"Q. To summarize this issue, a column that has six numbers, say, three even and three odd numbers, and a second column has six numbers that are odd, one of which has a greater chance than the other
- All columns have the same chance of winning.
- So what is written here in section 3 is misleading
- Therefore, I say again... The court asks me to answer whether this is a deception or not, I answer that if a person fills out one column and we only look at this column that will win, then these things are irrelevant, these tips will not improve the chances of winning. Because all columns have. If a person fills out 100 columns and asks according to what he chooses them according to such guidelines, we need to check whether these data help narrow down possibilities, I didn't check. [...] I have to really think like does it have an effect on reducing templates, I can stand behind the fact that filling in a single column doesn't help."
Prof. Fibich's words indicate that he also does not believe that the choice of combinations with certain characteristics, such as a mix of even and odd numbers, affects the chances of winning. Regarding filling out a large number of forms according to guidelines, he did not confirm that this would be beneficial in reducing the possibilities. He said that he "did not check it."
- To summarize this point, the two experts agreed that there is no possibility of choosing combinations that have a higher chance of winning the lottery. Choosing combinations with certain characteristics does not increase or decrease the chances of winning the lottery (Prof. Fibich refrained from confirming that choosing numbers on many forms according to guidelines can help narrow down the possibilities. He noted that he had not examined this and that "we have to think"). Mr. Miller, for his part, thinks otherwise. According to him, certain combinations have a higher chance of winning the lottery. However, no reference was presented to his claim, which, as stated, contradicts the position of the experts, including the expert on his behalf.
- Miller was also asked about the "best experts" who developed the statistical method, as presented on the Respondent's website. Mr. Miller replied in general and unproven statements that these were a number of statistical experts, whose names he could not disclose, "graduates of universities, several companies from abroad, who presented certificates in this field and also in the field of software" [...] "who developed the same software that produces the combinations and gave their opinion on this whole issue of number selection." It was claimed that the engagement with them took place before the company was established, "for over 13-14 years", and did not last for a long period of time (p. 130 of the minutes of February 5, 2024).
- On the other hand, in an affidavit in response to the questionnaire provided to the respondent, Mr. Miller, in response to a question about the names of the senior mathematicians available to the club's customers and the names of the experts who developed a tested statistical method that are mentioned on the club's website, replied that "at the beginning of Mega's activity, the company was given a method that was developed by a mathematician who specializes in statistics and is a foreign resident. The company has no connection with the expert from whom the method was purchased, which is still used by the company."
- When confronted with the contradiction in his statements, Mr. Miller insisted on his position in the cross-examination that "there were several experts", and not one such expert in the answers to the questionnaire, and claimed that an attempt had been made to locate their names, but it was unsuccessful, due to the passage of time. Mr. Miller did not provide a satisfactory explanation for the discrepancy between his versions as to the scope of the people who developed the method, and neither they nor the method were presented to me.
- It appears from the aggregate that there is a reasonable chance that in the main proceeding it will be determined that the representation presented by respondent No. 2, according to which it uses mathematical methods that make it possible to increase the chances of winning, is liable to mislead the customers regarding a material interest in the transaction. The method claimed by the respondent, which includes the omission of combinations with a seemingly low chance of winning the lottery, is not backed up by mathematical or statistical evidence. The experts agreed that there is no way to choose combinations that have a higher chance of winning the lottery.
- Admittedly, the Respondent attempts to qualify its liability by means of certain clauses in the Regulations stating that the probability of a customer's winning "is in accordance with the probability of a customer winning such lotteries" and that "it is hereby declared and agreed that the Mega Club does not guarantee any winning of any prize and is not even responsible for the chances of success of the subscriber in any lottery or any prize". However, from the totality that emerges from the Respondent's representations, it appears that there is a reasonable chance that it will be determined that these will mislead the customer into thinking that participation in the lottery lotteries through the Respondent's services will yield him a higher chance of winning prizes due to the unique selection of numbers available to him by virtue of an engagement with the Respondent.
