On Friday, Daynard was part of a team that filed a class action lawsuit against DraftKings in Middlesex Superior Court. boston The company's “$1,000 bonus” promotion for new sign-ups was a deceptive advertisement to induce people to use a “known addictive product.”
“We anticipate that other lawsuits will be filed by us and others, because certainly this DraftKings pitch is not the only misleading and deceptive pitch out there. ” he said. “I think there are misleading sales pitches in this state and other states as well.”
David Woods, an attorney at Hughes, Hubbard & Reed in Kansas City who represents tobacco companies, said the lawsuit against DraftKings is not exactly the same as previous lawsuits.
However, “the fact that this lawsuit was brought by Richard Daynard and the Public Health Advocacy Association, which has been active in tobacco litigation, and the fact that it raises the issue of addiction, “This could signal a new wave of lawsuits similar to those filed against companies,” he said, pointing to recent lawsuits against manufacturers of opioids, vaping products, and social media companies.
First, gambling addiction Harry Levant, a gambling addiction counselor in Philadelphia, caught Daynard's attention when he began researching the issue at Northeastern's Institute for Public Health Advocacy. Ten years ago, while working as a lawyer, Levant stole $2 million from his family and clients to fuel his gambling addiction. He has since advised others and came to the Northeast about three years ago to work on policy solutions.
In Friday's lawsuit against DraftKings, plaintiffs Shane Harris of New Bedford and Melissa Scanlon of Woburn allege that they received a “$1,000 payment” in their contract with DraftKings earlier this year after Massachusetts legalized gambling. He said he opened an account with an online gambling company in hopes of benefiting from a promotion advertising “bonuses.” Up. (Online sports betting began in the state in March, with DraftKings leading the way among gambling site operators.)
However, the complaint contains a clause hidden in the fine print that requires customers to make an initial deposit of $5,000 and make high-risk bets totaling $25,000 over 90 days in order to receive the full $1,000 bonus. says the complaint. According to the complaint, Harris and Scanlon did not understand that they would need to wager an average of $276 per day for three months to qualify.
“DraftKings' '$1,000 Bonus' offer is unfair and deceptive because…plaintiffs and class members believe that the “This is because they were required to deposit large sums of money and place bets using various methods,” the complaint states.
This offer was still available DraftKings website On Friday, the wording was different, though: “New customers receive a playthrough bonus of up to DK $1000! minutes. $5 deposit required.”
“DraftKings takes consumer protection and responsible gaming seriously,” the company said in an emailed statement. “DraftKings respectfully disagrees with the claims and assertions made by the Institute for Public Health Advocacy. Unfortunately, the Institute has ignored our multiple attempts to engage in direct dialogue and instead We have filed a lawsuit. DraftKings intends to vigorously defend this lawsuit.”
The company denied wrongdoing in a nine-page letter to the plaintiffs before filing the lawsuit. Customers can review the full terms of the offer before opening an account, the company's lawyers wrote.
“Far from being deceptive or unfair, these terms and conditions outline the promotion in straightforward terms and provide examples of maximum promotional bonus amounts in specific circumstances,” the Nov. 17 letter said. There is,” he said. “To the extent that Ms. Scanlon chose not to read these terms (which we think is unlikely, as she has successfully met the requirements), that does not mean that DK engaged in any deceptive trade practices. It does not represent.”
DraftKings stock, which has more than tripled so far this year, rose about 1% on Friday.
False advertising claims against large companies are common and range from serious to less serious claims. Claim. 2019, AT&T agreed to pay $60 million Taco Bell customers this summer after the company advertised “unlimited” cell phone plans without disclosing that their download speeds would drop significantly after customers used a certain amount of data. sued a fast food chain The company claimed its tacos had less filling than advertised.
And DraftKings itself has been sued multiple times, agreeing to pay $8 million in 2021. settle a lawsuit The ad contained a misleading promotional offer for a daily fantasy betting game.
Updated with comments from DraftKings and David Woods.
Aaron Pressman can be reached at [email protected] him @Unpresman.
