DraftKings has agreed to a settlement in a lawsuit filed by Lisa D’Alessandro, the wife of a problem gambler in New Jersey.
D’Alessandro’s lawsuit alleges that DraftKings encouraged her husband to continue gambling with the sports betting platform.
Court papers reveal that the man, identified only as his username Mdallo1990, placed over 14,000 sports bets between 2020 to 2024, incurring losses of nearly $950,000.
Bettor Gambled Away Family Savings
D’Alessandro stated that her husband had stolen funds from the family without her consent. She discovered in November 2023 that he had emptied their savings and drained their children’s accounts to fund the addiction.
DraftKings had previously motioned to dismiss the case as the company said it had in no way encouraged the man to steal funds to gamble on the platform.
The company had, however, assigned Mdallo1990 as a VIP customer and provided him with incentives such as free bets, electronics, travel offers, and branded merchandise.
The lawsuit alleged that DraftKings should have intervened and placed restrictions on Mdallo1990’s account when it was evident he had lost control of his gambling. The account made deposits of less than $25K in 2020 but $777K in 2023, which should have set alarm bells ringing.
DraftKings had attempted to dismiss the case as it was not brought by one of its customers, but after the lawsuit moved forward, the two parties have now reached a settlement. The details of the settlement have not been publicly released.
DraftKings Legal Troubles
Last month, DraftKings also agreed to pay a $3 million settlement in Connecticut following an investigation by the state’s Department of Consumer Protection (DCP) over bonus offers.
Around 7,000 users were due to be compensated because of the company’s failure to properly show the rollover requirements of its online casino bonus offer.
DraftKings denied any wrongdoing, but a company spokesperson said it was willing to cooperate with the DCP.
“DraftKings is committed to operating in compliance with all regulatory requirements,” the spokesperson said. “We value our relationship with the Connecticut Department of Consumer Protection and will continue to work collaboratively with them.”
The company is also facing a lawsuit in Baltimore over claims that its bonuses and promotions mislead customers. The city is also suing fellow sportsbook FanDuel over similar accusations.
Baltimore Mayor Brandon Scott commented, “These companies are engaging in shady practices, and the people of our city are literally paying the price.”
“DraftKings and FanDuel have specifically targeted our most vulnerable residents — including those struggling with gambling disorders — and have caused significant harm as a result. This lawsuit is a critical step to hold them accountable and protect all Baltimoreans.”
DraftKings recently implemented new responsible gambling measures, including the launch of my budget builder last month, which allows users to set customized budgets and warnings across all the company’s products.
The company has also invested $10 million in a national ad campaign aired during March Madness, which promoted responsible gambling in collaboration with the NFL and NBA.
