Yahoo Finance Gainey McKenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against DraftKings Inc. (DKNG)
NEW YORK, July 06, 2021 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a class action lawsuit has been filed against DraftKings Inc. (f/k/a Diamond Eagle Acquisition Corp.) (“DEAC”, “DraftKings”, or the “Company”) (NASDAQ: DKNG) in the United States District Court for the Southern District of New York on behalf of those who purchased or otherwise acquired DraftKings publicly traded securities between December 23, 2019 and June 15, 2021, inclusive (the “Class Period”).
On April 23, 2020, DEAC completed certain transactions (the “Business Combination”) through which DraftKings became a public company and acquired SBTech Global Limited (“SBTech”).
The Complaint alleges that Defendants made false and/or misleading statements and/or failed to disclose that: (i) SBTech had a history of unlawful operations; (ii) accordingly, DraftKings’ merger with SBTech exposed the Company to dealings in black-market gaming; (iii) the foregoing increased the Company’s regulatory and criminal risks with respect to these transactions; (iv) as a result of all the foregoing, the Company’s revenues were, in part, derived from unlawful conduct and thus unsustainable; (v) accordingly, the benefits of the Business Combination were overstated; and (vi) as a result, the Company’s public statements were materially false and misleading at all relevant times.
On June 15, 2021, Hindenburg Research (“Hindenburg”) published a report alleging that the Company’s merger with SBTech exposed DraftKings to dealings in black-market gaming. Citing “conversations with multiple former employees, a review of Securities and Exchange Commission and international filings, and inspection of back-end infrastructure at illicit international gaming websites,” Hindenburg alleged that “SBTech has a long and ongoing record of operating in black markets,” estimating that 50% of SBTech’s revenue is from markets where gambling is banned.” Following publication of the Hindenburg report, DraftKings’ stock price fell $2.11 per share, or 4.17%, to close at $48.51 per share on June 15, 2021.
Investors who purchased or otherwise acquired shares of DraftKings during the Class Period should contact the Firm prior to the August 31, 2021 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at tjmckenna@gme-law.com or gegleston@gme-law.com.
Please visit our website at http://www.gme-law.com for more information about the firm.
