Multiple class action lawsuits and state enforcement actions are making the case that daily fantasy sports platforms FanDuel and DraftKings operate as illegal gambling enterprises, and courts across the country are taking these claims seriously. Over 80 class action lawsuits have been filed against the two companies, with a consolidated complaint containing 27 claims under state and federal laws. In California alone, the state Attorney General issued a legal opinion in 2025 explicitly concluding that DFS contests violate the state’s penal code, triggering a wave of new litigation that could reshape the industry nationwide. The legal battles extend well beyond California.
The City of Baltimore has sued both companies for predatory marketing tactics. Connecticut forced DraftKings to refund over $3 million to thousands of consumers over deceptive bonus promotions. And mass tort lawsuits allege both platforms use addictive design features to exploit vulnerable users.
Table of Contents
- Why Are Class Action Lawsuits Claiming FanDuel and DraftKings Are Illegal Gambling?
- The California Crackdown and What It Means for DFS Users Nationwide
- Baltimore Takes on DraftKings and FanDuel Over Predatory Marketing
- How Connecticut Consumers Got $3 Million Back from DraftKings
- Gambling Addiction Lawsuits Allege Manipulative App Design
- The Arbitration Problem and How It Affects Your Rights
- What Comes Next for DFS Litigation and Consumer Claims
- Frequently Asked Questions
Why Are Class Action Lawsuits Claiming FanDuel and DraftKings Are Illegal Gambling?
The central legal argument across these lawsuits is straightforward: daily fantasy sports contests are not games of skill, as the companies have long claimed, but rather constitute sports wagering under state gambling statutes. California Attorney General Rob Bonta put it plainly in his 2025 legal opinion, concluding that “California law prohibits the operation of daily fantasy sports games… Such games constitute wagering on sports in violation of Penal Code section 337a.” That opinion gave plaintiffs’ attorneys the ammunition they needed to file four class action lawsuits in California federal court against FanDuel, DraftKings, PrizePicks, and Underdog Fantasy. The distinction between skill and chance matters enormously because it determines whether these platforms need gambling licenses, whether they can operate at all in certain states, and whether consumers who lost money were unknowingly participating in illegal activity. In the Gilbert Criswell v.
FanDuel case, filed December 5, 2025 in the U.S. District Court for the Northern District of California, the plaintiff alleges FanDuel collected approximately $200 million in entry fees from California residents while misrepresenting its services as legal. That case claims violations of California’s Unfair Competition Law and Consumer Legal Remedies Act. One complicating factor for consumers hoping to join a class action: a judge has ruled that mandatory arbitration agreements embedded in the platforms’ terms of service are valid. This means users who agreed to those terms may be required to arbitrate individually rather than participate in class actions. However, not all lawsuits are brought by individual consumers, and enforcement actions by state attorneys general and municipalities operate under different legal frameworks entirely.
The California Crackdown and What It Means for DFS Users Nationwide
California represents the single largest market for daily fantasy sports, and the Attorney General’s opinion that DFS contests are illegal under state law sent shockwaves through the industry. The coalition of law firms that filed four separate class actions in California federal court is seeking damages for consumers who paid entry fees into contests that, under this interpretation of the law, were never legal to begin with. If courts agree with the AG’s analysis, the financial exposure for FanDuel and DraftKings could be staggering. The Criswell complaint against FanDuel provides a concrete window into the scale involved. The allegation that FanDuel collected roughly $200 million in entry fees from California residents alone illustrates why these companies have fought so hard to maintain the fiction that DFS is a skill game exempt from gambling regulation.
Across all four California lawsuits, the combined damages sought could reach into the hundreds of millions. However, consumers in other states should not assume California’s legal reasoning will automatically apply where they live. Many states have passed specific legislation exempting DFS from gambling laws, and the legal landscape varies dramatically from one jurisdiction to the next. A consumer in New York, where DFS was legalized through specific legislation after its own legal battles, faces a very different situation than someone in California or another state without explicit DFS authorization. The California cases are significant precisely because they could influence courts and attorneys general in states that have not yet addressed the question directly.
