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00:00Welcome back to Newswire here on Sports Grid.
00:05We got the ultimate he-said-she-said story in sports betting this week.
00:09This lawsuit that is being filed against DraftKings with a response from one of the people involved
00:15in it.
00:16And let's bring in Sam McQuillan from Legal Sports Report.
00:19Sam, this is an extremely convoluted story.
00:22It's a convoluted lawsuit.
00:24On social media, there was a convoluted response trying to understand exactly what happened
00:31here.
00:32Is this a legit lawsuit?
00:33Is it not legit?
00:35The people involved, are they legit?
00:38Are they unsavory characters?
00:39I don't know what to make of this entire thing.
00:43I would love for you to tell me your opinion of it.
00:46But first, I think we probably should tell the story as to what this lawsuit is all about,
00:50and then we can take it from there.
00:53Yeah, Craig, it essentially involves three very strange parties.
00:57One is the John Doe who filed this lawsuit.
01:00One is a professional gambler named Kadun Kirilos, if I'm saying his last name wrong.
01:06I apologize.
01:07But he's commonly known as Spanky in the gambling world.
01:10And then DraftKings, a sports betting company, obviously.
01:13So it's these three parties have been named in this lawsuit.
01:16It accuses Spanky, who fired back this week, kind of telling his side of the story.
01:22It accuses him of extorting a man to pay him half a million dollars, who he allegedly
01:27found using information obtained from higher ups at DraftKings.
01:32The lawsuit accuses Spanky of orchestrating an altercation on a subway platform in Long
01:37Island City, Queens, which is just a stone's throw away from where I am right now across
01:41the river.
01:42The lawsuit, which identifies as John Doe, claims he was approached by a masked man during
01:49his commute into the city, who then threatened to kill him if he didn't pay $500,000 to Spanky.
01:56And then it goes on to say that Spanky allegedly got the information where he would know the
02:01whereabouts of this man and his commute from higher ups at DraftKings who have access to
02:06your personal information as a better Spanky came out on social media this week, saying
02:12that the person who filed the case, an attorney named Steven Jacobs, is actually the John
02:17Doe who is identified in the case, the person who alleges that this extortion happened.
02:23He's an attorney at Herbert Smith and Freehill in New York.
02:26He claims that the two actually met through a mutual friend who then gave Jacobs money
02:32to launch a gambling partnership, what's known as using someone as a beard to place money
02:37at DraftKings without getting limited.
02:39You know, a guy like Spanky who claims he is banned from many sports books, limited
02:44at many sports books because they won't take his money, his gambling is too good, his information
02:48is too good.
02:49They typically use these guys known as beards where these people aren't limited.
02:54They don't have a history with the sports book.
02:56They find them.
02:57They give them the money to place bets.
02:59They make money and then they split the money afterwards.
03:02So Spanky came out and said that he actually won a substantial amount through Jacobs, about
03:08$350,000 in profits, along with $14,000 in bonuses.
03:14And what he says happened, Spanky's side of the story, is that Jacobs tried to withdraw
03:18the money.
03:19He then was hit with a roadblock from DraftKings, which required him to sign some paperwork.
03:24He kind of got cold feet, Spanky says.
03:26Then Spanky tried to figure out what he could do to get this money out of this guy.
03:31He emailed the New York State Gaming Commission, he says, and then uncovered through a FOIA
03:36request that this guy actually withdrew his appeal to the New York State Gaming Commission
03:41to get his money back pretty much as soon as he sent it.
03:44So it's a lot of he said, she said, like you said, Spanky claims that he tested Jacobs
03:48by saying he could get info from DraftKings on the payout when he's saying, obviously,
03:53I can't get that because I'm banned from DraftKings.
03:55I can't get that info.
03:57So it's this weird embezzlement accusation scheme, whether or not this guy was actually
04:01accosted.
04:02We don't have any evidence whether or not Spanky went to other lengths to try to get
04:07his money back from this guy.
04:08It does seem like there is a mutual acknowledgement that there was some sort of bearding scheme
04:13or using someone to get money from DraftKings through a proxy for Spanky.
04:20So it should be noted that that's illegal in New York.
04:23So you have some people speculating why he would admit to that.
04:26Maybe it's to clear his name from this case.
04:28And it's weird just to see DraftKings involved.
04:30They put out a statement saying, hey, we really have no part in this.
04:33We don't know why we're being sued.
04:35We obviously wouldn't give information to a proxy better to go locate somebody.
