What Sweepstakes Casinos Are
Sweepstakes casinos are apps and websites that offer slot- and casino-style games using virtual currencies, marketed as legal “free-to-play” sweepstakes rather than gambling. Typically they use a dual-currency system: a “fun” coin you can play for free, and a second “sweeps” coin you can obtain by buying coin packages (or by mail-in request) and later redeem for cash prizes. Operators argue this structure keeps them outside gambling law. A wave of lawsuits contends the opposite: that paying for coins to win cash-redeemable prizes is, in substance, illegal online gambling dressed up as a sweepstakes.
The model has grown rapidly and now operates in a legal gray zone that regulators and courts are actively testing.
The Litigation and Bans
In 2025, more than a hundred class-action lawsuits were filed nationwide against sweepstakes-casino operators — including companies behind well-known apps — with a striking cluster in Utah, where gambling is entirely illegal and state law lets people who lose money to illegal gambling recover double their losses plus fees. The suits generally seek to recover players’ losses and to have the games declared illegal gambling. In parallel, several states passed laws explicitly banning sweepstakes casinos, and attorneys general in states like New York and Louisiana sent cease-and-desist orders to operators. Some companies have exited certain states.
This is fast-moving, unsettled litigation; courts have not uniformly resolved whether these games are illegal, and outcomes vary by state law.
What Consumers Should Know
If you have spent money on a sweepstakes-casino app, know that the legality varies sharply by state and is being litigated; keep records of your purchases and losses in case a claim in your state applies. Treat these apps like gambling regardless of the ‘free-to-play’ label: set strict limits, never chase losses, and be aware that consumer protections and dispute options are limited in a legal gray area. If gambling is affecting your life, confidential help is available through problem-gambling hotlines.
Before You Act
Thinking About Filing a Claim?
Most plaintiff lawyers offer a free initial consultation and work on contingency, meaning no fee unless there is a recovery. LawsuitWatch is not a law firm: we publish explainers, and we do not provide legal advice, representation or referrals. Your state bar directory is the reliable place to find and verify a lawyer.
Sweepstakes Casino Lawsuit: The Illegal-Gambling Class Actions: Frequently Asked Questions
Answers to the most common questions about this case and your legal options.
What is a sweepstakes casino lawsuit about?
The lawsuits allege that 'free-to-play' sweepstakes casino apps — which let players buy virtual coins and redeem 'sweeps' coins for cash prizes — are illegal online gambling in disguise, and seek to recover players' losses and have the games declared illegal.
How many sweepstakes casino lawsuits are there?
More than a hundred class actions were filed nationwide in 2025, with a large cluster in Utah, where gambling is illegal and state law lets people recover double their losses plus fees. Several states also passed bans and sent cease-and-desist orders.
Are sweepstakes casinos legal?
It varies sharply by state and is actively being litigated; courts have not uniformly resolved it, and several states have banned them. Treat these apps like gambling, set limits, and seek problem-gambling help if needed.
Legal Disclaimer
This article is general legal information, not legal advice, and does not create an attorney-client relationship. Case status, eligibility criteria, and any amounts described are as reported at the date shown and may change. Consult a licensed attorney in your jurisdiction about your own situation.