Update on player refund-claims in Germany

German Federal Court of Justice (BGH) suspends appeal proceedings regarding the reimbursement of losses in online poker. Potential impact also possible for refund claims for losses from slots.

A lawsuit is currently pending before the First Civil Senate of the BGH with the case number I ZR 53/23, in which the BGH is dealing with the question of whether an operator of online poker must refund gambling losses to a player (see below for more details).

The proceedings concern losses from online poker, whereby the offer was subject to the total ban of Section 4 (4) of the State Treaty on Gambling 2012 (ISTG 2012). The ISTG 2012 was in force from 1 July 2012 to 31 December 2019, followed by a similar interims ISTG 2020 from 1 January 2020 to 30 June 2021. The total ban of Section 4 (4) ISTG 2012 did not provide for a possible license for the operation of online poker or virtual machine games (slots).

By order dated 10 January 2024, the BGH suspended the appeal proceedings pending a decision by the Court of Justice of the European Union (ECJ) in proceedings C-440/23. The proceedings C-440/23 represent a request for a preliminary ruling which was initiated by a civil court from Malta and relates in particular to the question of whether the total ban in Section 4 (4) ISTG 2012 was compatible with EU law.

Should the ECJ classify the total ban in Section 4 (4) ISTG 2012 as contrary to EU law, it may also have an impact on players' refund claims for losses from slots. In these proceedings, some courts assume that the gambling contracts are void due to a breach of Section 4 (4) GlüStV 2012.

At the present time, it is to be expected that a large number of courts of the first and second instance will follow the example of the BGH and suspend the relevant proceedings until a decision is reached by the ECJ in case C-440/23.

In detail on proceedings I ZR 53/23:

Facts of the case:

The defendant, based in Malta, offers gambling via a German-language website. In 2018 and 2019, the plaintiff participated in the defendant's virtual poker games, which do not involve playing against people. During this period, the defendant held a licence from the Malta Gaming Authority, but no German licence. The plaintiff claims that the online offers were illegal and that the gambling contracts are void. Plaintiff claims that he/she did not know that the defendant's offer was prohibited. With this lawsuit, the plaintiff has demanded repayment from the defendant of the payments made in the amount of the losses suffered of €132,850.55 plus interest.

Lower instances:

Paderborn Regional Court - Judgment of 8 July 2021 - 4 O 323/20

OLG Hamm - Judgement of 21 March 2023 - I-21 U 116/21

Source: Press release of the BGH from 17.01.2024