SAN DIEGO--(BUSINESS WIRE)--The DraftKings class action lawsuit charges DraftKings (NASDAQ: DKNG) and certain of DraftKings and Diamond Eagle Acquisition Corp.’s (“DEAC”) top executives with violations of the Securities Exchange Act of 1934 and seeks to represent purchasers of DraftKings securities between December 23, 2019 and June 15, 2021, inclusive (the “Class Period”). The DraftKings class action lawsuit (Rodriguez v. DraftKings Inc. f/k/a Diamond Eagle Acquisition Corp., No. 21-cv-05739) was commenced on July 2, 2021 in the Southern District of New York and is assigned to Judge Paul A. Engelmayer.
If you suffered substantial losses and wish to serve as lead plaintiff of the DraftKings class action lawsuit, please provide your information by clicking here. You can also contact attorney J.C. Sanchez of Robbins Geller by calling 800/449-4900 or via e-mail at firstname.lastname@example.org. Lead plaintiff motions for the DraftKings class action lawsuit must be filed with the court no later than August 31, 2021.
CASE ALLEGATIONS: DraftKings was incorporated in Nevada as DEAC NV Merger Corp., a wholly owned subsidiary of its legal predecessor, DEAC, a special purpose acquisition company, or SPAC. On April 23, 2020, DEAC consummated transactions and, in connection therewith, DraftKings acquired all of the issued and outstanding share capital of SBTech (Global) Limited (“SBTech”). SBTech became a wholly owned subsidiary of DraftKings.
The DraftKings class action lawsuit alleges that, throughout the Class Period, defendants made false and misleading statements and failed to disclose that: (i) SBTech had a history of unlawful operations; (ii) accordingly, DraftKings’ merger with SBTech exposed DraftKings to dealings in black-market gaming; (iii) this increased DraftKings’ regulatory and criminal risks with respect to these transactions; (iv) as a result, DraftKings’ revenues were, in part, derived from unlawful conduct and thus unsustainable; (v) accordingly, the benefits of the SPAC merger were overstated; and (vi) consequently, DraftKings’ public statements were materially false and misleading at all relevant times.
On June 15, 2021, Hindenburg Research published a report regarding DraftKings, alleging that DraftKings’ merger with SBTech exposed DraftKings to dealings in black-market gaming. Citing “conversations with multiple former employees, a review of [U.S. Securities and Exchange Commission 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. On this news, DraftKings’ stock price fell more than 4%, damaging investors.
Robbins Geller Rudman & Dowd LLP has launched a dedicated SPAC Task Force to protect investors in blank check companies and seek redress for corporate malfeasance. Comprised of experienced litigators, investigators, and forensic accountants, the SPAC Task Force is dedicated to rooting out and prosecuting fraud on behalf of injured SPAC investors. The rise in blank check financing poses unique risks to investors. Robbins Geller Rudman & Dowd LLP’s SPAC Task Force represents the vanguard of ensuring integrity, honesty, and justice in this rapidly developing investment arena.
THE LEAD PLAINTIFF PROCESS: The Private Securities Litigation Reform Act of 1995 permits any investor who purchased DraftKings securities during the Class Period to seek appointment as lead plaintiff in the DraftKings class action lawsuit. A lead plaintiff is generally the movant with the greatest financial interest in the relief sought by the putative class who is also typical and adequate of the putative class. A lead plaintiff acts on behalf of all other class members in directing the DraftKings class action lawsuit. The lead plaintiff can select a law firm of its choice to litigate the DraftKings class action lawsuit. An investor’s ability to share in any potential future recovery of the DraftKings class action lawsuit is not dependent upon serving as lead plaintiff.
ABOUT ROBBINS GELLER RUDMAN & DOWD LLP: With 200 lawyers in 9 offices nationwide, Robbins Geller Rudman & Dowd LLP is the largest U.S. law firm representing investors in securities class actions. Robbins Geller attorneys have obtained many of the largest shareholder recoveries in history, including the largest securities class action recovery ever – $7.2 billion – in In re Enron Corp. Sec. Litig. The 2020 ISS Securities Class Action Services Top 50 Report ranked Robbins Geller first for recovering $1.6 billion for investors last year, more than double the amount recovered by any other securities plaintiffs’ firm. Please visit https://www.rgrdlaw.com/firm.html for more information.
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