DraftKings has been settled to pay $8 million to a group of class action plaintiffs. The company got alleged of not representing the daily fantasy sports contests’ difficulty. The plaintiffs have also inflicted several more small and big charges on the company.
The court also determined the payment procedure for DraftKing. It cannot pay the bulk of $7.28 million to the aggrieved parties just in cash. Instead, the company has been advised to deliver it in “DK Dollars,” which is the credit equivalent on the website the allegators complained about. District of Massachusetts’ US district court has received the settlement.
The court document regarding the settlement said that it would provide remarkable relief of the current condition. As it will effectuate changes advised to introduce in DraftKing’s online platform. Moreover, a crucial monetary relief will emerge in whichever form it takes, DK Dollars or US dollars. The amount will be delivered to the class members who unfortunately made the first-time deposit.
As the pact suggests, DraftKings has to create two separate settlement funds. One will be used to credit $7.28 million to DraftKings players associated with the class action. The other one is to credit $720,000 in cash to the previous clients who had their accounts closed.
The settlement prohibits the DFS giant from fighting a class counsel fee of $1.9 million and opposing $100,000 in expenses of plaintiffs.
Where it All Began
Several legal suits filed against DraftKings and its peer FanDuel by some opposing plaintiffs have led the Boston company to stand this settlement last week. The federal court in Massachusetts received those files in February 2016.
In addition to alleging those DFS providers for not providing the right information regarding the difficulty level of the game, plaintiffs groused over the false advertisement about the deposit-wise bonuses and concealing crucial fine-related information. They also claim FanDuel and DraftKings employees exploited insider data to win in the DFS contests against their clients.
It’s reportedly not the first time those companies have entangled themselves with such allegations. For a similar case, the company had to prohibit their staffers from participating in DFS contests in October 2015.