DraftKings has filed a 49-page federal lawsuit against their former head of VIP operations for allegedly plotting to steal customer information and taking it to Fanatics. Front Office Sports first reported the news.
The lawsuit alleges that Michael Hermalyn “hatched a secret plan over the past year to steal and use confidential information, solicit customers and employees and a key competitor, Fanatics, Inc. (“Fanatics”), in brazen violation of his agreements with and duties to DraftKings.”
The suit goes on to allege Hermalyn’s plan began in earnest a year ago, where he met with Fanatics’ CEO to talk about job opportunities.
Things culminated, according to the lawsuit, this week with Hermalyn falsely claiming a friend of his ed away in Super Bowl while sitting in Fanatics’ offices.”
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The suit alleges Hermalyn quit his job with DraftKings last Thursday and took a “nearly identical role” at Fanatics, which launched Fanatics Sportsbook last year. DraftKings says that “without prompt injunctive relief barring Hermalyn from violating his agreements with DraftKings, Hermalyn will be free to launch an unlawful and targeted attack against DraftKings’ business and divert its most valuable customers immediately prior to one of the most business critical weekends for DraftKings.”
Furthermore, the suit alleges Hermalyn has claimed California residency in an effort to get out of the non-compete clause in his contract, but that he “maintains a multimillion dollar residence in New Jersey, where his wife still works and his kids go to school.”
Meanwhile Hermalyn, probably sensing trouble ahead, filed his own lawsuit in California, claiming the non-compete clause in his contract with DraftKings is no longer valid since he now, according to his suit, lives and works in California.
DraftKings has not commented on the suit.
