In a closely watched multidistrict litigation, Judge Edward Davila of the Northern District of California has dismissed all California claims against Apple, Google, and Meta in the App Store Simulated Casino Litigation, reaffirming the state’s sweeping public policy against gambling-related lawsuits. The September 30, 2025, order significantly weakens the position of plaintiffs advancing gambling-based theories in California, where a growing wave of class actions has sought to recast online games and sweepstakes as illegal gambling.
The Social Casino Allegations
The consolidated MDL combines dozens of consumer class actions challenging social casino apps—games that simulate slot machines and card tables and allow users to buy virtual chips to continue play but never to cash out. The defendants did not design or operate the games but instead provided the app-store infrastructure and payment systems used by developers. Each collects a standard commission—typically around 30%—on in-app purchases, as they do for all apps. Plaintiffs argued that, by facilitating these transactions, the platforms became active participants in gambling and should face liability under various state gambling-loss recovery statutes, California’s Unfair Competition Law (“UCL”), unjust enrichment, and RICO.
The California Ruling
Judge Davila rejected that theory as to California law, dismissing all California claims with prejudice and reaffirming the state’s long-standing refusal to entertain civil suits arising from alleged gambling transactions. Drawing on Kelly v. First Astri Corp. (1999) and Tak Chun Gaming Promotion Co. v. Long (2023), the court described this policy as “strong, broad, and long-standing,” tracing it “virtually to the inception of statehood.”
Plaintiffs urged the court to find that the UCL displaced this policy, but Judge Davila disagreed, writing that “silence is all the UCL offers.” Because both the UCL and unjust enrichment claims rested on allegedly illegal gambling transactions, the state’s public-policy bar foreclosed them entirely. Plaintiffs’ effort to recast the apps as “lotteries” also failed—the court observed that lotteries are still gambling under California law. Finding “no path to plead around this policy,” the court dismissed the claims with prejudice.
The court also dismissed the federal RICO and most state-law “loss-recovery” claims, concluding that the platforms were not “winners” under those statutes because their commissions do not depend on the outcome of any wager. The court explained that because the platforms take a fixed percentage of every transaction, rather than participating in the games themselves, they could not be considered parties to the wagers at issue. However, consumer-protection claims under other states’ laws were allowed to proceed, meaning exposure now varies widely by jurisdiction.
Section 230 and the Pending Appeal
The ruling comes amid broader proceedings in which Judge Davila has already held that Section 230 of the Communications Decency Act does not shield platforms from claims based on their payment-processing conduct. Applying the Ninth Circuit’s Calise v. Meta framework, the court examined whether the alleged duty arose from the defendants’ publishing role and whether fulfilling it would require monitoring third-party content.
The court concluded that processing payments does not constitute publishing activity and that compliance would not require content monitoring. That issue has been certified for interlocutory appeal, and Apple filed its petition for review in early October 2025. The appellate decision could clarify the limits of platform immunity where companies facilitate or profit from allegedly unlawful transactions.
Implications Beyond This Case
The California dismissal applies only to state-law claims but may shape litigation strategy nationwide. California courts have seen a surge of cases targeting social casinos, sweepstakes, and other digital games that mimic gambling mechanics. Plaintiffs often frame these suits under the UCL or restitution theories rather than gambling statutes. This ruling underscores that such an approach faces steep hurdles in California: if gambling is the gravamen, public policy bars the claim.
For defendants, the decision articulates a clear line distinguishing claims California courts will entertain. Unless plaintiffs can allege misconduct wholly independent of gambling—such as misrepresentation or data-privacy violations—California law will not permit recovery of losses tied to gambling-like play, even in virtual form.
What Comes Next
Claims under other states’ gambling-loss recovery statutes and under RICO remain pending in the MDL, as many states—unlike California—permit gamblers to recover losses from illegal games. The ruling leaves a patchwork of exposure across jurisdictions: the same app may be insulated in California but subject to claims elsewhere, depending on each state’s consumer and gambling statutes. The Ninth Circuit’s forthcoming review of the Section 230 question could have implications well beyond the social casino context, potentially affecting how courts treat platform liability for monetized third-party conduct.
However that issue is resolved, Judge Davila’s decision sends a clear message: in California, long-standing public policy continues to bar private recovery for gambling losses, no matter how modern the platform.
