Judge approves $155M class action settlement related to Big Fish Games and online gambling lawsuit

Inside the Big Fish office in Seattle. (GeekWire File Photo / Nat Levy)

The past and current owner of Seattle-based Big Fish Games will pay $155 million to recover payments made by users of its social casino games after a judge on Monday granted preliminary approval of two class action settlements.

The legal dispute dates back to 2015 when Cheryl Kater sued Big Fish’s then-parent company Churchill Downs. The suit argued that Big Fish violated Washington state law governing online gambling because chips used in its “freemium” game Big Fish Casino represented “something of value.”

In 2016, a U.S. District Court judge in Seattle threw out Kater’s complaint. But two years later, a federal appeals court ruled that Big Fish Casino constituted illegal online gambling, according to Washington state law.

Kater is listed on the settlement as a plaintiff, along with Suzie Kelly and Manasa Thimmegowda.

Churchill Downs and Aristocrat Technologies are listed as defendants. Churchill Downs acquired Big Fish Games for $885 million in 2014, and sold it to Aristocrat in 2018 for nearly $1 billion.

Churchill will pay $124 million of the settlement, while Aristocrat will pay the remaining $31 million.

The settlement could have major implications for the casual games market as many popular games use in-app purchases as a revenue driver. Several other lawsuits were filed in the wake of the federal appeals court decision, challenging the legality of social games in Washington.

Washington lawmakers earlier this year debated legislation that would shield many of the state’s smartphone game companies from class-action gambling lawsuits. However, the bills did not advance beyond initial discussion.

As part of the settlement, Big Fish has agreed to “establish a voluntary self-exclusion policy that will allow players to exclude themselves from further gameplay, make available resources related to video game behavior disorders, and change the game mechanics of its apps so players who run out of virtual chips can continue on in the game they are playing without buying chips,” according to the settlement filed in the U.S. District Court for the Western District of Washington.

The payout amount will be based on how much each person lost while playing Big Fish Casino, Jackpot Magic Slots, and Epic Diamond Slots.

Big Fish Casino is a series of games like slots, blackjack, and roulette that use virtual chips. We’ve followed up with Big Fish about changes to its games as a result of this settlement, and will update this story if we hear back.

Founded in 2002, Big Fish has an additional office in Oakland, Calif. The company was previously led by former president Jeff Karp, who just joined Electronic Arts. It cut about 15% of its workforce in September 2018. Big Fish has more than 600 employees, according to LinkedIn.

(Hat tip to Venkat Balasubramani)

(Editor’s note: The headline was updated to reflect Big Fish Games’ involvement in the lawsuit)

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Judge issues preliminary injunction for Amazon and top authors in lawsuit against ‘pirate’ book site

A judge ordered an e-book publishing site to halt its alleged counterfeit scheme as part of a court case involving a group of best-selling authors who are teaming up with Amazon.

U.S. District Court Judge Marsha Pechman on Thursday issued a preliminary injunction against the operators of Kiss Library and affiliated websites.

Amazon Publishing, Penguin Random House, and several well-known authors filed their original complaint last month, alleging that Kiss Library and related mirror websites sold unauthorized ebooks at discounted prices as they displayed, reproduced, sold, and distributed copyrighted works without permission.

John Grisham, Scott Turow, R.L. Stine, Sylvia Day, and other top American authors are named as plaintiffs in the suit. They request that the defendants return all profits made off the alleged illegal sales.

The preliminary injunction orders the defendants to stop selling the alleged counterfeit books. They are also restrained from disposing of any files and records related to the reproduction and distribution of the books. Any banks, payment processors, and other services associated with Kiss Library are ordered to stop conducting business with the sites; domain name registries also must deactivate the sites.

The defendants did not show up to a court hearing on Tuesday to discuss the preliminary injunction.

The judge said the plaintiffs are likely to succeed on the merits of their copyright claims and are suffering “irreparable injury in the absence of an injunction.”

Some of the same authors partnering with Amazon Publishing in the lawsuit were part of a group of more than 900 writers who publicly lambasted Amazon’s negotiating tactics during a ebook pricing and profit margin dispute with Hachette back in 2014. Amazon eventually reached an agreement with Hachette later that year.

Other authors listed on the lawsuit against Kiss Library include Lee Child, Sylvia Day, C.J. Lyons, Doug Preston, Jim Rasenberger, T.J. Stiles, Monique Truong, Nicholas Weinstock, and Stuart Woods.

See the full court order below.

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Amazon settles lawsuit with former AWS marketing VP who joined Google Cloud

Brian Hall

Amazon has reached a confidential legal settlement with Brian Hall, a former Amazon Web Services vice president of product marketing who was sued by the company after taking a job with Google Cloud in alleged violation of the non-compete clause in his Amazon employment agreement.

Hall changed his title on his LinkedIn profile overnight, signaling that he has been cleared to work as vice president of product and industry marketing at Google Cloud. He had listed his job as Google “VP in Purgatory” while the dispute was pending.

The case was the latest in a series of lawsuits filed by Amazon and others in Washington state to enforce non-compete clauses in employment contracts. The controversial agreements have essentially been banned in California. Washington state last year enacted new provisions meant to limit their applicability, but the law doesn’t apply to employees who earn more than $100,000 a year.

While Amazon and other tech companies treat the provisions as a necessary safeguard, critics say they put the Seattle region’s tech industry at a disadvantage to California.

“Settlement terms are usually secret, so we are left with the question of whether AWS is changing its overly-broad non-compete terms and/or its arbitrary enforcement of non-competes,” said Charles Fitzgerald, a Seattle-area angel investor and veteran tech executive who was a vocal supporter of Hall’s case. “At this point, all the uncertainty raised by the legal action against Brian Hall remains for anyone considering a job at AWS.”

Neither the company nor Hall is commenting on details of the settlement, and the court docket has yet to be updated with a record of the resolution.

In a tweet overnight, Hall thanked those who supported his case.

oh, and also some other things I can now do… THANK YOU to all of the people who have supported me in the last few months. @charlesfitz I think you can retire the #freebrianhall tag now. I won’t say much more… https://t.co/FRrJNg8vc8 https://t.co/CVaQlBJFJ7

— Brian Hall (@IsForAt) July 17, 2020

Hall left his role as vice president of product marketing for Amazon Web Services in March and took a senior product marketing job with Google Cloud in early April.

Amazon then sued Hall, claiming that the new role violated the terms of his non-compete agreement and risked exposing valuable competitive information to one of its biggest rivals. The company was seeking to enforce an 18-month non-compete provision in Hall’s employment contract, asking for an injunction to prevent him from working in cloud product marketing for Google during that period. This suit was unusual in that it involved a marketing leader, not an engineering executive or technical leader as in many other cases.

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