- With regard to the representation regarding the use of the services of the "best experts" – the Respondent did not provide a coherent answer to the question of who those experts are, and whether it is a team of experts or perhaps one expert. Admittedly, it has not been proven that the Respondent did not engage with those experts in the past and that this is a misrepresentation, however, given the totality of the circumstances and representations, and for the purposes of certifying the class action before me, since it is not clear what expertise can yield the alleged results and since reliable information was not provided by this Respondent about those experts and even contradictions arose in the versions, there is a reasonable chance that in this aspect as well, it will be determined later that this is a representation that is liable to be misleading.
- In summary, it appears that there is a reasonable basis to assume that respondent No. 2 is using representations that are liable to mislead its customers as to their chances of winning by participating in the lottery lotteries through its services due to reliance on experts, which ostensibly constitutes a material interest in the transaction.
Respondent 3 - Lottodil
- Lotdeal offers its customers a "monthly subscription to the 'Lucky Five' - a unique and statistics-based lottery package that doubles and triples your chances of winning, every month, every month!" The website further states that "Lotdeal believes that every person, wherever he is, has the right to have a chance at a life of financial freedom. As a result, everything possible, whether by developing new products or using statistical research, is done in order to create this opportunity for you as well." The website also explains "How does the Lotdeal Club do this? Among other things, thanks to the group lottery, through which you can participate in enlarged and especially expensive forms, which are only possible with a large purchase of large participants. For a sum equal to 198 shekels per person per month, you will be able to participate in the unbelievable number of 278 lotteries, which will greatly maximize your chances of winning!" Similar representations also appear in the engagement agreement with the respondent: Clause 4 of the agreement specifies what is included in the "Lucky Five" track: "Four group lottery forms built using a unique club reduction method containing 11 numbers each, which were built and selected by the statistical team of the Lottodeal Club [...]." [Emphasis added - the undersigned].
- In 2020, an administrative proceeding was opened against the respondent with the aim of imposing a financial sanction on the respondent by the Consumer Protection and Fair Trade Authority. In the framework of the proceeding, various allegations were made against this respondent, including the claim that she misled her clients by using the representation that she employs statisticians who improve the chances of winning customers. In a post on the respondent's Facebook page, which was part of the factual basis in the administrative proceeding, it was published that the respondent has "a statistical and revolutionary method that improves your chances of winning by tens of percent," and that "the secret to the high winning percentages lies in our team of statistics experts, who by means of unique methods for selecting numbers improve the chances of winning by tens of percent." The witness on behalf of the respondent, Mr. Yossi Azaria, was confronted with the aforementioned publication and was asked whether they had a revolutionary method for improving the chances of winning by tens of percent. To this, the witness replied: "My explanation is that tens of percent is the method of reduction and the multiplication of participants in the lottery."
- Azaria was also asked about the statistical studies and the team of statisticians that the Respondent boasts. In his interrogation, Mr. Azaria explained that Mr. Yaron Malki, an accountant by training, "is the consultant in this matter", "he is the statistical wing", and that only the Respondent is assisted. Mr. Azaria testified that Mr. Malki relied on two or three articles relevant to the field, and apparently also on his personal knowledge and professional training as an accountant, in order to create the statistical content that the Respondent uses. As to the nature of that "statistical wing", he replied as follows (p. 109 of the transcript):
"Q. A royal accountant has a degree in statistics or mathematics
- I assume that he has extensive knowledge. I know that he is an accountant and an economist. As for the court's question, I don't know if he has a degree in economics. As for mathematics and statistics, I don't know what courses he took. It's hard for me to assume that an accountant gets a diploma without math and statistics classes.
- Your company uses statisticians or mathematicians
- Biron Malki. I don't have anyone else outside.
- [...] Why do you tell clients that you have a team of statisticians?
- Because I see Biron Malki as an expert in the field. As far as I'm concerned, Yaron Malki is the team that is in charge of this
- In other words, you see Biron Malki as a statistician and see him as a team
- I don't know if he's taking more people, but he's in charge of it in the company. [...] We have different consultants who are in charge of different issues, and Malki is the one who is talented to do this issue on behalf of the company."
- Azaria testified that following the financial sanction imposed on the Company in the framework of the administrative proceeding described above, the customers were no longer told that the Company was assisted by statisticians (p. 111 of the minutes). However, immediately afterwards, Mr. Azaria was confronted with the fact that in the engagement agreement with the Company and on its website, statements relating to the team of statisticians and statistical studies, contrary to his statement.
