Independence man suing Stake, Drake over ‘illegal online casino’ in Missouri
An Independence man has filed a lawsuit against the company that runs the website Stake.us, accusing the group of operating an unlicensed and illegal online casino in Missouri.
The lawsuit also names celebrities Drake and Adin Ross as defendants for their efforts as influencers promoting the site to their millions of fans.
The lawsuit was filed in Jackson County Circuit Court on Monday by attorneys for plaintiff Justin Killham, who they said had lost money gambling on the website in recent months as a result of its “wrongful trade practices.” Killham is seeking damages, a court order against the website and to proceed with a class action lawsuit.
The website, which pitches itself as a “social casino,” is operated by Sweepsteaks Limited, which the lawsuit said is based in Cyprus. Stake was founded by billionaires Ed Craven and Bijan Tehrani in 2017, according to Forbes.
Representatives for Stake, Drake and Ross did not respond to requests for comment Friday.
Stake.us uses a dual-currency system designed to obscure the fact that players are gambling with real money, attorneys for Killham wrote, saying the site’s “Stake Cash” is a “clear vehicle” for real-money betting.
Players use two forms of virtual currency on the website: gold coins, which have no monetary value, and Stake Cash, which can be redeemed for real money at a 1:1 exchange rate, the lawsuit said. To keep playing, users acquire Stake Cash by buying coin bundles that contain both the gold coins and the Stake Cash, and players receive a nearly equivalent amount of Stake Cash for every dollar spent on coin bundles, the lawsuit said.
“Stake characterizes these transactions as primarily Gold Coin purchases with Stake Cash supposedly included as a ‘free’ bonus,” the lawsuit said. “However, the pricing structure makes it clear that players are actually paying for Stake Cash.”
Users can then wager their Stake Cash on virtual casino-style games like roulette and slots, the lawsuit said. At the top of every game on the platform are toggles that allow players to switch between wagering the non-monetary coins and Stake Cash, it said.
Many players, attorneys wrote, “are misled into believing they are engaging in harmless gaming, only to find themselves spending significant sums of money chasing Stake Cash winnings."
“Stake’s platform uses celebratory animations, sound effects, and other psychological triggers (hallmarks of traditional slot machines) to keep players engaged and spending,” the lawsuit said. “This manipulation disproportionately affects vulnerable populations, including individuals susceptible to gambling addiction, who may not recognize the financial stakes until they have already suffered significant losses.”
Attorneys noted that in April, the Missouri Gaming Commission issued a warning about online casinos, which are illegal in the state.
“It is important to remember that just because you can download the app, visit the website, and play the games, it does not mean it is a legitimate and legal gaming platform,” the commission wrote in a news release.
The lawsuit decried online influencers like Drake and Ross who post videos of themselves gambling on the Stake platform and said they were liable for violating Missouri law. Attorneys called Drake an “unofficial mascot” for Stake, a role they said was “quietly corrosive.”
According to the lawsuit, Drake was “glamorizing the platform to millions of impressionable fans, many of whom treat his wild betting habits like gospel. What makes it even more unsettling is that Stake apparently fronts Drake and Ross ‘house money,’ so any reported losses are part of a marketing tactic designed to draw attention. Stake’s influencer marketing, especially through Drake and Ross, is directed among others at teenagers in Missouri and in other states.”
