NFL Players Association Files $65 Million Lawsuit Against DraftKings

Michael Savio
By: Michael Savio
08/27/2024
Sports Betting
NFL Players Association Files $65 Million Lawsuit Against DraftKings
Photo courtesy of All-Pro Reels From District of Columbia, USA, CC BY-SA 2.0

Key Takeaways

  • The NFLPA’s lawsuit is believed to be for around $65 million
  • DraftKings closed its NFT marketplace last month
  • Massachusetts previously sued DraftKings over their NFTs

The hits just keep on coming for DraftKings.

The industry leader is at the center of a new lawsuit by the NFL’s Player’s Association (NFLPA). The group alleges that DraftKings plans to end a rights deal and cease making payments. While the NFLPA has yet to announce the amount they seek in the lawsuit, it is estimated to be around $65 million.

The case will now be reviewed in New York Federal Court before a trial dates are set.

Lawsuit Centers Around Failed DraftKings NFT Market

While DraftKings Sportsbook is a major NFL sponsor, this lawsuit centers around the industry giant’s failed NFT market. The company invested significantly in opening an NFT marketplace, but the market has crashed since then. As a result, DraftKings closed their NFT marketplace and now wants to leave their contract with the NFLPA.

The NFLPA’s deal with DraftKings involved using the names, images, and likenesses of the league’s players on NFTs. A monthly payment plan was set up to satisfy the deal, but now the sports betting and DFS giant wants out.

"The impetus for DraftKings' decision to repudiate its license agreement with Plaintiffs is simple: the once white-hot market for NFTs has cooled down," attorneys for the NFLPA wrote in the complaint. "DraftKings is also facing a civil lawsuit and regulatory inquiries into its product. Buyers' remorse, however, is not a basis to terminate a contract."

NFT Marketplace Fallout Continues

The DraftKings NFT marketplace closed last month primarily due to a lawsuit the company was facing in Massachusetts. The Bay State sued DraftKings over the controversial offering, claiming the company violated security laws. Given the decline of NFTs and the cost of the lawsuit, DraftKings chose to shut the marketplace down.

While the decision to cut the marketplace seems wise, the NFLPA lawsuit could lead to the failed platform costing the company even more money.

Losses Pilling up for DraftKings

In addition to the NFT fallout, DraftKings’ sportsbook has also come under fire. They recently suffered a public embarrassment when they announced they would add a surcharge to winnings in four markets. Public outcry and a lack of support for other operators forced them to reverse course just days later, but the damage to their reputation was already done.

DraftKings also recently lost a motion to dismiss another case in Massachusetts. Several bettors brought this lawsuit, claiming the advertising around its welcome bonus was intentionally misleading. That is a bad sign for DraftKings, who could face similar lawsuits if this one is lost.

Michael Savio covers the US online casino industry, giving readers insights and information they won’t find anywhere else. He has followed the retail industry since his time living in Las Vegas and has continued to do so as the online industry has taken off. Michael covers everything from online casino reviews to industry news, making him one of the most trusted insiders in the business. Check out Michael’s latest articles at casinos.com to see what he has to offer!