Federal Judge Dismisses Lawsuit Against VGW in Montana

A federal judge has put an end to Montana’s legal battle with VGW Holdings, dismissing a lawsuit against the Australian sweepstakes company. For context, VGW no longer operates in the state.

One Less Thing for VGW to Worry About

VGW, which is one of the biggest sweepstakes operators in the US, has been experiencing rapid growth, attracting the ire of state regulators. Amid a broader push against the sweepstakes model, the Australia-based company found itself in hot water in several states.

While VGW has mostly complied with cease-and-desist orders and is no longer available in Montana, a local plaintiff sought damages against the operator. Michael Lighter, who initiated the lawsuit, accused VGW’s dual-currency model had violated Montana’s gaming laws, as well as federal laws on online gambling.

As mentioned, Lighter sought damages, as well as injunctive relief.

On August 16, however, VGW requested the termination of the proceedings. Only three days later, a federal judge filed an order in the US District Court for the District of Montana that granted the request, effectively dismissing the lawsuit without prejudice.

The reason for the dismissal was not made public.

The win in Montana is an important development for VGW, which has been feeling the heat in multiple states due to the United States’ broader pushback against sweepstakes operators. The dismissal certainly means that VGW will have one less thing to worry about.

VGW Entered California’s Tribal Gaming Market

Elsewhere, VGW just signed a groundbreaking partnership with the Kletsel Dehe Wintum Nation of the Cortina Rancheria tribe in California. This alliance with the tribal entity will allow the operator to offer its products in California legally under the authority of the Kletsel Economic Development Authority.

While tribal gaming groups have largely opposed sweeps, the latest partnership suggested that compromise might be possible after all.

More recently, VGW’s shareholders gave the green light to Laurence Escalante’s takeover offer. Escalante, who is the founder and major stakeholder of VGW, has been trying to get hold of the company for a while and recently returned with a new proposal, putting forward some AUD 3.2 billion on the table.

On August 1, shareholders approved the proposal, bringing Escalante closer to his goal.