DraftKings Beats Deceptive Conduct Lawsuit in New York

DraftKings secured a new court victory this week as a federal judge in New York dismissed a proposed class action claiming that the company deceived customers with a sign-up bonus offer. The complaint, filed by New York resident Nerye Aminov, alleged DraftKings falsely advertised a $1,000 deposit bonus to attract new customers.

DraftKings Defended Its Position

According to the plaintiff, the terms of the offer, spending a $5,000 deposit and making at least $25,000 in bets within 90 days, were buried in fine print and virtually impossible for typical users to discover. However, US District Judge Margo Brodie disagreed. In a ruling released Monday, Brodie determined that the platform had adequately disclosed the bonus terms.

The court noted that no reasonable consumer would expect to receive $1,000 simply for opening an account. Brodie referenced the bold text on DraftKings’ deposit screen that explained users could receive “a 20% deposit bonus up to $1,000” and that these funds would be accumulated through play.

A reasonable consumer would not be misled to think that merely signing up for a DraftKings account would entitle them to the full $1,000 deposit bonus.

US District Judge Margo Brodie

A key pillar of DraftKings’ defense was that Aminov had personally reviewed the bonus conditions before making his deposit and wagering. The court agreed, noting that the operator made sufficient disclosures and the terms were displayed prominently enough to inform customers regarding the offer’s structure.

The Operator Faces Frequent Legal Pressure

DraftKings had asked the court to dismiss the suit in its entirety, arguing that the plaintiff failed to prove he was defrauded, injured, or that the company violated any laws or regulations. Judge Brodie approved this request, dismissing Aminov’s other claims, including unjust enrichment and fraudulent inducement. The court further added that the plaintiff had not differentiated the damages from those alleged under his deceptive marketing argument.

This swift legal victory gives DraftKings a breath of fresh air. Earlier this month, the company resolved a problem gambling-related lawsuit in New Jersey, alleging that the operator took advantage of a person’s compulsive gambling tendencies. After failing to dismiss the case, DraftKings agreed to a settlement, although the exact terms were not publicly disclosed. 

The most recent court ruling removes one legal headache for the sports betting giant, which faces ongoing scrutiny over its promotional offers. However, such lawsuits are an inevitable part of being a successful gambling operator. DraftKings has proven it can navigate such challenges while focusing on sustained, responsible growth.