DraftKings Faces Injunctive Relief Over California Daily Fantasy Sports

• A federal judge has preserved a claim for injunctive relief that could block DraftKings from operating paid daily fantasy sports contests in California.
• The ruling dismissed several claims against the company but left open the possibility of an injunction blocking its operations in the state.
• The plaintiffs alleged that DraftKings misrepresents the lawfulness of its contests in California, where commercial online sports betting is prohibited.
• The court's decision highlights the complexities surrounding the regulation of daily fantasy sports in California.

"Plaintiffs argue there is a 'significant' risk of future injury because plaintiffs wish to gamble in California if it is legal and that is precisely what DraftKings continues to represent," Breyer said. "The court agrees with plaintiffs."

A federal judge has preserved a claim for injunctive relief that could block DraftKings from operating paid daily fantasy sports contests in California. The ruling, issued by U.S. Senior District Judge Charles Breyer, dismissed several claims against the company but left open the possibility of an injunction blocking its operations in the state. This development is significant for companies operating in the gaming industry, particularly those with interests in California or clients who advise on gaming and compliance issues.

The ruling was issued in a class action lawsuit brought against DraftKings by two of its users. The plaintiffs alleged that the company misrepresents the lawfulness of its contests in California, where commercial online sports betting is prohibited. The court's decision highlights the complexities surrounding the regulation of daily fantasy sports in California. While no court has declared such games illegal, the state Attorney General's 2025 nonbinding opinion concluded that state law prohibits daily fantasy sports games with players physically located in California.

The preservation of a claim for injunctive relief has significant implications for DraftKings and other companies operating in the gaming industry. If the plaintiffs are able to prove their case, it could result in an injunction blocking DraftKings from operating paid daily fantasy sports contests in California. This would be a major blow to the company's operations in the state and could set a precedent for future cases involving similar issues.

A federal judge has preserved a claim for injunctive relief that could block DraftKings from operating paid daily fantasy sports contests in California, citing the company's deceptive advertising and potential for future harm to consumers. Lawyers advising clients on gaming or compliance issues should watch for developments in this case, particularly if their clients operate in California or have interests in the state.

Source: Original reporting via CN