DraftKings Uses AI to Target and Extract Money from Vulnerable Gamblers, Class Action Lawsuit Alleges

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A proposed class action lawsuit alleges that DraftKings has “weaponized” artificial intelligence to identify vulnerable gamblers who tend to lose and then bombard them with promotions that encourage them to place even more bets.

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The 37-page lawsuit was filed in the wake of a September 2026 New York Times report that said DraftKings in 2023 used customers’ betting records to build an AI machine-learning model to predict which users were likely to respond to promotions by betting, and consequently losing, more money.

The class action lawsuit accuses DraftKings (DK) of then exploiting vulnerable gamblers by using AI to target those users with an onslaught of emails, texts and in-app messages featuring incentives and promotions designed to keep the users gambling and prevent them from leaving the platform.

The case charges that DraftKings has contradicted both its own public claims regarding its apparent “commitment to responsible play” and privacy notices, which claim that the platform may use betting information to assess whether a customer is engaging in “potentially problematic” betting behaviors.

The case alleges that DraftKings has failed to disclose that customers’ information is used “not to protect users but, rather, to target the most vulnerable among them.” The lawsuit says that the company takes into account dozens of data points to identify “likely losers,” including the frequency with which an individual played, their daily account balances, and how much they typically lost versus how much they bet.

According to the complaint, DraftKings users who are less likely to lose bets are deemed “inelastic” and are provided with fewer incentives than so-called “elastic” users who, in the platform’s view, have a tendency to lose money. In fact, the case says, a former DraftKings employee stated that targeting “elastic” customers with promotions was “effective because they take advantage of gamblers’ psychology.”

Per the lawsuit, the promotions at issue play a “vital” role in DraftKings’ business model, as the company brought in roughly $8.7 billion in gross revenue from sports and casino gamblers in 2025, while it issued users approximately $3 billion in promotions.

Critically, the case claims that DraftKings knows, or should have known, that gambling can be addictive for many users. The National Institute on Drug Abuse has stated that "[t]he legalization of online gambling is associated with larger increases in irresponsible or risky gambling, particularly among those with lower incomes who can least absorb losses,” per the filing.

Citing The Times, the complaint alleges that while DraftKings was developing its AI model to target losing gamblers, it “stalled or squashed” efforts to use the same technology to identify users at risk of developing gambling problems. When DraftKings employees developed an AI model that would assign users gambling addiction risk scores, the company “sidelined” the project, the case says.

Customers trusted that DraftKings would safeguard their personal information with the belief that it would be used to ensure responsible gaming and were not informed that it would be used to identify the most vulnerable and at-risk users, the lawsuit stresses.

The DraftKings class action lawsuit looks to cover all individuals who, within the relevant statute of limitations, were deemed by DraftKings to be “elastic” and/or received targeted email, texts, online or in-app notifications, messages, incentives, and/or promotions from DraftKings based on DraftKings’ use of the AI machine-learning model.

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