Regulatory
Disgorgement
Definition
A remedy requiring a party to give up money obtained through unlawful conduct. It is restorative rather than punitive, aimed at removing a gain rather than imposing a fine.
Why it matters
Disgorgement changes the economics of operating while litigating. Injunctions and daily penalties are forward looking, so an operator facing them can exit a market and stop the meter, keeping everything earned up to that point. Disgorgement reaches backwards to the start of the conduct and is unaffected by a later withdrawal.
That makes it the remedy to watch in enforcement against unlicensed or contested operators. A state seeking only an injunction is asking a business to stop; a state seeking disgorgement is asking it to pay for the period in which it did not. Where a company does not report revenue by jurisdiction, quantifying the sum becomes a substantial dispute in itself.
Gaming regulators also use disgorgement alongside civil penalties in ordinary licensing matters, typically to strip value connected to accounts or activity that should never have been accepted.
The bottom line
A fine punishes conduct and an injunction stops it. Disgorgement removes the reason it was profitable, which is why it is the remedy operators should price most carefully.