Stake.us is embroiled in a significant legal controversy as the City Attorney’s Office of Los Angeles has initiated a lawsuit alleging that the platform and its affiliates have violated California’s gambling and advertising statutes.
This lawsuit targets not just Stake, but also its co-founders, Ed Craven and Bijan Tehrani, their streaming associate Kick, top suppliers Evolution and Hacksaw Gaming, as well as 12 other collaborators. Prosecutors assert that the collective was running an illegal online gambling operation, contravening the state’s Unfair Competition Law (UCL) and False Advertising Law (FAL).
This week, LA City Attorney Hydee Feldstein Soto lodged the complaint at the California Superior Court, marking her as the first U.S. official to pursue civil action against an online sweepstakes casino.
The lawsuit demands a permanent injunction to cease Stake.us’s operations within California, compensation for residents who have incurred losses, and civil fines reaching up to $2,500 for each infraction. In cases involving elderly or disabled individuals, penalties can soar to $7,500, potentially exposing Stake to liabilities in the range of hundreds of millions to billions of dollars.
Documentary evidence reveals that Stake.us was created as a «mirror» platform to Stake.com, its international casino and sportsbook that is barred in most U.S. regions. The site employs a dual-currency system where players buy Gold Coins and are awarded bonus Sweeps Coins, redeemable for gift cards or cryptocurrency, which is alleged to conceal real-money gambling under the guise of a sweepstakes.
Alongside Stake, the lawsuit also implicates game providers such as Evolution, NetEnt, Red Tiger, Big Time Gaming, and Hacksaw Gaming. Analysts observe that this action indicates regulators’ readiness to compel accountability not just from operators but also from B2B suppliers who facilitate unlicensed gambling.
This is not Stake.us’s first encounter with legal challenges. The company is already dealing with lawsuits in California, Illinois, and Alabama, where it faces accusations of misleading practices and operating an illegal casino masquerading as a sweepstakes platform.
With illegal gambling estimated to account for a third of the U.S. market, both suppliers and operators are now under increased scrutiny, which may lead to serious financial and reputational repercussions.
