DealDash, one of the largest and best known "penny auction" websites, has been accused of operating an "illegal gambling site” and using a "widespread deceptive marketing campaign to lure customers" to the site, according to the advertising watchdog group Truth in Advertising (TINA.org).
"DealDash’s marketing claim — that consumers can generally expect to win items on the cheap — is simply not true," Bonnie Patten, TINA.org’s executive director, told NBC News.
DealDash denies all of the allegations by made in the suit and by TINA.
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"DealDash offers fair value and an entertaining experience for its customers and its business partners," attorney Michael Tuteur said in an email. "DealDash’s auctions are also not a 'form of gambling' as the class action complaint alleges. As with a traditional in-person auction, the outcome of any DealDash auction is not based on chance."