The Missouri Attorney General recently filed a suit against Gridiron Fantasy Sports and its owner for allegedly defrauding consumers by failing to award prizes to the winners of fantasy sports leagues.
Participants in the fantasy football and baseball leagues were required to pay entry fees for a chance to win prizes. At the end of the 2010 season, the company notified winners and told them how much they had won. During the investigation, however, the AG discovered that the company failed to pay out at least $151,261 of the promised prizes. The suit alleges, in part, that the company used the fantasy baseball entry fees to pay the fantasy football winners and the football entry fees to pay the baseball winners. Because the amount of money available would depend on the number of participants, the company could not guarantee the prizes.
The AG is asking the court to issue injunctions prohibiting further violations of the law, to require the defendants to provide full restitution to victims and pay all court and investigative costs, and to require the defendant to pay the state a civil penalty and an amount equal to 10 percent of total restitution ordered.