Stake.us New York Case: Judge Questions Arbitration Bid

A federal judge in New York ordered every party in the Stake.us underage gambling lawsuit to answer a question none of them raised: Judge John P. Cronan gave them until August 13 to file a joint letter explaining whether a court needs personal jurisdiction over a defendant before it can send that defendant's case to arbitration. For a group of Curaçao, Cyprus and Australian companies that have explicitly reserved the right to argue no US court has jurisdiction over them, that was an awkward question to have to answer. They answered it on August 13, and they answered it in opposite directions.

The order is three typed lines stamped across the top of a lawyer's letter, signed by hand and entered on August 6. It is not the first thing Judge Cronan has signed here, because he granted a scheduling extension on July 21, but it is the first legal question he has put to anyone, and it goes to the heart of the escape route every offshore sweepstakes operator uses.

What did the judge actually order?

The full text of the endorsement, verbatim: "By August 13, 2026, the parties must submit a joint letter, not to exceed three pages, explaining whether a court must have personal jurisdiction over a party in order to grant that party's motion to compel arbitration. SO ORDERED."

It carries Judge Cronan's signature and the date August 6, 2026, and it is endorsed directly onto the face of the Stake defendants' own pre-motion letter, which had asked for permission to file a motion to compel arbitration.

We flagged this endorsement on August 8 in our earlier report on the removal of this case but could not read it, because the document was not on the public docket at the time. It is now, and it says something more pointed than a scheduling note.

Why does personal jurisdiction matter here?

Because of what the same defendants asked for in the same week.

Buried in the Stake defendants' August 5 letter is a reservation of rights: the parties "intend to stipulate that (1) by filing their motions to compel arbitration, Defendants expressly reserve and do not waive any objections they might raise to the Complaint under Federal Rule of Civil Procedure 12(b), including any objections based on lack of personal jurisdiction."

So the defence position, as filed, is that the court should exercise its power to force this case out of the courtroom while leaving open the argument that the court has no power over them at all. Judge Cronan's order asks whether those two things can both be true. Nobody had briefed it. He raised it himself.

The joint letter filed on August 13 splits on it. The defendants say no: a motion to compel arbitration is a threshold, pre-merits question, "courts in this district routinely resolve a motion to compel arbitration prior to resolving a motion to dismiss for lack of personal jurisdiction," and moving to compel waives nothing. They add that the Eastern District of Virginia did exactly that on July 30, 2026, in Ridley v. Sweepsteaks Ltd. - granting a motion to compel arbitration brought by some of the same defendants and denying their personal-jurisdiction motion as moot. The plaintiff says the opposite, citing the Second Circuit's Victory Transport and a line of cases treating personal jurisdiction as "a prerequisite to the entry of an order compelling arbitration," and argues the court should decide remand before it reaches personal jurisdiction at all. Both sides asked to argue it inside the main briefing rather than separately, and that is what the court allowed.

The eight Stake defendants named in that letter are Medium Rare N.V. doing business as Stake.com, Sweepsteaks Ltd. doing business as Stake.us, EasyGo Group Holdings Pty Ltd., EasyGo Entertainment Pty Ltd., Medium Rare Ltd., Slicemedia B.V., Bijan Tehrani and Edward Craven. Their own letter describes Medium Rare as a Curaçao limited liability company and Sweepsteaks as a Cyprus limited liability company.

Why does the plaintiff want the case back in state court?

Because he says it should never have left one. On August 10, plaintiff's counsel at Seeger Weiss filed a letter saying he will oppose all three arbitration motions and cross-move to remand the case to New York Supreme Court.

The argument turns on how the case got to federal court in the first place. The plaintiff's letter says there are no federal claims here and no diversity between the parties, which leaves the New York Convention, the treaty covering international commercial arbitration, as the only thing holding the case in federal court. Coinbase frames it slightly differently, citing the Convention provisions together with the supplemental-jurisdiction statute, and the plaintiff's answer to that is that supplemental jurisdiction cannot be assumed into existence when nothing supports it. Absent a showing that a valid arbitration clause "falls under the Convention," the plaintiff's letter says, the case "must be remanded to New York Supreme Court" in its entirety.

Then comes the sentence that matters far beyond this one case. The plaintiff argues the Stake.us agreement is "plainly invalid as an agreement collateral to an illegal gambling transaction and null and void on its face."

That is not a novel theory any more. It is the theory that already worked. In July, a Minnesota federal judge refused to send a Stake.us class action to arbitration on the reasoning that a contract violating state gambling law may be void, and a void contract cannot supply an enforceable arbitration clause. The same argument is now running in New York, and Stake.us has an appeal of the Minnesota ruling pending in the Eighth Circuit.

Who is Christopher Freeman?

The ninth defendant is the one our earlier report could not explain. We wrote then that the docket did not show what role Freeman was alleged to have played, and that we were not going to guess. The August 5 letters answer it.

Freeman's own counsel at Alston & Bird set out the allegation against him: the plaintiff says he co-founded Primedice, which the complaint calls a predecessor gambling site to Stake.com and to "its alleged clone Stake.us," and which the complaint says is operated by co-defendant Slicemedia. It characterises Freeman as "integrally involved" in Primedice's design and operation and in the "early corporate decisions regarding the operation of the enterprise."

Then the plaintiff's letter adds the part that is hard to look past. It says Freeman sued Stake.com himself in 2023, and quotes his complaint in that case describing Stake.us as "illegal online gambling" and as "yet another example of the clandestine corporate structures Craven and Tehrani habitually deploy," employing "deceptive practices [that] prey upon individuals who struggle with gambling addiction." The case cited is Freeman v. Stake.com et al., index 653247/2023, filed in New York Supreme Court on July 6, 2023.

