Maryland’s biggest city has filed a lawsuit against DraftKings and FanDuel, accusing the companies of “predatory” practices in sports betting.
The Mayor and City Council of Baltimore, represented by the Baltimore City Department of Law and law firm DiCello Levitt, claim that the two operators engage in deceptive and unfair practices by targeting and exploiting vulnerable gamblers in violation of Baltimore’s Consumer Protection Ordinance (CPO).
“These companies are engaging in shady practices, and the people of our city are literally paying the price,” said Baltimore Mayor Brandon Scott. “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.”
The lawsuit alleges that DraftKings and FanDuel use a two-pronged scheme to harm Baltimore residents, firstly by using misleading promotions such as bonus bets and “other tricks” to attract new users, designing those promotions to encourage compulsive gambling behaviour.
Second, the lawsuit claims that the operators leverage the vast array of data they have about their users, along with sophisticated analytics and personalized inducements, to identify those who suffer from a gambling disorder, and then extract what they can from them.
The lawsuit details how DraftKings and FanDuel allegedly identify those who exhibit disordered gambling and work their hardest to keep those users in the game.
According to the complaint, DraftKings’ and FanDuel’s targeting of the vulnerable is so widely known that professional gamblers have taken to purposefully mimicking the behaviour of those with gambling disorders – including programming their devices to check scores at odd hours – in order to encourage DraftKings and FanDuel to provide rewards such as bonus bets meant to induce continued gambling.
“DraftKings and FanDuel put corporate greed ahead of the well-being of Baltimoreans, getting users hooked to their gambling platforms and then leveraging troves of data to identify, target, and exploit the most vulnerable among them,” said City Solicitor Ebony Thompson of the Baltimore City Department of Law. “Their predatory practices have caused significant harm to our community, and we are taking action to hold them accountable and protect our citizens.”
Marylanders wagered more than $5 billion in the fiscal year ended 30 June 2024, with $3.7 billion wagered in the first half of fiscal year 2025. Many of those bettors are in Baltimore, Maryland’s largest city.
“Putting profits over people, these companies have engaged in unfair, abusive, and deceptive trade practices,” said DiCello Levitt founding partner Adam Levitt. “We stand with the City of Baltimore in their efforts to safeguard Baltimoreans by holding DraftKings and FanDuel accountable and ensuring they implement responsible gambling measures to prevent further harm.
“The predatory practices of sports betting sites are a national problem, and the City of Baltimore is taking a lead role in efforts to curtail them. You can bet we will bring the fight.”
Shares in DraftKings Inc (NASDAQ:DKNG) closed 5.90 per cent lower at $32.40 per share in New York Thursday, while shares in FanDuel parent Flutter Entertainment Inc (NYSE:FLUT) closed 5.16 per cent lower at $217.62 per share.