DraftKings Sues Philadelphia Over Subpoena for Online Gaming Records

DraftKings has sued Philadelphia in a Pennsylvania federal court in hopes of blocking the city’s probe into its confidential sports betting and iGaming marketing practices.

In the lawsuit filed in Pennsylvania’s Eastern District Court, attorneys for DraftKings allege that the state’s consumer protection law preempts the city from altering or expanding its unfair trade practices enforcement regime. The litigation argues that the commonwealth’s Unfair Trade Practices and Consumer Protection Law (UTPCPL), which was passed in 1968, overrides the Philadelphia Consumer Protection Ordinance (PCPO).

The PCPO was authored to protect residents from fraud, scams, and deceptive business practices. Enacted in June 2024 by Mayor Cherelle Parker, the ordinance grants the city’s executive branch the authority to investigate and prosecute companies doing business within the city’s limits.

DraftKings, which does business across the state by operating online sports betting and casino gambling, argues that the state consumer protection act preempts the city’s local ordinance.

DraftKings Lawsuit

In its 20-page complaint, DraftKings asks the federal court to dismiss Philadelphia’s April subpoena for the gaming company’s internal documents regarding its marketing practices. The summons additionally sought confidential records regarding revenue and wagering data, user practices, VIP programs, and promotional disclosures.

DraftKings says the Pennsylvania General Assembly deliberately omitted municipalities from the enforcement structure of the UTPCPL, leaving the state attorney general and district attorneys as the public enforcers of the law.

“Unlike the UTPCPL, the PCPO authorizes enforcement actions in the name of the City. That difference creates a direct conflict with the UTPCPL’s enforcement scheme, under which public enforcement actions are brought by the Attorney General or a district attorney in the name of the Commonwealth, not by municipalities in their own names,” the complaint contends.

Pennsylvania’s Home Rule Act states that “no city shall exercise powers contrary to, or in limitation or enlargement of, powers granted by acts of the General Assembly which are applicable in every part of the Commonwealth.”

DraftKings is seeking declaratory and injunctive relief on the arguments that the PCPO is invalid because it is preempted by the state’s UTPCPL and Home Rule Act. DraftKings also contends that its state-issued gaming license gives the Pennsylvania Gaming Control Board sole regulatory oversight of its operations.

Along with the court orders for relief, DraftKings asks for the City of Philadelphia to pay for its legal and court costs, plus any other relief deemed appropriate.

Baltimore Lawsuit

A similar lawsuit brought by the City of Baltimore against DraftKings, along with rival FanDuel, continues to play out in Maryland state court. Baltimore City attorneys allege that online sportsbook operators have violated the Baltimore Consumer Protection Ordinance through deceptive and abusive business practices.

After the sportsbooks’ request for a federal court to take on the case was denied, DraftKings and FanDuel appealed the matter to an appellate court, and the appeal is pending.”