Drake Named In Case Accusing Online Casino Of ‘Deceptive’ Practices

Topline

Rapper Drake, livestreamer Adin Ross and Sweepsteaks Limited, the company that owns the online “social casino” Stake.us, were sued in a class action lawsuit in Missouri that accuses the online platform of circumventing state gambling laws and accuses Drake and Ross of “deeply fraudulent” marketing for the company.

The lawsuit accuses Drake of promoting unlawful gambling in Missouri. (Photo by Simone Joyner/Getty Images for ABA)

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Key Facts

In the lawsuit, plaintiff Justin Killham says he lost money on Stake.us “as a result of Defendants’ wrongful trade practices,” accusing Stake of disguising itself as a “social casino” that does not offer real gambling, as a ploy to evade state laws that prohibit online gambling.

Stake, co-founded by billionaires Ed Craven and Bijan Tehrani in 2017, operates an online gambling website, Stake.com, as well as a separate website for U.S.-based users, Stake.us, that it calls a “social casino” on which users play games using digital coins.

Killham’s lawsuit accuses Stake of bypassing gambling laws on Stake.us by bundling user purchases of “gold coins,” which have no real-world value, with a bonus of “Stake Cash,” which can be gambled and then cashed in for cryptocurrency, which the suit says is a “clear vehicle for real-money gambling.”

The suit accuses Drake and Ross, both of whom have partnerships with Stake, of targeting teenagers with their marketing for the platform and gambling using “house money” Stake provides them, so any losses they might share on social media are “part of a marketing tactic designed to draw attention.”

Drake, who has 142 million followers on Instagram, has already made two posts this week advertising Stake, including one video purporting to show him with a balance of $1 million in his Stake account.

Forbes has reached out to Stake, representatives for Drake and Ross for comment.

Key Background

The “dual-currency” format that some online casinos in the United States use, like Stake’s bundling of gold coins with Stake Cash, has come under increasing scrutiny in recent weeks. Earlier this month, California Gov. Gavin Newsom signed a bill outlawing online sweepstakes casinos that use this dual-currency model and making online games that simulate gambling and may make players eligible for prizes, cash or cash equivalents unlawful. In August, Los Angeles City Attorney Hydee Feldstein Soto filed a lawsuit against Stake.us, making similar allegations to Killham’s Missouri suit. Feldstein Soto accused Stake of creating Stake.us as a “carbon copy of Stake.com” with “virtually the same layout, games, graphics, colors and user interfaces,” while rebranding it as a social casino, to bypass state gambling laws. Feldstein Soto’s lawsuit says the online platform “provides players with the opportunity to exchange their real money for virtual casino chips, gamble those chips, and then convert the winnings back into cash,” adding the platform “looks like gambling, sounds like gambling, and feels like gambling because it is gambling.” Feldstein Soto’s lawsuit named Stake’s billionaire founders, Craven and Tehrani, as co-defendants.

Tangent

Stake garnered attention earlier this year for an apparent advertising push that involved X accounts posting memes and other content with a small Stake logo at the bottom, though it’s unclear whether Stake was behind these posts or paid creators to add the Stake logo to their content. In response to one of a viral post of an adult film actress that included the Stake logo, the United Kingdom’s Gambling Commission launched an investigation into the platform. In February, the commission said gambling company TGP Europe Limited, which partnered with Stake for its United Kingdom operations, would shut down the Stake platform in the country.

Forbes Valuation

Ed Craven and Bijan Tehrani are both worth $2.8 billion, according to Forbes estimates. Stake.com generated $4.7 billion in revenue in 2024, Forbes previously reported. Craven and Tehrani are also founders of Kick, a livestreaming platform they launched as a rival to Twitch.