Daily Fantasy Sports Law News: Class Action Lawsuit Filed Against FanDuel – Media, Telecoms, IT, Entertainment

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Daily Fantasy Sports Law News: Class action lawsuit filed against FanDuel

March 31, 2021

Klein Moynihan Turco LLP

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In a major development in the world of everyday fantasy sports law, FanDuel, an industry giant, was named in a class action lawsuit in multiple states involving its online sports betting platform. In the lawsuit, various violations of the state consumer protection law are asserted, which, according to the plaintiff, have led to sports bettors being induced to take part in risky bets that they would otherwise not have placed.

What were the alleged consumer protection violations featured in the daily class action lawsuit against the Fantasy Sports Act?

FanDuel has been a leader in the online sports games industry for several years as both daily fantasy sports and legal sports betting have increased across the country. FanDuel users have access to real-time data on current sporting events via its mobile application. This data, such as a game’s score and time remaining in the game, is displayed alongside the game’s betting odds and other lines that users can bet on while a game is in progress. This is known as “live betting”. The lawsuit alleges that FanDuel is alternatively underestimating how much time is left in a particular sporting event or otherwise reporting a game score that is materially different from the actual score for remaining game time as reported on the mobile application . The lawsuit also alleges that these inaccuracies and / or misrepresentations were intended and resulted in bettors placing bets on outcomes (such as game numbers) that appeared to the user far more likely than actual game status would dictate. As a result, the plaintiff in the relevant lawsuit alleges that users in every state where FanDuel operates a regulated sports betting company have been injured by placing bets that they lost and would not have placed if FanDuel was truthful and accurate at the time of the bets in question Data supplied and damage costing millions of dollars.

Compliance with Daily Fantasy Sports Law

While FanDuel may have to rely on a third party provider to provide its real-time data services, FanDuel has been liable for millions of dollars in the game due to alleged delays between the data it provided to customers and the actual status of the game as of now Subject bets have been placed. FanDuel is very familiar with legal complications. Although FanDuel is in hot water again, this lawsuit provides valuable insight into the importance of accurate representations for operators of online sports betting and daily fantasy sports platforms. Daily fantasy sports and sports betting are in an area where lawmakers and gambling regulators have historically mainly dealt with issues of competitive integrity and consumer protection. These are nascent markets, with a user base that is both committed and willing to participate, but not always the most demanding or the most educated in decision-making. The need to be direct and accurate when presenting to users is paramount. Even the most cautious of operators can slip without proper guidance. Therefore, in order to ensure compliance with applicable consumer protection laws and gambling regulations, it is important that the operators work closely with knowledgeable advisors to regularly review the competition rules as well as the platform structure, prices and marketing presentations.

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Originally published March 10, 2021

The content of this article is intended to provide general guidance on the subject. A professional should be obtained about your particular circumstances.

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