Consumer Protection – No Gambling Loss Recovery for ‘Virtual Casino’ Play

Mason v. Machine Zone Inc. (Lawyers Weekly No. 001-061-17, 10 pp.) (Keenan, J.) No. 15-2469, March 17, 2017; USDC at Baltimore, Md. (Bredar, J.) 4th Cir.

Holding: A plaintiff who, while playing Game of War on her mobile device, used “virtual chips” purchased with real money to spin a “virtual” casino wheel in order to win virtual gold or other virtual resources to use while playing the game, does not state a claim under the Maryland Gambling Loss Recovery Statute because she did not lose money; the 4th Circuit affirms dismissal of her claim.

Game of War

Plaintiff began playing Game of War on her mobile device in early 2014. After using complimentary virtual chips for a chance to win a virtual prize at the Game of War casino, she began purchasing virtual gold in order to obtain more chips to continue interacting with the casino function. Between early 2014 and January 2014, plaintiff paid over $100 to participate in the virtual casino.

In seeking damages under the Loss Recovery Statute, plaintiff alleged she lost money playing an unlawful “gaming device,” namely, the Game of War casino, and sought full disgorgement and restitution of any money defendant Machine Zone has won from plaintiff and from other Maryland residents who have lost money playing in the virtual casino.

The district court dismissed plaintiff’s claim, concluding plaintiff did not state a claim under the Loss Recovery Statute because “she did not lose money” in the virtual casino. The court also rejected plaintiff’s claims under the California Penal Code, the California Unfair Competition law and the theory of unjust enrichment. She appeals only dismissal of the Maryland claim.

On appeal, plaintiff maintains she lost money in the virtual casino because, after paying money to “spin” the virtual wheel, she “won” prizes that were worth less than the amount of money she spent to spin the wheel. She says she is entitled to recover the difference between the amount of money she paid to spin the virtual wheel and the monetary value of the virtual prizes she won. We disagree.

Gaming Device

We assume, without deciding, that the virtual casino is a prohibited “gaming device.” We agree with the district court that plaintiff did not “lose money” when participating in the virtual casino and that therefore, she failed to satisfy a required element for stating a claim under the Loss Recovery Statute.

If plaintiff received in the virtual casino “resources” of lesser “value” than virtual gold, as she claims she did, Machine Zone did not win money as a result. Nor did Machine Zone lose money if plaintiff “spun” the virtual wheel and received any particular prize. Indeed, Machine Zone retained the money that plaintiff paid to obtain virtual gold regardless of the outcome of plaintiff’s spin of the virtual wheel.

Instead of losing money in the virtual casino, plaintiff paid money to obtain virtual gold, which she later used to accrue virtual chips, all while playing Game of War on her mobile device. When she participated in the virtual casino, plaintiff used only virtual chips, which are not redeemable for money. Thus, when plaintiff “spun” the virtual wheel, there was no money at stake; she only could receive either virtual gold or other virtual resources, neither of which were money.

Based on the manner in which the Game of War casino operates, plaintiff could not have lost or won money as a result of her participation in that virtual activity. We also reject plaintiff’s contention that the existence of a secondary market shows that she lost money as a result of her participation in the virtual casino.

Judgment affirmed.