Introduction

On 1 July 2025, the Swedish Supreme Court (Högsta domstolen) delivered its judgment in case T 607-24, providing further guidance on the application of Section 33 of the Swedish Contracts Act (1915:218) in the context of today’s digital capabilities for collecting, analysing, and acting on customer data. The outcome, in this very specific case, resulted in ordering an online gambling operator (“the operator”) to pay approximately EUR 500,000 plus interest to a player.

Proceedings in the Lower Courts

The case involved a player who, between 2009 and 2014, wagered nearly EUR 15 million on online slot games, ultimately losing approximately SEK 8 million. After achieving VIP status in 2012, the player's gambling escalated significantly. In October 2014, he requested account closure, which the operator honoured. Following a subsequent gambling addiction diagnosis, the player sued in the Patent and Market Court, seeking repayment of nearly EUR 15 million plus interest. Among various legal grounds cited, the player relied primarily on Section 33 of the Contracts Act.

Section 33 of the Swedish Contracts Act establishes that legal acts cannot be enforced when “the circumstances under which it was undertaken are such that invoking it would be contrary to good faith and fair dealing (tro och heder), and the counterparty must be assumed to have been aware of these circumstances.” This provision enables courts to invalidate contracts concluded under improper circumstances, requiring reversal of any performance rendered. The preparatory works specifically indicate that Section 33 should apply when a party acts in bad faith by contracting with someone who, due to illness or age, cannot properly understand the agreement terms.

After the claims were dismissed by the Patent and Market Court, the Patent and Market Court of Appeal granted leave to appeal. The Court held that actual knowledge of a formal medical diagnosis was unnecessary — it was sufficient for the operator to have known of the player’s serious gambling problems. Based on the player’s unusual betting patterns and substantial losses, the Court determined the operator possessed the requisite knowledge. Since the operator continued what the Court deemed aggressive marketing despite this knowledge, the Court declared the gambling agreements unenforceable. The operator subsequently appealed to the Supreme Court.

The Supreme Court’s Assessment

The Supreme Court established that each individual game constituted a separate legal act potentially subject to Section 33 of the Contracts Act. The question was (i) whether the circumstances under which the games were played (the legal acts) were contrary to good faith and fair dealing, and (ii) whether the operator had actual knowledge of these circumstances.

The Supreme Court clearly established that actual knowledge is required in para 12 of the judgment (our translation):

“Under Section 33 of the Contracts Act, in order for the recipient of a legal act to be prevented from relying on it against the party who performed the act, it is required that the recipient had actual knowledge of the circumstances that make it contrary to good faith and fair dealing to invoke the act. It is not sufficient that the party ought to have known of these circumstances.”

Applying this standard to modern digital operations, the Supreme Court made a groundbreaking determination: companies using digital tools to manage customer relationships and process substantial volumes of behavioural data are deemed to have knowledge of the information their systems collect and utilise. On this basis, the Court found that the operator's extensive access to and active use of the player’s gambling behavior data constituted actual knowledge of the player’s conduct. The evidence demonstrated the operator knew the player was gambling very large amounts, engaging in high-frequency gaming, and displaying clear signs of losing control. These circumstances collectively established that the operator had actual knowledge of the player's serious gambling problems. Importantly, the Court clarified that actual knowledge of a formal gambling addiction diagnosis was unnecessary.

Despite possessing actual knowledge of the player’s serious gambling problems, the operator continued targeting him with what the Court characterised as intrusive marketing for high-risk gambling forms and bonus offers encouraging further gambling. The Supreme Court concluded that enforcing the gambling contracts under these circumstances would contradict good faith and fair dealing. Consequently, the Court declared each individual gambling contract void and ordered the operator to return EUR 527,395, representing net losses incurred between January 2012 and October 2014.

Legal Significance

The facts of the case were highly specific. The Supreme Court expressly noted that this category of gambling was permitted between 2009 and 2014 and that there were no explicit marketing restrictions in place at that time. Today, however, online gambling services require licensing and are subject to strict marketing regulations. The shift in regulatory attitudes is clearly reflected in the judgment, and this raises questions as to whether, and to what extent, Section 33 will apply in other contexts involving digital services.

This ruling signals a potential expansion of corporate responsibility for companies collecting and processing customer data. In practice, companies may be deemed aware of insights their systems derive and be expected to act on such information, even in fully automated customer interactions. As artificial intelligence and advanced analytics become increasingly integrated into commercial services, this responsibility may intensify significantly.