- It emerges from this that the Respondent claims that it maintains a team of statisticians, when in fact it is one person, an accountant by training, who creates the statistical content on which the Respondent is based, which was not presented to me and no reference was brought for its existence, which is inconsistent with the words of the experts. As for the statistical studies in which the Respondent claims that they were used, it is a matter of using the conclusions of CPA Malki from several articles he read on the subject, which are not clear what they are and what their content is, and in fact there is no real reference for their existence. It also became clear that despite the administrative proceeding that was filed against the Respondent and included claims in this matter, the Respondent left in its publications representations relating to the team of statisticians and the statistical studies.
- As to the nature of those statistical methods, including the "club-specific [the] reduction method" used by the respondent for the purpose of selecting the numbers in the lottery forms, Mr. Azaria did not know how to answer, on the merits, and referred the questions to CPA Malki. When asked, "What is happening from the customer's point of view?" he replied: "Reductions. They increase the number of winnings. As Regev and Fibich said." From this vague answer, it is not possible to conclude exactly how the method of reduction to which the respondent is referring works. The fact that Mr. Azaria also attributed the method to Dr. Regev and Prof. Fibich does not necessarily indicate that it is indeed the same method. For we have seen, in the testimony of some of the respondents' representatives, that the term "reductions" is used to describe various methods, only one of which is the method of reductions to which Dr. Regev referred in her opinion. In the absence of the possibility of extracting information from Mr. Azaria about the nature of this method, since he did not know how to provide actual information about the statistical aspects, it is not possible to determine that this is indeed the same method of reductions to which Dr. Regev referred in her opinion, and which, according to her, in fact does not yield a significant improvement and relates to the Eighth Prize.
- It should be noted that contrary to Mr. Azaria's claim, CPA Malki is not making a declaration on behalf of this Respondent. No testimony was presented on his behalf, and it was also not possible to cross-examine the relevant party with the Respondent regarding the alleged statistical methods.
- As it has been held more than once: "Failure to bring a relevant witness naturally raises the suspicion that there are things in his body, and that the party who refrained from bringing him is afraid of his testimony and his exposure to cross-examination." A rule has been adopted by the courts "that a party presumes that he will not withhold evidence from the court that is in his favor, and if he refrains from bringing evidence that is within his reach and there is no reasonable explanation for it, it can be concluded that if the evidence had been brought, it would have acted against him" (see Civil Appeal 548/78 Anonymous v. Anonymous, 35(1) 736 (1980).
- Azaria's vague explanation, together with the fact that CPA Malki, who is ostensibly in charge of the Respondent's statistical aspect, did not come to testify, lead to the conclusion that there is a reasonable basis to assume that the Respondent's statement regarding the use of a unique reduction method and the use of a team of statisticians is prima facie misrepresentation.
- As for the representations in relation to increasing the chances of winning, according to the Respondent, its representations do not mislead the customers. The Respondent undertakes to increase the chances of winning, and it does so, as detailed on the Website, "inter alia, thanks to the group lottery, through which it can be a partner in enlarged and particularly expensive forms, which are only possible with a large purchase of large participants. [...]". This is also detailed in clause 6 of the engagement agreement with it: "The participant declares that it has been explicitly explained to him that the company is not and cannot be responsible for the participant's chances of success in any lottery or prize. The chances of success are subject to the theory of probabilities over which the company has no control. The probabilistic assumption that emerges from the company's software is that the large number of participants in a given program of the National Lottery increases the chances of winning."
- In order to strengthen the Respondent's argument that its representations do not mislead the customers, this Respondent attached a transcript of a recording of a conversation with Mr. Aner Bar-Ilan, the class plaintiff in the proceeding in the Bar Ilan case, which was conducted against the Respondent also for deception. The transcript shows that the Respondent's representative explained to the client that the chances of winning increase by participating in the lottery lotteries through the Respondent's services because the participation is a group, and that the prizes are distributed among the members of the group accordingly. The representative explains as follows:
"Aner: Tell me a second, what are my chances of winning?