Plaintiff says ads were deceptive
As the number of states in which sports betting is legal approaches 40, the hottest topic in the industry right now is arguably the ethics surrounding advertising and promotions. And now Caesars is in the spotlight, sued by a customer who claims the company’s sports betting ads were deceptive.
Filed in the US District Court for the Eastern District of New York, the lawsuit claims that Caesars’ marketing has been “untruthful and deceptive.”
Specifically, plaintiff Lachae Vickers says she was convinced to sign up for a Caesars Sportsbook account because of the promise of a “risk-free” bet. She plunked down a $125 wager, believing there was zero risk involved and promptly lost it all.
The suit alleges Caesars engaged in negligent misrepresentation, intentional misrepresentation, and fraudulent inducement.
There is always risk
To explain, many sportsbooks run promotions for “risk-free” bets, though many have changed the lingo in order to improve transparency. The idea is that you can make a bet – typically the first bet you place with the site – and if you lose, you get a refund. But there is a catch. The refund is not really a refund, at least not in cash back to your account. Instead, most sportsbooks that employ this promo give you a refund in the form of bonus bets, essentially store credit.
Thus, you can certainly make back your losses if you win the follow up bonus bets, but you can also lose those, as well, and have nothing to show for your initial bet.
The lawsuit adds, “Not only do false promises of ‘free’ or ‘risk-free’ bets lure consumers into opening and using betting accounts, but the false promises can also normalize betting larger amounts than consumers would otherwise wager.”
That’s not a bad point. Someone might decide that $100 is a good amount to deposit, that it is an amount they can afford to lose, but they might see “risk-free” and choose to bet more, as after all, they don’t think there is any risk.
““At no time in Caesars Sportsbook’s marketing or during Caesars Sportsbook’s signup process were [the] Plaintiff and the Class Members warned of the true financial risks of using the Caesars Sportsbook service for an initial bet,” the lawsuit state, “including the immediate and acute risk of losing the entire amount in that initial bet and the risk that losses will never be reimbursed by [the] Defendant.”
Lingo is changing
Naturally, critics of the plaintiff might say that she could have easily just read the terms and conditions and that is definitely true, but the point big, bold, “risk-free” advertising is not to get someone to read the terms. It is to get someone to deposit money and bet.
As mentioned, many sportsbooks have already changed the language in their ads. The promo is the same, the terminology has changed. In New York, for example, Caesars doesn’t call it a “risk-free” bet anymore. In the graphic on its website, it says, “Get up to $1,250 back as a free bet if you don’t win.” There is also a link to “learn more,” which lays out the terms of the promo.
The NBA recently prohibited any gambling operator that advertises on league or team-controlled platforms from using “risk-free” terminology.