Landmark case clears way for fraud and contract claims to proceed in state court.
DETROIT, July 22 – In a major legal development for online gambling in the U.S., the Michigan Supreme Court has ruled that Jacqueline Davis, a Detroit woman who turned a $50 deposit into over $3 million on BetMGM, can pursue her lawsuit against the gambling giant in state court. The court’s unanimous decision rejects BetMGM’s argument that only state regulators can resolve such disputes, setting a precedent that could reshape how online gambling complaints are handled nationwide.
Davis’s $3.1 Million “Heater” Sparks Legal Battle
The dispute stems from March 2021, when Davis hit a remarkable six-day winning streak on BetMGM’s “Luck O’ the Roulette” game. Her balance soared from $50 to over $3.29 million, and BetMGM even approved a $100,000 withdrawal, sending her a congratulatory email.
But the celebration didn’t last long. The company soon froze her account, citing a “technical glitch” that it claimed inflated her winnings. In a letter to Davis, BetMGM said that 2.5% of her plays were affected and that, without the error, her account would’ve hit zero after about 368 turns.
Supreme Court Rejects BetMGM’s “Regulators Only” Argument
At the core of BetMGM’s legal defense was its claim that the Michigan Gaming Control Board (MGCB) has exclusive authority over online gambling disputes. The company argued that Davis’s fraud, breach of contract, and conversion claims should be handled by regulators — not the courts.
But in a sweeping decision authored by Justice Brian K. Zahra, the Michigan Supreme Court dismissed that argument.
“There is no clear indication that the Legislature intended the [Lawful Internet Gaming Act] to abrogate plaintiff’s common-law claims of fraud, conversion, and breach of contract,” Zahra wrote.
The court emphasized that the MGCB does not have the authority to resolve monetary disputes or award compensation to players. The board itself told Davis in its investigation that it had “no authority to award any money or other relief.”
What Happens Next in the Case?
The Supreme Court’s decision reverses lower court rulings that had thrown out Davis’s lawsuit, sending the case back to Wayne County Circuit Court for further proceedings. While the ruling doesn’t guarantee Davis will receive her full $3.1 million, it allows her to make her case in front of a judge.
This case could set a legal precedent for how online gambling operators handle player disputes, particularly when large sums of money are involved and platform errors are claimed.
BetMGM Silent on Latest Ruling
As of publication, BetMGM has not responded to requests for comment on the ruling.
The case has drawn parallels to a recent UK dispute, where the British High Court ordered Paddy Power to pay out £1 million (around $1.28 million) to a player who was originally told she had won the jackpot but received only £20,000.
Why This Matters for the Gambling Industry
This ruling underscores the growing tension between state regulation and consumer rights in the expanding U.S. online gambling market. As platforms grow in popularity, legal frameworks for dispute resolution are being tested – and, in this case, reshaped.
Players now have more legal footing to challenge platform decisions in court, especially when regulatory bodies decline to get involved or lack the authority to resolve financial disputes.