DraftKings faces second class action over Predictions sports event contracts platform claims

DraftKings is facing a second proposed class action lawsuit, filed on August 3 in Massachusetts federal court. The plaintiffs, Jason Gordon, Arie Weissmann, and Johnny Harris, are seeking to represent other users who allegedly lost money on DraftKings Predictions. The lawsuit claims that DraftKings’ Predictions platform operates as an unlicensed sportsbook, despite the company labeling its transactions as "trading," "predictions," and "event contracts."

The complaint states that Predictions has been available in states where DraftKings lacks sportsbook authorization since its debut in December 2025. Screenshots from the filing show sports matchups with spreads, totals, and odds, similar to those found in traditional sportsbooks. The plaintiffs argue that DraftKings functions as an unlicensed sportsbook by generating revenue from transaction fees and potentially receiving additional payments tied to routing transactions.

They allege that customers are not adequately informed about these relationships or total transaction costs before engaging in Predictions. The lawsuit also highlights a risk disclosure in DraftKings’ terms that acknowledges uncertainty over event-contract regulation and the active and evolving litigation concerning state gambling laws’ applicability to those contracts.

The three plaintiffs have reported losing money, with Gordon alleging losses exceeding $700, Weissmann claiming losses over $1,000 before joining DraftKings’ self-exclusion program, and Harris stating losses above $100, along with transaction fees. The filing cites DraftKings CEO Jason Robins, who acknowledged that customers do not fully understand the difference between Predictions and the licensed sportsbook, calling this an "actual huge advantage."

Another proposed class action reached the same court on July 28, alleging that Predictions enables illegal sports wagers in states where online betting is prohibited or DraftKings is unlicensed. The lawsuits seek to return alleged unlawfully taken funds, along with costs and attorneys’ fees, and have requested a jury trial.