It was 2017 when DraftKings & FanDuel attempted to merge into one, big, happy family. However, it did not take long for that move to be called off, as the Federal Trade Commission (along with a couple of attorneys general) said they would sue to block any merger. The combined companies would have controlled 90% of the market for daily fantasy sports, which authorities say would have violated antitrust law.
Now, two U.S. senators have called for the FTC and the Justice Department to take another look, and to open an investigation into DraftKings & FanDuel over a similar accusation. In a joint letter dated December 5th, Senator Mike Lee (R-Utah) and Senator Peter Welch (D-Vermont) expressed concerns that the companies might be working together to suppress competition in the fantasy sports and online betting industry.
In a statement on his Twitter account, Senator Lee stated that, “We can’t allow online gambling companies to violate antitrust laws, especially as more Americans grapple with the effects of this industry on our society.” Neither the FTC nor the DOJ have responded to the request for an investigation. Meanwhile, following this news DraftKings’ shares were down about 2.6% in late morning trading on the Nasdaq.
In addition to the request for a new investigative, the legislators are hoping regulators could take some sort of enforcement action to make sure that these companies are not in violation of antitrust law outlined by the Sherman Act. They referenced reports suggesting that DraftKings & FanDuel could be secretly working together in order to pressuring other businesses into not collaborating with their competitors.
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