FanDuel Players Fight Arbitration Clause in Fantasy Sports MDL

FanDuel players claim that the company’s user agreement was purposefully obscure, arguing that they are not bound by the arbitration pact.

According to players bringing multidistrict fraud claims against FanDuel Inc. and DraftKings Inc., the terms and conditions are not clear enough for the average user to understand.

They claim that players aren’t aware that they are agreeing to an arbitration deal so they should not be bound by the clause.

An attorney for the plaintiffs told Senior U.S. District Judge George A. O’Toole that the company linked terms and conditions below a prominent, green “Play Now” button which was allegedly an intentional choice to mislead customers.

“FanDuel knew how to make this a binding contract, there are a few things they could do that are easy,” plaintiffs’ counsel said. “They could make this into a link where you have to formally check a button and say ‘I agree to these terms,’ or they could have called out the terms of use in bold letters, with a blue hyperlink and an underline and they would have been squarely within the law in terms of forming a contract.”

“They chose not to do that. They chose to obscure the terms, and frankly they should not be rewarded for doing so,” added counsel for the plaintiffs.

Lawyers for FanDuel reject this argument, stating that reasonable consumers know they are entering into an agreement by signing up with the website. Counsel also claims that consumers know that they are subject to terms and conditions which they can look for if they choose to.

“The test is not whether every link is blue or whether the link is perfect, it is ‘do they know they are agreeing to something and where to find it,’” FanDuel’s counsel said. Pointing to the display of the FanDuel agreement used during part of the class period, he added, “it’s hard to imagine something less cluttered than this. It’s a white background and everything jumps out.”

Claims against FanDuel and DraftKings were consolidated into a multidistrict litigation in Massachusetts in February 2016. The move streamlined claims that the companies tricked consumers into believing they could win games when the games were allegedly one sided contests designed to be won only be the elite few.

Plaintiffs in the multidistrict litigation also claim that the game companies encouraged illegal gambling and “bonus fraud.”

The consolidated complaint was filed in September 2016 and included claims by 19 named plaintiffs against DraftKings and FanDuel. The FanDuel class action consolidates 80 separate complaints and brought claims of violations of different states’ consumer protection laws, common law claims, and claims under the federal Racketeer Influenced and Corrupt Organizations (RICO) Act.

The players are represented by Christopher Weld Jr. of Todd & Weld LLP; Jasper D. Ward of Jones Ward PLC; and Howard T. Longman of Stull Stull & Brody.

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