DraftKings Reaches Settlement Over TCPA Issue

DraftKings recently announced that they have reached a settlement agreement concerning a Telephone Consumer Practice Act (TCPA) class action. David Izsak filed the complaint in October 2014 in the Northern District of Illinois. Mr. Izsak received a text message stating, “Come play DraftKings with me. Use my link and we’ll both get a bonus.” After calling the sender, he discovered the number from the text message is owned and operated by DraftKings.

On June 13, 2016, the Northern District of Illinois ruled on the defendant’s motion to dismiss. The court granted the motion in part, and denied the motion in part. According to the court, the TCPA count would be able to continue. A TCPA violation consists of the defendant utilizing an automatic telephone dialing system (ATDS). According to the court, a plaintiff “must plead additional, independent facts that suggest beyond the speculative level that Defendant actually used an ATDS and is liable under the TCPA.” Based on the follow-up call to the sender, the court decided the claims were properly pled.

TCPA violations can reach astronomical numbers. For each text sent, a defendant found guilty of violating the TCPA can be held liable for a minimum of $500. The lead plaintiff, representing his class, had asked in the complaint for treble damages for each sent text. DraftKings and the plaintiff delayed a status hearing to later in July based on the settlement agreement. Then they will file the stipulation to dismiss.

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