DraftKings named in lawsuit over using AI to target consumers likely to spend more

• DraftKings has been named in a new lawsuit by a gambler who alleges that the company has been targeting a "class of players"
• The lawsuit follows a report by The New York Times in which former employees speak about how AI tech was used by the company
• The report and the lawsuit allege that DraftKings leveraged its AI tech to incentivize gamblers likely to spend more, with the lawsuit suggesting those people were vulnerable

DraftKings, an online sportsbook and casino, is facing a new class-action lawsuit after customers read a New York Times report alleging that the company had been using AI to target consumers who are likely to spend more money.

In wake of NYT report, DraftKings faces new lawsuit

The lawsuit stipulates that DraftKings not only targeted consumers who would spend more with the platform, but also targeted "vulnerable consumers."

Commenting on the original reporting by the New York Times in September, DraftKings rebuffed the implications, calling out the veracity of the statements provided by former employees, and insisting that the company was doing what any consumer-facing company in any industry did.

The person leading the charge in the new lawsuit is Daniel Vest, a gambler from West Virginia who filed the complaint with the Massachusetts Federal Court, with the Bay State being the jurisdiction where DraftKings is headquartered.

"Despite its professed 'commitment to responsible play' and to 'ensure that are playing responsibly,' (DraftKings), upon information and belief, uses AI, and has developed its Model, not to protect users but, rather, to target the most vulnerable among them," the lawsuit claims.

Vest is seeking to represent more plaintiffs in the case, arguing that the AI technology employed by DraftKings was used to specifically target consumers to keep them gambling.

The lawsuit names a term used in the New York Times reporting, "elastic," as the type of players who were allegedly targeted by the company and offered additional credits.

Gambler says DraftKings targeted a specific type of player

Vest argues in the complaint that DraftKings resorted to unfair and deceptive practices, and adds that the company broke its contractual obligations under state laws.

DraftKings has responded to the new allegations via a spokesperson and once again reiterated that its AI tech was not used to inflict harm on consumers - but, to the contrary, to shield vulnerable consumers.

"DraftKings does not use AI to target customers based on losses, nor do we use AI to target customers based on indicators of potential problem gaming. We intend to vigorously defend any potential lawsuits on the matter," the company stated.

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