A DraftKings fantasy baseball contestant filed a would-be class action in a Manhattan federal court against Major League Baseball, MLB Advanced Media, the Houston Astros, and the Boston Red Sox over the unfolding sign stealing scandal.
Kristopher Olson seeks “to recover damages for defendants’ wrongful promotion of fantasy baseball wagering competitions that they caused to be, and knew or should have known were, corrupt and dishonest.”
Following media reports, an MLB investigation concluded that during the 2017 and 2018 seasons, the Astros illegally used a camera system to steal signs. A player or staff member wold convey the upcoming pitch to the batter by banging on a trash can. The Red Sox are under investigation by MLB for allegations of similar conduct during the 2018 season.
Olson notes that MLB has an equity stake in DraftKings, and that teams have entered into lucrative promotion agreements with the fantasy sports betting site.
Baseball fans, trusting in the game to be honest, “have engaged in DraftKings’ games of skill to the tune of millions of dollars in daily fantasy sports baseball contest fees” to the “enormous financial benefit” of the defendants, he says.
The contestants, thinking the contests were based on the honest skills of the players, made bets they wouldn’t have if they’d known the truth, Olson says. He accuses MLB of being “well aware that its member teams were engaging in corrupt and fraudulent conduct” undermining the fairness of such bets, but the league wholly failed to investigate, deter, or remedy it, Olson adds.
Causes of Action: Unfair and deceptive practices under state consumer protection statutes; unjust enrichment; negligence.
Remedy: Restitution, damages.
Potential Class Size: Olson estimates the class could encompass millions of DraftKing users.
Response: MLB didn’t immediately respond to Bloomberg Law’s request for comment.
Attorneys: Olson is represented by Silver, Golub & Teitell LLP.
The case is Olson v. Major League Baseball, S.D.N.Y., No. 1:20-cv-00632, 1/23/20.