FanDuel and DraftKings seek dismissal of US gambling addiction lawsuit
FanDuel and DraftKings have asked a Pennsylvania court to dismiss a lawsuit accusing them of designing products that encourage gambling addiction. The case, regarded as one of the most significant lawsuits ever filed against betting operators in the United States, also names the National Football League (NFL) and sports technology company Genius Sports as defendants.
According to filings submitted to the Philadelphia Court of Common Pleas, FanDuel and DraftKings argue that the plaintiffs cannot rely on Pennsylvania consumer protection law to classify their mobile apps as “defective products.” The companies contend that their apps are free to download and therefore do not meet the legal definition of a product subject to product liability rules under Pennsylvania law.
Case gains nationwide attention
The lawsuit was filed in March 2026 by Christopher Sage and Terry Thompson, two bettors from Philadelphia who claim they developed gambling-related disorder after using the two operators’ platforms. A revised version of the complaint later expanded the allegations against the companies.
The case attracted further national attention after reports that a FanDuel VIP manager allegedly asked baseball player Bryce Harper to record a personalised video for one of the plaintiffs, Terry Thompson, through the Cameo platform. The plaintiffs’ lawyers have cited the incident as an example of the strategies used to keep high value customers actively engaged on betting platforms.
The case is notable for the legal argument put forward by the plaintiffs. Rather than focusing solely on advertising or commercial practices, the lawsuit argues that the apps themselves were designed in a way that encourages compulsive behaviour, bringing the case closer to product liability claims commonly seen in disputes involving medicines, equipment or consumer goods.
The lawsuit focuses primarily on microbetting, a form of wagering that allows users to bet on specific events during a sporting event, such as the outcome of the next play, the next pass, a free kick or a possession. Unlike traditional sports betting, which is generally placed before an event begins, microbetting offers hundreds of betting markets during a single match, allowing users to place continuous wagers while watching the game.
The plaintiffs’ lawyers argue that FanDuel and DraftKings used artificial intelligence, real-time notifications and personalisation tools to encourage users to continue betting.
According to the complaint, Terry Thompson placed almost all of his wagers on NFL microbetting markets. During the period referenced in the lawsuit, he allegedly placed approximately $23 million in wagers and accumulated losses of nearly $1.9 million. Christopher Sage claims to have lost more than $170,000 while using the platforms of both companies.
The plaintiffs argue that this rapid form of betting reduces the time between placing a wager and learning its outcome, increasing the frequency of betting decisions and amplifying impulsive behaviour.
Operators defend regulated betting market
The companies reject this interpretation. In its defence, FanDuel argues that regulated sports betting in the United States emerged to replace a market previously dominated by illegal operators, offshore bookmakers and illicit gambling.
The company states that since the US Supreme Court struck down the federal sports betting ban imposed by the Professional and Amateur Sports Protection Act (PASPA) in 2018, states have developed regulated markets with consumer protection mechanisms and tax revenue collection. According to the operator, the purpose of the legislation was never to eliminate the inherent risks of gambling, but rather to provide a safer alternative to the illegal market.
Another argument raised by the companies concerns regulatory authority over these issues. FanDuel and DraftKings argue that Pennsylvania law grants the Pennsylvania Gaming Control Board (PGCB) exclusive authority to oversee licensed sports betting activities. According to the operators, any disputes regarding advertising, VIP programmes, responsible gambling policies or how betting platforms operate should be handled by the regulator rather than through individual civil lawsuits.
Based on this argument, both companies believe the lawsuit should be dismissed by the state court. FanDuel has also filed a motion seeking to compel arbitration, arguing that the plaintiffs accepted this requirement when they agreed to the app’s terms of use through several updates implemented over the years.
This argument closely mirrors the one used by DraftKings in another legal dispute involving the City of Philadelphia. Last week, the company sued the municipality to block an investigation based on a local consumer protection law, again arguing that only the PGCB has authority to oversee licensed betting operators in the state.
The NFL has also requested to be dismissed from the lawsuit. The league argues that it merely licenses statistical data and has no direct relationship with the bets placed by the plaintiffs. According to its lawyers, holding the organisation responsible for players’ losses would violate constitutional principles related to due process.
Genius Sports, the NFL’s official provider of real-time statistics, argues that there is no causal relationship between providing sports data and the alleged development of a gambling-related disorder. The company maintains that betting decisions depend on several independent factors, including platform design and, above all, the voluntary choices made by users.
Case could influence future lawsuits against operators
Although other lawsuits involving advertising, promotional bonuses and VIP programmes have previously been filed, this is one of the first attempts to classify betting applications as products whose design itself may cause harm to consumers.
If this legal theory advances in court, similar lawsuits could emerge in other US states, particularly as live betting continues to grow and operators increasingly use personalisation tools, artificial intelligence and real-time notifications to increase user engagement.
The plaintiffs’ lawyers have until 5 August to formally respond to the arguments submitted by the companies.
This article was first published on the Portuguese SiGMA News page on 23 July 2026.
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