Two of the online gaming industry’s most prominent suppliers, Evolution and Pragmatic Play, have pulled their games from Stake.us, following a civil lawsuit filed by the City of Los Angeles. The legal complaint accuses Stake.us — the U.S. offshoot of crypto-gaming giant Stake.com — of running an illegal gambling operation disguised as a social casino.
The lawsuit names over 20 entities, including several of Evolution’s studios such as NetEnt, Red Tiger, Big Time Gaming, and Nolimit City. Prosecutors allege these suppliers knowingly enabled Stake.us to offer slot-style games to California residents, despite lacking proper licensing.
This marks the first civil enforcement action against a sweepstakes casino in the U.S., signaling a major shift in how regulators approach unlicensed online gambling — by targeting content providers rather than just operators.
Legal and Legislative Pressure Builds
The lawsuit coincides with Assembly Bill 831, which seeks to criminalize sweepstakes casinos and penalize companies offering software, marketing, or games to such platforms. The bill, led by Assemblymember Avelino Valencia, has advanced through the Senate Appropriations Committee and now awaits a full Senate vote.
If passed, AB 831 could impose fines up to $25,000, misdemeanor charges, and even jail time for violators. The California Nations Indian Gaming Association (CNIGA) backs the bill, but opposition has emerged from smaller tribal groups who argue it could threaten their limited gaming revenues.
Stake Pushes Back, Defending Business Model
Despite growing legal scrutiny, Stake.us maintains that it operates within legal bounds through a dual-currency system. Users can buy “Gold Coins” for entertainment and receive “Sweeps Coins” or “Stake Cash,” which can be exchanged for gift cards or cryptocurrency — a model it claims exempts it from gambling laws.
However, officials argue the platform mirrors Stake.com’s real-money casino experience, including its games and design, creating an environment that blurs the line between entertainment and gambling.
“We have not been served at this time,” a Stake spokesperson said, adding, “We reject allegations that have been made in the media in relation to this potential claim and will vigorously defend this and all such claims.”
Streaming Platform Kick Also Under Scrutiny
The lawsuit also names Kick, a livestreaming platform tied to Stake’s founders Ed Craven and Bijan Tehrani, for allegedly promoting Stake.us through sponsored content. Prosecutors say Kick’s role went beyond passive broadcasting, making it an active participant in the alleged unlawful enterprise.
A Potential Industry Turning Point
With major developers now distancing themselves from Stake.us, analysts say suppliers may scale back involvement in sweepstakes partnerships due to rising liability concerns. This mirrors similar regulatory action in Europe, where Evolution was forced to limit access to its games over licensing issues.
For Los Angeles City Attorney Hydee Feldstein Soto, who is leading the case with law firm Susman Godfrey LLP, the goal is clear: shut down Stake.us in California, seek restitution for residents, and set a precedent other jurisdictions may follow.
As California — one of the largest markets in the U.S. — moves toward stricter enforcement, this case could reshape the sweepstakes casino landscape nationwide.
Source:
“Major providers pull games from Stake.us amid LA suit”, sigma.world, Sep 2, 2025
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