An attorney in South Carolina, Jame M. Hughes of Motley Rice has filed a complaint last week against Polymarket and DraftKings Predictions.
The complaint stipulates that the companies have breached local gambling laws and offered games of chance without a formal authorization to do so.
Prediction Markets Targeted Once Again – This Time in South Carolina
The argument is familiar. The lawsuit argues that prediction markets are gambling, and while companies from the sector refuse to acknowledge or agree to this, there has been growing pressure on the sector, including places such as Washington, Michigan, and New York.
Hughes has detailed his case in the complaint, arguing that the defendants incite and collect winnings from illegal wagers placed by state residents on the outcome of sporting events.
“This lawsuit is premised on a straightforward thesis: The rhetorical set dressing of ‘prediction markets’ and event contracts doesn’t change reality,” Hughes explained.
The complaint further stipulates that the companies are adding fuel to the problem gambling epidemic, driving people to desperate lengths. Hughes argues that the ramifications suffered by state residents are not exclusively limited to at-risk and problem gamblers, only.
Pressure Piles on the Sector with Legal Moves Happening
Even people who do not gamble compulsively can still be on the hook for serious financial ramifications.
The market has come under a lot of scrutiny of late, with New York announcing on Friday that it is filing a lawsuit against Kalshi, another prediction market company, and alleging that it is offering illegal gambling.
Furthermore, the state’s AG and the governor’s office are seeking $36 billion back from the company in the form of illegal proceeds generated as well as restitution to customers.