Baltimore Takes on DraftKings and FanDuel Over Predatory Marketing
In April 2025, the Mayor and City Council of Baltimore filed a lawsuit against DraftKings Inc. and Flutter Entertainment, FanDuel’s parent company, for violating Baltimore’s Consumer Protection Ordinance. The complaint describes what it calls a two-pronged scheme: first, misleading “bonus bet” promotions designed to encourage compulsive gambling, and second, the use of data analytics and personalized inducements to target users who show signs of gambling disorders. What makes the Baltimore lawsuit particularly damning is its comparison of how Flutter Entertainment operates in different countries. The complaint documents that Flutter implemented meaningful protections in the United Kingdom, including financial vulnerability checks, VIP program restrictions, and restrictions for bettors under 25, that it has not replicated in the United States.
In other words, the company knows how to protect vulnerable users and chooses not to do so in the American market. That kind of evidence is difficult to explain away in court. The case has already survived an early procedural challenge. A Maryland federal judge sent the case back to state court on November 10, 2025, after the sportsbooks attempted to move it to federal court where they may have perceived a more favorable environment. DraftKings and FanDuel have appealed that decision to the U.S. Court of Appeals for the Fourth Circuit, but for now the case will proceed in Baltimore’s city court system, where local consumer protection laws carry significant weight.
How Connecticut Consumers Got $3 Million Back from DraftKings
The Connecticut DraftKings settlement offers a concrete example of what enforcement action can actually deliver for consumers. DraftKings agreed to refund over $3 million to approximately 7,000 Connecticut consumers who participated in bonus offers, specifically deposit match and deposit bonus promotions, between October 19, 2021 and January 4, 2023. The Connecticut Department of Consumer Protection found that DraftKings violated state gaming laws by advertising deposit matches without clearly stating complex playthrough requirements. The playthrough requirements are worth understanding because they are common across the sports betting industry. A typical deposit match promotion might promise to match a user’s $500 deposit, but the fine print requires the user to wager 25 times that bonus amount before any winnings can be withdrawn.
DraftKings’ promotions made the match sound simple and generous while burying the restrictions. On top of the refunds, DraftKings agreed to pay $50,000 for consumer protection programs and provide annual training on Connecticut laws to its marketing personnel. The tradeoff for consumers in this type of settlement is worth noting. The $3 million spread across 7,000 consumers works out to roughly $430 per person, which may be significantly less than individual consumers actually lost through the deceptive promotions. DraftKings denied all wrongdoing while agreeing to the restitution, a standard corporate posture in these settlements. Consumers who believe they lost substantially more through misleading bonus structures may want to evaluate whether individual claims or participation in broader litigation could yield better results, though the certainty of a guaranteed refund has real value compared to the uncertainty of prolonged litigation.
Gambling Addiction Lawsuits Allege Manipulative App Design
Beyond the illegality arguments, a separate wave of litigation targets FanDuel and DraftKings for allegedly using predatory design features that exploit users with gambling disorders. The Macek et al. v. DraftKings lawsuit alleges misleading “No Sweat” and “risk-free” promotions, manipulative app design, and failures in self-exclusion programs meant to help problem gamblers lock themselves out of the platforms. Multiple mass tort lawsuits making similar claims are ongoing as of early 2026. The self-exclusion failures are particularly troubling.
These programs exist specifically because the companies acknowledge that some users develop gambling problems and need a mechanism to stop. When those mechanisms fail, whether through poor implementation, delayed processing, or loopholes that allow excluded users to create new accounts, the platforms bear responsibility for the resulting harm. Plaintiffs in these cases allege that the failures are not accidental but reflect a business model that prioritizes revenue over user safety. A significant limitation for individuals considering these claims is that gambling addiction lawsuits require plaintiffs to demonstrate both that the platforms engaged in wrongful conduct and that this conduct caused measurable harm. Proving causation in addiction cases is inherently complex, and defendants will argue that users made voluntary choices to gamble. Consumers who believe they have been harmed should document their interactions with the platforms, including any attempts to self-exclude, communications with customer support, and records of promotional inducements they received, as this evidence becomes critical in building individual or class claims.
