Bernstein Liebhard, a nationally acclaimed investor rights law firm, announces that a securities class action lawsuit has been filed on behalf of investors who purchased or acquired the securities of DraftKings Inc. from December 23, 2019 through June 15, 2021. The lawsuit filed in the United States District Court for the Southern District of New York alleges violations of the Exchange Act of 1934.
If you purchased DraftKings securities, and/or would like to discuss your legal rights and options please visit DraftKings Shareholder Class Action Lawsuit or contact Joseph R. Seidman, Jr. toll free at (877) 779-1414 or Seidman@bernlieb.com.
The complaint alleges that, throughout the Class Period, defendants made materially false and misleading statements regarding the Company’s business, operations, and compliance policies. Specifically, defendants made false and/or misleading statements and/or failed to disclose that: (i) SBTech (Global) Limited (“SBTech”) had a history of unlawful operations; (ii) accordingly, DraftKings’ merger with SBTech exposed the Company to dealings in black-market gaming; (iii) the foregoing increase the Company’s regulatory and criminal risks with respect to these transactions; (iv) as a result of all the foregoing, the Company’s revenues were, in part, derived from unlawful conduct and thus unsustainable; (v) accordingly the benefits of the business combination dated December 22, 2019 were overstated; and (vi) as a result, the Company’s public statements were materially false and misleading at all relevant times.
On June 15, 2021, before the market opened, Hindenburg Research published a report titled “DraftKings: A $21 Billion SPAC Betting It Can Hide Its Black Market Operations.” The report alleges that one of the companies that was part of the three-way merger that took DraftKings public, SBTech, exposed DraftKings and their investors to black-market gaming, money laundering and organized crime. Hindenburg Research claimed that it had “conversations with multiple former employees, […] review[ed] SEC & international filings, and inspect[ed] back-end infrastructure at illicit international gambling websites[.]” Based on this information, the report concluded with the opinion that “DraftKings has systematically skirted the law and taken elaborate steps to obfuscate its black market operations.”
On this news, DraftKings’ stock price fell $2.11 per share, or 4.17%, to close at $48.51 per share on June 15, 2021.
If you purchased DraftKings securities, and/or would like to discuss your legal rights and options please visit https://www.bernlieb.com/cases/draftkingsinc-dkng-shareholder-class-action-lawsuit-fraud-stock-406/apply/ or contact Joseph R. Seidman, Jr. toll free at (877) 779-1414 or Seidman@bernlieb.com.
Since 1993, Bernstein Liebhard LLP has recovered over $3.5 billion for its clients. In addition to representing individual investors, the Firm has been retained by some of the largest public and private pension funds in the country to monitor their assets and pursue litigation on their behalf. As a result of its success litigating hundreds of lawsuits and class actions, the Firm has been named to The National Law Journal’s “Plaintiffs’ Hot List” thirteen times and listed in The Legal 500 for ten consecutive years.
Joseph Seidman, Jr.
Bernstein Liebhard LLP