DraftKings Faces More Lawsuits Over Advertising Practices

DraftKings is facing a number of class action lawsuits in numerous jurisdictions over alleged deceptive and fraudulent promotional tactics.

Six plaintiffs have filed class action lawsuits against the Boston-based sports betting and DFS giant in Illinois, Kentucky, and New Jersey, seeking injunctive relief and damages for themselves and others for DraftKings‘ alleged deceptive practices, which include the promotion of “no-sweat” bets. 

“Consumers should be able to rely on one of the country’s leading sports gambling outfits to do what it promises and play by the rules,” said Loevy + Loevy attorney Isaac Green, who represents the plaintiffs. “Our complaints allege that DraftKings is misleading and manipulating customers in violation of the law.”

Lawsuits filed in Illinois, Kentucky, and New Jersey

According to the class action lawsuits, DraftKings makes “false promises and misrepresentations” when it offers its “no-sweat” deal, leading prospective consumers to assume they may gamble without risk. Despite DraftKings’ “no-sweat” guarantee, the real terms and conditions of its promotion apparently do not include compensation for losers.

“The complaints allege that DraftKings deliberately makes it sound like you get the cash value of your bet back, which encourages new players to bet larger amounts of money than they otherwise would,” says Green. “But you don’t. “It is not as ‘risk-free’ as advertised.” 

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The suits also analyze DraftKings’ betting limitations. The plaintiffs allege that DraftKings encourages losing gamblers to continue gambling, particularly with large bet sums, while limiting winning bettors by reducing their bet quantities and frequency.

Deposit match promises have also been raised in class actions against DraftKings.

According to court documents, the plaintiffs claim that DraftKings’ deposit match offers encourage customers to spend more money, despite the campaign failing to meet users’ expectations owing to convoluted terms and restrictions. Deposit match offers also only give gamers virtual tokens to spend instead of cash. 

The six plaintiffs in the class actions say DraftKings’ promotional methods are deceptive and fraudulent because they target minors and make false promises and misrepresentations; however, they are not the only customers suing DraftKings.

DraftKings risk-free lawsuit moves forward in Massachusetts.

In Massachusetts, two citizens filed a class action lawsuit against DraftKings for allegedly violating state consumer protection laws by promising a $1,000 deposit incentive.

Shane Harris and Melissa Scanlon, who work with the Public Health Advocacy Institute, believe DraftKings engaged in “unfair and deceptive acts” in its promotional materials.

Last August, a Massachusetts judge dismissed DraftKings’ plea to dismiss the case. 

Samantha Guery filed a class action lawsuit against DraftKings in New York the same month, saying that the operator deceptively advertised its “risk-free” promotion.

Guery said that the free bonus bet she received as part of the promotion did not match the amount of her initial wager, accusing DraftKings of deceiving customers.

The lawsuit against DraftKings will be voluntarily dismissed with prejudice because Guery first failed to react to the court’s communication attempts. As a result, Guery’s lawyers requested relief from the lawsuit, which resulted in its voluntary dismissal. 

DraftKings’ legal troubles continue to be centered in New York, with the operator also facing a lawsuit in the United States District Court for the Eastern District of New York.

Last month, Nerye Aminov filed a class action lawsuit against DraftKings, alleging violations of New York General Business Law, willful deception, and unjust enrichment in connection with the company’s marketing activities for first-time deposit bonuses. 

Aminov claims that DraftKings failed to adequately educate new users that the deposit incentive is calculated as 20% of up to $5,000 of the new customers’ initial deposit. The lawsuit argues that DraftKings failed to disclose the need for a $5,000 deposit and at least $25,000 in wagering to be eligible for the promotion’s $1,000 deposit bonus.

Aminov is suing for the refund of his initial money as well as the entire $1,000 incentive. He’s also seeking statutory damages. The lawsuit represents a nationwide class of DraftKings users who registered an account and deposited funds with the operator in response to the promotion. 

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