\u201cThe public policy against gambling loss recovery bars plaintiffs\u2019 claims to the extent they seek recovery of their losses in any form, whether it is damages or restitution,\u201d the Bill Clinton appointee said.<\/p>\n
Breyer further dismissed plaintiffs\u2019 claim of declaratory judgment, as well as all RICO claims against DraftKings subsidiary Crown Gaming and individually named DraftKings officers, writing that \u201camendment would be futile.\u201d<\/p>\n
However, the ruling does not let DraftKings off the hook completely. Breyer said the same policies barring recovery of gambling losses in court do not extend to prohibit public injunctive relief for gambling based on deceptive advertising.<\/p>\n
He further ruled the plaintiffs had sufficiently claimed they suffered economic injury and have standing for injunctive relief under California\u2019s Unfair Competition Law and Consumer Legal Remedies Act.<\/p>\n
\u201cPlaintiffs argue there is a \u2018significant\u2019 risk of future injury because plaintiffs wish to gamble in California if it is legal and that is precisely what DraftKings continues to represent,\u201d Breyer said. \u201cThe court agrees with plaintiffs.\u201d<\/p>\n
The judge described the current status of gambling in California as \u201cmurky.\u201d He acknowledged California Attorney General Rob Bonta\u2019s 2025 nonbinding opinion concluding<\/a> state law prohibits daily fantasy sports games with players who are physically located in California, while also recognizing no court has declared the games illegal, nor has the state taken any enforcement actions.<\/p>\n \u201cA person in plaintiffs\u2019 position could reasonably continue to participate in purportedly illegal gambling if not for injunctive relief provided by this court, particularly if DraftKings offers similar illegal contests under different branding,\u201d Breyer said, adding, \u201cIndeed, plaintiffs allege that they may be tricked into engaging in future online gambling if DraftKings continues to represent that its games are legal.\u201d<\/p>\n Breyer additionally found the plaintiffs met the threshold to claim fraud by detailing how DraftKings represented its games as legal in California \u2014 despite online sports betting supposedly being illegal in the state \u2014 and how they relied on the representations before playing the games.\u00a0Further, he said, plaintiffs explain that DraftKings\u2019 campaign in support of a 2022 state ballot proposition to legalize online sports betting in California suggests \u201cDraftKings was aware its games were not legal at the time.\u201d<\/p>\n During a hearing last week<\/a>, the judge indicated an injunction blocking DraftKings in California is on the horizon if the plaintiffs prove they have standing, which they now have.<\/p>\n \u201cIf there is standing, and the game falls within the statute, I don\u2019t understand what the argument is about a general injunction that says you can\u2019t do it here,\u201d Breyer said last week.<\/p>\n Representatives for the parties did not immediately respond to a request for comment.<\/p>\n The lead plaintiffs, two DraftKings users, sued the daily fantasy sports website<\/a> in June 2025, claiming the company misrepresents the lawfulness of its contests in California, a state that prohibits commercial gambling.<\/p>\n In their complaint<\/a>, lead plaintiffs Zhicheng Zhen and Jonathan Smith argue DraftKings violated the state\u2019s Unfair Competition Law and Consumer Legal Remedy Act. In their amended complaint<\/a>, they tacked on additional violations of state law, RICO claims and requested declaratory relief.<\/p>\n