High 5 Games to Pay $25 Million After Washington Illegal Gambling Lawsuit

A Washington jury has ruled that High 5 Games' online casino-style games violated state gambling laws.

Ziv Chen - News Editor at Covers.com
Ziv Chen • News Editor
Feb 11, 2025 • 13:21 ET • 4 min read
Photo By - Imagn Images.

A Washington jury has ruled that High 5 Games must pay $25 million in a class-action lawsuit tied to its sweepstakes casino business model.

The case was brought forward on the basis that the company's online casino-style games violated state gambling laws. 

The lawsuit challenged how High 5 had structured its sweepstakes casino operations, particularly the practice of selling virtual chips that allowed for continued gameplay without providing any avenue for real-money payouts.

At the root of the case was the idea that High 5 engaged in a revenue model constituting gambling. Plaintiffs contended that while the user could not withdraw real money from their wins, they needed to expend real money to acquire virtual money for continuing games.

Under Washington state law, gambling is defined as risking something of value on a game of chance. The lawsuit maintained that even though the digital chips used in these games held no direct monetary value, they were still valuable to players because they extended the gaming experience. 

Last June, U.S. District Judge Tiffany M. Cartwright agreed with arguments that two of High 5's mobile gaming apps were illegal.

She ruled that the virtual coins players used held value, in accordance with Washington law, even though they can also be obtained for free and have no cash value.

With the ruling, Judge Cartwright agreed with the plaintiffs that had sued High 5, asserting that the High 5 Casino and High 5 Vegas apps were illegal in Washington.

The jury found High 5 liable for its business practices. It awarded $17.7 million in damages and another $7.2 million in enhanced damage claims under Washington's Consumer Protection Act.

Sweepstakes Casinos Remain in the Spotlight

The ruling comes amid a broader wave of litigation against sweepstakes casinos and other digital gaming sites using in-game currency systems. In their complaint, the plaintiffs contended that High 5 benefited from encouraging addictive gambling behavior without being subject to the heavy regulations imposed on traditional gambling operators.

Over the last 10 years, these sites have become lucrative, raking in billions due to the selling of virtual credits. This is because they simulate a gambling experience without technically offering real money prizes.

Despite that distinction, the number of legal challenges is growing, as more lawsuits argue that these games meet the legal definition of gambling. For example, Connecticut is considering banning sweepstakes casinos like High 5 Casino.

Meanwhile, the National Council of Legislators from Gaming States also proposed banning these platforms. 

Courts in Washington and other states already have ruled that casino-style games with in-app purchases can be considered gambling under their respective state laws. High 5 hasn't publicly responded to the outcome of the most recent lawsuit.

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Ziv Chen is an industry news contributor at Covers.com

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