Over 20 years ago, a series of clever plaintiffs attempted to leverage the Racketeer Influenced and Corrupt Organizations Act (RICO) – a federal statute designed to combat organized crime in the United States – to sue Topps, Upper Deck, Fleer, Pinnacle, MLB, and others, alleging that purchasing baseball card packs constitutes “unlawful gambling.”  They argued purchasers are permitted to sue under RICO to recover the purchase price of the baseball card packs as alleged “gambling losses.” 

The gambling premise: that purchasers allegedly “gamble” their money based on chance to win the coveted “insert card” in the baseball card pack (e.g., the Ken Griffey, Jr. card).  The presiding federal courts – most notably the Fifth Circuit and Ninth Circuit – resoundingly have rejected the plaintiffs’ theory on RICO standing grounds.  They reasoned that purchasers did not suffer the required RICO “injury” because (1) the card purchasers received exactly what they bargained for, i.e., payment of money for a pack of baseball cards and the chance to win an insert card, and (2) that not receiving the desired insert card was, at best, a mere expectancy interest or an intangible interest, neither of which is cognizable under RICO.

Fast forward 20 years: On March 18, 2022, a plaintiff filed a class action against Topps alleging card packs advertising the coveted “redemption” card constitute an unlawful lottery.  See Wheeler v. The Topps Company, Inc., No. 22-cv-2264 (S.D.N.Y.).  And three days later, the same plaintiff filed a similar class action against Panini based on largely the same allegations.  Wheeler v. Panini America, Inc., No. 22-cv-763 (D.D.C.).  

The complaints refer to a “no purchase necessary” notice on the card packs – which can serve as a defense to some gambling allegations in certain circumstances – but the complaints allege the notice is not sufficiently prominent on the card pack, is allegedly “onerous” and “unfair” to non-purchasers, and results in deceiving consumers into purchasing the card packs allegedly unaware of the non-purchase option.  The plaintiff did not assert a RICO claim, nor does she allege which state or federal gambling laws are at issue (other than referring to the card packs as “lotteries” generally).  The complaints assert a variety of state and federal common law and statutory claims: violation of consumer fraud acts in over a dozen states; violation of the Magnuson Moss Warranty Act, 15 U.S.C. §§ 2301, et seq.; and common law claims for fraud, negligent misrepresentation and unjust enrichment.

The complaints certainly take the “kitchen sink” approach, rather than the RICO-centric focus of the prior rounds of class actions.  It is unclear whether the claims will survive legal scrutiny by way of a pleadings challenge, or whether they will suffer the same dismissal fate as the prior class actions.  The prior class actions – resolved on RICO standing grounds and not on the grounds that the card packs are not gambling – may be useful for Topps to bolster similar lack-of-standing arguments as part of the statutory claims.  If threshold challenges fail, however, Topps and Panini may have to argue the gambling merits question they and others avoided 20 years ago.