Sports Gambling Addiction Lawsuit [2026 Update]

The Sports Gambling Addiction Lawsuit is an Active Lawsuit

See if You Qualify

Sports betting apps are accused of using deceptive, unlawful, or unfair tactics to encourage people to use their betting platforms. People who have used sports gambling apps have lost money, experienced mental health challenges, and suffered other setbacks. Some people who say that online gambling has hurt their finances or health are filing lawsuits against online gambling outlets. These lawsuits seek damages and accountability from the sports gambling sites that people have become addicted to.

This page explains what an online sports gambling addiction is, why sports betting apps are so popular, the signs of a sports betting addiction, and who is at risk of developing a gambling addiction. It also discusses how features like VIP host messaging, deposit-limit changes, “risk-free” language, and personalization/targeting may encourage people to gamble more and result in civil liabilities for sports betting companies.

You can also find information about past lawsuits and enforcement actions against online sports betting apps. This webpage also discusses who may qualify to file a sports gambling addiction lawsuit, what compensation is available, and how to file a lawsuit if a sports gambling addiction has severely impacted your life.

Sports Betting Lawsuits – News and Updates

February 2026: People in Missouri Bet $543M in First Month of Legal Online Sports Betting

In December of 2025, Missourians waged $543 million dollars on sports betting, with 99% of those bets placed online ($538 million), according to the Missouri Gaming Commission. December was the first month when state residents could place bets with online sportsbooks. The state collected only $521,000 in revenue from these bets. That revenue goes into a state fund to help problem gamblers. Missouri adds to a growing list of states that allow residents to place bets online with apps like DraftKings, BetMGM, Caesars Sportsbook, and FanDuel.

January 2026: Man Files Lawsuit Against Sports Betting App for Allegedly Violating State and Federal Gambling Laws

A Michigan man has filed a lawsuit against the sport-betting company DraftKings for allegedly breaking federal gambling rules. In his December 2025 complaint, Michael Koester says the sports betting app allowed him to instantly increase his betting limit without observing a 24-hour cooling-off period. Koester says that he lost more than $25,000 between 2022 and 2023.

October 2025: Pew Research Says 10% of Americans Have Used a Sports Betting App and 40% of Americans Think Sports Betting is “Bad”

According to data released by the Pew Research agency, as of 2025, 10% of Americans have ever placed a bet on an online sports betting app. Similarly, a growing number of Americans sees sports betting as bad for society or bad for sports. 43% of Americans say legal sports betting is “a bad thing” for society, and 40% say it’s “a bad thing” for sports. Many of these people placed bets in a private betting pool or fantasy league.

March 2021: Online Sports Gambling Company Reaches Settlement Agreement In Class Action Lawsuit

On March 3, 2021, the fantasy sports team company behind DraftKings reached a settlement in a class action lawsuit against the company, regarding daily fantasy sports contest/advertising claims. Many people who lost money on the platform from a specified time period may qualify for a settlement. DraftKings asserts no wrongdoing.

May 2018: U.S. Supreme Court Overturns Federal Law Barring Sports Betting

The Supreme Court struck down a federal ruling regarding commercial sports betting. With the law overturned, some of the $150 billion in illegal betting may now be redirected into legal sports gambling. The overturned decision was called The Professional and Amateur Sports Protection Act, which prohibited states from authorizing sports gambling. Now, bets can be placed using mobile devices legally.

About the Sports Gambling Addiction Lawsuit:

What Is the Sports Betting App Addiction Lawsuit?

The sports betting app is about allegations of misconduct by sportsbook apps that resulted in people gambling more frequently and losing more money than they intended. People who are filing lawsuits against the companies (e.g. BetMGM, Caesar’s, DraftKings, Fanatics, and FanDuel) that own sports betting apps allege that deceptive promotions, VIP targeting, and misleading “risk-free” bets put users at risk and fuel gambling addiction. Plaintiffs seek compensation for financial losses and mental health issues related to sports gambling.

What Is a Sports Gambling Addiction?

Sports gambling addiction is a gambling addiction that is centered around sportsbooks and bets. For example, a person may bet on the outcomes of professional or college games, the likelihood of a player being traded, or other sports-related events. That said, sports betting addiction is not a standalone diagnosis. Instead, it is a type of gambling disorder.

