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.
"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."