Article by Attorney at Law Alicia Pointner

The Higher District Court of Zweibrücken has made a reference decision that could have far-reaching consequences for the entire gambling industry. In the case 7 U 113/23 which was handled by the Melchers Litigation Team, a Higher District Court ruled for the first time on 26/02/2025 that international jurisdiction for claims between a foreign debt buyer and an online casino with a foreign license does not generally lie in Germany. This landmark ruling could be seen as a catalyst for a change in case law in the area of player claims in the online casino sector.

The case centres on a dispute between a debt buyer and an online casino operator based in Malta. The plaintiff, who buys the claims of German players for a fraction of the amount of the loss and then asserts claims for repayment and damages in his own name, had argued that German jurisdiction would follow from several provisions of the Regulation on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters (Brussels I Regulation). The Higher District Court of Zweibrücken clearly rejected this by denying international jurisdiction in its entirety. Neither the place of performance - i.e. the place where the service was actually provided according to Art. 7 no. 1 b) of the Brussels I Regulation - was in Germany, nor was the place of performance. This was clearly in Malta.

It should be particularly emphasized that this is the first time that a German higher district court has dealt exclusively with the question of international jurisdiction and the relevant case law of the ECJ in a well-founded and sufficiently thorough manner. In addition, it has worked out the correct connecting factors for the question of jurisdiction in tort pursuant to Art. 7 no. 2 of the Brussels I Regulation.

The Court did not hear the plaintiff's argument that the connecting factor for determining the "place where the harmful event occurred" should be the player's place of residence, because the harmful account debit took place there (place of performance) or at the place where the defendant had directed its activities (place of action. Rather, the court expressly ruled that neither the place of action nor the place of performance was in Germany. The concept of the place of performance should not be interpreted so broadly as to include any place where the harmful consequences of an event can be felt, even if the damage actually occurred elsewhere. This would lead to a general place of jurisdiction for plaintiffs, which is not the intention of Art. 7 no. 2 of the Brussels I Regulation.

The decision makes it clear that even if the offer with a German-language website is directed at German consumers, the relevant place of performance - based on the technical control and the registered domicile of the operator - is in Malta.

This decision opens a new perspective: German courts could increasingly, following this case law, increasingly dismiss claims by debt buyers for the reimbursement of gambling losses to fail on the grounds of inadmissibility. As a result, debt buyers would be forced to pursue players' claims in Maltese courts, which could prove to be particularly difficult. Finally, a recent Maltese court decision of last instance confirmed that the refusal to enforce two Austrian judgments in Malta was lawful. This will make it even more difficult in the future for players who want to reclaim their lost stakes to get their money back. The business model of profiting from the wave of player lawsuits by buying up claims is being put to the test, and this finding is accompanied by the insolvency of a major buyer of debts at the beginning of March.

The decision of the Higher District Court of Zweibrücken could therefore point in the direction of a greater restriction of legal enforcement of judgments by debt buyers and trigger a change in the business model. It remains to be seen whether the plaintiff will appeal the decision and how the Federal Court of Justice will rule.

In any event, the decision of the Higher District Court has already provided a decisive impetus that is likely to have a lasting impact not only on case law but also on the strategy of debt buyers.

Contact:
Melchers Rechtsanwälte
Attorney at Law Alicia Pointner

Im Breitspiel 21
D - 69126 Heidelberg