According to the Fifth Edition of the Diagnostic and Statistical Manual of Mental Disorders (DSM-5), someone may have a gambling addiction if they engage in betting and wagering even though it causes problems in multiple areas of their life. Someone with a clinical gambling disorder should also have experienced a minimum of four specific symptoms within a single year.

However, some people with a gambling addiction go through periods of remission where problem gambling does occur, only to have gambling disorder symptoms resurface later.

Sources show that sports betting addiction rates have gone up in recent years, as it has become easier to access sports betting opportunities online. For example, the Pew Research Center found that 10% of Americans had placed a bet in a sports betting app, up from 6% of Americans in 2022.

Many people believe some of the apps used to bet on sports-related activities are purposefully designed to be addictive. Lawsuits filed against betting apps accuse these companies of creating a purposefully addictive product and not taking proper precautions to protect consumers.

How Legalized Sports Betting Led to an Increase in Addiction to Betting Apps

In 2018, the United States Supreme Court ruled that each state could pass its own laws on sports gambling. Since then, the number of sports betting opportunities has increased, particularly through online and mobile apps. Some reports suggest that this increase in the number of sports betting apps has led to a rise in the rates of sports betting addictions. Some people believe that the increase in access to sports betting on apps and online has made it easier for people to develop problematic gaming habits that lead to addictions and personal and financial losses.

Moreover, some claim that many of these online sports betting apps engaged in targeted, aggressive, and misleading advertising. They believe these strategies have led people to think these sports betting apps are risk-free and safe. Some people believe that this has led to a surge in problematic gambling behaviors on these online platforms, which have caused real-world harm.

Why Are Sports Betting Apps So Addictive?

Modern sportsbooks are addictive because of their ease of access, the dopamine rushes involved in chasing a potential play, and the allure of “risk-free” bets.

Some of the things that can make sports betting apps addictive include:

• 24/7 online access to betting platforms
• Apps highlighting near-misses
• Instant loss-chasing
• Variable rewards (e.g., instant payouts, bonus bets, access to exclusive bets)
• So-called “risk-free” betting
• In-app bonuses

Online sports betting applications also use bonus bet schemes, where someone is encouraged to buy or stay in for the chance to win a premium reward. Lawsuits allege that the way the games are designed encourages continuous, disordered engagement with sports betting.

24/7 Mobile Access and In-Game Betting

Sports betting apps give people 24/7 access to the betting platforms and betting opportunities, which some researchers have suggested may raise the likelihood of problematic gambling behaviors. The increased access to gambling opportunities may remove natural barriers to traditional gambling behaviors, like going to a casino, calling in a bet, or getting a scratch-off lottery ticket.

Moreover, players may have access to more betting opportunities on the sports betting platforms than they would for in-person betting. These online opportunities include micro-bets, live betting, and in-game wagers. Some studies have shown that increased access to legal gambling opportunities has increased the rates of gambling.

Dopamine, Near-Misses, and Loss Chasing

According to research published in the journal of Molecular Psychiatry, the design and mechanics of online sports betting apps can trigger dopamine seeking and release cycles   in much the same way that substance use disorders do.

For example, in-app displays may make the person think they have a higher chance of winning a bet than they actually do. One study has shown that this experience of near-misses  may activate the person’s brain in the same way an actual win does, which can ramp up the severity of their gambling, including sports betting.

Sports betting also offers variable rewards, including small and large payouts, cash prizes, bonus bets, and additional access to betting opportunities. Variable reward cycles have been shown to be a likely driver of addictive tendencies, including problem gambling behaviors.

Additionally, some studies suggest that electronic gambling machines (EGMs) may carry a higher risk of addiction than casino table or racing games. Sports betting apps share many of the same features of EGMs, which may make them more likely to lead to someone becoming addicted or engaging in problem gambling.

“Risk-Free” Bets and Bonus Traps

Another way that sports betting apps draw people in is by offering “risk-free bets,” bonus traps, and other perks. These in-app schemes offer the chance to win a payout, earn credits, or get other rewards if the person completes an action.

For example, the app may ask the person to pay a small amount of money for the chance to win a large amount in bonus bets. However, the person may have a small chance to win bonus bets, and these bets may not be exchangeable for real-world cash. Instead, the “bonus bets” they win give them access to participate in more bets, which may require them to spend more money.

