Livestream shopping platform Whatnot is facing allegations of operating an illegal gambling operation and violating the RICO Act by allowing sellers to conduct randomized box breaks and randomized repack breaks—sealed packages of collectible items—on its platform.
Attorney Paul Lesko at Leskow Law, known for his commentary on sports card law, has filed 15 arbitration requests and represents 30 clients in claims against Whatnot, The New York Times reported. The filings argue that randomized box breaks breach California’s laws prohibiting illegal lotteries (Whatnot is headquartered in California but incorporated in Delaware), while repack breaks function as unlawful “grab bag” lotteries for trading cards.
“Whatnot knowingly operates an addictive platform without sufficient safeguards and controls. They are basically making money off of dopamine, rather than just selling cards. Our clients who have addiction issues and have tried to get off the platform. There aren’t safeguards such as the ability for self-banning or meaningful spending limitations to the point that these are things that are required by online casinos but are not available on the Whatnot platform,” Lesko said in a CllctMedia video posted on X.
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