04:40So more will come in this weird, weird case, and I'm sure more of it will be very weird
04:45indeed.
04:46Yeah.
04:47Yeah.
04:48A lot of strange commentary coming from this.
04:50Maybe the most strange is the fact that this Spanky says that he's limited or can't bet
04:57in these sports books.
04:58As far as I know, Sam, Las Vegas is a four or five hour flight away.
05:05Just do whatever you're going to do and then come back and you make yourself your fortune
05:08if indeed that is the case.
05:09I don't know.
05:10It's a very odd story, to say the least for me.
05:14Anyway, all right.
05:15Valley bet, not really off to the best start when sports betting got legal over the last
05:20couple of years.
05:22And now there is some discussion that Massachusetts was going to have Valley bet, but not going
05:27to have it at least for the time being.
05:29I know that there's been a lot of turbulence with this and the company as well.
05:34You know, naturally, you know, Valley inevitably is not going to be sponsoring these RSNs also
05:38in the future.
05:39So I wonder what the future of the name, by the way, Valley bet is.
05:43Yeah.
05:44Valley bet has waited over a year to launch in Massachusetts.
05:48So naturally it pushing back its launch date, again, isn't that surprising.
05:52It had actually planned to launch Valley bet today, but came out yesterday and told the
05:58Massachusetts gaming commission, frankly, it needs more time to get things straight.
06:02And it's now going to plan to launch sometime in July.
06:05The commission said that there's one outstanding issue to resolve, but it'd be surprising at
06:10this rate if they had much, if any success in the Bay state, considering it'll be about
06:1416 months since the other sports books have launched.
06:17People are getting plenty of action elsewhere in Massachusetts.
06:21You wonder what the incentive to join a book like Valley bet, which again, like you said,
06:25doesn't have the greatest reputation and has been marred by a myriad of problems.
06:30They're now on version 3.0 of their product after writing off about 3 billion or trying
06:35to write off about $3 billion in acquisitions over the last couple of years that resulted
06:40in less than 1% market share across the country.
06:44So when it launched the sports betting app last fall, it was offline in several States
06:49for a couple of months, obviously causing people to get off the app and lose more customers
06:55there.
06:56And they went over to third-party technology, which is the opposite of what most successful
07:00sports books do.
07:01We've seen them go on to their own technology and yeah, Valley bet is facing the, you know,
07:07the whole ordeal with losing Valley sports as well.
07:10And they are currently exploring a sale from one of their higher ups has offered to buy
07:15the company and suggested that they get out of sports betting altogether.
07:18We've seen smaller apps like win bet and better not survive in Massachusetts.
07:22So you have to think at this point, why are they even launching in Massachusetts if they
07:26can't even really do it on time?
07:28Yeah.
07:29No, it doesn't make sense.
07:30I mean, I guess that'll be the next story is they don't end up doing it.
07:33All right.
07:34Let's wrap it up with the latest going on in Canada.
07:36I know Pat was on the show yesterday talking about this new blueprint for the government.
07:41They're launching a regulated online gambling market in Alberta, Canada.
07:45Do you think that this happens?
07:47Yeah, I think it'll happen by the end of the year.
07:50They seem pretty optimistic from the reporting that Pat did.
07:53It's kind of the only steps forward are going to be negotiating with the 45 First Nations
07:58tribes and the land-based casino operators, but it could be a really big opportunity for
08:03the global gaming companies that are trying to get in the state.
08:06It's the fourth largest province in Canada and home to 3.3 million adults, where importantly,
08:13the legal age of gambling is only 18.
08:15So that opens up a bigger market to these companies, and it's going to use Ontario's
08:19model as a blueprint.
08:22And market analysts are suggesting that that could mean about $700 million in gaming revenue
08:27in the first year, which would be, I believe, the seventh largest market in North America
08:32for gaming operators.
08:33So it could be a huge boon for companies like DraftKings, FanDuel, that haven't got
08:38much traction in terms of legalizing iGaming and sports betting in the states.
08:42Now you go up north, you have this huge market, which most importantly, is going to have iGaming,
08:47which would be a huge, huge boon to their business.
08:49So we'll have to see what happens at the end of the year, but it's looking pretty good
08:53right now for the gaming companies who want to enter Canada.
08:55Yeah, could be an exciting time, FanDuel, DraftKings, and some of the others normally
08:59dominated by some of the other companies.
09:00Thanks again.
09:01Appreciate you coming on, Sam.
09:03Yep.
09:04Thanks a lot, Craig.