This scheme can entrap players in the sports betting app, making them feel like they have to keep playing the sports betting app in order to get a true payout. Some sports gambling players are filing lawsuits against apps and online platforms, claiming they were misled about the true nature of the in-app betting schemes.

What Are the Common Signs of Sports Gambling Addiction?

People with a sports gambling problem display the same symptoms as someone with gambling disorder or compulsive gambling . Sports gambling addictions may cause someone to show a range of symptoms, including:

• Canceling plans to make more time for sports betting opportunities
• Increasing the amount of money and time spent engaging in sports betting
• Frequently removing or raising daily betting limits on their sportsbook apps or accounts
• Mood swings and adverse coping behaviors (like drinking, angry outbursts, panic attacks, etc.), which are tied to their losses
• Lying to friends, families, and loved ones about how much time and money the person spends on sports betting
• Borrowing money from institutions, friends, family, coworkers, and others to make up for sports betting losses or participate in more plays
• Not being able to stop or slow down the person’s sports gambling activities, even though it has negative consequences on their life or well-being

People with a sports gambling addiction may go through periods where they have little to no urge to engage in problematic gambling habits. During this time, they may incorrectly think they no longer have a gambling problem. However, they may engage with problematic gambling behaviors when their addiction is triggered again (e.g., by stress, upcoming sports seasons, or a chance to win big).

Some people may engage in illegal activities (e.g., stealing money or property) to accommodate their sports betting addiction. Under the DSM-IV, someone needed to have committed an illegal act to meet the definition of a gambling disorder. However, the DSM-5 removed this requirement. Under the new criteria, someone can have a sports gambling addiction even if they do not commit illegal acts.

Mental Health and Financial Consequences of Gambling Addiction

Sports gambling addictions can have serious consequences on a person’s mental health, financial situation, and other areas of their life. Some of the real-world harms that someone with a sports gambling addiction may experience include:

• Anxiety
• Depression
• Suicidal thoughts or attempts
• Substance abuse (alcohol, drugs, etc.)
• Overwhelming debt
• Job loss
• Loss of relationships
• Increased problems managing anger or stress

Oftentimes, the real-world harms that a sports gambler experiences because of their addiction also affect their loved ones.

Who Is Most at Risk for Sports Betting Addiction?

Potentially, anyone who participates in sports betting activities could develop a gambling addiction. However, some populations may be at a higher risk than others.

Some studies have shown that the following groups may be at a higher risk of developing a sports gambling addiction:

• Being a minor or young adult
• Being in college
• Being male
• Having a mental health condition

It is important to note that people who do not have these characteristics can still be at risk for developing an addiction to sports betting.

Young Adults, Men, and College Students

Some research suggests that people who are young (20s and under) or male are developing gambling problems at a higher rate than others, according to the American Psychological Association (APA). The APA also notes that newer forms of gambling (like sports betting and video game-based gambling) appear to be most attractive to this group. Increased availability of gambling opportunities has also been associated with a higher risk of increased gambling activity and problem gambling behaviors.

One of the reasons that younger populations may be particularly vulnerable to sports betting is that they may have a harder time controlling their impulses and self-regulating their emotions.

Additionally, as online gambling has become more accessible, people may be exposed to sports betting platforms and advertisements at an earlier age. This increased exposure at an early age may also raise the chances of the person engaging in sports betting and developing gambling problems.

People With Underlying Mental Health Challenges

Having an underlying mental health condition (such as depression or OCD) may also increase someone’s chances of having a sports betting addiction. For example, a study that looked at gambling rates among college students found that having a psychiatric condition was “significantly associated with disordered gambling.” Another study found that having ADHD was one of the risk factors associated with having a gambling disorder, based on a survey of study participants.

Major Sports Gambling Addiction Lawsuits in the U.S.

Lawsuits are being filed against sports betting platforms. Sportsbook providers facing lawsuits filed by consumers and government entities include:

• BetMGM
• Caesar’s
• DraftKings
• Fanatics
• FanDuel

Sports betting addiction lawsuits are being filed by affected consumers as well as cities, tribes, and government entities. These lawsuits accuse sports betting companies of engaging in practices that lead to addiction, financial, and personal losses while not putting proper safety practices in place.

