Fliff Sweepstakes App Facing $5M Class Action Lawsuit in California

Article ByDavid Weir

June 12, 2023

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Posted in: US Gambling News, California Gambling News, US Sports Betting News

Fliff, a “social sportsbook” app that uses virtual sweepstakes coins players can get for free — but can also buy — is being sued by a California customer.

The plaintiff, Bishoy Neshim, says he lost $7,000 using Fliff’s services.

His legal team says that violates various federal and California state gambling laws, including The Wire Act.

The suit says that the app’s coins, “Fliff cash,” have a 1:1 ratio with U.S. Dollars. It also questions why the free-to-play players have no chance of winning the actual sweeps unless they use cash to buy coins.

“That’s the epitome of an online sports book,” complaint documents said.

Fliff is available in 49 states. But users can only withdraw coins for real money in 45 of them, including California.

Related: Our expert and in-depth guide to California gambling law

Alleged Sports Prediction Games

California does not have legal sports betting.

Voters have rejected a legal sports betting market in the state three times in the past 20 years.

In 2022, Proposition 27 saw 83.05% vote against. It was one of the widest public vote defeat margins in state history.

“Fliff facilitates the ability for California residents to make online sports wagers to win real money without any approvals, regulations, oversight, or taxing,” the new lawsuit against Fliff says.

It also argues that having certain features set out to look exactly like a traditional sportsbook — that can only be won by players using coins purchased with real cash — means Fliff does not meet the state’s definition of a sweepstakes where all prizes are awarded by “lot or chance”.

“In the real world, alleged sports prediction games are nothing more than online sports gambling,” documents said.

Wider Fallout

As well as $5 million in damages, the lawsuit is also invoking the federal Interstate Wire Act of 1961.

Under the terms of that agreement, gambling communications between states are illegal.

This lawsuit alleges Fliff is violating that act, meaning it would have to cease offering services across state lines.

Fliff is also under investigation in Ohio. The state’s Casino Control Commission has tightened up ship recently after a string of sports betting controversies. That included launching an investigation into sweepstakes sports book operators, such as Fliff, Prediction Strike, and Dynasty.

Fliff has stopped purchases for Fliff cash in the state since July 1.

The plaintiff in this California lawsuit is seeking a full jury trial.

Historically, lawsuits against gambling operators tend not to go to court if they are not dismissed. Instead, operators prefer out of court settlements, with plausible deniability of lawbreaking.  

Such as the $419 settlement posted in another recent “social” gambling lawsuit against slot maker International Game Technology.

In this case, though, Fliff could face felony charges of unlawful bookmaking under California law, and federal laws are involved. so, the stakes may be higher for prosecutors.

Fliff has until June 28 to respond to the complaint before the case is passed on to the California courts.