About a month after a federal judge dismissed their lawsuit against the Illinois Lottery over failure to pay winnings amid the ongoing Illinois state budget impasse, plaintiffs from the dismissed federal case have hit the same lottery and state officials with another class action, this time asserting the state owes them interest on the unpaid or slowly paid lottery winnings.
On Jan. 7, a group of plaintiffs, including Rhonda Rashce and Daniel Chasteen – the lead plaintiffs in the failed federal class action – filed suit in Cook County Circuit Court against the Illinois Lottery, acting Lottery Director B.R. Lane, Illinois Comptroller Leslie Munger and Illinois Treasurer Michael Frerich. They are represented in the action by attorneys from the Zimmerman Law Offices, who also represented plaintiffs in the federal class action complaint.
In September, the same plaintiffs sued the Illinois Lottery and state officials over the failure to pay. However, in early December, a federal judge, while calling the case “unfortunate,” granted the state officials’ request to dismiss the case on the grounds the state departments and offices were exempted under the 11th Amendment to the U.S. Constitution, which is held to immunize state governments and state departments and officials acting in an official capacity against lawsuits brought in federal court by citizens.
In that case, the judge said the federal courts cannot “disregard fundamental principles of federalism and long-standing rules prohibiting federal courts from interfering with the state’s operation of its own treasury.”
The new Cook County lawsuit carried over allegations from the federal lawsuit against the state officials, noting the state, after July 1, 2015, stopped paying anyone who won more than $25,000 in an Illinois Lottery game. On Oct. 15, the Lottery stretched its nonpayment policy to anyone winning more than $600.
The Cook County complaint noted state officials said the unpaid winnings were being held in “interest bearing accounts” while the state sought to resolve the budget woes that purportedly prevented it from paying the Lottery winnings.
However, since the state on Dec. 14 resumed paying all Lottery winnings, the state has “refused to pay, and continue to refuse to pay, said winners any interest” on the winnings.
While the federal judge had ruled their case effectively amounted to a breach of contract claim, the plaintiffs have asserted the state’s failure to pay violates their rights under the U.S. and Illinois state constitutions.
The new complaint included 21 named plaintiffs, whose winnings totaled more than $3.65 million, ranging from individuals who won $1,000 to groups of plaintiffs who collectively won prizes of $1 million and $2 million, respectively.
The proposed class in the litigation would include anyone who won prizes of more than $600 in Illinois Lottery games since July 1, 2015, and “have not been paid any income generated on their lottery winnings” while the state withheld payment of those winnings. The complaint asserted the class likely numbers in the “thousands of individuals,” whose total winnings would number in the hundreds of millions of dollars, as the class could include the winners of a $262 million Mega Millions game jackpot.