Yes, a sweepstakes class action can settle before trial. A sweepstakes class action is a lawsuit where a group of entrants sues a sponsor over how a giveaway was run. As one example, Coinbase and its administrator agreed to pay $2.25 million in Suski v.
Coinbase after nearly four years including U.S. Supreme Court litigation over a June 2021 Dogecoin sweepstakes, according to Legal 500 / Klein Moynihan Turco in the settlement announcement. That deal did not end the case by itself. It still needed a judge to approve it.
Official resources:
- Read the official notice from Cornell — Use this primary source to verify the official announcement.
- Read the official notice from Cornell — Use this primary source to verify the official announcement.
Table of Contents
- How common is pretrial settlement?
- Why must a judge approve the deal?
- What happens between agreement and payout?
- What can delay final approval?
- Do regulators create separate sweepstakes payments?
How common is pretrial settlement?
Settlement before verdict is the normal path in certified class cases. A Federalist Society review of class-action data found that 75% of certified class actions pending in 1993 settled, and 90-100% of resolved cases studied settled before verdict, in the class-action data review.
Trial is rare because both sides face risk and cost. A sponsor can limit exposure through settlement. Class members can receive payment sooner without a verdict.
Why must a judge approve the deal?
A private agreement does not bind the class by itself. Federal Rule of Civil Procedure 23(e) provides that certified-class claims may be settled only with court approval, and a binding proposal may be approved only after a hearing finding it fair, reasonable, and adequate, according to Cornell Legal Information Institute in the text of Rule 23. That review happened in the Coinbase case.
Courthouse News Service via IndustriesNews reported that U.S. Magistrate Judge Sallie Kim granted final approval to the Coinbase Dogecoin class settlement in San Francisco. Approval made the settlement enforceable for the class.
What happens between agreement and payout?
The American Bar Association Litigation Section describes a three-step sequence. Parties first seek preliminary approval. Then they send court-directed class notice.
Then they seek final approval at a fairness hearing where members may object or opt out. For readers, that sequence means: Do not wait for trial news. Payment rights usually depend on the notice and claim process.
- watch for mailed, emailed, or published class notice
- read the eligibility, claim, opt-out, and objection instructions
- file a claim or respond by the stated deadline
What can delay final approval?
Government notice can affect timing. Cornell Legal Information Institute explains that 28 U.S.C. Section 1715 under the Class Action Fairness Act generally requires each settling defendant to notify appropriate federal and state officials within 10 days of filing a proposed settlement.
That requirement constrains when final approval may issue. Objections raised at the fairness hearing can also require more review. A fairness finding must still show the proposal is fair, reasonable, and adequate.
Do regulators create separate sweepstakes payments?
Yes, a sponsor can also face a government settlement. Kelley Drye Ad Law Access reported that Publishers Clearing House agreed to an $18.5 million FTC order over alleged dark-pattern sweepstakes entries, undisclosed costs, privacy misrepresentations, and CAN-SPAM violations plus business reforms.
Those refunds moved separately from class-court approval. PYMNTS reporting on the FTC action said the FTC began sending more than $18 million in refund checks on April 30, 2025 to 281,724 PCH buyers, in the refund report. Class members should monitor notices and cash settlement checks promptly.