DraftKings is facing a patent infringement lawsuit in New Jersey federal court over its micro-betting services.
The complaint was filed on May 9 by Texas-based Micro-Gaming Ventures, LLC in the U.S. District Court for the District of New Jersey.
According to the lawsuit, DraftKings’ sportsbook platform allegedly violates five patents tied to micro-betting and location-based wagering technologies.
Micro-betting, also known as in-play betting, enables users to wager on specific in-game events, such as the next pitch in a baseball game or the outcome of the next football play. This segment has seen rapid growth in the U.S. betting market and is widely expected to be a major driver of future industry expansion.
The filing mentioned:
The patented inventions provide many advantages over the prior art, and in particular improved the operations of managing micro-bets within larger macro-events and authorising users based on their locations.
One advantage of the patented inventions is that they provide a way to determine, via a configured computer, when a micro-bet is available to bettors and thereafter when the micro-bet has closed to additional betters.
This becomes increasingly important as micro-bets move quickly and necessarily close from play to play and pitch to pitch.
The complaint states that the patents at issue were developed by inventors Michael Shore, Alfonso Chan, Luis Ortiz, and Kermit Lopez between 2010 and 2013, well before micro-betting technology became mainstream in the U.S. These patents cover systems for handling bets on “micro-events” within larger sports matches and for verifying users based on their geographic location.
The lawsuit highlights DraftKings’ $195 million acquisition of SimpleBet in 2024 as evidence of the commercial importance of micro-betting technology. And notably, the patents were filed prior to New Jersey’s legalization of online gambling in February 2013 and before the U.S. Supreme Court’s landmark 2018 ruling in Murphy v. NCAA, which enabled legalized sports betting nationwide.
DraftKings’ office in Hoboken, New Jersey, is cited in the filing as a basis for bringing the case in the New Jersey district court.
