FanDuel and DraftKings hit by data leak lawsuit Â
Filing in New York federal court, the latest twist in scandal which has engulfed the daily fantasy industry
A class action lawsuit had been filed against daily fantasy sports (DFS) operators FanDuel and DraftKings following the data leak scandal which continues to rock the industry. [private]
The lawsuit, seen by eGR North America, has been filed in the US District Court for the Southern District of New York and names Kentucky resident Adam Johnson as the plaintiff, and both DraftKings and FanDuel as defendants.
The main issue raised in the filing is that DraftKings and FanDuel employees having access to lineup data brings into question the integrity of the game and the operators themselves, and claims both are violating Kentucky, Massachusetts and New York law.
The lawsuit brings seven specific claims against the two sites: negligence, fraud and misrepresentation, violation of the Kentucky Consumer Protection Act, civil conspiracy, violation of the New York Deceptive Acts and Practices Law, violation of the New York False Advertising Law, and unjust enrichment.
The plaintiff is seeking a number of damages, including restitution of all monies wrongfully obtained by the defendants, requiring the defendants to cease and desist from engaging in unlawful and/or deceptive practices alleged in the complaint, and retrospective and prospective injunctive relief.
The filing comes after DraftKings and rival FanDuel moved to defend the integrity of their businesses after allegations of insider trading related to a DraftKings employee winning US$350,000 on rival site FanDuel surfaced last week.
The scandal has engulfed the DFS industry, with DraftKings suspending its $250m ad partnership with ESPN, and the New York attorney general launching a probe into both DraftKings and FanDuel to determine whether they were committing fraud.
Meanwhile Boston attorney general Maura Healey confirmed yesterday she would not be pursuing any criminal inquiries into DraftKings just weeks after launching an inquiry into the firm.
Both FanDuel and DraftKings were unavailable for comment at the time of publication.