The anonymous plaintiff in a suit alleging DraftKings colluded with a prominent sports bettor to extort him for $500,000 will be named publicly, according to documents filed June 28.
Lawyers representing DraftKings wrote Doe had withdrawn his request to use a pseudonym, according to a document filed with the U.S. District Court for the Eastern District of New York. The note came as part of a document DraftKings filed asking the court to grant a temporary stay of evidentiary discovery.
Doe had previously been identified by multiple media outlets, as well as Gadoon “Spanky” Kyrollos, the pro sports bettor accused in the lawsuit of colluding with DraftKings to arrange death threats as part of the extortion claim. In a lengthy X (formerly Twitter) post June 25, Kyrollos said the plaintiff was Steve Jacobs, Doe’s attorney.
The X post was submitted as evidence during DraftKings’ letter to the court asking for a delay in the discovery process.
In the post, Kyrollos laid out in detail his partnership with Jacobs as well as Oscar Jones, who was also mentioned in the original lawsuit. Kyrollos acknowledged associating with Jones and by extension Jacobs, but denied any wrongdoing. He was not named as a defendant in the suit.
Kyrollos said he, Jones, and Jacobs had worked together to place bets with DraftKings, winning tens of thousands of dollars. When Kyrollos and Jones asked Jacobs for their share of the winnings, Kyrollos said Jacobs tried to evade his partners in part by abusing his law license and filing a fake letter with New York gaming regulators.
Jacobs was reportedly terminated from his position with Manhattan-based Herbert Smith Freehills law firm a day after the lawsuit was first reported on June 26.
Twists and turns
Doe’s identity was the latest twist in a bizarre accusation against one of the country’s biggest sportsbooks and its most prominent sports bettors.
Doe – or Jacobs – claimed in an April lawsuit that DraftKings leaked confidential personal information to Kyrollos. In March 2023, a masked Kyrollos associate allegedly waited more than three hours outside the plaintiff’s apartment, grabbed him, and then threatened to kill him if he didn’t pay Kyrollos $500,000. The plaintiff further alleged DraftKings, where he had been a VIP customer, locked him out of his account and then stonewalled him when he tried to confront the sportsbook.
DraftKings called the accusations meritless. The salacious claims in and of themselves immediately raised serious doubts.
Beyond the magnitude of the allegations that a multibillion-dollar publicly traded sportsbook company would extort a customer for half a million dollars, the connection with Kyrollos made little sense. Kyrollos has railed on X against the company multiple times to his more than 40,000 followers, saying they banned him as a customer because he was a winning bettor.
Kyrollos acknowledged he gave sports picks to Jones who then sent them to Jacobs as a “beard” to place bets. This practice, Kryollos wrote, of using proxies such as Jacobs to place bets allows big-money bettors to submit wagers at sportsbooks where he’s banned.
“Whales,” or losing customers that can bet large amounts, are keys to this approach, Kyrollos wrote; Jacobs had lost so much money he wouldn’t raise DraftKings’ suspicions if he started winning some of it back.
Jacobs, by his admission in prior lawsuits, is a compulsive gambler. A former World Series of Poker tour player who won nearly $200,000 in the early 2000s, Jacobs had lost hundreds of thousands of dollars by the mid 2010s. He unsuccessfully argued in a 2020 court case that he didn’t owe a former roommate more than $300,000 he had borrowed – and lost – gambling.
Next steps
DraftKings’ motion to stay discovery, when both parties are required to release all documents and other evidence related to the case, was not unexpected. The extensive process of uncovering and submitting documents is burdensome, DraftKings argued, especially when it remains adamant the case will be thrown out of court.
The company asked for a delay in discovery until after the court rules on a motion to dismiss the case. That decision could come as early as August.
DraftKings included Kyrollos’ X statement that he had never received any information from anyone at DraftKings about the plaintiff, nor had he or an associate threatened him, as part of its evidence in asking for a stay of discovery. It also cited Kyrollos’ claim that he “obviously” does not have the power to receive payout information about the plaintiff’s account.
“These admissions from Mr. Kyrollos, if true, highlight that Plaintiff’s Complaint is baseless and discovery is particularly inappropriate until the Court rules on DraftKings’ motion to dismiss,” company attorneys wrote in their request to stay discovery.
DraftKings told Jacobs that it had filed its formal appeal to have the case dismissed ahead of court-mandated June 28 deadline. Jacobs has 30 days to respond, after which DraftKings will have another week to refute his claims.
DraftKings’ motion to dismiss had not been published publicly as of July 2.
