Law firms Suing Sportzino and Zula Sweepstakes Casinos Declare Victory

Law firms suing operator of Sportzino and Zula sweepstakes casino websites prevailed in contentious jurisdictional battle over location of customer arbitrations.  A DC federal court rejected the operator’s lawsuit to move nearly 1,000 arbitrations from San Diego to Canada.

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Gaming attorney Daniel Wallach writes: "Numerous courts (including several in CA) have found the element of consideration to exist in a casino-themed sweepstakes where there is a close correlation between the amount of money spent and the number of free entries received to play games of chance for real money."

The filed class action suit against Sportzino and Zula Casino Illegal referred to the two sweepstakes casino sites as ‘Gambling Traps’.

According to the 36-page lawsuit, the complaint claims Blazesoft, the company behind Sportzino and Zula Casino, attempts to circumvent real money online gambling restrictions in the state of Illinois by deceptively marketing the platforms as “sweepstakes” casinos—i.e., sites and apps where users can play slots, bingo and other casino-style games without having to wager money.

As part of what is referred to in the suit as "their predatory scheme", Sportzino and Zula Casino offer players two types of virtual currencies—Gold Coins, which are used to play “free” casino games and hold no monetary value, and Sweepstakes Coins, which can be wagered on casino-style games and redeemed for real cash, the case says. Per the suit, Sweeps Coins are valued at roughly a 1:1 ratio with the U.S. dollar.

Although the platforms insist that players can obtain Sweeps Coins for free through various promotions, the only advertised way of accumulating these tokens is to purchase bundled packs of Gold Coins and Sweeps Coins.

“This dual-currency structure effectively converts what appears to be an innocuous gaming platform into an unregulated online casino where players use real money to gamble on games of chance,” the lawsuit charges.

The complaint argues that Blazesoft’s misconduct creates a “dangerously misleading environment” that’s particularly harmful to younger audiences and individuals susceptible to gambling addiction.

“By creating an illusion of risk-free entertainment, Defendants’ platforms manipulate users into participating in activities that carry severe financial and emotional consequences,” the case contends. “Many players are misled into believing they are engaging in harmless gaming, only to find themselves spending significant sums of money chasing Sweeps Coin winnings.”

The lawsuit looks to represent anyone in the United States who has lost money wagering on online casino games offered by Sportzino or Zula Casino.