Federal Judge Greenlights Class-Action Lawsuit Over Roblox

Roblox Faces Class-Action Lawsuit Over Allegations of Encouraging Underage Gambling

A federal judge in California has allowed a class-action lawsuit against Roblox, one of the world’s most popular online gaming platforms, to proceed. The lawsuit claims that Roblox facilitates underage gambling by allowing third-party developers to create virtual casinos where users can gamble with the platform’s in-game currency, Robux.

Roblox, which boasts over 164 million active users, is particularly popular among children. The plaintiffs in the case argue that Roblox knowingly permits third-party gambling sites to accept Robux as a form of payment, luring minors into gambling activities. The class-action suit, filed in August 2023 by a group of parents, asserts that their children lost money while engaging with these virtual casinos. The plaintiffs claim that Roblox’s design incentivizes developers to create such environments, profiting from the transactions.

According to the lawsuit, Roblox takes a 30% commission on all Robux transactions, which includes purchases made in third-party virtual casinos. This, the plaintiffs argue, creates a harmful cycle where developers are motivated to create addictive experiences, including gambling games. The parents allege that Roblox failed to protect its young users from exposure to these virtual casinos, despite knowing their existence and the risks they posed.

In his ruling, U.S. District Judge Vince Chhabria stated that Roblox has a duty to protect its users, particularly minors, and accused the platform of misfeasance. Chhabria further explained that Roblox had “created a clearinghouse for illegal transactions within the virtual playground” and had knowingly facilitated and profited from these activities. He noted that it was foreseeable that third-party developers would exploit the platform’s structure to create highly addictive gambling experiences.

Roblox’s Role in Underage Gambling Allegations

Roblox allows users to play and create games, using its in-game currency, Robux, for purchases and interactions. Although the platform is free to use, it encourages players to buy Robux with real money, especially to access premium features. As of 2022, 60% of Roblox users were under the age of 16, with a significant portion of users between 9-12 years old.

The plaintiffs argue that Roblox intentionally incentivized third-party developers to create experiences where users could gamble with Robux, benefiting from the platform’s 30% commission fee. The lawsuit claims that this system promotes underage gambling, with Roblox profiting from the losses of minors who engage in these activities.

Judge Chhabria cited the existence of well-known virtual casinos, such as Bloxflip, which reportedly had 5.7 million monthly visitors in 2022. These virtual casinos were widely recognized by both users and the Roblox platform, further supporting the argument that Roblox knew minors were being exposed to gambling.

As the lawsuit proceeds, Roblox faces increasing scrutiny for its role in facilitating underage gambling. While the court dismissed additional fraud claims, Judge Chhabria’s ruling highlights the platform’s responsibility to protect young users from harmful activities. This case marks a significant development in the legal landscape surrounding online gaming and underage gambling, raising questions about the responsibilities of platforms like Roblox in ensuring the safety and well-being of their users.