Misleading gambling promos? DraftKings faces class action lawsuit
Boston-headquartered sports betting major DraftKings has been hit with a federal class action lawsuit in Pennsylvania, accusing the company of exploiting users with misleading promotions and fuelling gambling addiction, particularly among young and at-risk users.
The , filed on 18 April 2025 in the U.S. District Court for the Eastern District of Pennsylvania, paints a damning picture of DraftKings’ business practices. Plaintiffs allege that the company knowingly targeted vulnerable individuals, especially young men, with deceptive marketing, psychologically manipulative app features, and misleading “risk-free” betting offers that were anything but risk-free.
The truth about “risk-free” bets
At the center of the suit are DraftKings’ high-profile promotional deals — such as “No Sweat First Bets” and several deposit match promotions. Branded as risk-free or low-risk offers, these promotions purportedly came with complicated and draconian terms hidden in the fine print. Plaintiffs say that instead of refunds when users lost their initial bets, they were issued “Bonus Bets” that were neither cash-equivalent nor straightforward to use or withdraw.
According to court documents, Bonus Bets often expired quickly, restricted withdrawals, and failed to credit full winnings. This bait-and-switch, the lawsuit claims, misled consumers into betting under false assumptions and resulted in significant financial losses.
Related news: MLB Players Union fights DraftKings’ appeal bid in NIL lawsuit – SigmaPlay
Targeting addicted gamblers
One of the most disturbing allegations in the close to 100-page court filing is that DraftKings used customer data and behavioural profiling to identify signs of gambling addiction — and instead of intervening, the company doubled down on its efforts to keep those users betting.
The five named plaintiffs — Kenneth Macek, Matthew Harner, Avi Setton, Lionel Alicea, and Robert Walker — all Pennsylvania residents, say they were manipulated into depositing more money through VIP outreach, deceptive promotions, and direct solicitations.
In one example, plaintiff Avi Setton reportedly asked DraftKings to close his account in 2019 due to a gambling addiction. The company failed to act on that request until 2024, by which time Setton had lost over $350,000.
Another plaintiff claimed that even after placing himself on Pennsylvania’s self-exclusion list, he was still able to gamble and received personalised incentives from DraftKings encouraging further bets — a direct violation of consumer protection expectations.
Impossible-to-win promotions
The class action also targets the DraftKings Casino Deposit Match promotion, which promised to match deposits up to $2,000. Plaintiffs argue the terms were effectively impossible to meet — such as requiring tens of thousands of dollars in bets within a week — making it nearly unattainable to claim or keep the matched funds. Most users, who could not meet these requirements, lost both the bonuses and their initial deposits.
These so-called predatory designs were no mistake, the suit claims, but integral to DraftKings’ business model. The site is charged with creating its promotions and app to induce frequent betting and addictive behaviour, maximising earnings at the cost of user welfare.
National scope and broader legal storm
While the case was filed in Pennsylvania, it seeks nationwide class action status. Plaintiffs argue that users across the country who engaged with DraftKings’ “No Sweat,” “Risk-Free,” and deposit match promotions suffered similar harms and should be eligible for compensation.
DraftKings is not alone in facing scrutiny. Such lawsuits have also been filed against the company in New Jersey, Illinois, and Kentucky. Simultaneously, legal action is broadening across the wider industry, as operators such as FanDuel, BetMGM, and Caesars have also been accused of promoting addictive betting habits.
Related news: Baltimore Pursues Legal Action Against Top Sportsbooks
Lawyers are now currently examining cases of people between 18–30 who lost substantial amounts — at least $10,000 — and exhibited symptoms of compulsive gambling upon their use of these sites. These legal cases seek to bring companies to account for not having a proper system of user protections in place and allegedly taking advantage of behavioural weaknesses.
Allegations and relief sought
The DraftKings plaintiffs are pursuing a wide range of claims including:
- Negligence
- Fraudulent inducement
- Intentional infliction of emotional distress
- Violation of Pennsylvania’s Unfair Trade Practices and Consumer Protection Law
- Unjust enrichment
- Intentional misrepresentation
- Failure to warn
- Conversion
They are seeking monetary damages for losses, emotional distress, and unjust enrichment, as well as a judicial order to reform DraftKings’ promotional practices.
SiGMA News has reached out to DraftKings for comments regarding the latest lawsuit in Pennsylvania. However, the company has not responded as of the time of publication.
