Amazon has agreed to settle a proposed class action lawsuit that could allow U.S. consumers to pursue more than $200 million in damages from third-party developers of social casino applications, marking another significant legal development in the growing scrutiny of the online social gaming industry.
The proposed settlement, filed on Thursday in the U.S. District Court for the Western District of Washington in Seattle, requires approval from a federal judge before it can take effect.
The lawsuit, originally filed in 2023, accused Amazon of violating Washington state’s gambling laws and consumer protection statute by facilitating payments for social casino applications distributed through the Amazon Appstore. The plaintiffs alleged that Amazon acted as an intermediary by processing in-app purchases for casino-style games that they argue constituted illegal gambling under Washington law.
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Although the settlement creates a pathway for consumers to seek substantial compensation, it does not require Amazon to make any direct payment to class members. Instead, Amazon has agreed to the entry of a $201 million judgment against the company and will assign to the plaintiff class its legal rights to seek reimbursement from the third-party developers responsible for the social casino applications.
Under the proposed agreement, class members would agree not to enforce or collect the judgment against Amazon itself. Instead, they would pursue recovery from the app developers through the legal rights transferred by Amazon.
The structure effectively shifts the financial burden from the technology platform to the companies that created and operated the casino-style applications.
Amazon has denied any wrongdoing.
The settlement represents the latest stage in a broader series of lawsuits targeting the social casino industry. Unlike traditional online gambling platforms, social casino games generally allow users to play casino-style games such as slot machines or poker using virtual currency rather than cash winnings.
However, critics argue that the games encourage users to purchase additional virtual chips or credits through repeated in-app transactions, creating gambling-like behavior without offering cash prizes.
Washington has some of the strictest gambling laws in the United States, and previous court decisions have held that virtual chips purchased in certain social casino games may constitute “things of value” under state law. That legal interpretation has provided the basis for numerous lawsuits against social casino operators and the technology companies that distribute their applications.
Attorneys representing the plaintiffs described the proposed settlement with Amazon as another milestone in their broader legal campaign against the industry. According to court filings, previous settlements reached with social casino developers have already returned more than $650 million to consumers in Washington and elsewhere across the United States.
“The class is poised to recover a significant portion of their total losses that keeps pace with the settlements achieved against the social casino developers,” the plaintiffs’ lawyers said in court documents.
The proposed $201 million covenant judgment represents approximately 30% of the total amount spent by class members on purchases made within the social casino applications. According to the plaintiffs, the amount was calculated using transaction records that Amazon produced during the litigation, detailing in-app purchases made through the Amazon Appstore.
Any funds ultimately recovered from the developers would be distributed among eligible class members.
The case marks a fresh episode of the increasing legal scrutiny facing major technology platforms over their role in distributing third-party applications and processing digital payments.
Although Amazon is seeking to resolve its involvement in the litigation, similar lawsuits remain active against several of the world’s largest technology companies.
Parallel cases are pending against Apple, Google, and Meta, all of which have denied any wrongdoing. Those lawsuits raise similar allegations that technology companies facilitated transactions involving social casino applications that allegedly violated gambling laws.
The Amazon settlement does not establish liability because the company continues to deny the allegations. Instead, it represents a legal mechanism allowing consumers to pursue claims directly against the developers while ending Amazon’s participation in the litigation.
The case, Steven Horn v. Amazon.com Inc., is being heard in the U.S. District Court for the Western District of Washington under case number 2:23-cv-01727-RSL.
The plaintiff is represented by attorneys Todd Logan of Edelson and Cecily Jordan of Tousley Brain Stephens.
If approved by the court, the agreement would add another significant chapter to the ongoing wave of litigation surrounding social casino games, an area where plaintiffs have already secured hundreds of millions of dollars in settlements from developers and continue to pursue claims against some of the technology industry’s biggest companies.