"On March 29, 2018, the United States Court of Appeals for the Ninth Circuit published a decision in Kater v. Churchill Downs (Big Fish Casino). The civil case was brought by a former Big Fish Casino customer who claimed she had lost more than $1,000 in virtual chips on the site. The Court of Appeals' decision reverses an earlier dismissal by the United States District Court for the Western District. In short, the Ninth Circuit panel found that the use of virtual casino chips within Big Fish Casino's games constitutes gambling under Washington law. Specifically, the panel held that virtual chips (which may be purchased or won) extend the privilege of playing Big Fish Casino and are a 'thing of value,' which led them to conclude that Big Fish Casino constitutes illegal gambling under Washington law. The case has been remanded back to the U.S. District Court to allow the civil lawsuit to proceed. The defendant, Churchill Downs, also has the right to appeal the Ninth Circuit panel's decision. It is important to note that the case could continue for another two or three years.
"As a result of the Court of Appeals' decision, some online social gaming platforms have made the business decision to no longer allow Washington residents access to their sites. We continue to receive communications from angry customers holding the Washington State Gambling Commission responsible for their discontinued service. We are not a party to the civil court case, we did not testify in the case, and we did not order these sites to discontinue free online play for Washington residents. Customers with concerns should contact these websites directly."