High 5 Games’ Casino Apps Declared Illegal in Washington State
Two mobile apps offered by High 5 Games have been ruled illegal in Washington after a lengthy legal battle. The Western Washington District Court, presided over by Judge Tiffany Cartwright, found that High 5 Casino and High 5 Vegas constitute online gambling, which runs afoul of state laws.
Definition of Online Gambling
In Washington, online gambling is defined as any activity that requires users to stake value on the outcome of a game of chance or an event with a potential prize. This broad definition has deterred many gaming operators, even social ones, from conducting business in the state. However, despite Washington's stringent gambling laws, High 5 contended that its operations were legal under the premise of being a “social casino,” utilizing virtual coins rather than real money.
High 5’s Defense
High 5 Games argued that their games operate with virtual coins and emulate video slot machines typically found in physical casinos. They emphasized that players could use free coins awarded upon registration and periodically thereafter for gameplay. However, Judge Cartwright determined that High 5’s games were still a form of online gambling, making them illegal in Washington under the Washington Consumer Protection Act and the Recovery of Money Lost at Gambling Act. The court found that promoting additional chip purchases with real money is tantamount to gambling.
Legal Precedent and User Experience
The case initially began six years ago when High 5 Games player Rick Larsen filed the lawsuit. During the proceedings, it was revealed that users could not maintain regular gameplay unless they were willing to pay, challenging the company's claim of social gaming. Moreover, Washington law recognizes virtual currency, such as the coins used in these games, as having a “thing of value,” even if they cannot be redeemed for cash.
In light of the ruling, High 5 Games stated they had made substantial efforts to cease operations in Washington. Judge Cartwright ruled that the company is liable to pay damages to Larsen and other plaintiffs. The exact amount of damages will be determined by a jury.
No Response from High 5 Games
At the time of writing, SBC Americas has not yet received a response from High 5 Games regarding the verdict. This case is part of a broader crackdown on online gambling operations in Washington. A related case involving High 5 Games, Wilson vs. PTT, LLC, remains active but has shown no progress since early 2023.
Judge Robert Lasnik recently ruled that other online gaming companies, including DoubleDown Interactive and IGT, also violated Washington state gambling laws. Similar to High 5’s games, these companies offered games that were free to play but allowed users to pay for additional chips. Consumers would bet to acquire more chips, which they otherwise would have needed to buy, further complicating the legal landscape for online gaming companies operating in the state.
Industry-Wide Implications
This ruling underscores the complexity of categorizing and regulating online gaming apps. Despite claims of operating as social casinos, the practice of incentivizing players to purchase in-game currency using real money is scrutinized heavily under Washington's gambling laws. The decision sets a precedent that could have far-reaching implications for other gaming operators, prompting them to reconsider their business models in jurisdictions with stringent gambling regulations.
Conclusion
The ruling against High 5 Games highlights the challenges faced by online gaming companies in navigating the varied and often rigorous legal frameworks that govern their operations. As gaming technology continues to evolve, so too must the laws and regulations that ensure fair and lawful play. The industry will undoubtedly be watching closely to see how these legal challenges unfold and what adjustments may be necessary to comply with state-specific regulations.
In the meantime, those involved in the gaming industry, particularly in jurisdictions with strict gambling laws such as Washington, should re-evaluate their practices to mitigate legal risks and ensure compliance.
The quote from the court summarized the situation concisely: “The undisputed material facts as to liability show that High 5’s games violate Washington’s gambling laws and the Consumer Protection Act.” This statement reflects the court's firm stance on the issue, reinforcing the need for stringent adherence to the law.