A live performance from Drake, who’s grappling with a RICO lawsuit centering on alleged ‘illegal online gambling platform’ Stake.us. Photo Credit: musicisentropy
Is Drake deceiving consumers – and bankrolling “ongoing music botting campaigns” – by promoting an “illegal online casino” called Stake.us? The plaintiffs in a new racketeering class action believe so, and they’re seeking millions in damages as a result.
Self-proclaimed Stake.us users LaShawnna Ridley and Tiffany Hines just recently submitted the multifaceted RICO complaint to a Virginia federal court. (The involved law firm, Impresa Legal Group, today put out a formal release about the case for good measure.)
However, similar suits (one filed in Missouri) are also in motion, and the Virginia action covers a variety of angles across its 22 detail-oriented pages.
At the top level, the all-encompassing complaint’s defendants list alone extends to at least three continents; Toronto-born Drake, the Cyprus-headquartered company behind Stake.us (Sweepsteaks Ltd.), Boca Raton-born streamer Adin Ross, and New South Wales-based George Nguyen alike are fending off the action.
In the plaintiffs’ words, Stake.us is “one of the largest and most profitable illegal online casinos” in operation, allegedly falsely depicting itself as a “social casino” that deals in virtual currencies as opposed to real money.
But in reality, the casino – which, many are aware, Drake plugs on social media and elsewhere – allegedly emphasizes virtual currencies like Stake Cash in an effort to skirt regulations. Nevertheless, Stake Cash can allegedly “be cashed out at a one-to-one exchange rate for US dollars and thus serves as the currency with which most bets are made.”
“By masking its real money gambling platform as a free and safe ‘social casino,’” the filing parties summed up, “Stake and Defendants create a predatorial gambling environment, deliberately misleading consumers and exposing consumers to the risks of gambling addiction and jeopardizing the financial well-being of consumers and their families.”
(Even when accounting for simultaneous bets, calculating the odds of scoring roulette wins is simple enough; here are Stake-branded clips of Drake hitting on 0, 10, 23, 11, 11 again, and 11 yet again.)
Needless to say, allegedly misleading consumers and separating them from their cash via an unregulated gambling platform is a serious matter. But the RICO suit, which reiterates Drake’s claiming to have “been paid some $100,000,000 per year to promote Stake,” doesn’t end there.
The legal text also takes aim at “Stake’s ‘Tipping’ program – an unlimited and wholly unregulated money transmitter that appears to exist outside the oversight of any financial regulator,” according to the document.
Drake and Ross have allegedly executed sizable on-platform tips (one, from the rapper to the streamer, coming out to $100,000). And said tips ultimately “went, directly or indirectly,” to the aforementioned Nguyen.
That individual allegedly “served as a facilitator and operational broker– alternately converting Stake-based cryptocurrency to cash, or receiving cash from Stake transferred cryptocurrency proceeds.”
And “[f]rom there, Nguyen interfaced with bot vendors, supervised coordinated amplification strategies, and integrated paid ‘clipping’ campaigns” in an effort to further promote Drake and Stake, per the complaint.
This leads to the most interesting part of the lawsuit: Drake’s alleged bot-powered streams on Spotify and different DSPs.
Allegedly tied directly to and enabled by Stake’s tipping function, the alleged artificial streaming campaign was “[a]t the heart of the” purported scheme, the plaintiffs explained.
“In addition, through Stake’s Tipping function, Defendants have financed their combined artificial streaming (‘botting’) to create fraudulent streams of Drake’s music; fabricate popularity; disparage competitors and music label executives; distort recommendation algorithms; and distribute financing for all of the foregoing, while concealing the flow of funds,” one relevant section reads.
“At the heart of the scheme, Drake – acting directly and through willing and knowledgeable co-conspirators – has deployed automated bots and streaming farms to artificially inflate play counts of his music across major platforms, such as Spotify,” another paragraph elaborates.
All told, the plaintiffs are seeking relief for three claims: One concerning an alleged racketeering enterprise, the next pertaining to an alleged RICO conspiracy, and the third involving the Virginia Consumer Protection Act. DMN reached out to Stake for comment but didn’t immediately receive a response.
