DraftKings is being sued across seven states for allegedly breaking responsible gambling laws. One of the nation’s largest sports betting websites is facing a lawsuit after Michael Koester, a customer based in Michigan, was able to raise his betting limits without observing minimum waiting periods, required under multiple state gaming laws, something he claims contributed to ‘significant’ gambling losses.
The complaint
As such, Koester, who is acting as the lead plaintiff, filed the complaint on December 30, 2025 against DraftKings for breaking player protection laws in the states of Michigan, Colorado, Connecticut, Indiana, Iowa, Louisiana and New York.
According to the complaint, there are state-enforced laws that require a 24-hour “cooling-off” period after users increase their self-imposed deposit or wager limits.
The aim of this is to protect users from impulse betting and rapidly increasing their limits, a sign that somebody might be a problem gambler.
However Koester, who has been a DraftKings customer since 2021, alleges that between 2022 and 2023 he was able to repeatedly increase his betting limits and immediately be able to place wagers at the new limit, without the mandatory delays.
He claims he wagered a total of $25,000 across the two years.
As such, in the complainants opinion, DraftKings accepted deposits and wagers during periods when, under state regulations, betting should have been restricted.
Koester’s legal team maintains that the seven states involved use largely consistent regulatory language that a waiting period must be enforced on users after they increase their betting limits.
The law
Currently, the law states that once a player establishes any responsible gaming limitations (such as deposit, spend, time, wagering amount etc), there must be at least a 24-hour waiting period after the request before it can be activated.
Koester is also rumoured to have tried to contact the DraftKings customer service and the Michigan Gaming Control Board prior to this lawsuit.
However, with both of those interactions proving unsuccessful for the customer, he has subsequently taken the case to the US District Court for the Eastern District of Michigan.
According to the lawsuit, Koester lost money because DraftKings didn’t follow the law properly. It said:
“But for this immediate ability to increase gaming limits, the Plaintiff would have been able to delay his gambling impulse and avoid falling into a destructive gambling cycle which caused him significant harm.”
Should the lawsuit prove to be successful for the Plaintiff, DraftKings may be forced into paying millions of dollars in refunds to players. Furthermore, websites may have to redesign their responsible gaming limitations and change the timeframe for accepting bets.
This isn’t the first time DraftKings have been taken to court, the website is currently defending an Iowa case where a player is seeking $14m in winnings which were voided after a weather-affected golf tournament.
Koester’s motion seeks a summary judgement without trial and, if successful, may change the landscape for sports betting consumers rights in the USA.
