Over 40 separate class-action lawsuits have been filed against fantasy sports sites Fan Duel and Draft Kings, alleging the two sites fraudulently coerced players into an illegal gambling scam.
Most of the suits assert consumer fraud and false advertisement Plaintiffs are seeking reimbursement for lost fees paid to the websites.
Some suits also say the companies engaged in insider trading after it was found that employees were participating in Fantasy Football leagues and disproportionately earning winnings based on inside knowledge they obtained through employment.
The difference between FanDuel and DraftKings is that they payout daily or weekly prizes to players while other Fantasy Sports providers don’t.
The two sites say their businesses are based on skill, not a chance. Under federal law, these types of games are permissible if players win based on skill rather than luck.