By now, you have heard of companies like FanDuel and Draft Kings – either because you watch television, and their spots are on about every 12 seconds, or because you heard that some employee of one of them may have cheated while on the other site and won a cool $350,000. The story isn’t quite that simple, but the controversy surrounding one-game fantasy betting is real, and people are getting hurt because of it.

What exactly happened?

FanDuel and DraftKings are websites promoting daily fantasy sports (DFS). In a nutshell, a person can play a game of fantasy football and make bets on his or her team, in the hopes of scoring a large payout. The benefit of this type of gaming is that you aren’t locked into one set of players for the whole season. This year, the DraftKings’ content manager, Ethan Haskell, played a DFF game on FanDuel, and won $350,000. It was perfectly legal for him to do so, but the controversy revolves around something called “ownership trends.” See, FanDuel and DraftKings use similar price points, so to speak – so the chances are good that whatever information one has, the other also has.

That means that Haskell could have used the data he had on ownership trends to place his bet on FanDuel and reaped the same rewards. Which he did – to the tune of $350,000.

But Haskell is not the only one. The New York Times reports on the “clubby, cozy connections between the two companies” which is leading to big payouts for their employees, in a very insider trading kind of way. A class-action lawsuit has been started in New York alleging fraud.

Additional problems

You may have noticed we keep using the words “place a bet.” But the truth is, this type of online gaming isn’t considered gambling, and therefore is perfectly legal all across the country. That’s because this DFS are games of skill, not chance, and by labeling them games, the companies can get away with gambling.

But no matter how you slice it, people are betting real money on fake fantasy players and losing it all, hoping for that large-scale payday. No one is regulating these games, which means people are at risk every day. And while you might say that adults should be held accountable for the chances they take and the choices they make, remember this: how you label the act contributes to how you view it. Dropping a bomb on an unarmed town in a different country sounds terrible, but no one has a problem with a “preemptive strike.” Online games are fun; online gambling is a problem. When two phrases mean the same thing, and companies try to slide by with tiny print disclaimers that are almost impossible to read and often buried in legal jargon, well – that sounds fishy to us.

We’re not saying that taking part in your annual office Super Bowl pool makes you a degenerate gambler, or that spending a day at the track or a vacation in Vegas or A.C. means you have a problem; we’re saying that DFS companies aren’t being honest about what they are, and they’re certainly not giving you the right information. What they do seem to be doing is stacking the deck so that their own employees can make a lot of money, and ensuring that consumers rarely do. And if that’s not fraudulent, we’d be hard-pressed to say what is.

If you’ve played DFS games on FanDuel or DraftKings, you may not have been given a fair shake and may be entitled to compensation. The Rocky McElhaney Law Firm is there to help you. Please contact us to set up an appointment with a dedicated Nashville consumer protection attorney. We proudly serve clients throughout East Tennessee from offices in Nashville, Gallatin and Knoxville.