We have not obtained that 2023 complaint. Those quotations reach us through the current plaintiff's letter, which is an adversary's filing, and we have not put them to Freeman. What is on this docket in his own lawyers' words is that he now wants the same arbitration clause enforced. He did not sign it, and his letter says he can rely on it anyway "on two independent bases: equitable estoppel and third-party beneficiary status."

What do the two sides say about the account dates?

Both sides agree the plaintiff opened his Stake.us account as a child. They disagree about whether that matters.

The four-minutes detail is Coinbase's own. Its August 5 letter states that "Coinbase's records show that Plaintiff clicked to accept the 2023 Coinbase User Agreement four minutes before his 18th birthday," and argues he did not finish identity verification until after he turned 18. Its lead argument is different again: that a 2025 user agreement, accepted by email notice and continued use, supersedes everything earlier. The plaintiff's answer is that a "passive email notice and continued use alone is not sufficient to establish assent."

None of this has been tested. No defendant has answered the complaint, and under the parties' proposal those deadlines stay frozen until the arbitration and remand motions are decided.

When does anything actually get decided?

Not this year, and not on the schedule the parties jointly proposed. Judge Cronan set his own on August 14, and every date in it runs later than the one the parties asked for.

Briefing closes in the first full week of 2027. A ruling on whether this case belongs in a courtroom at all lands some time after that, on a lawsuit filed in April 2026 about conduct alleged to start years earlier. That delay is the point of the exercise, and it is the most useful thing for a player to understand about suing any offshore operator.

The order that set those dates did not answer the question Judge Cronan asked. It reads, in full: "The Court thanks the parties for their letter. Defendants may submit their anticipated motions to compel arbitration by September 7, 2026," followed by the three deadlines above and a direction to the clerk to close docket numbers 21 and 23, the two pre-motion conference letters. Whether personal jurisdiction has to come first is now something the parties will argue inside the arbitration and remand briefing, which is what they asked him to allow.

What does this mean if you play at a sweeps casino?

Two things, and only the first is about Stake.

The arbitration clause reaches further than the company you signed up with. The clause the Stake defendants rely on covers disputes between the player and the operator "or any of its affiliates, subsidiaries, ultimate parent and parent companies, partners, officers, directors, employees, contractors, shareholders, agents, licensors, subcontractors or suppliers." That list is doing real work: it is how non-signatories, including individuals, claim the benefit of a contract they never signed. Freeman is arguing exactly that, and so are the seven Stake defendants who are not Sweepsteaks. The plaintiff's answer is that only one defendant in the case actually signed the Stake.us agreement, and that Stake.com keeps its own separate terms with no arbitration clause in them at all.

Re-accepting terms as an adult can cost you the argument. The strongest card either defence group holds is not the original signup but the later acceptance: September 19, 2023 for Stake.us, and continued use after a 2025 email for Coinbase. Curaçao and Cyprus incorporation is then why this case sits in federal court under a treaty rather than before a New York judge. Our guide to how sweepstakes casinos work covers that structure, and the operators whose paperwork we can actually follow are the ones we rank. New York banned this model outright in December 2025, so our New York page carries no offers regardless. Minnesota, where the parallel Stake.us case is running, has not.

One limit on this piece. We are reporting the court file, not adjudicating it. Every characterisation of the plaintiff's case is an allegation from his complaint or his lawyers' letters that no court has ruled on; every characterisation of the defence comes from the defendants' own filed letters. We did not put questions to Stake.us, Coinbase or Mr Freeman before publishing.

Sources & documents

• Memo endorsement, Doc. 24, entered August 6, 2026 - Judge Cronan's order requiring the August 13 joint letter, endorsed onto the first page of the Stake defendants' pre-motion letter
• Plaintiff's letter, Doc. 25, filed August 10, 2026 - Seeger Weiss letter stating the intent to oppose arbitration and cross-move to remand
• Stake defendants' pre-motion letter, Doc. 20, filed August 5, 2026 - account dates, the arbitration clause text, the proposed briefing schedule and the personal-jurisdiction reservation
• Christopher Freeman's pre-motion letter, Doc. 21, filed August 5, 2026 - equitable estoppel and third-party beneficiary arguments by a non-signatory
• Coinbase defendants' pre-motion letter, Doc. 23, filed August 5, 2026 - the 2025 user agreement argument and the four-minutes account record
• Joint letter, Doc. 26, filed August 13, 2026 - the two sides' opposed answers to the personal-jurisdiction question, added on the August 17 re-read
• Scheduling order, Doc. 27, entered August 14, 2026 - Judge Cronan's briefing schedule, endorsed onto the joint letter, added on the August 17 re-read
• Docket entries for Doe v. Medium Rare N.V., No. 1:26-cv-05975 (S.D.N.Y.) - read August 11 and re-read August 17, 2026; Doc. 27 is the most recent filing

Every quotation above is verbatim from a document we downloaded from the federal court's public record on August 11, 2026, or, for the joint letter and the scheduling order, on August 17, 2026, with one exception we flag in the text: the 2023 Freeman quotations are quoted inside the plaintiff's August 10 letter, and we have not obtained the 2023 complaint they come from. Docket entry 22, the proposed stipulation, is not available on the public docket, so we describe the reservation of rights from the Stake defendants' letter that sets it out rather than from the stipulation itself. This article reports the contents of court filings. It does not assert that any allegation in the complaint is true, and no court has found any defendant liable for anything.

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