is seeking to "pierce the corporate veil", holding Stake.us executives Ed Craven and Bijan Tehrani personally accountable for the operation. The complaint demands injunctive relief to stop operations and advertising, restitution of player losses, and potentially treble damages under California’s consumer protection laws.
This lawsuit marks the first civil enforcement action by a U.S. government entity—rather than an individual consumer—specifically targeting a sweepstakes casino. Legal experts have underscored its potential to disrupt similar operations nationwide.
Moreover, by naming suppliers and streamers, Los Angeles expands the legal net, holding not only operators but also content and service providers responsible, a tactic that could fundamentally deter supply chain participation in illicit gaming.
The lawsuit comes amid growing regulatory pressure in California. In response, several suppliers—including Evolution and Pragmatic Play—have already withdrawn their games from Stake.us in the state.
Pragmatic Play cited evolving legislation and compliance concerns as reasons for their exit.
Los Angeles’ bold legal challenge targets the heart of undisclosed sweepstakes gambling operations by holding not just operators but their suppliers and founders accountable. With widespread market exits, evolving legislation, and a city setting new enforcement benchmarks, the gambling landscape in California—and perhaps across the U.S.—might be on the cusp of dramatic transformation.
