Judge Clears DraftKings Lawsuit Over Deceptive Practices To Move Forward

Court rules that company failed to provide evidence of the “terms and conditions” shown to plaintiffs over $1,000 bonus bet promotion.

A Massachusetts judge has refused to dismiss a lawsuit accusing DraftKings of misleading new customers with a $1,000 bonus bet promotion, rejecting the company’s request for summary judgment and allowing the case to proceed.

The DraftKings class action lawsuit was originally filed in April 2024 by Melissa Scanlon and Sean Harris, who both say they opened accounts with the on-line sportsbook in Massachusetts, after being told the company was offering a $1,000 bonus to new accounts for deposits. 

However, they say those promotions were misleading, with a number of caveats and details that made the offer far less enticing, which DraftKings hid within fine print and buried deep in terms and conditions consumers are likely to miss.

Sports Betting Concerns

The lawsuit comes as DraftKings has grown to be the most dominant sports betting website in the U.S. Although it is only allowed to solicit customers in states that have approved legalized gambling, including Massachusetts, a growing number of gambling addiction lawsuits now allege that DraftKings and similar companies have fueled a sharp rise in gambling addiction, particularly among young adults.

Plaintiffs nationwide cite aggressive marketing, misleading “risk free” promotions, and app features designed to drive high frequency betting, arguing that companies like DraftKings prioritize profits over consumer protection by using real time data to identify and retain users showing signs of compulsive behavior.

Mental health experts warn these tactics can accelerate financial harm beyond traditional gambling, as in-game betting, instant deposits and constant push notifications allow losses to mount quickly, while live odds and promotions create an illusion of control that fuels repeated attempts to recover losses.

The Massachusetts Department of Public Health notes that gambling disorders can begin in children as young as 10, and that problem gambling affects about 4% to 8% of youths, compared with roughly 1% of adults. By the time students reach high school, 60% to 80% report having gambled at least once in the past year, underscoring how common these behaviors have become.

A survey published late last year by the University of Maryland found that problem gambling rose sharply between 2010 and 2024, doubling in some cases. The most serious gambling addictions, known as disordered gambling, increased from 3.4% in 2010 to 5.7% in 2024, the findings revealed.

The plaintiffs in this DraftKings lawsuit claim the site promoted a $1,000 bonus to new users, without making it clear there were numerous strings attached, including deposit and betting activity requirements. The promotion was offered to new users of DK Sportsbook.

According to the complaint, DraftKings misled consumers by purposefully obscuring how the promotion required users to deposit at least $5,000 in their accounts and required them to place $25,000 in bets within 90 days. The company also did not clarify that the promotion only applied to new DK Sportsbook users and did not include Daily Fantasy Sports accounts.

In response to the lawsuit, DraftKings filed for summary judgment, asking that the case to be thrown out because the information was in “terms and conditions” links and in fine print on advertisements.

However, in a decision and order (PDF) issued by Massachusetts Superior Court Justice Debra A. Squires-Lee on February 17, DraftKings was not able to produce direct evidence that the plaintiffs ever saw those terms and conditions, instead recreating a “walkthrough” that the company alleges the plaintiffs were shown.

“Based on this record, I cannot conclude from the text of the terms and conditions and the placement of certain hyperlinks that, as a matter of law, the terms and conditions were sufficiently prominent and provided reasonable notice to the consumer.”

– Massachusetts Justice of the Superior Court, Debra A. Squires-Lee

While some charges in the lawsuit were dismissed, such as alleged misuse of plaintiffs’ personal identification information, the ruling means the lawsuit can proceed.

Sports Betting Lawsuits

The decision comes as separate gambling addiction claims continue to be filed nationwide, alleging that betting sites target college age users and other individuals vulnerable to gambling addiction. Plaintiffs claim the companies encourage high frequency betting even when their algorithms identify those users as showing signs of problem gambling.

Some of these users continued to receive personalized incentives and marketing offers after requesting account closures or appearing on self-exclusion lists, raising serious concerns about how platforms exploit vulnerable behavior.

As a result, sports gambling addiction lawsuits are being investigated for individuals between the ages of 18 and 30 who suffered significant financial losses after using online sportsbooks, often exceeding $10,000. Platforms named in ongoing investigations include:

Sports gambling lawyers are reviewing claims nationwide on behalf of young adults and college students who developed compulsive gambling behavior and experienced financial harm that may have been preventable.

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