A German court has suspended two cases of players seeking to recover gambling losses from operators that offered gambling before it was regulated or that didn’t have licenses at the time. Such cases have become more common, prompting the court to address the European Court of Justice (ECJ) on the matter.
The German Court Directed Its Questions to the ECJ
The Erfurt Regional Court outlined four issues regarding the recent cases, referred to as LG Erfurt 8 O 391/23 and 8 O 515/24. For context, one of the cases concerns iGaming, while the other one is related to sports betting.
The Erfurt court was largely concerned about the haphazard application of gambling regulation in the past. For context, Germany used to allow online lotteries and betting on horse races, despite prohibiting online casino gaming. The court alleged that the government was strangely tolerant to some forms of online gambling, despite the ban.
The court also sought to understand why certain products were legal in-person but not online, and why the Schleswig-Holstein state was able to issue online licenses while iGaming remained ban in the rest of Germany.
The court also called the claims that online gambling is more dangerous into question, asking whether there was sufficient proof and whether the ban was effective in stopping black market gambling.
The Erfurt Regional Court also sought to understand whether EU law truly provides German authorities with the authority to impose penalties or deny reimbursement.
If Germany’s gaming ban is found to contradict EU law, operators might be exempted from penalties in relation to their pre-regulation business.
Because of the complexity of these questions, a resolution in 2025 is unlikely, according to lawyers.
Not the First Players to Seek Their Money Back
As mentioned, cases of players seeking to recover losses from gambling operators they played with prior to the legalization of gambling, have become fairly common.
Earlier this year, for example, the Supreme Court in Austria ruled in favor of a plaintiff, who filed a lawsuit against bet-at-home over significant gambling losses. The losses were accumulated between 2018 and 2020 when the operator had no permission to operate in the country. As a result, bet-at-home was ordered to return EUR 2.8 million to the player.
However, Austria also allowed gambling operators to seek back player winnings in what some called a dangerous precedent. As a result, a Malta-based online gambling operator that did not hold a license in the European country at the time of the bets in question filed a claim asking to recover the EUR 7,152 won by the defendant. The Supreme Court later lowered that sum, asking only for a partial repayment of EUR 626.60.
Similar cases are not unique to Europe. In America, a nonprofit organization recently set out to recover millions of dollars spent by players on “gray machines” in Kentucky. These machines, better known as skill games, are available across many shops in the country and are not regulated as gambling despite their apparent similarities.