Sports betting giant sues former executive for trying to aid its rival

A report said that the company accused its ex-employee of devising "a secret plan."

Feb 7, 2024 - 00:30

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Sports betting giant sues former executive for trying to aid its rival

DraftKings has been sitting pretty alongside FanDuel atop the sports betting market in the U.S., but the smaller players are still present and looking for ways to grab some market share.

One of those players is Fanatics, the company most known for sports merchandise, who acquired PointsBet in the back half of 2023 for $225 million. Fanatics had also been acquiring talent to bolster its betting division, including some who were from its top rivals.

But a new report by Front Office Sports said that one of the talents Fanatics poached from DraftKings is getting sued for allegedly stealing data from his former employer.

FOS reported that it obtained a federal lawsuit that said that Michael Hermalyn, DraftKings' former senior vice president for growth, created "a secret plan" that involved taking confidential customer information before he moved to Fanatics to become its president of VIP.

The civil complaint said that Hermalyn "timed his departure and theft of confidential information to coincide with the critical days leading up to the Super Bowl." It also said that he met with top brass from Fanatics and told other employees to follow suit.

The report also said that DraftKings is looking to file a temporary restraining order on Hermalyn after he filed his own lawsuit against the massive sportsbook, challenging its non-compete against him. Hermalyn's lawsuit was originally reported by Daily Journal.

What adds to the craziness of this situation is that Hermalyn allegedly lied about his location while still working with Fanatics. In late January, he allegedly claimed that he was taking a couple days off due to a death of a friend, but was actually at the Fanatics offices in Los Angeles.

There's surely going to be more to come about the aftermath of this story, but it's an indication of the heat of the competition in sports betting, particularly with the Super Bowl just days away.

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