Massachusetts Lawsuit Claims DraftKings, FanDuel Engineer Apps To Exploit, Addict Users

By Bill Speros

Mar 26th, 2026 5:47 PM EDT

A Massachusetts man has sued DraftKings and FanDuel in Suffolk County Superior Court. The lawsuit alleges the two sports betting companies deliberately engineered their mobile platforms to addict users and exploit problem gamblers for profit.

Daniel Arroyo of Dorchester filed the complaint Wednesday through the firm Aylstock, Witkin, Kreis & Overholtz and the Public Health Advocacy Institute.

The DraftKings and FanDuel lawsuit alleges both operators deployed behavioral targeting, variable reward mechanisms, predatory VIP programs, and personalized notifications designed to reach users at vulnerable moments. It further alleges that both companies made depositing money effortless while deliberately slowing the withdrawal process, and that they possessed detailed, real-time data on individual users' gambling patterns and signs of compulsive behavior — and used that data to increase engagement rather than protect users.

Arroyo claims in the suit that he placed more than 8,000 bets on FanDuel after being assigned a VIP account manager. The manager provided event tickets, exclusive promotions, and personalized bonuses, the suit claims. Arroyo eventually left his job, lost more than $160,000, and is currently in therapy.

"These companies didn't just offer users a digital platform to place bets; they engineered addiction," said Jennifer Hoekstra, a partner at the firm, said in a release. "The science, the data, and the corporate conduct all tell the same story: DraftKings and FanDuel knew exactly what their platforms were doing to vulnerable users, and they chose profit over people."

The complaint also alleges a disparity in consumer protections between the companies' U.S. and U.K. operations. FanDuel's parent company, Flutter Entertainment, voluntarily imposed deposit limits, stake caps, and VIP program restrictions for British customers following regulatory intervention in that market. No equivalent measures were applied to U.S. users, according to the suit.

A representative of FanDuel said the company was not commenting on the suit.

Lawsuit Asserts Claims For Product Liability, Other Faults

On Tuesday, clients represented by PHAI sued FanDuel, DraftKings, the NFL and data company Genius Sports in Pennsylvania. That suit alleges that they offer a "known addictive product."

The lawsuit asserts claims under Massachusetts law for strict product liability, negligent design, failure to warn, fraudulent concealment, negligent misrepresentation, unjust enrichment, and breach of implied warranty of merchantability. It seeks both compensatory and punitive damages.

The filing cites the companies' own SEC filings, investor disclosures, and job postings as evidence that both possessed the infrastructure to identify problem gambling patterns in individual accounts. The suit also alleges both companies continued using "risk-free bet" promotional language after state regulators had taken enforcement action and while the American Gaming Association was in the process of formally prohibiting the term.

Research cited in the filing found that problem gamblers — classified as less than 2% of the total betting population — account for more than half of sports betting revenue, a figure the plaintiffs argue shows the industry's business model is structurally dependent on its most vulnerable users.

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