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MarketScreener Homepage  >  Equities  >  Nasdaq  >  Churchill Downs Incorporated    CHDN

CHURCHILL DOWNS INCORPORATED

(CHDN)
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Churchill Downs Incorporated : $155 Million Offered To Settle Two Big Fish Games Class Action Lawsuits

08/10/2020 | 06:12am EST

In order to settle two class action lawsuits -- Thimmegowda v. Big Fish Games and Kater v. Churchill Downs -- regarding games offered by Big Fish Games, Churchill Downs Incorporated has agreed to pay $124 million and Aristocrat Leisure Limited has agreed to pay the remaining $31 million for a total settlement amount of $155 million - subject to approval by the U.S. District Court. The plaintiffs, Cheryl Kater, Suzie Kelly and Manasa Thimmegowda, alleged the social casino platforms, "Big Fish Casino," "Jackpot Magic Slots" and "Epic Diamond Slots," offered gambling games prohibited under Washington state law.

Big Fish Casino is a social gaming application that provides "freemium" online casino games. Similar to many other providers, users are awarded free chips when they create their account and may obtain additional chips by winning games, via free chip replenishment, or by purchasing additional chips. Big Fish Games was owned by Churchill Downs Incorporated and subsequently sold to Aristocrat Leisure Limited earlier this year.

In 2015, Cheryl Kater brought a purported class action alleging that she (and others similarly situated) should recover monies they spent on Big Fish Casino under Washington's "Recovery of Money Lost at Gambling Act" ("RMLGA") and Consumer Protection Act, as well as under a theory of unjust enrichment. The crux of the argument was that Big Fish conducted illegal gambling under Washington state law—and therefore, Ms. Kater should recover any monies she spent with Big Fish.

The Honorable Marsha J. Pechman, who was serving as the Chief Judge of the United States District Court for the Western District of Washington at the time, dismissed Ms. Kater's complaint in November 2015. Ms. Kater filed an appeal, and on March 28, 2018, the Ninth Circuit overturned Judge Pechman's decision. In sum, the Ninth Circuit Court held that the virtual chips constituted a "thing of value," and therefore, Big Fish had conducted illegal gambling under Washington law. The decision was based on Washington's statutory definition of "thing of value," which reads:

[A]ny money or property, any token, object or article exchangeable for money or property, or any form of credit or promise, directly or indirectly, contemplating transfer of money or property or of any interest therein, or involving extension of a service, entertainment or a privilege of playing at a game or scheme without charge.

Wash. Rev. Code § 9.46.0285 [emphasis added].

Following mediation between the Aristocrat group, the Big Fish brand, Churchill Downs and plaintiffs, the companies agreed to offer the $155 million settlement which remains subject to approval by the U.S. District Court for the Western District of Washington.

Originally published June 03, 2020 .

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.


Mr Glenn Light
Lewis Roca Rothgerber Christie LLP
201 E. Washington Street
Suite 1200
Phoenix
AZ 85004
UNITED STATES
Tel: 6022625311
Fax: 6022625747
E-mail: Lsimon@lrrc.com
URL: www.lrrc.com

© Mondaq Ltd, 2020 - Tel. +44 (0)20 8544 8300 - http://www.mondaq.com, source Business Briefing

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Financials (USD)
Sales 2020 1 075 M - -
Net income 2020 -31,9 M - -
Net Debt 2020 1 851 M - -
P/E ratio 2020 -226x
Yield 2020 -
Capitalization 7 201 M 7 201 M -
EV / Sales 2020 8,42x
EV / Sales 2021 5,78x
Nbr of Employees 5 500
Free-Float 88,2%
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Number of Analysts 3
Average target price 189,67 $
Last Close Price 185,22 $
Spread / Highest target 12,3%
Spread / Average Target 2,40%
Spread / Lowest Target -4,98%
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Managers
NameTitle
William C. Carstanjen Chief Executive Officer & Director
William E. Mudd President & Chief Operating Officer
R. Alex Rankin Chairman
Marcia A. Dall Chief Financial Officer & Executive VP
Benjamin C. Murr Chief Technology Officer & Senior Vice President
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