CSGO Lotto wins motion to dismiss its class-action lawsuit

A class-action lawsuit against third-party Counter-Strike: Global Offensive skin gambling site CSGO Lotto appears to have been been dealt a major blow, after the court overseeing the case ruled that it wouldn’t go federal.

The ruling, which was given by the Washington Western District Court on Oct. 4, states that the plaintiffs were arguing that gambling site CSGO Lotto and one of its owners, Trevor “TmarTn” Martin, had engaged in fraudulent activity so egregious that it violated the Racketeer Influenced and Corrupt Organizations Act (RICO). Martin, who is also a part-owner of successful esports team EnVyUs, frequently promoted CSGO Lotto to his massive YouTube following without disclosing that he had an ownership role at the site, leading to community uproar against Martin and CSGO Lotto.

In the proceedings, however, the defendants argued that “plaintiffs who enter into transactions knowing that there are a wide range of possible outcomes cannot state a RICO claim when they receive less than favorable outcomes within that range.” The court sided with the defendants, and ruled out a RICO standing as it did not consider gambling losses “sufficient injury to ‘business or property.’”

Additionally, the plaintiffs’ second option of taking the case federal via the Class Action Fairness Act (CAFA) also proved to be unsuccessful. In a post on the CS:GO subreddit, esports attorney Bryce Blum offered the following explanation.“In order to get federal jurisdiction through CAFA, the matter in controversy has to exceed $5,000,000. While plaintiffs provided facts about the economics of skin betting and Valve’s CSGO revenue, they did not assert an actual damages figure an instead relied on ‘common sense’ arguments that the amount of damages exceeded $5,000,000,” Blum concludes this section by simply writing “The court didn’t buy these arguments.”

Despite this outcome, it doesn’t mean the class-action suit itself has been dismissed and the plaintiffs are free to appeal the Washington Western District Court’s ruling.