The main Fliff lawsuit was Bishoy Nessim v. Fliff, Inc., a June 2023 putative class action filed in California federal court that accused the Philadelphia-based social sportsbook of running an illegal online gambling operation dressed up as a sweepstakes promotion. A judge sent the case to private arbitration in January 2024, and the plaintiff voluntarily dismissed his claims weeks later. Since then, the legal pressure on Fliff has shifted to state attorneys general, a mass arbitration campaign, and new laws banning dual-currency sweepstakes platforms.
What the Class Action Alleged
Plaintiff Bishoy Nessim filed suit on June 6, 2023, in the United States District Court for the Central District of California (Case No. 5:23-cv-01048-SSS-SHK), represented by Saltz, Mongeluzzi & Bendesky. He said he had lost thousands of dollars on the platform and sought at least $5 million in damages on behalf of California consumers.1Gaming Today. Fliff Class Action Complaint2SMB Class Action. Class Action Lawsuit in California: Fliff Gaming Sports Betting App
The complaint brought two counts: violation of California’s Unfair Competition Law (Business and Professions Code § 17200) and unjust enrichment. The core theory was that Fliff’s sweepstakes label was cosmetic. Users buy “Fliff Coins” for play, receive “Fliff Cash” as a bonus, and can redeem accumulated Fliff Cash for real money once the balance reaches $50. Because Fliff Cash carries a dollar-for-dollar equivalence to cash and can be withdrawn to a bank account, the complaint alleged, Fliff was effectively operating an unlicensed sportsbook. It pointed to California Penal Code § 337a, which prohibits bookmaking, and the federal Wire Act (18 U.S.C. § 1084), which prohibits transmitting wagers across state lines.1Gaming Today. Fliff Class Action Complaint
Fliff describes its model as a legal sweepstakes promotion on the theory that no consideration is required because entries arrive as a free bonus. The lawsuit disputed that framing directly.
How the Case Ended
Fliff moved to compel arbitration on August 11, 2023, pointing to the mandatory arbitration clause and class action waiver in its Terms of Use, which route disputes to the American Arbitration Association and require individual rather than group resolution.3Duane Morris Gaming Law Blog. Gambler Loses Bid to Pause Fliff’s New Arbitration Agreement
Nessim’s lawyers tried to block enforcement of that clause with a temporary restraining order. The court denied it, finding no likelihood of success on the merits.3Duane Morris Gaming Law Blog. Gambler Loses Bid to Pause Fliff’s New Arbitration Agreement They also argued the clause was unconscionable. Judge Sunshine S. Sykes acknowledged the terms were an adhesive contract with some procedural unconscionability, but she found that degree minimal because Fliff is, as she put it, a “nonessential recreational activity” with alternatives on the market. She also rejected the argument that the clause was substantively unconscionable for limiting Unfair Competition Law remedies.4PlayUSA. California Judge Orders Fliff Lawsuit Arbitration
On January 5, 2024, Judge Sykes granted Fliff’s motion to compel arbitration, ending the class action route and sending the dispute to a single arbitrator.4PlayUSA. California Judge Orders Fliff Lawsuit Arbitration One report noted the ruling foreclosed participation by “hundreds if not thousands” of potential class members.5Mundovideo. Fliff California Sports Betting Lawsuit Sent to Arbitration On February 28, 2024, Nessim filed a notice of voluntary dismissal, dropping his claims entirely. No public record indicates the arbitration produced an award or settlement.6Mealey’s Litigation. Plaintiff Dismisses Suit Claiming Sweepstakes App Caused Gambling Losses
The Mass Arbitration Campaign That Followed
With the class action closed off, an organization called Class Action U began coordinating a mass arbitration effort against Fliff and its companion sweepstakes casino, Sidepot. The campaign connects affected users with the law firm Kopelowitz Ostrow P.A. to pursue individual arbitration claims, alleging Fliff and Sidepot operated as unauthorized gambling platforms marketed as social gaming and used deceptive advertising and manipulative interfaces without warning users of wagering risks.7Class Action U. Fliff Mass Arbitration Claims
Eligible participants must be at least 18, must have created a Fliff or Sidepot account, and must have lost money on the platforms within the past four years. The firm works on contingency, so participants pay nothing upfront.8Class Action U. Current Mass Arbitration Claims The process moves through intake and evidence gathering, a notice of dispute, a 120-day mandatory mediation window, and, if no settlement is reached, a bellwether phase in which representative cases are arbitrated over six to twelve months.7Class Action U. Fliff Mass Arbitration Claims
State Regulators Pick Up the Fight
Where private plaintiffs got stuck at the arbitration door, state attorneys general have not. AGs can seek injunctive relief, restitution, disgorgement, and civil penalties without being bound by consumer arbitration clauses.9Forbes. Legality in Doubt: Sweepstakes Casinos Could Be Targeted by State Attorneys General Several states have now moved directly against Fliff.
