Lottery watchdog Dawn Nettles has voluntarily dismissed her lawsuit against ticket reseller Lottery.com.
The class-action suit had accused the entity and former Lottery Commission Executive Director Gary Grief of engaging in “systematic fraud, misappropriating lottery funds, illegally selling tickets across state lines, and manipulating the outcome of lottery games.”
Nettles’ original petition also included International Game Technology (IGT), the Texas Lottery’s operating vendor, as a defendant. However, in March, Nettles dropped her suit against IGT.
She is now seeking a nonsuit without prejudice for the case, meaning that she wishes to retain the right to refile the same claim at a later time.
Initially filed in the 333rd District Court in February and later transferred to a business court, the original petition specifically targeted a controversial $95 million jackpot won in April 2023 by an entity called “Rook TX LP.”
Rook TX LP was listed as a defendant in Nettles’ case, which described it as a “Delaware entity that has engaged in business in Texas, specifically to launder stolen lottery funds from the State of Texas.”
According to The New York Times, Rook TX LP engaged in a bulk purchase of $25 million on nearly every possible number combination and ended up claiming the lump-sum payment of $57.8 million before taxes.
Lottery.com did not file an answer to the suit and could have been subject to summary judgment, according to an attorney familiar with the case.
Gregory Potts, the chief operating officer of Lottery.com, said in a press release following the news that he met Nettles during a Texas Senate Finance committee earlier this year, at which details surrounding the suspicious April 2023 win were discussed.
“We believe the decision to seek a voluntary dismissal speaks to the lack of any evidence that Lottery.com was engaged in any wrongdoing,” stated Potts.
At the hearing where Potts said he met Nettles, senators also grilled lottery commissioners about their having allowed lottery ticket resellers such as Lottery.com to operate in the first place.
Lottery ticket resellers, also known as couriers, allow customers to play the lottery online through an intermediary who buys the ticket at a brick-and-mortar store on their behalf.
The practice is set to be explicitly prohibited in Texas via Senate Bill 3070 after years of debate over resellers’ legality. Part of the push for that ban came from questions over reseller involvement in a series of controversial jackpot winnings, including the April 2023 incident.
In a separate lawsuit, another individual alleges that Lottery.com was one of four lottery retailers—also including Lottery Now, Inc., ALTX Management, LLC, and Qawi and Quddus, Inc.—that worked with a sports gambling company to orchestrate the bulk purchase.
Jerry B. Reed of Hood County filed the suit just two years after he won a $7.5 million jackpot in 2023, shortly after the bulk purchasing event, which he says made him miss out on $95 million more in potential winnings.
Gathering members for a class-action lawsuit in Texas is a challenging task. In Nettles’ case, she and her attorneys would have had to track down Texans who played the April 2023 lottery and retained their playslips. Assuming the members could be located, their damages would be capped at the face value of their tickets.
These parameters do not apply in Reed’s case, and all of the defendants subject to the Nettles litigation when it was voluntarily dismissed are subject to his suit.
When asked if Lottery.com intended to file an answer in Reed’s lawsuit, Potts did not respond.