The Arbitration Problem and How It Affects Your Rights
One of the most significant obstacles for consumers seeking to join class actions against DraftKings or FanDuel is the mandatory arbitration clause buried in both platforms’ terms of service. A judge has already ruled these arbitration agreements valid, which means users who clicked “agree” when creating their accounts may have waived their right to participate in class action litigation. Instead, they would be required to pursue claims individually through private arbitration, a process that tends to favor corporate defendants who have the resources to handle thousands of individual cases.
This does not mean affected consumers have no options. The California lawsuits were filed by law firms on behalf of classes of consumers, and the viability of those class actions will depend on how courts in those specific jurisdictions interpret the arbitration provisions. Government enforcement actions, like the Baltimore lawsuit and the Connecticut settlement, bypass arbitration entirely because they are brought by public entities rather than individual consumers. Users who are concerned about their rights should review the specific terms they agreed to and consult with an attorney who handles consumer protection or gambling law.
What Comes Next for DFS Litigation and Consumer Claims
The next twelve to eighteen months will likely be decisive for the future of daily fantasy sports litigation. The California class actions are in their early stages, and how federal courts there respond to the Attorney General’s opinion that DFS contests violate state gambling law will set the tone for similar challenges elsewhere. The Baltimore case, if it proceeds through city court as currently expected, could produce a ruling on whether sports betting companies can be held liable under local consumer protection ordinances for predatory marketing, a theory that other municipalities could replicate.
For consumers who have lost money on FanDuel or DraftKings, the landscape is shifting in their favor but remains uncertain. The Connecticut settlement demonstrates that enforcement actions can produce tangible refunds, even if the amounts are modest relative to total losses. Anyone who participated in bonus promotions with unclear terms, attempted to self-exclude and was not properly blocked, or paid entry fees in states where DFS legality is now being questioned should monitor these cases closely and consider consulting with a consumer protection attorney about their specific situation.
Frequently Asked Questions
Can I still file a claim against FanDuel or DraftKings if I agreed to their terms of service?
Possibly. While courts have upheld mandatory arbitration clauses in some cases, the enforceability depends on your specific jurisdiction and the terms you agreed to. Government enforcement actions and certain class actions proceed regardless of individual arbitration agreements. Consult a consumer protection attorney to evaluate your situation.
Am I eligible for the Connecticut DraftKings refund?
The Connecticut settlement covers consumers who participated in DraftKings deposit match or deposit bonus offers between October 19, 2021 and January 4, 2023. DraftKings agreed to refund over $3 million to approximately 7,000 affected consumers. If you believe you qualify, contact the Connecticut Department of Consumer Protection for details.
Are daily fantasy sports illegal in California?
According to California Attorney General Rob Bonta’s 2025 legal opinion, DFS contests constitute wagering on sports in violation of Penal Code section 337a. This opinion has led to multiple class action lawsuits, but final court rulings have not yet been issued. The legal status remains actively contested.
What is the difference between the class action lawsuits and the gambling addiction lawsuits?
The class actions primarily argue that DFS contests are illegal gambling and that consumers are owed refunds of entry fees paid. The addiction lawsuits focus on predatory design features, misleading promotions, and failures in self-exclusion programs that allegedly caused specific harm to users with gambling disorders. Some consumers may have claims under both theories.
How much money could I get from these lawsuits?
It varies widely. The Connecticut settlement averaged roughly $430 per consumer. The California lawsuits involve much larger sums, with one complaint alleging FanDuel collected $200 million from California residents alone. Individual recovery depends on how much you spent, which state you are in, and how the litigation resolves.
Should I stop using DraftKings or FanDuel now?
That is a personal decision, but continuing to use these platforms while litigation is pending could complicate future claims. If you are in a state where the legality of DFS is being challenged, be aware that your continued participation may be referenced by defendants arguing that users understood and accepted the risks.