DraftKings to Pay $8M to End Multiple Class Action Lawsuit Claims

DraftKings has agreed to pay $8 million to settle a number of class action lawsuit claims, including that the company didn’t adequately represent how difficult its daily fantasy sports contests are to win. 

Plaintiffs made a number of allegations, including that the DraftKings and FanDuel terms and conditions weren’t clear enough for average users, that the companies unfairly tricked consumers into participating in one-sided contest designed to allow only a few elite players to win, and that the companies were engaged in illegal gambling.

The claims were centralized in Massachusetts federal court in early 2016.

Anyone in the United States who made a first-time deposit into their DraftKings Daily Fantasy Sports account before Jan. 1, 2018, and who are not net lifetime winners on DraftKings as determined by DraftKings’ business records not later than 48 hours prior to the Agreement Execution Date is considered a Class Member, according to the settlement agreement.

The settlement will be divided into two funds, Casino.org reported.

The first fund will go to Class Members in the form of DK Dollars — credits on the DraftKings website.

The second fund will consist of $720,000 to be paid in cash to Class Members with closed DraftKings accounts.

Class Members will be broken down into eight levels based on the amount of their first deposit into their DraftKings account.

The maximum amount available to each Class Member will equal the highest amount of that first deposit multiplied by 1.75. As an example, the settlement funds available to any Class Member at the highest level of initial deposits will be $1,050 cash or DK Dollars.

In addition to the monetary relief, under the terms of the settlement agreement, DraftKings will take several measure regarding its daily fantasy sports content, including limiting each authorized player  to one active and continuously used account, enabling authorized players to exclude themselves from contests, and enabling authorized players to set limits on the amount of funds they can deposit, among other things.

DraftKings admits no wrongdoing but has agreed to the settlement in order to end the litigation, Casino.org reported.

The class action lawsuits involve over 3 million people, Casino.org reported, with the FanDuel claims still pending.

Are you a DraftKings accountholder? What do you think of the settlement? Let us know in the comment section below.

The DraftKings Multidistrict Litigation is In re: Daily Fantasy Sports Litigation, Case No. 1:16-­md­-02677, in the U.S. District Court for the District of Massachusetts.

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