New York, NY – The NFL Players Association has filed a lawsuit against DraftKings, a prominent betting partner of the league, for breaching their contract. The NFLPA alleges that DraftKings owes approximately $65 million from a licensing agreement that the sportsbook giant is failing to honor.
The civil suit, initiated in federal court in the Southern District of New York, asserts that DraftKings is seeking to terminate a contract signed in 2021 with the NFLPA. This contract granted DraftKings the rights to use the name, image, and likeness of players for its now-closed NFT marketplace without fulfilling the remaining minimum guaranteed payments.
Legal representatives for the NFLPA have not disclosed the specific amount being pursued in the lawsuit. However, they have pointed out the substantial income earned by five top executives at DraftKings since 2021, totaling around $261.1 million. This figure significantly surpasses the owed amount to the NFLPA Licensors.
Both DraftKings and the NFLPA have refrained from immediate comments in response to requests for statements. Meanwhile, an NFL spokesperson has declined to provide any feedback to the media concerning this legal dispute.
In the complaint filed by the NFLPA’s attorneys, it is argued that DraftKings’ decision to terminate the licensing agreement stems from a decline in the NFT market’s popularity. The attorneys claim that issues like a pending civil lawsuit and regulatory investigations are leading DraftKings to backtrack on their contractual obligations.
DraftKings recently announced the closure of its NFT marketplace due to legal complications, prompting the termination of the agreement with the NFLPA. The company is currently grappling with a lawsuit in Massachusetts that accuses them of breaching securities laws through their NFT marketplace.
Despite the Massachusetts ruling influencing DraftKings’ actions, the NFLPA’s legal team argues that this decision does not justify terminating the contract with the NFLPA. The crux of their argument revolves around DraftKings needing to fulfill their financial obligations regardless of market conditions or legal challenges.