Cryptocurrency casino and betting platform Stake.com is being hit with a $400 million lawsuit from a former associate, crypto news sites report. The legal challenge alleges that the affiliate was cut out from collaborating in the creation of the site.
Christopher Freeman filed the lawsuit within the Southern District of New York and is searching for punitive damages and fees for his funding in the firm that preceded Stake.com, reports Coins or Tokens. Freeman claims he was “misled” into not participating in the formation of the site.
According to the court complaint, Freeman was a friend of co-founder Bijan Tehrani, and both allegedly intended to set up a casino business under the name Primedice. The former associate claims that he had a 20% stake in the Primedice project, while Tehrani and fellow co-founder Ed Craven had 40% each.
However, Freeman claims that his holdings were then dropped to 14% as his initial stake “had been reduced to reward members of the development team,” reports Be In Crypto. Freeman alleges that his share transfer occurred despite the trio having an agreement that Primedice would only provide equity to people who had put money into the business.
Freeman further alleged that he was then “discouraged” from joining Stake.com, despite having allegedly helped raise the idea of a crypto casino with his business partners as cryptocurrency took off. However, Tehrani and Craven supposedly then told him they had lost interest in the idea, citing potential issues with regulation.
In 2016, Freeman alleges he was dismayed from joining Stake.com – Tehrani and Craven’s new venture. He was supposedly told he could only participate if he moved to Australia, and that the new project would only deal in fiat currencies such as US dollar and Euro, reports WA Today.
Freeman believed that a fiat money casino was “the wrong direction to go,” court documents allege, reasoning it was highly competitive; and that he did not want to be forced to move to Australia. Much to his surprise, and despite the previous statements about a crypto casino being too risky, Tehrani and Craven then launched the crypto gambling site Stake.com.
Freeman also alleges that when he questioned Tehrani and Craven, he was given assurances by the pair before having his system privileges revoked. The lawsuit goes on to say that his Primedice account was blocked and never returned.
As for Stake.com, the crypto betting brand has denied the allegations, labeling them “internally inconsistent, intentionally misleading, and provably false.” The founders of the site –described as the world’s biggest crypto casino– believe that the court will dismiss Freeman’s case.
An investigation by Australian media in late 2021 revealed that the casino, which was believed to be an offshore enterprise, was actually founded in Melbourne in 2017. The crypto site is the lead jersey sponsor of English Premier League soccer team Everton and also counts Canadian pop superstar Drake as its main brand ambassador.
Over the years, Stake.com has proved to be a successful endeavor, growing into an operation estimated to be worth up to AUD 1 billion ($680.5 million), according to WA Today. Furthermore, the brand claims to have processed $100 billion in bets across its casino and sports betting businesses.