DraftKings is being sued in a second proposed class action that claims its Predictions platform operates as an unlicensed sportsbook, with sports bets packaged for customers as financial-style “event contracts.”

The case was filed Monday (August 3) in Massachusetts federal court by Jason Gordon, Arie Weissmann and Johnny Harris. DraftKings Inc. and its wholly owned subsidiary GUS III LLC, which operates as DraftKings Predictions, are named as defendants. The three plaintiffs want to represent other Predictions users who they allege lost money.

According to the complaint, Predictions debuted in December 2025 and has since become available in states where DraftKings does not have authorization to run a licensed sportsbook.

Customers can wager money on sports outcomes, the lawsuit alleges, even though DraftKings calls the transactions “trading,” “predictions” and “event contracts.” The plaintiffs say those labels do not alter what customers are doing: risking money on an outcome for the chance of receiving a payout.

Plaintiffs in second class action lawsuit say DraftKings Predictions functions as an unlicensed sportsbook

To support that argument, the complaint points out how Predictions looks and operates. Screenshots in the filing display sports matchups with spreads, totals and odds. On page 18, one example features the Dallas Mavericks and Toronto Raptors, giving users “Yes” or “No” choices on whether Dallas will win by particular point margins.

How DraftKings generates revenue from Predictions is also disputed. The lawsuit points to terms allowing market makers to take the other side of customer transactions, while DraftKings affiliates can also serve as market makers.

According to the plaintiffs, DraftKings collects transaction fees and may receive additional payments tied to routing transactions. They allege customers do not receive adequate information about those relationships or total transaction costs before participating.

The complaint says DraftKings’ terms themselves recognize uncertainty over event-contract regulation. It quotes a risk disclosure referring to “active and evolving litigation and regulatory activity” concerning whether state gambling laws apply to those contracts.

All three plaintiffs report losing money. Gordon, who lives in Texas, claims losses exceeding $700. Fellow Texas resident Weissmann alleges he lost more than $1,000 before joining DraftKings’ self-exclusion program. Harris, from California, claims losses above $100 as well as transaction fees.

The filing also cites DraftKings CEO Jason Robins, saying he acknowledged that “customers don’t really even understand the difference” between Predictions and the licensed sportsbook and called that “actually a huge advantage.”

Another proposed class action reached the same court July 28. Plaintiff Michael Chan alleges Predictions enables illegal sports wagers where online betting is prohibited or DraftKings is unlicensed. He seeks classes covering Alabama, California, Florida, Georgia, Minnesota, New Mexico, South Carolina and Texas, plus a separate California class.

Gordon, Weissmann and Harris allege violations of Massachusetts gambling law and unfair or deceptive practices. They want money allegedly taken unlawfully from Predictions customers returned, along with costs and attorneys’ fees, and have requested a jury trial.

Both lawsuits contain allegations from plaintiffs that have not been established by the court.

Featured image: DraftKings

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