NFLPA Sues DraftKings Over $65 Million NFT Deal Dispute

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Transcript

00:00Okay, so now, what's the latest here with the NFLPA suing DraftKings?

00:07You know, the NFLPA, just like the NFL, they want their piece of the pie here.

00:12Are they entitled to this?

00:13Do you feel like there is something to stand on here?

00:16I believe it's $65 million they feel like they're owed.

00:19Yeah, it's about $65 million.

00:21Craig, it's hard to say right now.

00:23DraftKings is trying to say that they don't owe this money because the NFT product that

00:30DraftKings and the NFLPA partnered on, they shut it down due to legal issues.

00:37And it looks like the legal issues that they're talking about are whether NFTs can be classified

00:42as securities or not.

00:44Now, when they wrote up the contract with the NFLPA, it did include an out for them

00:51that said, if NFTs at any point are categorized as securities or various other things that

00:59could have been listed as, that allows DraftKings to break the contract.

01:03And so that is what they are saying they're doing, that they do not owe this money.

01:07And the NFLPA is saying, of course, you owe this money.

01:11First of all, the ruling that—it wasn't even a ruling that says the NFTs are securities.

01:18It was simply a court allowing the case to continue.

01:21So there is a lot of assuming going on there that that would go through the way that DraftKings

01:27at this point hopes it does.

01:29And the NFLPA, they really took a big swing at DraftKings on this, and they listed out

01:36the compensation for five of their executives since that NFT partnership was going on.

01:42And it came out to more than $260 million since 2021, Greg.

01:49That's a lot of money that's going to executives.

01:51And so they're saying, how do they not have $65 million to pay what they legally have

01:57to pay as part of a binding contract?

02:00So we're going to be watching this for a while.

02:02It is not a good look for the NFL and the NFLPA to be having this big of a beef with

02:10one of their authorized sports betting partners.

02:13And DraftKings has had a rocky month, and it's been up and down for them.

02:19They got a great headline this morning.

02:20They are buying SimpleBet, so they're going to add in AI pricing, and their offerings

02:26and live betting and parlays will be a little deeper.

02:29So that's a great headline that sent the stock green this morning.

02:32But yeah, a couple of lawsuits going on for DraftKings right now, and it's more negative

02:39headlines than positive heading into the football season for them.