What started out as a potential feel-good story for DraftKings and the daily fantasy sports industry turned into a potential headache quickly.
A former contestant on television’s ‘The Bachelor,” Jade Roper Tolbert, took down the biggest contest in fantasy football at DraftKings this weekend, the Millionaire Maker. That came with a top prize of a million dollars.
That was initially greeted as great news:
- It was good publicity for the company from a minor celebrity and the industry.
- A woman won the top contest in DFS, which is overwhelmingly played by men, according to surveys and studies.
- The new season of The Bachelor starts tonight, for good measure.
But the initial excitement turned into potential concern when details about her victory came to light. Notably, her husband also plays daily fantasy sports, and the two of them could be in violation of DraftKings’ terms of service and an array of state laws that deal with DFS contests.
Those concerns led to a lot of consternation on Twitter, national media attention, from the likes of TMZ and The Washington Post and a short statement from DraftKings:
“We take the integrity and fairness of our contests very seriously and are looking into this matter.”
And DraftKings CEO Jason Robins even addressed it on Twitter:
We released a statement that we are investigating the allegation that the millionaire winner violated our multi-accounting policy. I understand everyone wants answers and we are trying to work quickly, but I personally just learned about this within the past hour or two.
— Jason Robins (@JasonDRobins) January 6, 2020
So what exactly happened? And what happens next?
Details of the Millionaire Maker at DraftKings
Here’s a quick rundown what we know:
- Tolbert took the top spot in the Millionaire Maker, the DraftKings contest with the biggest prize pool for the NFL’s wild-card weekend. She confirmed it was her via a tweet.
- Tolbert entered the maximum amount of entries allowed in the contest — 150 entries at $20 each.
- Her husband, Tanner, also entered the maximum number of entries allowed.
- In its largest contests, DraftKings has an entry limit of 150. Both DraftKings’ terms of service and a variety of state laws concerning DFS codify this limit.
So what’s the potential problem with the contest?
Just two people from the same household or who know each playing in a contest is not necessarily an issue in and of itself.
The issue comes from the possibility that the Tolberts were working together to circumvent the maximum entry limits. Again, both laws and DraftKings prevent a single person from entering the Millionaire Maker more than 150 times.
Collusion of this type is a difficult thing to prove beyond a shadow of a doubt. But several years ago DraftKings launched a “game integrity unit” where collusion and attempts to circumvent the entry limit would not be tolerated.
Here’s more from DraftKings on its guidelines of unacceptable behaviors:
Team-building complementary lineups which serve to work together AND executing a strategy that may create any unfair advantage over individual play.
- Example A: You and 2 of your friends coordinate the makeup of the lineups you build AND coordinate which contests you enter using them.
- Example B: You and a group of friends collaborate in NFL contests to each draft different QBs and WRs, to guarantee you aren’t competing as directly with each other.
Entering the maximum number of entries in a contest, type of contest, or event, and having a 3rd party, regardless of their relationship, put in additional entries for you.
- Example: A contest has a maximum of 10 entries. You put in 10 entries but want to play more so you give your friend 10 additional lineups to play in the contest.
So was there a problem with the DraftKings contest and the Tolberts’ entries?
That’s the million-dollar question, and right now there’s a lot of speculation. It’s hard to make a determination on beyond a shadow of a doubt, at least with information we currently have on hand.
But to think that a married couple entered contests — to the maximum allowed — entirely independently of each other also takes a bit of suspension of belief. Can it be proven? That’s up to DraftKings and perhaps state regulators.
Since lineups are publicly available information, DFS players started looking at the lineups of the Tolberts. The fact that there is little overlap between their Millionaire Maker lineups at the quarterback position has given people pause.
This is absolutely insanity and is the the clearest collusion ever. Check the QBs lmao pic.twitter.com/JudoCAT0JQ
— William Bierman (@williambierman) January 6, 2020
If the husband and wife weren’t working together, how would you arrive at the quarterbacks having very little overlap between the two users, the argument goes. (There were only four games and eight starting quarterbacks available in the contest.)
There’s also this response/nugget about Jade Tolbert playing Seattle receiver D.K. Metcalf that raised some eyebrows:
Is that the smoking gun that will lead DraftKings to say their terms of service were violated? We’ll have to wait and see.
What do state laws say about collusion?
Every state has slightly different laws. But most of them have language that limits the number of entries to 150, or different levels depending on the size of the contest. Here’s New York, for instance:
Each Operator must restrict the number of entries submitted by a single authorized player for any contest to 150 entries per player per contest, or by a maximum of three percent of the total number of entries by all players for any contest, whichever is less, or as determined by the Commission. Operators must take reasonable steps to prevent authorized players from submitting more than the allowable number of entries per contest.
Does the apply to this situation? That’s in the eye of the beholder, or perhaps regulators. A determination would have to be made if one Tolbert was making entries for the other to get around the entry limit.
Many state laws also mention collusion specifically. Here’s Delaware:
Registrant shall prohibit the use of third-party scripts or scripting programs for any contest and ensure that measures are in place to deter, detect and, to the extent reasonably possible, prevent cheating, including collusion, and use of cheating devices, including use of third party software programs that submit entry fees or adjust the athletes selected by an authorized player.
Again, that’s pretty vague, but may apply.
What will DraftKings do?
This is another big question. DraftKings is clearly not ignoring the issue, but it’s not clear it will actually take action. DFS laws have existed for years, and there are no known cases of a law being applied to a collusion case.
DraftKings also doesn’t usually publicly comment about these types of situations, but it’s so high-profile that it has to deal with it somewhat publicly.
The company has at least two variables that may affect whether it acts on the situation:
- DraftKings is going public, and the situation is difficult to just ignore as a company that will need to be more transparent in its dealings.
- DraftKings has gambling licenses in a variety of states, and is seeking more. Having regulatory action pending in states on the DFS front might be less than ideal.
Still, taking action against the Tolberts potentially opens up a can of worms for DraftKings that it would rather keep closed. At the same time, if complaints get logged in states around the country, it may not be up to DraftKings.