A jury in the United States Federal District Court for the Southern District of New York ruled that Papaya Gaming constituted a false advertisement in the case brought by Skillz Platform, requiring compensation of $420 million.
The award was accompanied by a recommendation of $719 million for undue profit in return for the award. The judge will review the record of the case and determine for himself the amount of the undue profit, after which the plaintiff will choose between the damages and the undue profit. The case stems from an allegation that Papaya falsely promoted the fairness of his skill-based mobile phone game products. The petition filed in March 2024 stated that Papaya, while promoting his game as a pure-skilled driver, used robots to simulate real players and manipulate the results of the cash competition. In October 2024, the United States Lottery Control Board (MGCB) asked Papaya to stop operating in Michigan because it considered its games to be illegal gambling without a licence.
According to Skillz, these practices enable Papaya to exaggerate participation indicators, control success rates and encourage users to increase consumption through misleading fairness and competitive advocacy. The jury found that Papaya Gaming Ltd. and Papaya Gaming Inc. had violated the Lamham Act, constituting false advertising and unfair commercial behaviour. Papaya Gaming is a rapidly developing mobile game development studio in Tel Aviv, Israel. The company is well known for developing multiple “cash racing” mobile games that allow players to win prizes through real money-to-war games such as cards, eliminations and puzzles.