Lawsuits Against DraftKings

DraftKings is an online sports betting platform that also has a companion app users can access to place and track bets. Users can also create their own fantasy teams.

Legal complaints (civil lawsuits) have been filed against DraftKings and its partners, Crown PA Gaming and Golden Nugget Online Gaming. One of the allegations in the complaints against DraftKings is that the company knowingly targets consumers who have gambling problems.

DraftKings is also under fire by consumers for not closing their accounts when requested, which can make it difficult for people to control their gambling. Legal complaints allege that DraftKings uses misleading advertising and promotions (including the “Risk-Free Bet” or “No Sweat First Bet”) to get people to spend more money than they intend to under the assumption that they can recoup their losses or win big.

DraftKings also entered into an $8 million settlement to resolve claims filed by consumers who say they wrongfully lost money in unfair “contests” run by DraftKings. Another multistate class action accuses DraftKings of violating state laws requiring companies to impose a 24-hour cooling-off period before granting a consumer’s attempt to increase their daily betting limit.

Lawsuits Against FanDuel

FanDuel is an online sportsbook company that lets consumers place bets on sports-related activities and create their own fantasy sports teams. People are filing lawsuits against FanDuel, alleging misconduct by the company.

Like DraftKings, FanDuel is the subject of a lawsuit that accuses the platform of knowingly targeting a man with current gambling problems.

According to another lawsuit, FanDuel also uses bonus bet schemes, alluring but misleading incentives, and other improper tactics to get and keep people to place bets on the platform. Similar lawsuits also accuse FanDuel of actively fostering problematic gambling activities, including by reaching out to users to remind them to place bets if they have been inactive for a time. Lawsuits also describe how FanDuel uses a VIP scheme to promote users to VIP status and assign them a VIP host who then fosters and nurtures an increased interest in gambling on the platform. For example, one such legal complaint indicates that a VIP host and a VIP consumer sent up to 100 messages a day.

City and Government-Led Lawsuits

Cities, governments, and tribes are filing lawsuits against sports betting companies, accusing the platforms of violating state, federal, and tribal laws. For example, the Ho-Chunk Nation alleges that online betting platform Kalshi is illegally operating a sports gambling company in Wisconsin. The Ho-Chunk Nation says that tribal casinos are the only place where gambling is legal in Wisconsin, so Kalshi is breaking the law by allowing people to bet on its online platform in the state.

Likewise, the City of Baltimore is suing DraftKings and FanDuel, accusing the companies of breaking the city’s Consumer Protection Ordinance. The lawsuits accuse FanDuel and DraftKings of a number of unfair and illegal practices. One such accusation is that the companies gather usage data to determine which consumers on the app are most likely to place large and frequent bets. Then, the companies ramp up outreach to those vulnerable consumers, according to the legal complaint.

Similar lawsuits are being filed in other states, tribes, and municipalities across the United States. Enforcement actions have also been filed against DraftKings for allegedly unlawful sports betting activities in New Jersey, Massachusetts, and Connecticut, which resulted in over $3 million in refunds and fines collectively.

Common Allegations in Sports Gambling Addiction Lawsuits

Some allegations being made against FanDuel, DraftKings, and other sports gambling providers include the use of unlawful or deceptive practices. For example, lawsuits say that sports betting apps knowingly used deceptive promotions and VIP targeting to encourage excessive gambling and encourage additional bets.

Consumers, municipalities, and others have accused these organizations of being misleading about whether the wagers and contests offered by the sportsbook company are legal in the consumer’s state and about the nature or potential payout of advertised sports bets.

Here are some of the allegations against sports betting apps, according to lawsuits:

• Deceptive and misleading advertising
• Failure to protect people with known gambling addictions
• Engaging in predatory VIP programs
• Violating state and municipal gambling laws

Additionally, current and former coaches, players, and others who worked for the NBA have been criminally charged with engaging in illegal betting activities, money laundering, and other insider schemes to fix games and entice people to place illegal or fraudulent bets. Similar charges have been brought against people connected with Major League Baseball.

Deceptive and Misleading Advertising

Plaintiffs in sports gambling addiction lawsuits accuse the platforms of using deceptive and misleading advertising to get customers to join and stay on the platforms.

