Please complete this form relating to your transactions for DraftKings Inc. (NASDAQ: DKNG), f/k/a Diamond Eagle Acquisition Corp. (“DEAC”) (“NASDAQ: DEAC) securities between December 23, 2019 and June 15, 2021, both dates inclusive (the “Class Period”).
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Notice is hereby given that a class action lawsuit has been filed on behalf of those who purchased or acquired DraftKings Inc. (“DraftKings”) (NASDAQ: DKNG), f/k/a Diamond Eagle Acquisition Corp. (“DEAC”) (“NASDAQ: DEAC) securities between December 23, 2019 and June 15, 2021, both dates inclusive (the “Class Period”).
DraftKings operates as a digital sports entertainment and gaming company in the U.S. It operates through two segments, Business-to-Consumer and Business-to-Business (B2B). DraftKings provides users with daily sports, sports betting, and iGaming opportunities. It is also involved in the design, development, and licensing of sports betting and casino gaming platform software for online and retail sportsbook, and casino gaming products. DraftKings distributes its product offerings through various channels, including traditional websites, direct app downloads, and direct-to-consumer digital platforms.
DraftKings was incorporated in Nevada as DEAC NV Merger Corp., a wholly owned subsidiary of its legal predecessor, DEAC, a special purpose acquisition company. On April 23, 2020, DEAC consummated transactions contemplated by a Business Combination Agreement (the “Business Combination”) dated December 22, 2019, as amended on April 7, 2020. In connection therewith, DEAC merged with and into DraftKings, whereby DraftKings survived the merger and became the successor issuer to DEAC. Also, DraftKings acquired all of the issued and outstanding share capital of SBTech (Global) Limited (“SBTech”). SBTech is a full-service B2B turnkey technology provider with omni-channel sports betting solutions, trading services, and marketing and bonus tools powering popular sports betting and online gaming brands.
The Class Period commences on December 23, 2019, when DraftKings issued a press release announcing the Business Combination. Throughout the Class Period, the defendants touted the acquisition of SBTech and its business.
The truth about SBTech was revealed on June 15, 2021, when Hindenburg Research (“Hindenburg”) published a report alleging that DraftKings’ merger with SBTech exposed DraftKings to dealings in black-market gaming. Citing “conversations with multiple former employees, a review of SEC and international filings, and inspection of back-end infrastructure at illicit international gaming websites,” Hindenburg alleged that “SBTech has a long and ongoing record of operating in black markets,” estimating that 50% of SBTech’s revenue is from markets where gambling is banned.”
Following this news, DraftKings’ stock price fell $2.11 per share, or 4.17%, to close at $48.51 per share on June 15, 2021.
The complaint alleges that throughout the Class Period, the defendants made false and/or misleading statements and/or failed to disclose that: (1) SBTech had a history of unlawful operations; (2) accordingly, DraftKings’ merger with SBTech exposed it to dealings in black-market gaming; (3) the foregoing increased DraftKings’ regulatory and criminal risks with respect to these transactions; (4) as a result of all the foregoing, DraftKings’ revenues were, in part, derived from unlawful conduct and thus unsustainable; (5) accordingly, the benefits of the Business Combination were overstated; and (6) as a result, DraftKings’ public statements were materially false and misleading at all relevant times.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Filling out the online form above or communicating with any counsel is not necessary to participate or share in any recovery achieved in this case. Any member of the purported class may move the court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.