A German court has followed the European Court of Justice in finding that gamblers can seek compensation from gambling companies if they lost money when online casinos and fruit machines were illegal in Germany.
The verdicts could have major consequences for gambling addicts, as thousands of people could potentially bring civil lawsuits against gambling companies.
A series of court decisions at regional, federal, and European level have found in favor of gamblers in the last year, beginning with the Higher Regional Court Stuttgart in September 2025, which agreed with a plaintiff in the state of Baden-Württemberg who sued the Malta-based online betting company Tipico Games.
The plaintiff lost around €10,000 ($11,200) between 2020 and 2022, but because online gambling was prohibited in Germany until 2021, the court found that operators had therefore received the winnings without legal basis and must return them.
Wins for the losers
Tipico Games then appealed to the Federal Court of Justice (BGH), the highest civil and criminal court in Germany. In an initial verbal hearing in mid-September this year, the court followed the principle of the plaintiffs' case on one key point: That gamblers have the right to claim back losses if the companies did not have a license in Germany at the time the losses were incurred. But a final decision on the case is only expected to be made in January next year.
Online casinos and fruit machines were banned in Germany from 2008 to 2021, but several gambling operators were active in the country because they had gaming licenses in other EU countries.
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In April this year, the European Court of Justice ruled that EU law does not preclude a member state from "prohibiting certain services," or from "attaching civil-law consequences to that prohibition." In other words, even if a gambling company has a legitimate license in one member state, that doesn't override national gambling laws elsewhere.
Thomas Dünchheim, a business lawyer at global law firm Greenberg Traurig who specializes in gambling law, said law firms were now gathering clients — sometimes trawling the internet with the help of AI tools — to prepare massive collective lawsuits. Dünchheim himself has people who have lost tens of thousands of euros come to him seeking representation.
"The pendulum is swinging more and more towards the consumer. It's a bit like in America — we're seeing a mass phenomenon like the Dieselgate lawsuits against VW," he told DW. "And there are lawyers who will collect all these little cases, bundle them, and then maybe even drive it forward with the help of a legal financing firm. It's a good business for all involved, and the ones that will have to pay are the gambling firms who operated unlawful gambling in Germany."
The dangers of online gambling
The decisions could bring a measure of help for addicts, as online gambling can be particularly dangerous for people with addiction issues. According to Tobias Hayer, a psychologist at the Institute for Public Health and Nursing Research at Bremen University, that comes down to four main features of online gambling: Anonymity and the consequent lack of social control, 24/7 accessibility, the frictionless nature of cashless transactions, and the high frequency of games played.
"These court verdicts are not surprising at all," Hayer told DW, but he added that he had an ambivalent attitude to them. "On the one hand I can imagine that this will be a huge relief to many gamblers who had an addiction problem. On the other hand, if these people suddenly get a lot of money in their hands, but they haven't worked through their problems, then of course there's a danger of recidivism."
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The legal obstacles
But Dünchheim suggested that the gamblers may not have such an easy ride when making their claims. It's true that German law has now concluded that if the gambling contract that the player makes with the company turns out to be unlawful in the country where they live, the player can claim their losses back. But only if the player themselves "did not act illegally," as Dünchheim put it.
"You also have to say: Many of these players deliberately went to games in this gray zone because the winnings are potentially bigger," he said. "Because the companies don't pay taxes."
"Then the defense team of the gambling company will of course say: 'You took part in an illegal game yourself, so you were acting illegally.' And this question of interpretation is not simple," he added. "It's a very interesting intellectual question, but it's also existential for the gambling companies."
Tipico's gambling gray zone
The Tipico case is perhaps particularly interesting in the German context because, although the company is based in Malta, it was founded in 2004 by a group of German lawyers. The company is a big employer, with several thousand employees worldwide, and has been a sponsor of more than one top German football club. Tipico has also said that it has rigorous consumer protection measures in place to identify and prevent dangerous betting behavior.
But there was some legal ambiguity about its online operations in Germany up until 2021. "They always had lawyers who could attest that what they are doing conforms to European law, because it is permitted in a European Union member state," said Dünchheim. "But that is a false assumption, as it has now been established that a gambling permit in another EU state doesn't apply in Germany, because unlike other areas, gambling law isn't harmonized across the bloc."
"Tipico was started by two businessmen and grew big in a gray zone," as Dünchheim put it. "They had professional lobbying firms on board and they hired experienced lawyers, they had private equity firms on board. But of course they are carrying a huge financial risk."
Edited by Rina Goldenberg