We recently wrote about the flurry of legal issues with the social casino sweepstakes model. Now, the New York State Senate Racing, Gaming, and Wagering Committee passed S5935, a bill that, if fully approved and enacted, would prohibit in NY "online" sweepstakes games that uses a dual-currency system of payment allowing the player to exchange the currency for any prize, award, cash or cash equivalents, or any chance to win any price, award, cash or cash equivalents, and simulates casino-style gaming. The bill also covers other entities including financial institutions, payment processors, geolocation providers, gaming content supplier, platform providers, or media affiliates who support the operation, conduct, or promotion of sweepstakes games within the state of New York.
Since our last post, New Jersey has undergone an apparent shift in legislative approach. It did have a bill (AB 5196) that would regulate social casino sweepstakes, subjecting them to the existing regulatory framework requiring licensing, oversight and taxation. But a new bill (AB 5447) would prohibit them.
On a more positive note, a recent RICO lawsuit against a social casino sweepstakes model, which also named Apple and Google, was dismissed voluntarily by the plaintiff.
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