The Public Health Advocacy Institute (PHAI) based in Massachusetts has initiated a class-action lawsuit against DraftKings, representing two players, Shane Harris and Melissa Scanlon, who contend that DraftKings’ sign-up bonus offer lacked clarity.
PHAI and its Center for Public Health Litigation have taken legal action on behalf of these players.
The lawsuit centers on the allegation that the two plaintiffs were not adequately informed about the complete terms of the bonus.
Specifically, they were required to make an initial deposit of $5,000 to receive a $1,000 bonus upon signing up.
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Additionally, they needed to place bets totaling $25,000 within a specified time frame to qualify for $1,000 in non-withdrawable credits on DraftKings.
Both Harris and Scanlon expressed confusion when they didn’t receive the bonus as stated in the promotion. Consequently, the lawsuit asserts that DraftKings’ bonus offer was deceptive and unfair.
The lawsuit contends, “DraftKings’ advertising of the bonus is unfair and deceptive because an eligible consumer who, by definition, is a new participant in Massachusetts sports betting, like the plaintiffs, would be unlikely to understand the cost and risk involved in qualifying for the $1,000 bonus.”
It further claims that DraftKings was aware or should have been aware that its promotion was misleading, particularly to customers new to sports betting.
DraftKings is also accused of knowingly and unfairly structuring its bonus to maximize player sign-ups, wagers, and spending, which is considered especially unfair given the addictive nature of gambling products.
The suit argues that marketers of addictive products should take precautions to minimize addiction risk and that DraftKings’ promotion constitutes an unfair business practice.
While the plaintiffs are not alleging addiction-related injuries, they are seeking various forms of relief, including economic damages, statutory damages, treble damages, injunctive relief, and more.
The lawsuit additionally calls for DraftKings to discontinue this and similar promotions.
PHAI Executive Director Mark Gottlieb stated, “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.”
As of now, DraftKings has not issued a response to the lawsuit filing.