A Kentucky gambler who claims to have lost “thousands of dollars” on Bovada is attempting a class action lawsuit against the owners of the illegal offshore sportsbook and casino.
The suit alleges they presented Bovada as a “legitimate online business” in the state.
Billi Jo Woods’ action was filed in the U.S. District Court for the Eastern District of Kentucky against Morris Mohawk Group, Alwynn Morris, Calvin Ayre, and Harp Media BV, whose sites offer sports betting, casino, and poker games beyond the regulation of state laws.
Retail and mobile sports betting in Kentucky was legalized on March 31. But retail sportsbooks won’t open until Sept. 7, with mobile and online sports wagering set to launch Sept. 28. There are two retail casinos in Kentucky. Online casino gambling is not legal.
Woods alleges that Bovada has “illegally profited from tens of thousands of consumers” in Kentucky, while admitting participation in this enterprise since this year.
1800s Law is Basis for Suit, but Beat Offshore Sites Before
The proposed suit seeks to include all Kentucky residents who gambled and lost $5 within a 24-hour period on the Bovada sites. It alleges there is at least $5 million involved.
Gambling industry experts say there has never been a successful suit and collection from an offshore gambling site by an individual.
But Woods’ suit cites the Kentucky Loss Recovery Act, which was the fulcrum of a successful suit by the Commonwealth’s Justice and Public Safety Cabinet against PokerStars just two years ago. The state eventually prevailed against the Isle of Man-based website as parent company Flutter Entertainment agreed to a settlement.
“These lawsuits are not especially common; however, the most successful of these lawsuits was in Kentucky, recently,” John Holden, an assistant professor at the Spears School of Business at Oklahoma State University told Gaming Today. “The Commonwealth successfully used the same statute to sue the owners of PokerStars and won nearly $300,000,000 which was then trebled.
“Though, after years of appeals the state settled for about $300 million.”
While Flutter was possibly incentivized to settle, Bovada is not. Flutter is also the parent company of national sports betting market leader FanDuel, which has applied to offer legal sports bets in Kentucky. Illegal offshore websites won’t be doing that.
How Does A Class Action Suit Start?
A proposed class action suit must fulfill the following criteria before being considered for approval by a judge, according to the Federal Rule of Civil Procedure, Rule 23:
- The class is so numerous that the joinder of all members is impracticable;
Illegal Offshore Sites Beyond Reach Despite Concern
Reigning in the reach of illegal offshore gambling sites has been newsy recently, with members of Congress petitioning the Department of Justice in 2022 to act. Regulators from seven states did the same with US Attorney General this year and the NFL asking for a crackdown this summer.
An American Gaming Association report claims that the unregulated gambling sector absorbs $510.9 billion yearly, denying states where gambling is legal $13.3 billion in tax revenue.
Suits against illegal offshore sites by unsuccessful gamblers continue to arise, but federal laws cannot reach these sites, which are often based in the Caribbean. This is why the mantra of the legal American gambling lobby has been ‘buyer beware,’ in the hopes that gamblers will choose not to patronize sites that are beyond their state’s regulation and quality control.
In April, British Columbia resident Victor Janicki filed a lawsuit claiming he was denied a $220,550 jackpot from a blackjack side bet he’d made while playing at a site based in Costa Rica.
Baird Fogel, co-head of the Global Sports Practice at Eversheds Sutherland, said Woods faces an “uphill battle.”