Lotto.com Sues Texas Lottery Over Courier Ban

Lotto.com, a lottery courier, is taking legal action against the Texas Lottery Commission (TLC) in an effort to prevent the agency from forbidding its services in the state. 

The lawsuit alleges that the TLC "actively helped establish and run Lotto.com and other couriers in Texas" before making an "about-face" and banning the industry due to political influence. On that same day, numerous lottery terminals were confiscated from couriers, as stated in the lawsuit. 

The commission's prior official stance was that it did not possess the power to oversee courier services and thus did not have the authority to prohibit them. 

‘Fixed’ Jackpot 

Lottery couriers enable players to select their numbers and purchase tickets through an app. The courier will complete the order by buying tickets from a licensed physical lottery store. 

However, their existence in Texas is contentious following the involvement of several couriers in aiding a European syndicate to secure a $95 million jackpot in April 2023. 

The syndicate successfully acquired every possible winning number combination – a total of 25.8 million – by collaborating with three lottery couriers that facilitated ticket processing on a large scale. 

Texas legislation forbids the sale of lottery tickets via telephone, and online gambling is not permitted. However, lottery couriers assert a legal loophole since they only offer a delivery service for lottery tickets. 

Following intense questioning by the state Senate Finance Committee in February, TLC stated it would take steps to prohibit the courier sector and revoke the licenses of associated vendors. 

‘Consistent’ With Law 

However, in a meeting held in February 2021 between then-Lottery Operations Director Ryan Mindell [who later became TLC CEO] and Lotto.com CEO Tom Metzger, Mindell “notified Lotto.com of the specific steps required to obtain certification from the Texas Lottery, confirming that its business model complied with Texas law,” as claimed by Lotto.com in its lawsuit. 

In July 2021, Lotto.com requested a legal opinion from the Texas Lottery confirming that its courier services would comply with the law. Mindell stated that Lotto.com, functioning as a courier, was not obligated to secure a license and its activities did not violate the Texas penal code, based on the lawsuit. 

Since that point, TLC supported and collaborated with Lotto.com and additional couriers, as stated in the filing. This involved contributing to the creation of Lotto.com’s digital scratch-off product, which was introduced in 2023. 

“Now, over two years later, the Lottery is attempting to rewrite the history of its involvement,” claims the lawsuit.

Mindell stepped down from his role as TLC executive director on Monday.