DraftKings Faces Pennsylvania Lawsuit Over Misleading Promotions
DraftKings is under fire in Pennsylvania for allegedly deceptive promotions, per a class action lawsuit filed in the US District Court for the Eastern District of Pennsylvania.
A Legal Storm Hits DraftKings
The suit claims DraftKings’ “risk-free” and “no sweat” bets, plus deposit match offers, misled users with tough terms, costing players millions.
With Pennsylvania’s $2.18 billion online betting handle in 2024, the stakes are high. Similar lawsuits in New Jersey, Illinois, and Kentucky echo these concerns.
The plaintiffs argue DraftKings’ “risk-free” bets aren’t risk-free at all. Users must wager their own cash, and losses yield “Bonus Bets” with strict rules, expiring quickly, non-withdrawable, and paying only net winnings after a 9% vig.
Deposit match deals, like a $2,000 casino bonus, require betting 10-15 times the deposit and bonus within seven days. Failing to meet these terms often wipes out both the bonus and original deposit, even after wins.
Addiction and Accountability
Beyond promotions, the lawsuit accuses DraftKings of exploiting addictive behaviors. The platform allegedly targets young men prone to gambling issues, using algorithms to push frequent betting.
One plaintiff claims DraftKings ignored their 2019 account closure request, keeping it open until 2024, leading to heavy losses. Another says DraftKings allowed betting despite their Pennsylvania self-exclusion listing, a major compliance lapse.
DraftKings’ use of user data to identify risky bettors and hit them with tailored promotions also draws fire. The suit alleges VIP hosts encourage problem gamblers to keep betting, prioritizing profits over responsible gaming.
With 1.5 million active users in Pennsylvania, DraftKings’ $800 million state revenue in 2024 relied on such tactics. The plaintiffs seek compensation under consumer protection laws and aim to represent a nationwide class of affected users.
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