The sports prediction game operator, Fliff, finds itself in the crosshairs of a class action lawsuit in the state of California. A claim has been put forward, seeking a whopping $5 million in damages. The case was presented to the US District Court for the Central District of California on June 6.
Pursuing Reimbursement for Monetary Damages
The complainant, Bishoy Neshim, alleges that his losses exceeded $7,000 while using the app, accusing Fliff of operating as a gambling entity. He demands reimbursement for his financial losses and those suffered by others who stand affected by Fliff’s alleged unlawful sports betting operation. In a bid to halt Fliff’s purported violations of the federal Wire Act by offering cross-border contests, the lawsuit seeks an injunction.
Legally, sportsbooks are not sanctioned in California. This follows an electoral decision against the legalization of sports betting in November 2022. The proposition that would have legalized retail sports betting at tribal casinos and horse racing tracks, as well as a measure to legalize online and mobile betting, failed to gain majority vote.
The lawsuit asserts that “Fliff enables California residents to place online sports bets with the potential to win real money, absent any regulatory approvals, oversight, or taxation”. It goes on to say that Fliff claims to be a ‘free-to-play’ sweepstakes operator, offering the chance to play ‘sports prediction games’ for entertainment. However, the lawsuit contends that these so-called sports prediction games, in essence, represent nothing more than online sports betting.”
The complaint also expounds on Fliff’s methodology. Instead of actual cash, the operator uses a surrogate known as “Fliff cash”. This ersatz currency ostensibly has a one-for-one equivalent value to real cash and can be withdrawn directly into the users’ bank accounts.
The complainant argues that Fliff fails to meet the state’s definition of a “sweepstakes”, as its rewards are not allocated by lot or by chance. Instead, it appears to use the sweepstakes model to lure customers with complimentary “Fliff Coins”, before enticing them to deposit US dollars and convert these into Fliff cash.
Regulatory Scrutiny in Ohio
Headquartered in Pennsylvania and with a development hub in Bulgaria, the operator that is accessible in 45 US states, Fliff was among five operators that attracted the attention of regulators in Ohio. This occurred after an inquiry by the Ohio Casino Control Commission (OCCC) in May.
The OCCC raised concerns that these operators were offering markets that mimic conventional prop type bets. The outcome for players appeared to depend on their point totals resembling a spread.
As the California complaint unfolds, the court is anticipated to listen to arguments from both sides in the upcoming weeks and months. If Fliff is found guilty of illegal bookmaking under California’s legislation, the operator could potentially face a felony charge.
