As Vantiv Plans Exit from Daily Fantasy Sports Betting Attorneys Plan Lawsuits Against Replacements

Feb. 2, 2016 - PRLog -- Vantiv Inc, one of the largest companies to process payments for daily fantasy sports betting companies, will pull out of the sector as an increasing number of states have declared the games illegal, the New York Times reported on Friday.

Vantiv lawyer Jonathan Ellman sent the company's daily fantasy sports clients a letter saying it would stop processing their wagers and payouts at the end of February, the Times reported.

Attorneys that filed class action lawsuits against Vantiv believe the decision was proper, but late.  “Vantiv appears to be among the various credit card issuers and processers that were duped by the false claim the UIGEA rendered daily fantasy sports betting legal,” said Vincent Imbesi, a partner of one of the various law firms that filed class action lawsuits against Vantiv, DraftKings and FanDuel.

Mr. Imbesi said that Vantiv’s decision was inevitable because participating in the funding of illegal gambling can be both a state and federal crime.  “DFS gambling contests are not complex or original, most of the DFS wagering schemes are pool bets contingent upon the performance of athletes for which the bookmakers take a percentage of the pool,” Mr. Imbesi explained.

Funding illegal internet gambling was made a federal crime when the UIGEA became effective, Mr. Imbesi said.  “Ironically, the law [UIGEA] used by DraftKings and FanDuel to dupe investors and credit card processors is the same law that makes participating in the funding of illegal internet gambling a crime,” said Mr. Imbesi.

Law firms are preparing to file class action lawsuits against any credit card processor that decides to replace Vantiv as FanDuel or DraftKings processor.  Mr. Imbesi said that his law firm will either amend one of the pending lawsuits or file a separate lawsuit if a new processor starts.

“Proper due diligence would have revealed the DFS gambling schemes were illegal and Vantiv realizes that it was wrong for ever getting involved DFS gambling operators,” Mr. Imbesi said.  He cited Disney’s last-minute decision not to invest $250 Million in DraftKings in June of 2015.  Mr. Imbesi said, “Disney most likely concluded that DraftKings DFS gambling schemes were illegal and violated the company’s prohibition of profiting from gambling.”

It was a tough decision to refuse what appeared to be a lucrative business, but ultimately Disney made the right choice not to invest in companies that offered DFS gambling, Mr. Imbesi said.

Credit card processors that want to replace Vantiv are going to have to make a similar tough decision because the potential short-term revenue is high, according to Mr. Imbesi.  “However, any processor the replaces Vantiv and continues to fund illegal internet gambling will subject itself to civil and criminal liability,” Mr. Imbesi concluded.

Mr. Imbesi is a partner of Imbesi Law, P.C., and represents several plaintiffs that filed class action lawsuits against Vantiv, DraftKings and FanDuel.