**Summary Statements**
In a significant development for the digital gaming industry, two mobile apps offered by High 5 Games have been ruled illegal in Washington. Western Washington District Court Judge Tiffany Cartwright found that High 5 Casino and High 5 Vegas constitute online gambling, which is prohibited in the state.
**The Legal Landscape**
Washington classifies online gambling as any activity where users stake value on the outcome of a game of chance or an event with a prize on offer for a certain outcome. Given this stringent definition, many gaming operators, including social ones, often avoid operating in Washington to sidestep legal complications.
**Virtual Coins vs. Real Money**
High 5 contended that their games operate with virtual coins and are thus a “social casino.” Despite this defense, the court found that High 5’s games emulate video slot machines typically used for gambling in physical casinos. Judge Cartwright determined that High 5’s games are prohibited under the Washington Consumer Protection Act and the Recovery of Money Lost at Gambling Act.
The verdict comes six years after Rick Larsen, a High 5 Games player, first filed the suit. Larsen argued that the apps promoted illegal gambling by requiring players to purchase additional chips using real money. In response, High 5 claimed that players could use free coins given upon registration and periodically awarded. However, the court found that users cannot play regularly unless they are willing to pay.
**Virtual Currency as “Thing of Value”**
In a key point of the ruling, Washington law recognizes virtual currency as a “thing of value” even if it cannot be redeemed for cash. Therefore, the use of virtual coins in High 5’s apps was classified as a form of gambling.
High 5 Games stated that they have made efforts to cease operating in Washington following the ruling. However, Judge Cartwright ruled that the company is liable to pay damages to Larsen and other plaintiffs. The amount of damages will be determined by a jury in due course.
**Ongoing Legal Battles**
SBC Americas has yet to receive a response from High 5 Games regarding the verdict. Meanwhile, a separate case involving High 5 Games, Wilson vs. PTT, LLC, is still active but has seen no progress since early 2023.
This case isn’t isolated; Judge Robert Lasnik previously ruled that online gaming companies DoubleDown Interactive and IGT also violated Washington state gambling laws. The games offered by these companies are free to play, but users can pay for additional chips. Consumers bet to acquire more chips, which they otherwise would need to buy, thus falling under the scope of illegal gambling according to state law.
**Significance for the Gaming Industry**
The ruling against High 5 Games serves as a stark warning for other gaming operators who may be operating in a legal gray area. The distinction between "social gaming" and "gambling" can often be nebulous, but Washington state's stringent gambling laws leave little room for ambiguity. As digital gaming continues to evolve, legal scrutiny is likely to increase, compelling operators to rigorously adhere to state laws or face severe repercussions.
**Quotes**
On the case, Judge Cartwright remarked, “The undisputed material facts as to liability show that High 5’s games violate Washington’s gambling laws and the Consumer Protection Act.” This statement underscores the court's firm stance on the issue, leaving little doubt about the legal standing of such gaming operations in Washington state.
This latest ruling adds another chapter to the ongoing debate about the nature of online and mobile gaming. As courts continue to weigh in on these issues, the gaming industry will need to closely watch these developments to better navigate the complex legal landscape.