DraftKings is facing a class-action lawsuit alleging ‘unfair and deceptive’ advertising in relation to the sportsbook’s $1,000 bonus bet offer for new customers.
The suit was filed by the Public Health Advocacy Institute on behalf of two Massachusetts residents, Shane Harris and Melissa Scanlon, and claims that the promotion has unrealistic wagering requirements for the customer to receive the full amount of the bonus. The suit also alleges that marketing for the promotion led customers to believe that a simple deposit was all that was required to receive the bonus funds.
According to the promotion’s terms and conditions, a customer would need to deposit $5,000 with the first 90 days of opening an account. They would also need to place at least $25,000 in wagers in order to receive the full amount of the bonus.
The complaint stated:
“DraftKings knew, or should have known, that its advertisement and promotion was deceptive to their target customers, who were new to sports betting and were extremely unlikely to understand the gambling lingo in the fine print.”
The filing also noted that according to Massachusetts sports betting regulations, the company had a duty of care to its customers to ensure that they were protected as much as possible from the risks of problem gambling.
The Public Health Advocacy Institute’s executive director Mark Gottlieb, said:
“Shane and Melissa are typical of many thousands of people in Massachusetts who were misled by the bonus offer and would not have signed up had they understood DraftKings’ unfair and deceptive requirements.”
DraftKings and FanDuel Also Facing DFS Legal Action
Earlier in October of this year, a class-action lawsuit was filed in Manhattan which accused fantasy sports operators DraftKings and FanDuel of ‘negligence, fraud and false advertising’.
The complainant in the case, Adam Johnson, a Kentucky resident, claimed that daily fantasy games operated by the two companies are misrepresented as fair. The complaint is based on the recently revealed policies whereby both companies allow employees to enter contests on the other’s site for cash prizes. The lawsuit alleges that this is unfair as the employees have an unfair advantage due to the analytics made available to staff that help to determine winning strategies.
DraftKings co-founder Paul Liberman recently stated that some of the company’s employees made more through entering DFS contests on FanDuel than their salaries. However, an internal investigation launched after an employee revealed winnings of $350,000 found that no inside information obtained by staff could be seen as advantageous.
Reports this week have stated that a second lawsuit with a similar complaint has now been filed in the state of Illinois.
Ciaran has been working within the Gambling Industry as a deep analyst since 2019. His deep knowledge and understanding of all the gambling regulations, and processes makes him a true asset, and an always valuable point of view for Gambling Industry News, allowing us to cover every topics from a brand new perspective.
