Sports fans in Pennsylvania have filed a new lawsuit against DraftKings, alleging that the company’s deposit bonus offer is unclear and posed challenge to understand, and therefore was misleading in its entirety.
Pennsylvania becomes the next legal battleground for DraftKings
The lawsuit was filed with the Eastern Pennsylvania District Court, and it comes at the request of five players who have used the DraftKings platform in the Keystone State and found the deposit bonus difficult to grasp.
The lawsuit also seeks to open the door for more plaintiffs, turning it into a class-action lawsuit. In the complaint, the suits puts into question the marketing practices used by DraftKings and alleges that the company promised players to wager their money without any risk, which was not true.
"In reality, DraftKings has created an all-upside opportunity only for itself: the hidden terms of its promotions require users to deposit and gamble almost exclusively with their own money, which they almost always lose," an excerpt from the lawsuit states.
The way companies in the United States have represented their bonuses has long come under attack from legislators as well as customers. At the onset of regulated sports betting in the country, most sportsbooks would claim that their welcome bonuses were "risk-free," suggesting that the player would not be risking anything.
However, a closer examination of the terms and condition showed that a player would need to deposit a certain amount and then, if the amount has been wagered and lost, the sportsbook would reimburse them – but not in the form of funds that could be withdrawn, rather – in the form of bonus credits to be used on the website.
Major push against "risk-free" promotions in the United States
The latest lawsuit though, also features one plaintiff who was a VIP player who was on the self-exclusion since 2022. However, the player was able to sign up at DraftKings and Golden Nugget and play in 2024.
Another person alleged that they saw DraftKings branding and advertising on social media, and followed up by signing up. The plaintiff alleges that because of this, they are now a gambling addict. DraftKings has faced similar challenges in several states already, including Kentucky, New Jersey, New York, and Illinois.
The sportsbook is similarly accused of using misleading marketing practices, an accusation that DraftKings has denied. Despite all of this, the use of "risk-free" in gambling advertisements has declined across the United States, as sportsbooks have become aware of the pushback.
DraftKings has also been trying to launch a dedicated prediction market to rival Kalshi, Crypto.com, and others, but these plans may have now been put on the back burner.
