Tel Aviv Court Approves Temporary Stay for Papaya Gaming Amid $719M US Lawsuit

The Tel Aviv-Jaffa District Court, led by Judge Iris Lushi Avodi, has granted Papaya Gaming a temporary stay of proceedings following a request to implement a supervised payment arrangement. This legal move aims to maintain Papaya's business continuity and protect its employees and customers while it appeals a $719 million judgment against it in the United States. The judgment was issued by a federal court in New York in a lawsuit filed by Papaya's competitor, Skillz.

Papaya Gaming asserts that the US ruling contains significant errors and procedural flaws and intends to overturn the decision through an appeal process expected to last several years. The company emphasized that the US judgment has not yet been enforced in Israel, and the stay order is designed to prevent unilateral enforcement actions by Skillz that could disrupt Papaya's operations.

The supervised payment plan applies solely to the ongoing legal claims and does not affect Papaya's commercial activities. The company continues normal operations, fulfilling obligations to employees, suppliers, and service providers, while allowing users to withdraw funds from its apps without restriction. Under the court-approved framework, Papaya will transfer its available cash reserves into a dedicated fund overseen by a court-appointed official. This fund is expected to hold approximately $100 million for 2026 and additional tens of millions annually, serving as a source for potential claim settlements if the judgment is ultimately enforced in Israel.

Alongside the Tel Aviv proceedings, Papaya also filed a similar request for temporary relief with the federal court in New York to prevent enforcement actions abroad during the appeal. Papaya stated that this proactive and responsible step is intended to safeguard the company’s operations and stakeholders during the appeal, expressing confidence in the appeal’s chances due to the alleged fundamental errors in the original ruling. The company aims to continue growing while ensuring the rights of all parties involved are protected over time.