Online gambling has experienced a surge in popularity in recent years, mainly due to the diligent collaboration between online casinos and local regulators. This partnership has been instrumental in establishing robust and workable legal frameworks. A vital aspect of this collaboration was the definition of 'gambling' and its application to the igaming industry.

 Lawsuit Challenges Social Casino Legitimacy

A social casino player in Georgia has filed a class action lawsuit that could challenge these established definitions.

The plaintiff, Destiny Kennedy, claims that free-to-play game developer Virtual Gaming Worlds and their parent company, VGW Holdings Limited, owe her a full refund for the money she spent at their social online casinos.

Kennedy’s position is that the company operates its mobile and online casino sites illegally in the state of Georgia, saying:

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 “VGW proactively defrauds Georgia citizens because VGW advertises that its operations are legitimate and legal when, in reality, VGW knowingly and wilfully operates what constitutes an illegal gambling enterprise.”

Her legal team is quoting a 2012 amendment to the Georgian legislature prohibiting "internet cafes" from providing "casino-style gambling games”. They claim that the extended definition of this amendment makes it illegal to offer games of chance on a computer, regardless of whether those devices are in a place of business or someone’s personal property.

 Why Legal Terms and Definitions Matter 

Social casinos are growing in popularity with players around the world. In some cases, this is because local regulations do not allow for real-money casino gambling, and in others, it is because people enjoy playing casino games for fun.

Cases such as this one could become problematic for social casinos in the US should they come before a sympathetic judge who is looking to challenge existing gambling laws. However, should the judge in this case look to uphold the current gambling act, Kennedy's case could be dismissed as baseless due to the specific wording of the amendment on which they are building their case.

This means that in their claim that VGW provides “casino-style gambling games”, they will only be able to satisfy that they offer “casino-style games”. Without a direct link between wagering money and withdrawing money, their games do not qualify as “gambling”.

 ‘Casino’ Does Not Mean ‘Gambling’

VGW casino games align with the local laws for social and sweepstake casinos. While players can spend money on additional tokens and XP boosters, there is no way to win real money. While there is a long-winded way to exchange certain types of tokens for real-world prizes, there is no direct correlation between depositing, wagering, and withdrawing, as we see in real money casinos.

What many people outside of the industry get wrong is that they conflate casino-style games with the term 'gambling'. To qualify as gambling, there needs to be a tangible risk of money, with the expectation of a financial reward should one win the game.

A growing number of video games allow players to enjoy casino-themed games without any cost per game or expectation of winning real money. Recent examples like Balatro (a poker-themed roguelike), Luck Be a Landlord (a slot-based life sim), and Monopoly Poker (where you win chips in Monopoly to use at a fun poker table), have garnered tens of thousands of players and provide casino-style gaming in a non-gambling setting.