Class Action Lawsuits Target Online Gambling Firms in the Netherlands

Dutch online gambling companies are facing a wave of class action lawsuits as players seek to recover significant losses incurred before the legalization of online gambling in the Netherlands. These lawsuits, spearheaded by two advocacy groups, come after a landmark ruling earlier this year that set a precedent for the reimbursement of players’ losses by unlicensed gambling operators.

The legal battle began with a case in April, when a Dutch court ordered two unlicensed online gambling companies to reimburse two players who each lost approximately €200,000 ($224,000). This was the first time a Dutch court had held gambling operators accountable for losses incurred while operating without a license. Lawyer Benzi Loonstein, who represented the players, called the ruling “groundbreaking.” The decision has opened the door for further claims, with potentially far-reaching consequences for the online gambling industry in the Netherlands.

The Dutch Supreme Court is expected to issue its final decision on the case early next year, which could influence the future of similar claims in the country.

Two groups have emerged as leaders in the push to hold gambling companies accountable for their pre-legalisation activities. The foundation Gokverliesterug has launched a class action lawsuit demanding that online gambling companies repay the losses Dutch consumers incurred before the market was regulated in October 2021. This group’s legal strategy focuses on foreign operators who, despite Dutch regulations prohibiting online gambling, continued to offer their services to Dutch citizens, leading to substantial financial losses for many.

Koen Rutten, the lawyer representing Gokverliesterug, emphasized the need for accountability: “Many foreign online casinos ignored Dutch rules for years, assuming they would not get caught. They have to be held to account for that period, even though they now have licenses.”

The second class action claim is being led by Loonstein Advocaten, the law firm behind the initial April victory. This lawsuit has reportedly gained significant traction, with over 20,000 people signing up to participate in the claim. Both actions focus on the period before October 2021, when online gambling was illegal in the Netherlands, but widely available through operators such as Unibet, Bwin, and Pokerstars, who continued to provide services despite the ban.

The legalization of online gambling in October 2021 brought the market under official regulation, with 27 companies now licensed to operate under 37 different brands. However, the years prior to regulation left many Dutch consumers vulnerable, and addiction experts have warned of the devastating impact the newly regulated market has had on individuals’ finances.

Rutten pointed to the lack of social control in online gambling environments as a critical factor that allowed players to lose significant sums quickly. “At home behind their laptop or smartphone, people have proven to be able to lose enormous amounts of money in a short period of time. In that environment, social control is completely absent,” Rutten explained, adding that illegal operators often used aggressive tactics, such as promotions and bonuses, to keep players engaged for longer.

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As the lawsuits continue, the repercussions could extend beyond the gambling companies themselves. Gokverliesterug is also prepared to take legal action against payment processors and banks that facilitated the transactions between Dutch players and illegal gambling operators. Rutten indicated that the group is willing to escalate the case to the European Court if necessary, stating, “We hope for a quick settlement of the case. But thanks to a litigation funder, we have sufficient clout to conduct a lengthy procedure up to the European Court.”

The Dutch lawsuits reflect similar legal actions in neighboring countries like Germany and Austria, where courts have frequently ruled in favor of players seeking to recover gambling losses. However, these cases are not without complexity. In one recent Austrian ruling, a customer was ordered to pay back part of their winnings to an operator, highlighting the intricate legal issues surrounding these claims.

Source:

“Class action cases loom for online gambling firms“, dutchnews.nl, September 26, 2024.