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Sep 12, 2015; Dallas, TX, USA; A general view of the DraftKings sign board during the match with FC Dallas playing against New York City FC at Toyota Stadium. Mandatory Credit: Matthew Emmons-USA TODAY Sports

Alabama men file lawsuit against DraftKings and FanDuel; seek money they lost

KENT FAULK / AL.COM

Two Jefferson County [Birmingham metro area] men this [Wednesday] morning filed a federal lawsuit against daily fantasy sports websites DraftKings and FanDuel claiming the companies are operating illegal gambling operations in Alabama.

The two men seek their money back under a 150-year-old Alabama law that prohibits enforcement of  gambling debts. The lawsuit also seeks class-action status to represent all Alabamians who have lost money with the fantasy sports websites.

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The lawsuit was filed by attorneys for Sam Manzella and Robert Todd in U.S. District Court in Birmingham. The men are represented by the Heninger Garrison Davis LLC and Fawal & Spina law firms.

A spokeswoman for FanDuel declined comment this morning. A spokesman for DraftKings said the company does not comment on pending litigation.

The lawsuit states that DraftKings and FanDuel are operating an illegal online sports betting business that violates Alabama’s gambling laws.

“Defendants (DraftKings and FanDuel) define their sports betting scheme as DFS (daily fantasy sports) in a specious attempt to circumvent Alabama law which expressly prohibits ‘gambling,'” the lawsuit states. “In Alabama, a ‘person engages in gambling if he stakes or risks something of value upon the outcome of a contest of chance or a future contingent event not under his control or influence, upon an agreement or understanding that he or someone else will receive something of value in the event of a certain outcome’,” the lawsuit states.

A scheme is considered gambling, the lawsuit states, if “chance” is the dominant factor in determining the result of the game, even though the result may be affected to some degree by skill or knowledge.”

“Both Fanduel and DraftKings operate similarly to good old fashioned bookmaking,” said Tommy Spina, one of the attorneys for the men. “If you win you get money if you lose they get money.”

“Millions of people nationwide have participated in this activity and most people assume that since Fanduel and DraftKings advertise nationally they have a business arrangement with the NFL, that it is legal,” Spina said. “However , the reality is that it is not legal in states where gambling is prohibited.”

Gambling in Alabama, from a bettor’s perspective, is a misdemeanor, Spina said. From a bookmaker’s perspective it is a felony, Spina said.

While the two men have admitted they participated in the gambling in the lawsuit, Spina said he does not believe they will face criminal consequences. The lawsuit does not seek criminal action against DraftKings and FanDuel, he said.

The lawsuit does not say how much money Manzella and Todd lost or how much money may have been lost by all Alabamians.  However, the amounts lost by the two men would be small, Spina said.

[ Ed. note:  there is so much ‘wrong’ in this story that I hardly know where to begin.

1. Yes, gambling is illegal in my home state of Alabama.  Yet we all know it happens.  Heck, we get sports betting experts on the sports-talk radio shows every week of the football season to tell us their takes on the upcoming week’s games.  So you think this is the first time somebody has tried this legal tactic?  I’m betting not…. oops, gambling term.

2. If you’re so BAD at fantasy sports gambling – and yes: let’s be honest… it IS gambling – that you have to concoct a scheme like this one to get out of paying your debts, then you probably need to rethink your life from a debtor’s prison.  The attorneys claim the lost amounts are “small”.  I seriously doubt that.  It wasn’t just one of the sports-fantasy sites involved here:  it’s both of the major ones.  These guys are bad addicted.  My only hope here is that these yahoos didn’t put their own families out onto the street in the process.

3. Note that while the lawsuit admits that this enterprise they engaged in is illegal, they really want their money back.  If I’m a judge in the case, I’d recommend they be prosecuted on the gambling charge just for the audacity and arrogance involved.  This is tantamount to robbing a liquor store, getting caught, and then suing the store for failure to have an adequate alarm system to deter you from robbing the store.

4. The attorneys are going to collect a mint on this – probably even if they lose.  Does that alone suggest just how much coin these idiots might have dropped because they can’t pick a decent running back?

5. Oh, and for further cover, they’ve actually doubled down on this (sure, why not? It’s another gambling term):  they want class action status for the lawsuit… probably so that the attorneys can reap the benefits for their labors that they likely can’t fully extract from their clients.

Expect both Fan Duel and Draft Kings to respond vigorously to this suit:  so much that even if they happen to lose, it will be a Pyrrhic victory for the plaintiffs.  The companies will insure that they will at least make this highly expensive for these losers, which should deter others in the future.  It’s certainly nothing they want to encourage. ]

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