A consumer fraud case was filed against the Multi-State Lottery Association, an Iowa-based nonprofit that helps administer games in several state lotteries. The lawsuit alleges the association failed to prevent game rigging and failed to operate games in accordance with the association’s own rules. The suit is brought by lottery players who bought tickets for certain rigged games.
The association’s former security director has been criminally charged with installing software on lotteries’ random number generators that allowed him to predict winning numbers on three days of the year. While it did not give him the exact winning numbers, it allowed them to be predictable. He made the machines produce predictable numbers May 27, November 22, and December 29 if the drawings occurred on Wednesdays or Saturdays after 8pm. He then worked with his brother and friend to buy winning tickets on those days, worth millions. This occurred between 2005 and 2011 in Colorado, Wisconsin, Iowa, Kansas, and Oklahoma. The former director was caught when a surveillance video showed him buying a winning $16 million Hot Lotto ticket in December 2010.
The lead plaintiff in the class action, an insurance salesman from Iowa, kept the $45 in tickets he played in that particular drawing, as well as a detailed ledger of all games he plays. The lawsuit alleges hundreds of thousands of lottery players lost money and should be reimbursed, plus interest. So far the suit only includes players of Hot Lotto, Colorado Lotto, Wisconsin Megabucks, and Kansas 2X2, but the litigation and criminal investigation could uncover others.
This is the first class action lawsuit to be filed based on jackpot-rigging allegations. However, another Iowa man has filed an individual lawsuit after winning a $9 million jackpot in 2011. He says the jackpot would have been worth $25.5 million had the prior drawing not been rigged.