Soto v. Sky Union, LLC
159 F. Supp. 3d 871
N.D. Ill.2016Background
- Plaintiffs allege Sky Union’s Castle Clash is a gambling game disguised as a game of skill, violating CA, IL, and MI law.
- Soto (Illinois), Exelby (Michigan), and Eastman (California) sue on nine counts across three states, including penalties, prizes, and unfair competition theories.
- Castle Clash monetizes gameplay via virtual gems, Rolls, and in-game events with randomized rewards; players spend real money to obtain gems and entries.
- Sky Union removed the case to federal court under CAFA and moved to dismiss for failure to state a claim under Rule 12(b)(6).
- The court analyzes California Penal Code sections 330b and 319, California Bus. & Prof. Code 17200, ILRA, IPGA, ICFA, MLRS, and unjust enrichment theories, and grants dismissal of all counts.
- The court ultimately enters judgment for Sky Union, finding no viable claims, including that rewards are not 'things of value' and events are not prizes.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Do CA claims 1–3 survive? | Soto argues 330b and 319 render Sky Union liable; 17200 supports unfair competition. | Sky Union contends no private rights of action under 330b/319 and 17200 claim fails if statutes not violated. | Counts 1–3 dismissed; no private action under 330b/319; no valid unfair competition claim. |
| Do ILRA/IPGA/ICFA claims (Counts 4–6) survive? | Heroes/Talents are money or value; events are prizes; ICFA deception claims attach. | Rewards have no monetary value; no 'winner' or prize under ILRA/IPGA; ICFA failure. | Counts 4–6 dismissed; ILRA/IPGA not satisfied; ICFA claim fails. |
| Do MI MLRS claim (Count 8) survive? | Gems/Rolls constitute gambling losses under MLRS. | MLRS requires money loss with a gaming recipient; value of rewards not monetary. | Count 8 dismissed; MLRS not satisfied. |
| Do unjust enrichment claims (Counts 7 and 9) survive? | Sky Union should disgorge profits or losses due to unlawful conduct or fraud. | No unlawful conduct established; retention of payments not inequitable. | Counts 7 and 9 dismissed. |
Key Cases Cited
- Fortres Grand Corp. v. Warner Bros. Entm’t Inc., 763 F.3d 696 (7th Cir.2014) (acceptance of complaint's factual allegations for motion to dismiss)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. Supreme Court, 2007) (pleading requires plausibility, not mere possibility)
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. Supreme Court, 2009) (plausibility standard for ruling on Rule 12(b)(6))
- People v. One Mech. Device, 11 Ill.2d 151 (Ill.1960) (definition of gambling in IL context)
- Hotel Employees & Rest. Emps. Int’l Union v. Davis, 21 Cal.4th 585 (Cal. 1999) (unfair competition standard under California law)
- Score Family Fun Ctr., Inc. v. County of San Diego, 225 Cal.App.3d 1217 (Cal. App. 1990) (additional gameplay not a prize value under 330b(d))
- Merandette v. City & Cty. of San Francisco, 88 Cal.App.3d 105 (Cal. App. 1979) (definition of 'thing of value' in Penal Code context)
- Oatman v. Davidson, 310 Mich. 57 (Mich. 1944) (three elements of gaming: price, chance, prize)
- Automatic Music & Vending Corp. v. Liquor Control Comm., 426 Mich. 452 (Mich. 1986) (common-law view of gaming elements)