DraftKings Agrees To $102K Unfair Betting Event Class Action Settlement

DraftKings has reached a $102,000 settlement with a bettor who filed a class action lawsuit taking issue with the rules of a sports betting event.

Named plaintiff Christopher Leong claimed that that company accepted or rejected bets inconsistently, making the competition unfair.

The $102,000 settlement is now up for preliminary approval by U.S. District Judge Joseph H. Rodriguez. If approved, the settlement could provide benefits to nearly 200 Class Members who paid $10,000 each to enter the 2019 Sports Betting National Championship.

Per the terms of the proposed settlement deal, each Class Member would receive 150 “DraftKing Dollars” to use in future betting.

Leong will receive $7,000 for his role in the DraftKings class action lawsuit. Class counsel will also receive a cut of the $102,000, to the tune of $66,288.

The company has also agreed to post rules to help clarify the betting process for championship participants, and has agreed to state that all contestants will be subjected to the same rules. Under the terms of the DraftKings class action settlement, the company will do this for a period of three years.

DraftKings denies all liability in the betting rules class action lawsuit, but has agreed to settle the claims to avoid the continued costs and risks of litigating the issue. For comparison, the company itself noted that it might have to pay around $5.8 million if the claim was successful.

Leong filed his DraftKings betting rules class action lawsuit in January 2019 in New Jersey state court. The betting fairness class action lawsuit was then removed to federal court. He claimed that the rules of the January Sports Betting National Championships made the event unfair.

According to Leong, he and many other bettors were financially injured by the tournament and the company. He explains that each bettor had to pay $10,000 to enter the tournament.

He notes that $5,000 of the $10,000 was given back to the customer for betting, while $300 covered administrative costs, and the last $4,700 was put into a prize pool.

The DraftKings class action lawsuit explains that participants were instructed to bet on various sporting events to try to win money.

The bettors were allegedly told that they would have a chance at multiple large cash prizes, the largest being $1 million.

Reportedly, the rules were that bettors who were able to make the most money from an initial $5,000 would then be eligible for additional cash prizes.

However, Leong asserts that the money he and other bettors paid was effectively worthless, because the rules of the championships were inconsistent. He says that some bets were rejected by the company while other, comparable bets, were accepted.

According to the DraftKings class action lawsuit, the organization did not ever publish the rules on what bets would or would not be accepted.

He stresses that the company did not limit the size or types of bets that would be accepted, but nonetheless rejected many bets. The plaintiff notes that the only rules posted by DraftKings were that bettors “can wager on any sport (or combination of sports via parlay) or wager in the [DraftKings Sportsbook] that is live between 12:00 pm EST Friday January 11th and 1 am Sunday January 13th and whose events are graded by 8 am EST on Sunday, January 13th.”

Leong called the organization’s approach to accepting or rejecting bets “schizophrenic and wholly irrational.” In his eyes, this made the $10,000 entrance fee virtually worthless, because it became almost impossible to strategize on what bets to place, and what amounts to wager.

Additionally, he asserts that the organization did not reveal the results of all bets in a consistent way. Allegedly, some bets were cashed out immediately, while others were delayed. He says that this inconsistency affected how bettors could determine how successful their bets were.

He says that in effect, the combined result of these inconsistencies cheated participants out of their fair shot at the initial money from the bets, and from their shots at the larger cash prizes.

Do you participate in sports betting? Share your experiences in the comments below.

Top Class Actions will post updates to this class action settlement as they become available. For the latest updates, keep checking TopClassActions.com or sign up for our free newsletter. You can also receive notifications when this article is updated by using your free Top Class Actions account and clicking the “Follow Article” button at the top of the post.

Leong is represented by Williams H. Pillsbury of the Law Offices of Williams H. Pillsbury PLLC, and Maurice B. VerStandig of the VerStandig Law Firm LLC.

The DraftKings Betting Rules Class Action Lawsuit is Christopher Leong v. Crown NJ Gaming Inc., et al., Case No. 1:19-cv-12424, in the U.S. District Court for the District of New Jersey.

Read More Lawsuit & Settlement News:

Removing Toxic PFAS from Drinking Water Poses Challenges, Study Shows

Under Armour Class Action Alleges Fake Sale Prices

Johnson and Johnson Baby Powder Recall: Is it Safe Yet?

Bank of America Call Recording Lawsuit Reaches $1.9M Settlement