New York
On June 6, 2025, Attorney General Letitia James announced her office had shut down 26 sweepstakes casino operations in the state, Fliff and Sidepot among them. The AG’s office concluded the platforms let players risk “something of value” on games of chance, which is gambling under New York law.10New York Attorney General. Attorney General James Stops Illegal Online Sweepstakes Casinos Senate Bill S5935 later formally banned dual-currency gaming platforms in New York effective December 2025.11WilmerHale. Legal Developments in the Gaming Industry: Second Half of 2025
California
California enacted AB 831 in October 2025, effective January 1, 2026, banning sweepstakes casinos that use dual-currency systems. The law creates criminal liability for operators, payment processors, and affiliates, with violations classified as misdemeanors punishable by up to one year in jail and fines up to $25,000.12Vegas Insider. Sweepstakes Casinos Legal States Fliff’s sweepstakes sportsbook is no longer available in California, the state where the original lawsuit was filed.13Dimers. Fliff California
Illinois
On February 4, 2026, the Illinois Gaming Board issued a cease-and-desist letter to Fliff as part of 65 such orders sent to sweepstakes operators in coordination with the Illinois Attorney General’s office.14Sportsline. Illinois Gaming Regulators Issue Over 60 Cease and Desist Orders The IGB alleged Fliff was running an illegal online casino and offering sports wagering to Illinois users without a license, citing the Illinois Criminal Code, the Riverboat Gambling Act, and the Sports Wagering Act.15Illinois Gaming Board. Cease and Desist Letter to Fliff IGB Administrator Marcus D. Fruchter said that “illegal online gambling operations threaten consumer protections, undermine responsible gaming safeguards, and are antithetical to the public’s interest in regulated gaming.”16Gaming Intelligence. Illinois Issues Cease and Desist Orders Against Illegal iGaming Operators
Other States
Tennessee’s attorney general issued cease-and-desist letters to roughly 40 sweepstakes operators in December 2025. Montana banned sweepstakes casinos under Senate Bill 555, effective October 2025, and Connecticut passed a similar ban.12Vegas Insider. Sweepstakes Casinos Legal States Michigan, Maryland, and Minnesota have also taken enforcement steps against unlicensed operators in this space.
Where Fliff Stands Now
As of early 2026, Fliff is still operating, but its map has shrunk. The company is out of California under AB 831, out of New York after the AG action and subsequent legislation, and under a cease-and-desist order in Illinois. It was already unavailable in Washington and Idaho before these developments.13Dimers. Fliff California10New York Attorney General. Attorney General James Stops Illegal Online Sweepstakes Casinos
Fliff has responded by launching a daily fantasy sports product called Superstars, which was live in 11 states as of January 2026: California, Kansas, Kentucky, Minnesota, New Mexico, North Dakota, Rhode Island, South Carolina, South Dakota, Utah, and West Virginia. The company has said it plans further expansion. That pivot carries its own exposure. California’s attorney general issued a formal opinion in July 2025 concluding that daily fantasy sports games violate the state’s anti-bookmaking statute, though Fliff and other operators have continued offering pick’em-style contests there, reportedly by moving to peer-to-peer formats.17Closing Line. The Current Sweepstakes Sportsbook Fliff Does Fantasy Sports
If you lost money on Fliff or Sidepot and want to pursue a claim, the class action is closed, but individual arbitration through the ongoing mass arbitration effort remains open to users who meet the eligibility criteria above.