TLDR West Virginia resident Daniel Vest filed a proposed federal class action lawsuit against DraftKings on Sept. 30 in Massachusetts. The lawsuit claims DraftKings used AI and customer data to find gamblers most likely to bet more after receiving promotions. A New York Times report said the company’s model gave customers an “elasticity” score to decide who received incentives. DraftKings denies using AI to target customers based on losses or signs of problem gambling. The Massachusetts Gaming Commission is separately reviewing AI use by DraftKings and other licensed sportsbooks.
DraftKings is facing a proposed federal class action lawsuit that accuses the sports betting company of using artificial intelligence to target gamblers with promotions. The company denies the claims.
West Virginia resident Daniel Vest filed the complaint on Sept. 30 in federal court in Massachusetts. DraftKings is based in Boston.
The lawsuit claims the company used customers’ personal betting data in ways that went against its promises to promote responsible gambling.
Vest says he has bet thousands of dollars each year with DraftKings for several years. He claims he received at least 70 emails, texts, push notifications, and other messages from the company in about 30 days ending Sept. 25.
He is seeking to represent a nationwide class of DraftKings customers. These are customers the lawsuit says were flagged by the company’s AI systems as especially responsive to gambling incentives.
How the Alleged AI Model Worked
The lawsuit cites a September investigation by The New York Times. The newspaper reported that DraftKings built a machine learning model to predict which customers were most likely to gamble, and lose, more after getting promotions.
According to the Times, the system gave each customer an internal “elasticity” score. Customers labeled “inelastic” were seen as unlikely to change their betting much because