Papaya Gaming Founder Fights for Empire, Denies 'Dark Dealings'

Papaya Gaming, an Israeli mobile gaming company, has been ordered to pay $719 million to its competitor Skillz by a US court, which found the company used bots in its games without player disclosure. The founder and CEO, Uriel Becher, is now fighting the ruling, which he claims threatens the company's future. In a rare interview, Becher stated, "We acted with pure intentions and did nothing in the dark." He argues that the use of bots is common in the industry and that he was unfairly prevented from testifying in his defense. The company is appealing the verdict, which was handed down by a federal court in New York three months ago. The court determined that Papaya Gaming misrepresented its games as fair competitions between human players, when in reality, bots influenced the outcomes. Papaya Gaming is also seeking to delay collection proceedings in Israel, where a district court has temporarily halted enforcement, and has filed a motion in Delaware to recognize the Israeli proceedings as primary, offering protection against immediate operational disruption.

Papaya Gaming, founded a decade ago by Becher, Alex Liakhovetzky, and Andrey Birman, develops skill-based competitive mobile games like Solitaire Cash, Bingo Cash, and Bubbles Cash, where players can win real money. Becher emphasizes that these games are based on skill, not gambling, and that the company earns revenue by taking a commission from entry fees, comparing its model to stock market trading. The company reported revenues of approximately $500 million annually, with 85% originating from US players. The lawsuit was filed by Skillz, a public US company, alleging unfair competition and violation of the Lanham Act, which prohibits misleading advertising. Skillz claimed Papaya Gaming's undisclosed use of bots gave it an unfair advantage and harmed its business, leading to a 60% drop in Skillz's revenue from $384 million to $152 million between 2021 and 2023, while Papaya's revenue rose from $163 million to $461 million in the same period.

Becher maintains that bots are a standard industry practice used to improve user experience and reduce wait times, likening them to "automatic participants" that ensure market liquidity by matching players. He claims the company lost $40 million due to bots paying out prizes to human players without paying entry fees. The court, however, found that Papaya Gaming used bots to artificially inflate player numbers and manipulate outcomes, with bots participating in 90% of cash tournaments in January 2021, decreasing to 50% by late 2023. Becher asserts that the company stopped using bots proactively before the lawsuit, as their necessity diminished with a growing player base. He also stated that the court's description of the bots was inaccurate and that crucial evidence, including expert testimony, was not fully presented. Papaya Gaming is seeking a settlement to restructure its debt over 6.25 years under the supervision of a court-appointed trustee, Adv. Gil Oren.