FanDuel, DraftKings Facing Class-Action Suit in Louisiana

Louisiana sports betting sites are accused of predatory practices

This class-action suit was filed in the Civil District Court for the Parish of Orleans. The legal action is calling for a jury trial to assess whether DraftKings and FanDuel have violated Louisiana consumer protection laws.

The complaint alleges that the mobile sports betting apps used by the two sportsbook operators are not operating properly. It claims that customers are not being adequately warned about how addictive these sports betting platforms can be.

In the filing, it claims that both DraftKings and FanDuel are utilizing AI technology to personalize messages and programs that are then sent to bettors to keep them betting.

Players are being targeted through AI technology

Attorney Jennifer Hoekstra is representing plaintiffs Adrian Payton, Toi Smith, and Yolanda Perkins. She says that her clients have felt targeted and exploited by the sports betting sites.

“When someone hasn’t been on the app for a certain number of times, they start getting a bombardment of notifications," Hoekstra told Louisiana radio station News Talk 98.5. "Either for risk-free or bonus bets or bonus cash, to try and lure them back in."

The sites are utilizing AI to study the habits of players. The betting sites then use those algorithms to modify the promotions presented to those players. It's designed to best suit their wagering preferences.

“They sim so much about someone that they can almost predict their betting habits so they can get people potentially when they are at their lowest moment, after they’ve lost over $100 or $1,000,” Hoekstra said.

The lawsuit also alleges that the online sportsbooks are ignoring or bypassing self-exclusion and responsible gaming tools. If true, this would be in violation of Louisiana’s Sports Wagering Act.

Between them, DraftKings and FanDuel account for 75% of the online sports betting market in Louisiana. FanDuel owns 44% of the market, with DraftKings checking in at 31%.

Two Louisiana casinos are also named in the suit

Two Louisiana casino licensees, Amelia Belle Casino and Bally’s Baton Rouge, are also named in the suit. They are the partner land-based casinos whose state licenses serve to anchor the sportsbook apps’ Louisiana operations. DraftKings partners with Bally's Baton Rouge, while FanDuel teams with Amelia Belle Casino.

The three plaintiffs claimed to have each wagered over $20,000 on one or both of the DraftKings or FanDuel apps. According to the filing, they are suing on behalf of all Louisiana residents who have "created an account, deposited funds, and utilized the mobile sports wagering applications designed, manufactured, and operated by the Sportsbook Defendants under the regulatory authority of the Casino Anchor Defendants."

“We’re both asking for the money back, as well as an understanding that the casinos who are the sublicensees under DraftKings and FanDuel are violating their duty to supervise what’s running through their licenses,” Hoekstra said.

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