The disputed result of DraftKings’s “Millionaire Maker” challenge from earlier this month finally has a winner.
And it’s not a celebrity. Or even a person whose name is public.
As first reported by The Action Network and as confirmed by an attorney involved in the dispute, DraftKings has declared “SPclk36” the winner. SPclk36 is the username of a man who had initially been declared the runner-up to Jade Roper Tolbert, a former contestant on both The Bachelor (season 19) and Bachelor in Paradise.
SPclk36 retained prominent attorney Alan Milstein in the aftermath of the contest. Milstein is a shareholder at Sherman Silverstein in New Jersey who has litigated on behalf of Allen Iverson, Carmelo Anthony, Maurice Clarett, Eddy Curry and other sports figures. By hiring Milstein, SPclk36 sent a clear message that litigation against DraftKings was a real possibility unless SPclk36 was declared the winner.
Roper Tolbert and her husband Tanner Tolbert, whom Roper Tolbert met on Bachelor in Paradise, had each purchased the maximum allowable number of entries, 150. Each entry cost $25. One of Roper Tolbert’s entries picked several of the highest performing players from the four NFL Wild Card games held on Jan. 4 and Jan. 5. That entry scored 180.78 points. SPclk36, meanwhile, scored the second-highest total with 178.16 points. The winner is awarded $1 million and the runner-up is awarded $100,000.
As detailed by Sports Illustrated at the time, concerns were quickly raised about the possibility that Roper Tolbert and her husband may have “colluded” in their entries. Of the couple’s 300 total entries, 298 featured unique lineups. This suggested they aligned their picks in order to maximize the number of different entries that could win.
It is a violation of DraftKings’s community guidelines to coordinate lineups. Doing so provides unfairly high odds of winning. This type of impermissible coordination is termed “team-building complementary lineups.” It involves two or more people who work together and execute a strategy to produce an unfair advantage over individual play. In addition to ensuring basic fairness and contest credibility, there are legal reasons for DraftKings to prohibit collusion. State laws generally limit the number of entries submitted by a single player for any contest to 150 entries per player.
DraftKings investigated the disputed result and withheld paying the award during that time. As part of its investigative authority, DraftKings can require players to provide an affidavit—a sworn statement that could give grounds for a perjury criminal charge if the affiant knowingly lies. In the affidavit, a DraftKings player must expressly declare that he or she has fully complied with contest rules.
In a statement on Saturday, DraftKings expressed that it has “decided to update the standings for several contests.” One of those “updates” was the disputed “Millionaire Maker” challenge.
SPclk36 is the biggest winner of DraftKings’s decision. He is $900,000 richer. Milstein is also a winner. He persuaded DraftKings to change its mind.
“My client and I,” Milstein told Sports Illustrated on Saturday, “are thrilled that he has been rightfully declared the winner of the Millionaire Maker Contest.” Milstein complimented DraftKings on the company’s responsiveness to Milstein’s demands. “We have the utmost respect for the manner and expediency with which DraftKings conducted its investigation and kept us informed along the way.”
It’s unclear whether Roper Tolbert and Tolbert might now pursue legal action against DraftKings. At least in theory, they could sue for breach of contract, fraud and invasion of privacy. They could argue, among other points, that married couples have a privacy right in their discussions and that DraftKings should not presume collusion within those discussions. Also, DraftKings’s community guidelines clearly permit players to “discuss strategy around building lineups, statistics, and the quality of your picks publicly or privately.”
One hurdle for a lawsuit would be compulsory arbitration. As a contractual condition of playing a DraftKings contest, players accept arbitration to resolve any disputes stemming from their contractual agreements and transactions with the company. A state or federal court would decline to hear a lawsuit if the person suing contractually agreed to resolve the matter through arbitration.
DraftKings’s terms of arbitration make clear that any proceeding would be held in the Boston area (where DraftKings is headquartered). Unlike trials, which are open to the public and usually involve juries, arbitration proceedings are held in private and there is no jury. DraftKings players also contractually accept that even if they persuade an arbitrator that DraftKings was in the wrong, punitive (punishment) damages would not be available to them. That means the amount of money a DraftKings player would receive would be limited to the amount needed to fairly compensate them—and not an additional amount to punish or “send a message” to DraftKings.
DraftKings, which plans to go public in 2020 with a $3.3 billion valuation, is likely sensitive to perceptions that its contests might lack integrity or that the company ineffectively enforces game rules. The less credible DraftKings contests appear, the more likely state regulators will review them. That larger context is important here. The company’s decision to award the victory to SPclk36 should help DraftKings argue that it takes the integrity of its contests seriously and is even willing to reverse the order of winners to ensure fairness.
Michael McCann is SI’s Legal Analyst. He is also an attorney and Director of the Sports and Entertainment Law Institute at the University of New Hampshire Franklin Pierce School of Law.