Game Company Hit With $420+ Million False Advertising Verdict

Published: 2026-05-04 16:09:12 ET SKLZ

Published on 05/04/2026 at 04:09 pm EDT

Papaya offers mobile gaming apps in which players can compete for the chance to win cash prizes. It advertised that players are “matched with other players within the same skill level” and that each game is “totally fair and skill-based.” Some players expressed their doubts, posting comments online in which they suspected that the company unfairly matched human players against bots. Papaya responded to many of these comments, but neither confirmed nor denied whether bots played against humans.

In 2024, we reported that Papaya's competitor Skillz filed a lawsuit alleging, among other things, that Papaya falsely advertised that all players on its platform are human. In its motion to dismiss, Papaya argued that it never expressly stated that.

Although a New York federal court agreed that Skillz hadn't identified any statements that were expressly false, Skillz had identified statements—including references to “individuals” and “players”—that could imply that consumers are playing against humans, rather than bots. The court determined that if Papaya does employ bots, the claims identified by Skillz could be actionable.

Last week, a jury returned a verdict in favor of Skillz on its Lanham Act and New York General Business Law claims, finding Papaya should pay $420 million in actual damages. The jury also determined that Papaya should pay disgorgement amounts of $652 million and $720 million, with the actual amount to be determined by the court.

Gonzalo E. Mon Kelley Drye & Warren LLP Washington Harbour, Suite 400 3050 K Street, NW Washington DC 20007 UNITED STATES Tel: 212808 7800 Fax: 212808 7897 E-mail: [email protected] URL: www.kelleydrye.com