High 5 Games loses class action lawsuit; ordered to pay $25m

High 5 Games has been ordered to pay $24.9m in damages to players in Washington state. 

The verdict is the result of a lawsuit that alleged the company operated illegal gambling games and follows a court ruling from 2024 that found its social casino model breached Washington state gambling laws.

This is the first class action verdict against an online social casino operator and follows other settlements in the industry with payouts exceeding $650m.

Social casinos offer digital slot machines and casino games in exchange for virtual chips players buy with real money.

The lawsuit argued that although these virtual chips had no cash value, they functioned as real chips because players were required to buy more to continue. The court found in favor of the lawsuit, which sets a new legal precedent in Washington state.

High 5 Games’ customers in Washington lost nearly $18m, and the jury awarded an additional $7m in statutory damages. Key evidence during the trial indicated High 5 Games targeted high-spending users and offered a user struggling with a gambling addiction incentives to continue playing.

This verdict is the latest in a series of settlements in similar cases in which social casinos have been forced to pay out $650m to players who lost money in their games. Unlike the other cases, High 5 Games chose to take the case to court rather than settling.

Big Tech companies such as Amazon, Meta, Google, and Apple could be investigated next. The plaintiffs’ attorneys argue that they act as financial intermediaries that process payments and take a percentage from each transaction. Todd Logan, a partner at Edelson PC, the firm representing the plaintiffs, suggested Big tech is cashing in on the market and this verdict is just the beginning.