On Friday, two senators, Mike Lee and Peter Welch, penned a letter to the Federal Trade Commission (FTC) and Justice Department to investigate gaming behemoths FanDuel and DraftKings. Both senators accused the companies of conspiring to “obstruct or impair competitions,” a violation of the federal antitrust law.
Lee and Welch claimed that the plan kicked off immediately after the FTC stopped FanDuel and DraftKings from merging in 2016. The collaboration would have seen one firm control 90 percent of the US gambling market share.
“Shortly after their failed merger, FanDuel and DraftKings expanded their dominance by leveraging their positions in fantasy sports to become online sports betting giants. FanDuel and DraftKings may be compounding these harms through anticompetitive conduct,” the letter mentioned. “Such coordinated attacks risk cutting off these new, innovative competitors from critical technology inputs and marketing partnerships.”
The senators state that the two gaming companies are actively intimidating upcoming competitors via the Sports Betting Alliance trade association. They also claim that the duo negatively interferes with rivals' relationships with stakeholders, including sports leagues and essential vendors.
Both FanDuel and DraftKings are yet to respond to the allegations as of the time of publishing this piece. However, the silence has not stopped the senators from publicizing the issue.
Lee brought awareness to the letter with a post on X: “We can’t allow online gambling companies like @FanDuel & @DraftKings to violate antitrust laws, especially as more Americans grapple with the effects of this industry on our society”
The Justice Department has confirmed receiving the senators’ letter, while the FTC is yet to do so.