James Varga, better known by his former Twitch handle, Phantoml0rd, is filing a lawsuit against the popular streaming company following his 2016 suspension. According to Unikrn, Varga seeks damages from his lost revenue, as well as character damages due to the suspension.
Varga’s suspension was a bit murky, but it stems from his affiliation with a Counter-Strike skin gambling site called CSGOShuffle. Varga routinely featured the site on his streams, and claimed he was putting his money on the line for a chance to win rare skins for his Counter-Strike weapons. A bit of sleuthing turned up the almost certain fact that Varga actually owned the site, was gambling with the sites own money, and was using his streams to promote it fraudulently. This violates FTC, Valve, and Twitch rules, and he was subsequently booted from streaming on Twitch.
Varga’s lawsuit against Twitch claims that they were actually in breach of contract by suspending him, as he should have received written notice of any violations and been given thirty days to correct them. He also claims that the Skype conversations that indicate his involvement with CSGOShuffle are “unsubstantiated, false allegations.”
According to the lawsuit, Twitch did not tell Phantoml0rd why he was being suspended until January 2017, several months after his account was originally suspended. Even then, they originally told him that he was being suspended for his channel having fake subscribers. That was then amended to say he was spending too much time streaming non-gaming content, which includes his CSGO gambling. However, Vargas claims his contract allowed thirty minutes of non-gaming footage per stream, and that Twitch was aware that his skin gambling was not legitimately portrayed.
Although loot boxes are the dominant conversation in video game gambling, in game cosmetic item betting, like what is done on CSGOShuffle, has also been causing controversy for some time. It will be interesting to see how Vargas’ lawsuit plays out. We will stay with the story as more details emerge. Due to this pending litigation, Twitch has declined to comment on the story.