For example, DraftKings advertises Risk-Free Bets, which require the consumer to pay cash in exchange for a chance to win a payout or “bonus bet.” However, according to legal documents, the consumer usually does not win these “Risk-Free Bets,” and they receive a bonus bet if they lose. The bonus bet cannot be exchanged for cash. Instead, it can only be used to make more bets, which may lead to more bonus bet credits instead of actual cash.

Affected consumers have said that calling this type of play “Risk-Free” is misleading to consumers. FanDuel uses similar schemes on its platform, which some allege is also deceptive and misleading.

Failure to Protect Known Problem Gamblers

Plaintiffs are also accusing sports gambling companies of targeting and failing to protect known problem gamblers. For instance, a plaintiff with concerns about their gambling habits contacted a sportsbook platform to close their account and prevent them from engaging in more bets. According to the plaintiff, the sportsbook company ignored their requests and continued to ask the plaintiff to participate in gambling plays.

Another legal complaint accused a sportsbook company of targeting people who are on public lists of those with current or past gambling addictions. In some cases, plaintiffs have accused the companies of violating their own internal policies to protect people from problem gambling.

Predatory VIP Programs

Another practice being discussed in sports betting lawsuits is predatory VIP programs. In these VIP schemes, the consumer is upgraded to VIP status and assigned a VIP host. The VIP host works directly with that consumer, encouraging them to place bets and reminding them of upcoming betting opportunities. According to legal complaints, these targeted interactions draw people in and encourage them to wager more, particularly high-stakes sports bets.

Violating State and Municipal Gambling Laws

Gambling is not legal in all states or territories in the United States. Instead, each state has its own rules about whether wagers and contests are allowed and, if so, what forms are permissible. However, DraftKings, FanDuel, and other gambling outlets have been accused of operating illegal gambling operations in states where it is banned. For example, according to one complaint, a sportsbook app allegedly misled a California consumer into placing illegal wagers on the site, which could have led to that consumer being criminally charged. DraftKings is also accused of violating gambling laws in its consumers’ states, as are several “social casino” apps.

What Is This Lawsuit Not About?

Lawsuits filed against DraftKings, FanDuel, MGM, and other sports betting apps are not claims that say sports betting should be illegal or that it is always harmful. These lawsuits are not targeted at casual gambling. Instead, these lawsuits allege that these companies use questionable practices that encourage some people to over-gamble and lead some people to become addicted. People who file lawsuits are not guaranteed financial recovery.

Legal Theories Used in These Lawsuits

Some of the legal theories being used in the sports gambling addiction lawsuits include violations of consumer protection laws, false advertising, and negligence. Additionally, some legal complaints accuse the sportsbook companies of running an unlawful gambling operation or enabling unlawful gambling in that state or municipality.

Allegation: Consumer Protection and False Advertising Laws

Sportsbook companies are accused of violating consumer protection and advertising laws. The allegations include claims that the companies are not being honest in their advertisements about their services, including the potential payouts. People are also accusing sports betting providers of knowingly engaging in targeted, predatory advertising towards people with a gambling addiction.

Allegation: Negligence and Duty of Care Arguments

Plaintiffs in some lawsuits are arguing that some sports betting companies are negligent and have violated their duty to protect addicted consumers. They may accuse companies of being careless in how they market their sports betting apps to consumers and of using misleading perks and incentives to keep them on the platform, including known problem gamblers. Some plaintiffs also claim the companies were dishonest about the terms, chances, and potential outcomes of bets.

Allegation: Illegal Gambling and Unlawful Operations

Some plaintiffs say sports betting platforms have been untruthful about what types of gambling are and are not legal in the plaintiff’s state. Gambling is not legal in every state. Moreover, states where some forms of gambling are legal have rules about what forms are permitted and when. However, some sports betting companies have allegedly been unclear or dishonest about the rules in the consumers’ state. For instance, at least one plaintiff from California said they unknowingly participated in illegal sports betting on a gambling platform because it led them to believe it was legal in California.

