TLDR A California whistleblower suit claims card breaks on Fanatics Live and Whatnot are unlicensed lotteries. The suit includes 18 plaintiffs in at least 11 states who spent from a few hundred dollars to more than $4 million on breaks. Fanatics Live bans spins and raffles but allows random team breaks run through its own tool. Four breaker businesses have sued TikTok and Fanatics, citing bans tied to “allegations of gambling.” No US state regulator has ruled on whether card breaks count as gambling.
Fanatics Live, the livestream shopping platform owned by Fanatics, tells sellers it “prohibits gambling.” Its rules ban duck races, spins, raffles, and roulette wheels.
The same platform allows random team breaks. In this card-break format, every buyer pays the same price and is randomly assigned a team.
A whistleblower suit filed under the California False Claims Act says card breaks on Fanatics Live and rival Whatnot are “unlicensed box-break lotteries,” ESPN reported in June. A Fanatics spokesperson declined to comment to ESPN.
What the Whistleblower Suit Claims
The suit was filed in July 2025 and later unsealed. It alleges the companies “knowingly failed to pay the required taxes and to obtain mandatory gambling and business licenses.”
The complaint includes 18 named plaintiffs across at least 11 states. They spent from a couple of hundred dollars to more than $4 million on breaks on Whatnot, Fanatics Live, or both.
The suit asks the court to order Fanatics to “cease supplying product to unlicensed breaking operations” in California. Fanatics makes trading cards through Topps, which it bought in 2022.
California’s Department of Justice declined to intervene. The plaintiffs had until August to decide whether to pursue the case themselves, and it is not clear whether they did.
Whatnot faces a separate challenge. Attorney Paul Lesko