DraftKing was sued last week in New Jersey federal court over its micro-betting patents.
DraftKings was sued last week in New Jersey federal court over its micro-betting offerings.
The sports betting giant is facing a patent infringement lawsuit filed by Texas-based Micro-Gaming Ventures, LLC in the US District Court for the District of New Jersey.
The lawsuit, filed on Friday (9 May), alleges that DraftKings’ sportsbook platform infringes on five patents related to micro-betting technology and location-based wagering.
Micro-betting, also known as in-play betting, allows users to place wagers on specific moments within a larger sporting event, such as the outcome of the next pitch in baseball or the next play in football.
The vertical has become one of the main growth areas within US sports betting, with analysts previously highlighting it will likely become a key growth driver in the years ahead.
The filing said: “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.”
Inventors claim to own micro-betting patents
According to the complaint, the patents in question were developed by inventors Michael Shore, Alfonso Chan, Luis Ortiz, and Kermit Lopez between 2010 and 2013, predating the widespread adoption of micro-betting technology in the United States.
The patents cover systems and methods for managing bets on “micro-events” within larger games and authenticating users based on their geographic location.
The lawsuit points to DraftKings’ $195m acquisition of micro-betting provider SimpleBet in 2024 as evidence of the technology’s significant commercial value.
The timing of the patents is notable as they were filed years before New Jersey moved to legislate online gambling in February 2013 and before the Supreme Court’s 2018 decision in Murphy v. NCAA, which paved the way for legalised sports betting across the US.
The complaint alleges that DraftKings’ mobile app and website infringe on patent claims related to determining when micro-bets are available or closed to additional bettors, randomising available micro-bets, and authorising users based on their geographic location.
Micro-Gaming Ventures is seeking damages for past infringement and an accounting of all infringing acts. The company has requested a jury trial.
DraftKings maintains an office in Hoboken, New Jersey, which the lawsuit cites as grounds for filing in the New Jersey district court.
NEXT.io has reached out to DraftKings for comment.