Arbitration Clauses and Legal Challenges in Sports Gambling Addiction Lawsuits

Sports betting platforms may require users to sign a mandatory arbitration clause or a class-action waiver when they create an account. These requests may be part of the app’s Terms of Service. Arbitration clauses may prevent the consumer from filing a lawsuit unless the consumer meets certain conditions. Class action waivers may bar consumers from participating in a group lawsuit brought by other consumers who were allegedly harmed by the sports betting company. However, consumers may still be able to file a lawsuit if their sports betting addiction attorney can prove the agreement is unenforceable.

Who Qualifies to File a Sports Gambling Addiction Lawsuit?

Some of the eligibility criteria to file a sports gambling addiction lawsuit include the following:

• The person lost thousands of dollars in bets on the sports gambling app when they were a young adult.
• The person is under 18, and the sports betting app allowed them to place bets.
• The person used the sports betting platform and was later diagnosed with a gambling-related mental health condition (like a gambling disorder, depression, or anxiety).
• The person believes the sports gambling app allowed them to place bets that are actually illegal in the person’s state, but the app did not tell them this.

This list does not include all possible eligibility criteria. Talking to an attorney about how you were impacted by sports betting is the most effective way to know if you qualify. They can help you understand the updated requirements for sports gambling addiction lawsuits and whether you qualify to file for compensation.

How Can I File a Sports Gambling Addiction Lawsuit?

You can file a sports gambling addiction lawsuit with King Law by taking the following steps:

• Talk to a lawyer about your experience with sports betting platforms.
• Work with your attorney to gather evidence to show that the sports betting app used unlawful, dishonest, or predatory practices against you.
• Your lawyer writes up a legal complaint and uses it to open a lawsuit against the sports betting app.
• Your attorney prepares and negotiates a settlement to compensate you for your sports gambling-related losses.
• If your lawyer cannot get the sports gambling company to agree to a fair payout, they take your case to trial.

An attorney can help people understand and navigate sports gambling lawsuits, including knowing when, where, and how to file a case. King Law has extensive experience advocating for people who allege harm by large corporations.

What Evidence Helps a Sports Betting Addiction Lawsuit?

In order to file a lawsuit related to sports betting addiction, you will need to provide evidence to your lawyer. Your lawyer will use this information to build your case and file a complaint.

Here are examples of proof your lawyer may need to file a lawsuit related to your losses from sports betting apps:

• Information on how many bets you placed in a day, week, etc.
• Information on how much money you bet, won, and lost
• Information on what in-app promos encouraged you to bet and where you placed most of your bets
• Financial or banking statements showing withdrawals for gambling
• Medical records related to medical conditions associated with gambling addiction, such as anxiety, depression, or clinical gambling addiction

What Is the Deadline to File a Sports Gambling Addiction Lawsuit?

State law determines the deadline to file a sports gambling addiction lawsuit. Unless an exception applies, the person must file before these statutes of limitations expire. If a person misses one of these filing deadlines, their case may be dismissed, unless they or their attorney can prove that an exception grants them more time to take legal action. For this reason, it is extremely important for people to talk to a knowledgeable, trusted lawyer early on.

Estimated Sports Gambling Addiction Lawsuit Settlement Amounts

Sports gambling addiction lawsuits are in their early stages. Potential settlements for sports betting losses can vary widely based on factors such as a person’s gambling activities, the strength of their case against the companies, and the state’s court compensation laws.

Some class action settlements have resulted in multimillion-dollar payouts split among a group. However, the result may be different for someone filing an individual lawsuit. An attorney focusing on sports betting cases can help you determine what your potential sports betting addiction settlement could be based on your situation.

King Law Is Investigating Sports Gambling Addiction Claims

King Law is accepting and reviewing sports gambling addiction claims. Our firm is also closely following emerging trends for lawsuits against DraftKings, FanDuel, and other platforms. We have a history of championing hard-won litigation on behalf of clients who were lied to, taken advantage of, or harmed by large companies. We are prepared to help you, too.

Contact a Sports Gambling Addiction Lawyer Today

If you were harmed by a sports gambling company, contact our team today to schedule a no-obligation case evaluation. You can call us at (585) 496-2648 or fill out an online contact form. We take sports gambling addiction cases on contingency, meaning you do not pay us upfront legal fees for our services if you hire us. Instead, we would receive a set percentage of your settlement or jury award if we win your case for you.

Frequently Asked Questions (FAQs)