Sens. Mike Lee (R-Utah) and Peter Welch (D-Vt.) sent a joint letter to the Federal Trade Commission (FTC) and Justice Department on Friday urging lawmakers to investigate the actions of FanDuel and DraftKings.
Lee and Welch accused the two sports betting companies of working together to “obstruct or impair competition,” which is a direct violation of federal antitrust law. The alleged illegal activity comes after a failed merger between FanDuel and DraftKings in 2016, according to the lawmakers.
The Federal Trade Commission blocked the transaction, noting that it would give them a 90 percent market share, which lead FanDuel and DraftKing executives to vacate their plans to unite after weeks of public scrutiny.
“Shortly after their failed merger, FanDuel and DraftKings expanded their dominance by leveraging their positions in fantasy sports to become online sports betting giants. FanDuel and DraftKings may be compounding these harms through anticompetitive conduct,” the senators wrote.
They said the two companies were allegedly intimidating competitors through the Sports Betting Alliance trade association. FanDuel said they had no comment on the letter’s accusations and DraftKings did not provide a statement on the claims in Welch and Lee’s letter.
In the letter, Lee and Welch wrote that the two companies have worked together to pressure smaller rivals to “stymie market access” and also interfered with rivals relationships with other stakeholders, such as sports leagues and important vendors.
“Such coordinated attacks risk cutting off these new, innovative competitors from critical technology inputs and marketing partnerships.”
The Justice Department confirmed it received the Senator’s letter, but declined to comment while the Federal Trade Commission did not immediately respond to inquiries from The Hill.
“We can’t allow online gambling companies like @FanDuel & @DraftKings to violate antitrust laws, especially as more Americans grapple with the effects of this industry on our society,” Lee posted on the social platform X alongside screenshots of the letter.
After the letter’s release, DraftKings stock dipped, according to Yahoo Finance.
